Every energy industry writer has a message for you regarding the impacts of the COVID-19 pandemic. Many are providing valuable detailed information regarding how the power industry is keeping their workers safe and the lights on. These messages are important. A few columnists are using the disaster to argue in favor of their favorite energy agenda like electric vehicles (EVs), renewables, the Green New Deal, and so on. Certainly, an important lesson from this experience has been the demonstration of how critical it is for our country to be as independent from other entities as practical for critical supplies and infrastructure. That lesson applies to everything from medical supplies to energy infrastructure. There also may be a few additional lessons for the energy sector.
One of the first alarms raised regarding COVID-19, even before it became a pandemic, was its potential impact on the availability of solar panels. China was responsible for 71.4% of the world's production of solar panels in 2017, up from 14.7% in 2006 according to RTS Corp. As of today, the United States is an insignificant producer of the solar technology many folks want to see as a cornerstone of the country's energy platform. Do we want to be in this position?
There was a spike in the production of wind turbines and turbine blades using monies from the Economic Recovery and Reinvestment Act beginning in 2009. Far too many of those production facilities are no longer in existence a mere decade later. Of the top 10 wind turbine manufacturers in the world, based on a 2019 study by energyacuity, only GE is an American company. Consistent with the United States' modern movement away from manufacturing, GE just announced that it is closing one of its domestic turbine blade manufacturing facilities. In addition to GE, several large wind turbine manufacturers produce some equipment in the United States, but much of it is produced internationally. Isn't wind production another expected cornerstone of a U.S. energy platform less dependent on fossil fuels? Here too, the United States has to balance supply security with economics.
Even when it appears that an energy source is controlled by the United States, international dynamics can cause disruption. The perfect example is our oil supply. Not even a year ago, the United States finally achieved the capability to export more crude oil and refined products than it imports. This has been a goal ever since severely limited oil supplies caused the oil embargo crisis in 1973. Ironically, now international market manipulation to lower oil prices along with the COVID-19 shutdown effects on demand are threatening the financial viability of our domestic oil and gas (O&G) production capabilities. If we let our domestic O&G industry go out of business, we will once again be highly dependent on foreign sources. Moreover, natural gas-fired generation is the third leg of the United States' current de-facto energy supply platform. It is worth noting that our principal remaining oil import dependency barring the collapse of our new-found domestic production capability is for the oil supplies used in the transportation sector. Maybe now energy independence is a justification for EVs that everyone can get behind. A majority of EVs are manufactured domestically, right?
Where you ask are these ramblings headed? One obvious conclusion is the need for a well-balanced supply of domestic and international sources for resources like power infrastructure that are critical to the economic health of our country. Another lesson learned from our experience with the coronavirus should be that we must plan for multiple contingencies. Even with a three-legged energy strategy of solar, wind, and gas-fired generation, there are risks. ISO New England made that argument on April 15 when it filed a proposal with federal regulators to create new market products to improve reliability. The ISO proposal is intended to address an increasing dependency on gas, wind, and solar generation — all technologies involving a "fuel" that cannot be stored on site. Historically, a greater percentage of New England's energy supply consisted of technologies such as coal, oil, and nuclear where fuel supplies could be maintained on site. A fresh focus on energy storage may be in order.
Summing up, energy lessons from the COVID-19 pandemic might include objectives such as becoming more self-sufficient as a country, relative to critical supplies and infrastructure; broadly diversifying the energy technologies and energy supply sources we rely upon; and preparing for inevitable contingencies. The last catastrophic event that even approaches this pandemic was World War II. U.S. economic strength and manufacturing prowess helped brave American's win that conflict. Let us do our part to help ensure we can say the same the next time a major calamity strikes.
