Preparing for emergencies and preventing disasters requires planning, equipment and communications. This is true for fighting fires and for keeping the electric power system operating in extreme weather.
Firefighters have strategic plans regarding territory to address, as well as operational plans. Equipment includes fire trucks, protective gear and hoses. First responders need to share communications, so they can coordinate when an emergency requires more than just one department. This happens routinely where fire departments from multiple towns respond to a multiple alarm fire and provide mutual aid.
Electric utilities also have mutual aid agreements, equipment for generating and delivering electricity, and lots of planning. Preparing the grid to operate under extreme weather depends on all these things. In recent years, policymakers and planners have begun dealing with the impacts of extreme cold and extreme heat. This, rather than the damage to wires and resulting power outages from tornados, floods and hurricanes, is the subject of new attention.
Electric utilities began early in the twentieth century to find economies of scale and operating efficiencies by consolidating adjacent service areas. Transmission lines connecting more power plants and cities increased reliability and lowered costs by allowing reserves needed for one set of customers to be shared.
Power grids are subject to equipment failures or outages, so there has always been some recognition of back-up supplies and needed flexibility to meet changing conditions on both supply and demand. Power “pools” across multiple utilities and multiple states took this sharing and mutual aid to a more formal level and allowed both planning and operations under a clear structure that benefited all the participants. Today’s regional transmission organizations, such as the Midcontinent Independent System Operator (MISO), the Southwest Power Pool, ISO-New England and PJM are multi-state, multi-utility grid operators.
For much of the 120-year history of electric power companies, regional reliability standards and coordinated operations have been voluntary. It was only after the 2003 Northeast blackout that federal law required reliability standards to be mandatory and carry inescapable penalties.
Firefighting was also provided on a private opt-in, participants-pay arrangement for more than a century. The problems of “free-riders” that benefit from fire protection without paying, and increased fire hazards due to spotty participation creating incomplete protection eventually led to municipal fire departments established as public institutions supported by combined public resources for the benefit of all.
Today, the Federal Energy Regulatory Commission (FERC) is asking how grid operators and planners are evaluating risks of extreme heat, cold and droughts—hazards that can cause system-wide problems for the electric power grid. In addition, regulators seek planning for more equipment to deal with large-scale emergencies (e.g. transmission between regions) and better communications (e.g. shared assumptions, quicker sharing of resources) between utilities across their service-area borders.
Setting up standards and requiring coherent, shared communications are wise precautions for utilities to adopt for the larger-scale outages that we see from extreme heat, cold and drought. Going back to the fire department analogy, the regulation of fire risks through building codes and safety standards has saved countless lives by preventing fires in the first place.
Since utility companies do not share modelling assumptions, have not set minimum standards for interregional capacity-sharing, or even established a commonly understood risk assessment for large-scale outages due to extreme weather, the risks of extreme weather leading to significant impacts are exacerbated by the lack of action by utilities.
In the midst of calls for action to enhance grid reliability, we must also not be stampeded by alarmist rhetoric. Monopoly utilities make greater profits through larger investments, so the incentive is to spend, spend, spend. Standards are necessary to both provide a reliable system and protect ratepayers from excessive costs.
For more than 50 years, the states have been using a reliability standard that tempers the impulse to ensure reliability at all costs and saddle ratepayers with the excessive costs of “gold plating” the system. That standard says “the probability of load exceeding the available generating capacity shall not be greater, on the average, than one day in ten years.”
The “one day in ten years” standard is set by the state agencies who have the authority over this important public health and safety issue. The recent Summer Resource Assessment from NERC (the North American Electricity Reliability Corporation) was widely cited and exaggerated for its statement that MISO faces a risk of insufficient supply if demand is higher than normal forecast (specifically a demand level expected with just 10%, or one-in-10, probability).
This is true, but it must be noted that the risk of insufficient supply dropped from one day in ten years to one day in 5.6 years. Should this be a call to action? Yes. But it should not be an excuse for alarmist rhetoric or, even worse, a call to turn back the clock on our efforts to modernize the electricity supply. NERC also did not highlight that MISO’s risk was based on using 54% less capacity from neighbors than the past summer. (See pages 14 and 16.)
Sensible planning, replacing old equipment, and effective communications bring great benefits for both fire protection and grid reliability. Hyperbole, like yelling in a crowded theater, just causes harm. FERC is working on numerous approaches to disentangle some of the bad practices that put the grid in need of modernization and upgrade. It is not hard to find bad old practices, and 50 year-old power plants running on 90 year-old designs, in our electric system.
New transmission, new power plants, better attitudes and less defending of old fiefdoms will get us through the energy transition. Let’s get on with the changes.