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Amory Lovins Debunks the Myth of "Fuel on Hand" for Electricity Grid

Distributed Renewables, Efficiency, Microgrids offer Cheaper, More Resilient, and Reliable Energy Future

July 18, 2017, Basalt, Colorado — “Fuel on Hand” does not create grid resilience, according to analysis by Amory Lovins, originally published in Forbes. Lovins’s article reveals that “fuel on hand” at coal-fired and nuclear power plants is not as readily available as imagined, contributes nothing to grid reliability, and comes with other attributes that actually degrade grid reliability. The analysis proves decisively that both coal-fired and nuclear power plants are vulnerable to failures that can shut down many units over big areas for substantial periods.

The article was posted as an RMI blog today in anticipation of Energy Secretary Rick Perry’s 60-day departmental study to see if federal policies favoring un­named competitors (apparently wind and solar) are constraining supposedly vital “baseload” coal-fired and nuclear power plants, and compromising grid reliability and resilience. The study is proceeding despite numerous studies by grid operators, the Department of Energy, and other experts showing that solar and wind power actually boost resilience, reliability, and affordability.

Secretary Perry recently argued that power plants with “fuel on hand” (a new term he intro­duced) enhance “grid resilience,” making them worth more than market prices reflect, so they should be subsidized or even mandated. “Fuel on hand” refers to coal-fired and nuclear power plants, which store fuel onsite—not gas-powered plants, because gas is delivered via pipeline, or renewables, which (aside from minor waste- and biogas-burning) use no fuel. Coal and nuclear plants are also tradition­ally called “baseload” plants because they were meant to run steadily under market conditions that no longer exist: gas-fired power and renewables now undercut their operating cost, making many coal and nuclear plants uneconomic just to operate, even if building them cost nothing. Their vulnerabilities are an additional disadvantage.

The extreme concentration of rail lines hauling coal from Wyoming’s Powder River Basin is the largest of a series of potential chokepoints.

Two-fifths of U.S. coal comes from Wyoming’s Powder River Basin, nearly all through a single rail corridor whose weather-induced failure has more than doubled coal’s spot price. Coal is then delivered across the country. Railways haul nearly 70 percent of total U.S. power plants’ coal. This supply chain is disrupted almost monthly by heavy rain and snow, flooding, freezing, etc., and is vulnerable at chokepoints like major river bridges. A map (above) by Oak Ridge National Laboratory, the latest available, reveals the extreme concentration of coal transporta­tion’s sources, corridors, and hubs The National Academies have emphasized the whole delivery system’s “inherent fragility and instability.” Gas-fired plants’ pipeline network does have major physical and cyber vulnerabilities, but coal and nuclear plants’ vulnerabilities offer no distinc­tive advantage, and none are as resilient as distributed and renewable resources.

“Even after coal is piled up at the power plant, harsh weather can still render it inaccessible,” said Amory Lovins, chief scientist and co-founder of Rocky Mountain Institute. “In February 2011, cold weather shut down 50 fossil-fueled plants in Texas because of frozen coal piles, burst pipes, and other problems. Even in Pennsylvania and Wisconsin, cold snaps have frozen coal piles, prevented coal plants from starting, and stuck fuel barges on frozen rivers.”

Further, nuclear power plants are also vulnerable to weather, shutting down during prolonged heat waves as their cooling water overheats. When a regional blackout closes many reactors at once, nuclear physics makes them slow to restart: after the August 2003 Northeast blackout, it took nine nuclear plants three days to regain less than 3 percent of their output and two weeks to regain full output. They’re guaranteed unavailable just when they’re most needed.

Nuclear power plants are also so slow and costly to fix when they break that more than half have been disabled at least once for a year or more—10 of them twice. Onsite fuel also does nothing to avert shutdowns for maintenance, safety checks, or major accidents. TEPCO, the world’s #4 utility, paid billions and lost multiple units to several causes even before the $200+ billion Fukushima disaster ultimately shut Japan’s entire nuclear capacity, nearly 30 percent of its total power supply. (Fortunately, 70 percent of that loss was replaced by efficiency, renew­ables, and other distributed resources just in the first five years, showing competitors’ speed.)

“By contrast, wind and solar are generally designed to work in severe weather,” says Lovins. “Wind shuts down only under extreme duress like hurricanes and tornadoes, and has repeatedly helped keep regional grids running in the Polar Vortex and other grid emergencies when many fossil-fueled plants failed.”

Solar systems break only about 0.2 percent of the time, and their modular, ground-level components are easy to fix at night. Neither wind nor solar burns fuel. Their natural variability can be forecasted more accurately than demand for electricity. These attributes help explain why adding more solar, wind, and other (“dispatchable”) renewables makes grids more reliable.

Renewables’ biggest energy-security advantage is their ability to bypass the overwhelmingly largest cause of blackouts—grid failures. Large fossil-fueled or nuclear plants are useless if their long powerlines fail due to lightning, tree limbs, wildlife, operator error, or a rifle bullet. But redesigning the grid into “islandable” microgrids that can power critical loads until the big grid is restored is by far the most reliable way to deliver electricity, and can often save money too. That’s how the military is designing its bases, which can’t deliver mission assurance if they rely on fragile grids and fuel logistics. But we civilians whom the military defends need our stuff to work too.

Climate change is making heat waves and Polar Vortex-like freezeups more frequent and more severe. Society is not becoming more tranquil. Giant coal and nuclear plants will become more vulnerable and unreliable, not less. No amount of “fuel on hand” will change that. But the diverse, distributed, efficiently used, inherently resilient, renewable resources that some criticize as a threat to national energy security are in fact the keys to preserving and enhancing it.

This week, a leaked draft of the new study by DOE’s professional staff contradicted the Secretary’s assumptions and is now “evolving.” Its reportedly imminent release makes RMI’s analysis of the “fuel on hand” thesis especially timely. RMI will also post shortly a preprint of a new journal article examining all 14 of the “magical properties” that Secretary Perry and EPA Administrator Pruitt have claimed would justify favoring, subsidizing, or requiring coal and nuclear plants.

“Does ‘Fuel On Hand’ Make Coal and Nuclear Power Plants More Valuable?” by Amory B. Lovins, appeared on on May 1, 2017:


Media Contact: Nick Steel at

About Rocky Mountain Institute

Rocky Mountain Institute (RMI)—an independent nonprofit founded in 1982—transforms global energy use to create a clean, prosperous, and secure low-carbon future. It engages businesses, communities, institutions, and entrepreneurs to accelerate the adoption of market-based solutions that cost-effectively shift from fossil fuels to efficiency and renewables. RMI has offices in Basalt and Boulder, Colorado; New York City; Washington, D.C.; and Beijing. For more information, visit

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