5

Strategies for Reducing the Harmful Consequences from Loss of Grid Power

INTRODUCTION

Chapter 4 examined planning, design, and operations that can help improve the reliability and resilience of the grid to prevent or reduce the duration of grid outages. Chapter 6 looks at restoration of grid service. But in the middle sits the question of how to design and plan for a society that will be resilient even with the loss of power. This chapter examines current and future responses to that question. As introduced in Chapter 3, the exact form of that planning depends on the causes of grid failure, because those causes may affect which other services are available and the speed and extent of restoration (see Figure 3.2). Full restoration, as explored in Chapter 6, may take a long time—during and after which the effects of lost grid service could continue to reverberate through society.

As in the other sections of this report, the committee does not focus much on small routine disruptions that are inherent to power distribution systems. Those outages, because they are short and familiar, do not create major resilience problems; their effects are usually local, understood, and well within the range of imagination and planning. Indeed, in a typical year there are about 3,200 significant outages on power grids in the United States, with extreme weather and falling trees as leading causes (Eaton, 2016). In a 2015 Harris poll, homeowners self-reported that one out of four had experienced power outages for 12 hours or longer in the past 2 years (Briggs and Stratton, 2015). These are common events that generate large costs to the economy and public welfare—for example, jeopardizing the continued operation of home health care equipment (Ryan et al., 2015) as well as continuity of important public functions and economic activity such as data centers (Vertiv, 2016)—but are within the realm of normal experience and planning.

Instead, the committee focuses on large regional disruptions that last for several days or longer and cover a larger area, such as multiple service territories or even several states. Such long duration outages do occur, as shown in Figure 1.1 and discussed later in this chapter. Such events, which can have profound system-wide effects, require much more attention than they have received to date from policy makers and every segment of society that depends on electric service. Because these effects are outside the realm of normal experience, it is difficult for people and organizations to imagine the possible harmful outcomes on the basis of real-world information about consequences. Reducing these harmful consequences of large-area, long-duration grid failures is a problem of imagination and incentives.

For shorter-duration outages, electricity users have an incentive to make their own preparations for resilience. A wide range of users do exactly that—with different levels of effort and cost depending on what they are willing to pay to avoid loss of vital services. Long-duration outages have much more profound impacts on society and require preparedness that is much more costly. Planning for such outages requires system-wide thinking because so much depends on the power grid, including all 16 critical infrastructure sectors.¹ As the grid becomes even more tightly integrated with other important economic and social activities, the need for this system-wide perspective will grow.

Water supply systems that provide potable water and treat wastewater are one example of critical infrastructure interdependency. Because the pumps are large, sometimes they do not have their own backup generators. Loss of grid power beyond a few hours can lead to depletion of gravity-fed reservoirs and tanks as well as a decline in pressurization of the distribution pipes. Usually the criticality of these pumps is handled through coordination with the electric distribution supplier to give those assets high priority during restoration—an option that may not be available during the

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¹ The Department of Homeland Security designates the following 16 sectors to be critical to national security, national economics, or public health/safety: chemical; commercial facilities; communications; critical manufacturing; dams; defense industrial base; emergency services; energy; financial services; food and agriculture; government facilities; healthcare and public health; information technology; nuclear reactors, materials, and waste; transportation; and water and wastewater.

kinds of large-area, long-duration outages that are the focus of this report. Similarly, wastewater systems and particularly lift pumps are often critical if left off-line for too long. Sewage treatment often has enough storage to last for several days, but there have been cases where untreated effluent has been released directly to the environment in the aftermath of severe events.

Effective planning will require different strategies for different systems (NRC, 2012). And planning will require engaging actors—from first responders to the operators of critical infrastructures—who often do not work together adequately. Severe events and the corresponding shock, however, have inspired some of these different members of the private and public sector to work together more effectively—for example, during the aftermath of Superstorm Sandy when some parts of the tristate area lacked electric service and other infrastructure for more than a month.

This chapter looks at resilience from three perspectives: (1) incentives for actors to invest in resilience on their own, (2) planning methods that can improve how societies anticipate the effects of long-duration grid outages, and (3) approaches to designing electric power systems so they retain some or all of their function even when the larger grid has failed.

INCENTIVES FOR PREPAREDNESS

By and large, the existing electric power grid has done a remarkable job of providing reliable electric power service. Moreover, existing users of electric power services generally have done a good job of investing where needed to make themselves more resilient when grid service is insufficient. This track record reflects the incentives at work on the actors who are relevant to planning and using grid electricity. Here the committee looks at those incentives because they help reveal places where additional efforts by industry, civil society, and government may be needed to anticipate and plan for large-scale grid outages. Such a perspective helps to expose the areas where failures to prepare are most likely—because the incentives to ensure resilience are weakest—and where additional policy action may be needed.

Surveys of existing electric power users reveal that there are huge variations in the willingness, ability, and need to pay for greater resilience; moreover, desire for resilience depends heavily on the expected duration of grid power outages. Table 5.1 shows results from one review of prior research on interruption costs of different duration and circumstances. The table is complex and busy, demonstrating huge variation (of several orders of magnitude) in the economic harm suffered by different types of customers for different types of outages. For example, the financial losses to large and medium commercial and industrial (C&I) customers are orders of magnitude larger than losses to either residential or small C&I customers. And while much is known about the impact of relatively short duration outages (<16 hours), at present there is essentially no systematic research that provides such information for longer outages—let alone the large-area, long-duration outages that are the main subject of this study. Nonetheless, the existing research suggests that while, on the one hand, there are broader societal needs for more resilient power supply, on the other hand, cost-effective strategies must reflect that not all users need the same levels of resilience. This is particularly true for users and facilities that provide critical services such as hospitals, where using economic measures (e.g., willingness to pay) for resilient service may not be appropriate.

The incentive to become resilient is evident in the substantial investments that some power users make in obtaining backup supplies. For example, hospitals, data centers, and command posts for first responders all regularly install backup power systems. For smaller users, as well, there is extensive media coverage and advice—along with many vendor firms—that draw attention to the need for on-site power. Diesel generators are the technology of choice for this function; estimates compiled in the late 1990s suggest that the capacity of such generators in the United States was about 100 GW and growing at approximately 2 percent per year (Singh, 2001). Given the vital role of these generators in providing resilience, there has been ongoing attention to possible revision of standards for their reliability and environmental performance (Felder, 2007). There is also a substantial need for ongoing consumer education about the operation and safety of such devices since burns, fires, and especially carbon monoxide poisoning continue to be major problems.

The committee is concerned that, despite substantial investment in standby generators, awareness of the unreliability and other performance attributes of these systems remains highly uneven. According to Huber and Mills (2006), 1 percent of diesel generators at nuclear plants fail to start upon demand, while 15 percent of them fail after 24 hours of continuous operation. Consequently, nuclear sites have multiple redundant sources of backup power, and, in the wake of the Fukushima nuclear accident, the Nuclear Regulatory Commission has required additional investments in on-site power.² By contrast, the failure rates at start-up of hospital generators—which are much less well maintained in general and have fewer redundancies—are 10 times the rate of those in the nuclear industry (Mills, 2016). Similarly, there is low and uneven awareness of the challenges in obtaining fuel supplies in a long-duration outage, which presents a critical and underanalyzed risk.

Finding: Installing backup power systems alone is insufficient to improve resilience. These systems must be tested (i.e., started, operated) and maintained (e.g., cleaned) regularly so they function reliably during an outage. Relevant industry

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² Following Fukushima, the Nuclear Regulatory Commission requires backup power for critical systems at nuclear power plants, which will likely cost the industry approximately $4 billion (2016 dollars).

TABLE 5.1 The Significant Variation in Estimated Financial Losses Suffered by Different Customer Classes Operating under Different Ambient Conditions as a Function of Varying Outage Duration

NOTE: C&I, commercial and industrial customers.

SOURCE: Sullivan et al. (2015).

associations, and policy makers, government agencies, and regulators where appropriate, have an important role in disseminating information about the actual levels of reliability of backup units, as well as challenges obtaining fuel.

Recommendation 5.1: State emergency planning authorities should oversee a more regular and systematic testing of backup power generation equipment at critical facilities, such as hospitals and fire stations, and ensure that public safety officials include information related to electrical safety and responses to long-duration power outages in their public briefings. Those authorities should also periodically assess the costs and benefits of this testing program and use that information to prioritize sites for testing.

In addition to diesel generators—which are often connected to a single vital asset—there has been a steady rise in investment in microgrid systems (Hanna et al., 2017). These systems cover entire office complexes, campuses, and military bases, and, as shown in Figure 5.1, this segment of electricity infrastructure investment is expected to continue with substantial growth, which could have large implications for the resilience of power users. While the logic for installing microgrids at such locations varies, usually the continued service of high-quality electricity even after macrogrid failure is dominant. Microgrids, especially the larger systems, are designed to allow for islanding in the event of macrogrid failure, although in practice very few actually operate or are even tested in that mode. Many microgrids embed renewable power generation systems—notably solar photovoltaics—and the financial case for larger microgrids typically hinges on the integration of natural gas-fired small turbines that utilize the waste heat for local heating and cooling. Later in this chapter, the committee will explore how new research and incentives could lead the users of microgrid systems to use this resource to increase resilience.

Over the past few years, there has also been a surge in installation of “behind the meter” on-site battery storage (see Figure 5.2 and the section titled “Near-Term Drivers of Change and Associated Challenges and Opportunities for Resilience” in Chapter 2). This surge in investment has been driven in part by direct subsidy—notably in California—and in part by fundamental improvements in battery technologies. As with microgrids, these on-site battery systems could

in theory lead to higher resilience, but very few of these systems are actually designed for that purpose and none can supply power for periods of several days. Instead, these systems are sized to move small amounts of power—typically a fraction of total load just for an hour or two—from peak to non-peak periods to help C&I customers reduce the charge they pay for peak electricity demand. If technological improvements make it possible to install much larger systems then such batteries could be material to improving resilience to long-duration grid outages.

Where power users have a self-incentive to invest adequately in resilience—and where they have adequate

information about the effects of their investments—no further policy incentives may be needed. By contrast, when the market fails—for example, when users are unaware of their exposure to grid failure, unaware of the synergistic consequences of grid failure, or unable themselves to afford or recoup the benefits of actions that could improve resilience if low probability events occur—then there may be a need for policy intervention. These failures are often evident where there are large-scale outages that affect a wide array of vital social services—as revealed, for example, by the long-duration power outage after the January 1998 ice storm described in Box 5.1. In contrast to many events whose intensity was predictable in ways that aided advance preparations, the extent and impact of this storm was largely unexpected. This is a characteristic of such storms since icing conditions depend critically on the vertical temperature profile in the atmosphere; a change of just a few degrees can make the difference among ice, rain, or snow. Such unexpected outcomes are particularly worrisome hazards for the grid since ice storms already account for many long-duration outages. With climate change, the areal extent and possible impacts of such icing events are likely to change although, as noted in Chapter 3, the nature of those changes remains uncertain.

The questions surrounding when and how policy makers intervene to encourage additional planning and investment around responses to grid failure raise many fundamental questions about the proper role of government. If government stands ready to provide support in the case of a long-duration grid failure, then the well-known “moral hazard” problems could undermine the incentive for users of electric power to make those investments themselves. While communities are largely left to make their own decisions about their willingness to plan for and invest in resilience, there may be broader social implications and possible unintended consequences from the totality of all these local choices made with reference to local interests.³ Such societal concerns may create the need for policies to better harmonize or at least take these externalities into consideration. Indeed, better documentation and awareness of the metrics for grid reliability and resilience, discussed in earlier chapters, could make it much easier for market forces to function properly—for users of power services to become more fully aware of

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³ The issue of “moral hazard” arises if a community underinvests in protection for rare major events and then expects the broader society to cover its costs when such an event occurs.

their exposures to risk and thus more capable of obtaining the right level of resilience on their own.

Even once the right incentives are in place to invest in resilience, there may be organizational and cognitive barriers to action—especially for events that have never occurred or been imagined before. The committee believes that the largest challenges in creating resilience against the full effects of large-area, long-duration grid failures may lie with the system-wide consequences and interactions. Such problems are extremely difficult for organizations to anticipate and respond to effectively. Typically, organizations are structured to meet core missions and can be blind to, or find it very difficult to address, threats that arise in unexpected ways. Creating resilience against adverse system-wide effects requires that many different organizations coordinate and adopt solutions that might be far outside the normal scope of each organization individually. Where organizations do not have regular interaction and high levels of trust, collective action may be impossible.

The development of a coherent response that best serves the national interest requires laying a foundation for understanding the social value in resilience. Only then is it possible to evaluate whether the incentives of relevant actors will lead them to invest adequately in resilience. Only after establishing the social value in resilience is it possible to debate the degree of policy intervention needed to address the larger systemic impacts of large-area, long-duration outages.

Finding: The existing systems of incentives have generally been successful in encouraging proper levels of investment to address shorter-duration and limited-area outages. However, incentives for individuals and organizations to take steps to increase resilience against large-area, long-duration outages are a different matter. Developing national, regional, and local strategies to improve resilience against such outages requires two things: an assessment of the likelihood that disruptions will occur and a judgment about how much the various actors in society are prepared to invest in actions that lower the consequences of disruptions. At present, many communities, regulators, and grid operators do not have the information and/or incentives needed to make reasoned policy and operational decisions.

Knowing much more about what individuals and society are willing to pay to avoid the consequences of large grid failures of long duration is an important input to deciding whether and how to upgrade systems that can reduce impacts of a grid outage. Much of this knowledge is anecdotal from looking backward at such failures, such as from Hurricane Katrina, Superstorm Sandy, or the Northeast blackout of 2003. Most prior quantitative studies have only examined outages of much shorter duration. If these studies are to provide meaningful results, they will need to use state-of-the-art social science methods. Because different strategies may provide different insights, it would be prudent to have separate independent groups undertake more than one study. Results from this work can be used to inform national, regional, and local decision making about resilience investment.

While individuals’ willingness to pay is an important input to such decision making, considerations of broader social disruptions and of equity are also important. Some private actors may be willing to pay considerable amounts to assure their continued provision of electric power during events (or parts of them), but these actors typically lack incentive to make investments beyond their own needs. Others may be uninformed about the potential systemic consequences of long-duration outages. It is the role of government to assure the continued provision of critical social services and to provide access to basic power-dependent services to vulnerable groups such as disadvantaged communities or others that lack the financial mechanisms to assure their own resilience.

Recommendation 5.2: The National Association of Regulatory Utility Commissioners should work in coordination with the Department of Homeland Security, the Department of Energy, and the states to develop model guidance on how state regulators, utilities, and broader communities (where appropriate) might consider the equity and social implications of choices in the level and allocation of investments. These include investments in advanced control technologies capable of enabling continued supply to particular feeders or critical users that could mitigate the impacts of large-area, long-duration outages.

PLANNING FOR GRID FAILURE

The remainder of this chapter examines how U.S. communities and the country as a whole can understand and implement an appropriate level of resilience in the event of a large outage of long duration. First, this section introduces planning for grid failure—so that consequences can be anticipated and responses organized. The following section discusses the design of infrastructures so that they themselves are more resilient to long-duration full or partial loss of grid services.

Planning requires information on the potential length and scope of large grid outages. That information can be gleaned partly by looking at past system outages and their coverage, summarized in Appendix E. These experiences suggest the magnitude of possible future outages. History in other countries is also helpful to consider because most modern grids reveal similar points of vulnerability. For example, the downtown area of Auckland, New Zealand, lost nearly all grid service for 5 weeks in the summer of 1998 when the four main cables serving the area failed in rapid succession. While each failure had its own individual causes, the events correlated and cascaded into a national crisis (Rennie, 1998).

Systems that should have been redundant instead were the source of additional stress—something that often happens in complex systems where all the interacting failure points are difficult to imagine in advance.

However, the past may be an inadequate guide because long-duration outages are rare events and the underlying structure, operation, and policies governing the grid might expose this vital infrastructure to even larger and longer outages than observed historically. It is important to do more to identify events that are “unthinkable” on the basis of historical experience but could occur with coordinated system-wide attacks on the grid and the many systems that it supports. While there are some public safety professionals and organizations that practice and train for such dark and disturbing work, these practices are neither widespread nor comprehensive enough to substantially improve the nation’s resilience to large-scale outages. Good imagination and planning begins with understanding the full range of possible outcomes for grid failure. The committee’s focus here is on planning for continuation of vital services in areas affected by a large-scale, long-duration outage, but it also notes that one important element of planning includes evacuation—in effect deciding that it may be more feasible to move populations in some areas than to provide emergency provisions.

While characterizing the real risks of grid failure will be difficult, an even more complex planning task involves understanding how prolonged full or partial failures of grid service could have compounding effects on other important public infrastructures and private services. Much of modern life depends on grid electricity, which is why the National Academy of Engineering named electricity as the single most important engineering achievement of the 20th century (NAE, 2017).

At present, planning for all types of hazards to public infrastructure is a disorganized and decentralized activity. Even in federal programs focused explicitly on increasing grid resilience, planning and implementation of research and policy responses are fragmented across federal agencies (GAO, 2017). It is impossible to describe all of the relevant efforts succinctly. Here the committee focuses on the role of the federal government and its National Preparedness System (NPS), whose broad aims are to prevent or speed recovery from a wide range of hazards that affect the security and resilience of the United States.⁴ The NPS is organized by the Federal Emergency Management Agency (FEMA)—an arm of the Department of Homeland Security—to assess and plan for hazards to 12 vital emergency support functions, including energy, for which the Department of Energy (DOE) is responsible for primary agency support (FEMA, 2008). Table 5.2 shows the matrix of vital functions and the relevant federal agencies. It is an intrinsically complex, messy, and organizationally stovepiped activity.

Because planning for grid failure is such an intrinsically complex and difficult task, it appears that very little of the FEMA- and DOE-led effort is devoted to imagining and preparing for the full systemic consequences of losing grid power over large areas for long period. Instead, by design, the framework shown in Table 5.2 is operational and aimed at clarifying which agencies will be focal points for receiving, collating, and distributing information to the rest of the federal government. Under this framework, for example, DOE is tasked with organizing information to produce estimates of restoration times, percentages, and priorities. In its role as the focal point, DOE is also expected to work with legal authorities to resolve matters of jurisdiction and grant waivers to expedite restoration processes, as discussed in Chapter 6. These are, for the most part, operational functions rather than forward-looking research and development or strategic planning. These patterns of stove piping and overlapping layers of jurisdiction extend from the federal to the regional, state, and local levels. Only during emergencies—events that politically and organizationally focus minds—does some semblance of more unified and strategic focus emerge, such as through the creation of joint field offices that unify the coordinating structures discussed in more detail in Chapter 6.

Because planning for the system-wide consequences of grid failure is such a daunting task, it is not surprising that the jurisdictions that seem to be doing a better job are those that have experienced such failures in the past. The tristate area of New York, New Jersey, and Connecticut in the aftermath of Superstorm Sandy is a good example, as shown in Box 5.2. Electricity outage disaster preparedness and response exercises such as “Clear Path 4” (DOE, 2016) are critical opportunities to gain experience and have great potential to be expanded. Experience transforms the unimaginable and seemingly impossible into a tangible reality. However, often the result is that planning efforts focus excessively on avoiding the same calamitous outcome rather than planning for a broader range of possible future events.

From the Sandy experience, the Canadian ice storm, and many others, it is clear that long-duration failures in grid power will occur. Even with a concerted effort in design and investment for continuity of some electric services—a topic discussed in the next section—much of the country is unprepared for long-duration outages. To the extent appropriate, resilience must begin with individual households and businesses preparing themselves for long-duration outages with adequate essential supplies—such as of food, water, medicine—to cover, at least, multi-day outages.

Finding: Existing planning systems are, by design, ill-suited for anticipating and considering the wide range of interactions between loss of grid power and other vital infrastructures and

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⁴ Presidential Policy Directive 8: National Preparedness. See https://www.dhs.gov/presidential-policy-directive-8-national-preparedness, accessed July 17, 2017.

TABLE 5.2 The Federal Emergency Management Agency’s Matrix Concept Illustrates the High Amount of Interagency and Interdepartmental Coordination Required for Assessing and Responding to Threats to the Nation’s Vital Infrastructures

NOTE: P, principal coordinating agency; S, agencies supporting the principal coordinating agency; USRT, urban search and rescue.

SOURCE: FEMA (2008).

services for long-duration outages. These are intrinsically difficult tasks to perform both conceptually and organizationally. They require imagination and planning for interactions among multiple stresses on infrastructures and services that are rarely observed in the world.

For example, in the aftermath of a large regional storm, loss of grid power often leads to loss of reliable traffic control as well as obstruction of many roadways. These impede normal traffic flow and make it difficult for first responders to perform their tasks. The difficulties with first response,

in turn, magnify the humanitarian crises that result from the original storm event. Those difficulties compound into additional stresses on hospitals and public safety that consume their resources and make it more difficult to restore normal commercial operations. But even in such settings, it can be extremely difficult to anticipate how interactions among infrastructures lead to yet further interactions and harmful consequences that multiply as a grid outage event extends in time.

State and local emergency management organizations may not have sufficient understanding of electric power systems, which can slow down emergency power provision to critical facilities. In some states, such as California, organizations such as the California State Utility Emergency Association act as a liaison between critical infrastructure utilities and emergency management organizations. While several other states have similar programs, the practice is not widespread.

Finding: In every state, the governor is the ultimate authority responsible for overseeing disaster recovery and the mobilization of federal assistance. However, the states vary widely in the extent to which they are ready to perform these functions for long-duration grid outages. State and regional authorities would benefit from extending existing efforts to help identify common challenges and extend best practices—for example, the National Association of State Energy Officials’ efforts to improve awareness and preparedness for large-scale disruptions to energy infrastructure (e.g., by holding events to share best practices and experiences managing fuel shortages that often accompany grid outages and other infrastructure failures [NASEO, 2016]).

The technology of distribution system operations increasingly allows power system operators, in the face of limited grid or local power supply, to select which distribution feeders to energize. Those feeders typically serve loads with very different levels of social criticality, such as hospitals or water treatment plants. Advanced control will make it possible to selectively supply and/or restore power to individual meters on a feeder, with subsequent or sequenced restoration of service to others on that feeder. It will also be possible to change the allocation of which meters to supply over time as circumstances and needs evolve. While presently there are relatively few demonstration projects and microgrids with these functionalities, there is significant potential to improve resilience through their wider adoption.

Finding: Technologies that allow for intelligent, adaptive islanding of the distribution system create new needs for planners to envision which feeders and users should be energized under different circumstances. Yet, that type of planning has been minimal, and little effort has been dedicated to anticipating how energizing feeders and select users might be adapted over the lifetime of the outage.

Recommendation 5.3: We recommend that the Department of Homeland Security, and the Department of Energy, as the energy sector-specific agency, develop and oversee a process to help regional and local planners envision potential system-wide effects of long-duration loss of grid power. While orchestrated at the federal level, success of this effort will require sustained engagement by regional and local authorities. Federal seed funding could support several such local or regional assessments.

Officials in regions that have experienced long-duration outages will likely be more motivated (see Box 5.2). In other regions, the Department of Homeland Security and others will need to mobilize support for taking these “imagine the unimaginable” activities seriously. The regulatory community’s role in these efforts will be crucial. Public utility regulators in particular often have oversight over many infrastructures and determine whether electric utilities may recover the costs associated with planning for the effects of long-duration outages of grid power.

Recommendation 5.4: The National Association of Regulatory Utility Commissioners, in consultation with the Department of Energy, the Department of Homeland Security, and the states, should develop guidance to state regulators and utilities on the following: (1) selective restoration options as they become available, (2) the factors that should be considered in making choices of which loads to serve, and (3) model recommendations that states and utilities can build upon and adapt to local circumstances. In developing these recommendations, attention should be paid to how the use of these new technical capabilities to energize particular feeders or grid-connected users might create evidence to justify wider deployment of such control and metering technologies.

Examples of factors that such guidance might consider include the power needs of first responder and other critical infrastructure systems, service to selected fuel and food suppliers, availability (or lack thereof) of privately supplied backup generation or other means to assure continued availability of electricity, and ability of specific populations to access basic services during prolonged outages.

The industry has done extraordinarily well at improving how the country responds to existing grid failures, a topic explored in more detail in Chapter 6. That said, a great deal of the effort needed to imagine and plan for the effects of long-duration outages sits outside the power industry in other organizations—such as the operators of water supply and treatment facilities and first responders. But industry, led by the North American Electric Reliability Corporation (NERC), should take a fresh look at whether the existing system of reliability standards adequately envisions cascading effects that could lead to long-duration outages. And the industry’s central strategic organizations—notably the Edison Electric Institute, the American Public Power Institute, the National Rural Electric Cooperative Association, and NERC—should draw more attention to the need for society to plan for long-duration outages. This is important, even though such tasks may be uncomfortable for these organizations because they represent, to some degree, an awareness that the grid itself is more fragile than widely thought. At the same time, such self-driven industry efforts should improve awareness of the many ways that the grid system can be designed to allow more resilience, which is an area where there are highly varied experiences across existing U.S. utilities and other system operators.

Finally, much more attention is needed to engage the public in understanding the potential severity of large-area, long-duration blackouts and to improve public awareness and preparedness. The American Red Cross (2016) offers general guidance on how to prepare for power outages—with

supplies adequate for 3 days (assuming evacuation from home) or up to 2 weeks (assuming that homeowners stay at home). The Centers for Disease Control offer detailed guidance on food safety, noting that hazards to refrigerated food begin as early at 4 hours into a prolonged power outage; they also offer rudimentary strategies for disinfecting water (CDC, 2014). Many states also offer their own guidance tailored to local hazards—for example, Florida’s advice focuses on the need for 3 days of supplies to ride through outages caused by hurricanes (Harrison, 2016). It is unclear how households around the nation respond to this advice, or what factors may drive households to achieve appropriate levels of preparedness. FEMA assesses individual preparedness on a regular basis, and the results suggest that preparedness is low and not improving rapidly (FEMA, 2016). Similarly, many households and businesses obtain equipment—such as portable generators—yet are unaware of how to operate these devices safely, how to procure fuel during extended outages, and how low the real levels of reliability of these devices are in practice.

DESIGN

With better understanding of what society might be willing to pay to avoid or reduce the consequences of grid failure and equipped with better planning for how grid failure could affect other critical infrastructures, planners could then design systems so they are more resilient when grid power is lost. The committee looks at design from two related perspectives: (1) designing and deploying standby power systems, and (2) designing local power systems to provider higher customer resilience.

Designing and Deploying Standby Power Systems

Many methods already exist to establish on-site power systems—often using components that are patched together in ad hoc ways—that can provide local service in the event of grid failure. These existing approaches should be practiced and improved. Most backup power systems rely on small gasoline, natural gas, and diesel-fired generators that are relatively easy to operate. Nonetheless, experience operating these systems is highly uneven around the country. Areas in which loss of grid power is more frequent are, as a general rule, better at imagining the impacts and thus better prepared.

These self-supplied systems may be ineffective in the case of long-duration, large-scale interruptions because backup systems are generally designed to run reliably for a few days at most; after that point, maintenance and fueling may be essential. However, during a large event that affects many interconnected public infrastructures, such services may be very challenging to obtain. During such outages, households and other non-expert users often devise their own ad hoc solutions that can lead to adverse side effects—for example, carbon monoxide poisoning from small generators run with inadequate ventilation. Better information and oversight are needed to improve the availability, safety, and use of these power systems.

Many (if not most) of the emergency generators are not physical assets owned by government or even utilities. Instead, the government maintains contracts with the private sector to deliver equipment as needed. For example, the federal government maintains a small stockpile of portable generators at locations around the country, as well as much larger contracts for additional procurements that can be deployed during a major outage. It is poorly understood whether many of the contracts for provision of generators, fuel, and maintenance would prove to be robust under conditions that lead to sustained loss of grid power—conditions that might include natural disasters and cascading interactions between infrastructures under stress. For example, where delivery of these assets is envisioned by air, supporting facilities (e.g., airports, ground crews, and air traffic control) may be unavailable and roads may be impassable.

In addition to the contracts and stockpiles of mobile generators maintained by the federal government, there is potential to repurpose assets not traditionally used for power supply. Civilian and navy ships could provide a few tens of megawatts of emergency power to loads in coastal cities (Scott, 2006). Likewise, when they are equipped with appropriate interfaces or conversion kits, diesel electric locomotives can also be used to power communities located near railroad tracks. For example, Canada National Railway delivered multiple locomotives off-track to towns without power during the 1998 ice storm.

There are several other anecdotes of locomotives being used to supply power to critical loads during emergencies, and many train operators maintain conversion kits used to produce 60 Hz of alternating current power from locomotives. However, the availability of such conversion kits is likely limited, and it remains unclear how much load such non-traditional sources of emergency power could serve during actual blackout conditions (NRC, 2012). Nonetheless, such resources can augment federal emergency power operations that rely on conventional mobile generators.

Finding: The federal government maintains a small stockpile of portable generators and fuel, as well as contracts for additional procurements that can be deployed during a major outage. However, the quantity available in the event of a large outage is inadequate, probably by a large margin, and likely to remain that way. Furthermore, there is a lack of knowledge regarding the existence, load characteristics, and emergency power requirements of many critical facilities. During emergency operations, this can impede procurement, delivery, and installation of the proper equipment at the site. Also unknown is the ability to reliably obtain non-traditional sources of emergency power such as from train locomotives and ships.

Recommendation 5.5: The Department of Energy and the Department of Homeland Security should evaluate and recommend the best approach for getting critical facility managers to pre-register information about emergency power needs and available resources. Collecting this information in a centralized, accessible database will expedite provision of emergency power to critical facilities and help set priorities for allocating resources. The Emergency Power Facility Assessment Tool managed by the U.S. Army Corps of Engineers—a tool already in use but whose adequacy the committee was unable to assess completely—may prove to be a suitable platform. Once these informational resources are in place, periodic stress testing and evaluation are needed to ensure that they continue to provide reliable information.

It is crucial to increase community assessments of what will and will not work in the event of large outages of varying duration (including availability of liquid fuel and generators; power to refineries, gas stations, communication networks, and hospitals; local and regional availability of natural gas; workforce). These should be integrated with tabletop emergency planning exercises at the community, county, and state levels. FEMA provides some funding for state and local exercises. However, resilience to large-area, long-duration outages may not be adequately prioritized in existing state/local exercises, and greater emphasis could produce good models for systematic planning and operational assessments.

Designing Local Power Systems to Provide Higher Customer Resilience

Beyond customer-owned sources of backup power, the power infrastructure, and distribution systems in particular, could be designed to operate more effectively when the bulk transmission parts of the grid fail. Many utilities are already installing self-healing and self-correcting distribution systems. These have ubiquitous sensors that can identify and isolate faults and use automated or remotely controlled switching to assure continuity of power to as many users as possible. For purposes of this chapter, what is important about these systems is that they blur the lines between reliability and resilience. When they work effectively, these automated distribution systems improve reliability of traditional grid service. But it is a small step to extend that logic to integration of electric infrastructure that is located on a customer’s premises—for example, an intelligent microgrid that can island from or reconnect to the larger system as conditions require. Other examples include on-site battery storage at customers’ residences, which combined with photovoltaics (PVs) could provide continuity of service in the event of grid failure (i.e., reliability) and also offer local support for the grid that can help avoid outages or expedite restoration (i.e., resilience). In terms of grid design and decentralization, these activities at the “edge” of the traditional grid are important technological and behavioral frontiers for the future power system. At present, most of the capabilities—such as automated islanding and intelligent integration of local resources into utility distribution systems—are theoretical in nature and have not been tested at scale.

A particularly promising set of options related to improving resilience rests with various types of microgrids. It is crucial to understand how microgrids can enhance resilience by operating in self-islanding mode during long periods of grid failure. In that context, there are various classes of microgrids:

• Building scale. Nanogrids are small-scale microgrids feeding residential or commercial end users. During an outage, the nanogrid typically isolates from the distribution system, and individual energy resources (e.g., a rooftop PV system with battery energy storage, a local diesel generator, or a fuel cell) are used to power the local loads. At present, most of these small self-supply systems serve the purposes of improving reliability and saving customers’ money through self-generation. Most of these systems are not designed to provide reliability for long-duration outages of the macrogrid, and many of these systems (e.g., at the residential level) are not designed to operate in islanded mode at all. Technically, however, many more of these systems could be designed with those capabilities.
• Campus scale. Microgrids are emerging as solutions for whole collections of buildings (e.g., college campuses or military facilities). All of these systems are designed with the capability of seamlessly connecting and disconnecting (i.e., islanding) from the macrogrid. Maintaining power at these locations–oases during emergency situations may be critical for safely riding through a catastrophic event. This is the fastest growth segment of microgrids in part because there are some customers willing to pay heavily for reliability (e.g., military bases) and in part because large-scale energy users can take advantage of combined heat and power efficiencies from burning natural gas in micro turbines (Hanna et al., 2017). For these latter users, dependence on natural gas supplies—which themselves may be compromised during events that lead to outage of the macrogrid—may be an extra source of vulnerability. Earthquakes that affect the power grid can also disrupt natural gas supplies. Extreme cold associated with ice storms can spike other demands for gas, such as heating, and leave less gas for power generation. Such systems, in many cases, are designed for islanding within the microgrids—so that critical services such as hospitals and sensitive scientific equipment are kept online even as the rest of the microgrid suffers graceful degradation in service.
• Community scale. Community-centric microgrids can be established by sharing individual end users’ distributed energy resources (DERs)—a capability that exists

Finding: There is enormous technical potential to using microgrids to make electric service more resilient in the face of loss of bulk grid power. This field of research and application is evolving quickly with new control systems, sensors, and distributed energy resources. This rapid evolution of the frontier of technical capabilities is opening a potentially wide gulf between the technical capabilities of microgrid systems and the real-world systems that are operational.

It is difficult to test microgrids and self-islanding distribution systems in real failure modes, especially if real-world events that lead to grid failure create many other forces that could erode the capabilities of self-islanded or microgrid systems. Variations in power quality could damage sensitive equipment needed for operation of these systems, as could physical stresses (e.g., trees, water, wind) that are correlated with the larger events that caused macrogrid failure in the first place. Too little is known about whether decentralization of the power grid will improve or degrade resilience of service under varying conditions. A highly decentralized and automated grid system that is still controlled by central authorities could prove to be a highly effective means of assuring resilient energy services even in the face of macrogrid failure. Or decentralization could actually amplify vulnerabilities in the grid system. Control systems may be unable to provide stability in the face of large numbers of local decisions made without the benefit of centralized authorities. Those systems might also fail in coordinated ways—for example, in case of cyber attack on the power infrastructure.

Finding: Many microgrids have been designed with continuous grid integration in mind, and users are hesitant to operate them in abnormal modes (e.g., islanded, or back-feeding power to the local utility) that could cause harm. Too little is known about whether decentralization of the power grid will improve or degrade resilience of service under varying conditions. A highly decentralized and automated grid system that is still controlled by central authorities could prove to be a highly effective means of assuring resilient energy services even in the face of macrogrid failure. Or, decentralization could actually amplify the vulnerabilities in the grid system.

Recommendation 5.6: The Department of Energy should support demonstration and a training facility (or facilities) for future microgrids that will allow utility engineers and non-utility microgrid operators to gain hands-on experience with islanding, operating, and restoring feeders (including microgrids). While the full need for training and experience—as well as possible adjustment in microgrid standards, notably those developed by consensus under the Institute of Electrical and Electronics Engineers (e.g., 1547.4 and the 2030 family of standards, which are, at this writing, under revision)—is large, the committee envisions a small Department of Energy-backed program to establish best practices that could spread more widely across industry and the regulatory community.

As discussed in Chapter 2, today, in most states, regulatory and legal restrictions limit the ability of a microgrid to sell power to other entities or to move power across public thoroughfare unless it is operated by a traditional electric utility. At smaller scale, privately owned microgrids could offer significant advantages, even with existing rate structures that typically do not acknowledge the value such a system can provide to the grid (King and Morgan, 2007).

DISTRIBUTION SYSTEM INNOVATIONS THAT COULD ENHANCE RESILIENCE

Today when the power goes out, individual customers are essentially on their own until service is restored. Homes and commercial facilities that are equipped with standby generators can disconnect from the grid and continue to operate with full or partial power. Users with microgrids—such as some campuses and military bases—can island from the grid and continue operations. Everyone else, even those customers with grid-connected PV systems, finds themselves in the dark. There are ways to enhance local resilience, such as by making PV inverters more visible and controllable, by facilitating development of small private microgrids, and by enabling utilities to operate islanded feeders.

Increasing the Capabilities of Distributed Energy Resource Inverters

End users and utilities are investing in a wide array of DERs (e.g., PV arrays, wind turbines, battery storage), many of which are located on or near customers’ premises. These resources could be used, in theory, to provide power to local loads even when the grid is unavailable. Typically, these local resources are interconnected with the grid through power electronic devices called inverters that convert the direct current output from many of these devices into alternating current. Integrating these resources into the grid has presented regulatory and technical challenges. Currently, these devices are required to automatically disconnect when the voltage and/or frequency at their terminals deviates outside of a normal range, indicating the presence of a fault somewhere on the grid. There are several reasons for this requirement, including safety of the line crews in the field and protection of equipment. However, because of the way inverters and their control systems are now implemented, this also results in cutting off the supply of power to the DER owner as well as to the grid. Given the rapidly increasing penetration of

DERs, it may often be desirable to keep these resources online during abnormal situations. Motivated by concerns related to the stability of the bulk power system, FERC has modified its small generator interconnection regulations to require that DERs have the ability to “ride through” momentary fluctuations of frequency or voltage.⁵ In addition, the Institute for Electrical and Electronics Engineers is in the process of revising DER interconnection standards (IEEE, 2014), including guidelines for the intentional formation and operation of microgrids. These developments could have a positive impact on resilience during large-scale outages.

While it is not yet deployed at significant scale, technology is readily available to allow inverters to power local loads following automatic grid disconnection, making limited local power available to run refrigerators, freezers, and other critical loads.⁶ In addition to increasing resilience and reliability for end-use customers, ongoing advances in inverter technology and modifications to interconnection regulations can be beneficial for keeping local loads at least partially energized during large-area, long-duration outages. Such advances can also be beneficial for utilities during restoration (see Chapter 6). With proper design and operating standards, DERs and advanced inverters could actively contribute to the stability and reliability of microgrids to power local loads without jeopardizing equipment or human safety. Nevertheless, individual states are in various stages of policy development related to inverter performance and interconnection of DERs.

Recommendation 5.7: Utility regulators and operating utilities that have not adopted standards similar to the Federal Energy Regulatory Commission’s ride-through capability requirements for small generators should assess their current interconnection standards as applicable to distributed energy resources, consider the costs of requiring new installations to use enhanced inverters, and determine the appropriate policy for promoting islanding and other related capabilities.

Encouraging Private Microgrids

As explained in Chapter 2, in most states today, regulatory arrangements and laws granting distribution utilities exclusive service territories preclude private entities from constructing and operating microgrids if done in a manner that supplies power to an entity other than the owner of the microgrid or if that power is moved across a public thoroughfare. However, because many distributed generation (DG) systems display economies of scale (King, 2006), there may be sound economic justifications for customers to want to operate some privately owned microgrids at a scale that serves several customers. Indeed, the military does this on many bases, at times with reliability benefits for non-military users as well. Microgrids have several advantages for the electricity grid; for example, they can provide electricity during peak-usage hours and therefore forestall the need for expensive upgrades in central generation, transmission, and distribution systems. They can also be used to improve power quality and reliability for local consumers (Neville, 2008). Finally, with proper arrangements they can serve local customers during power outages, consequently increasing the resilience of the grid. A potential advantage of facilitating the development of privately owned and operated microgrids is that this could considerably speed the pace of innovation (in much the way innovation was spurred after deregulation in the telecom industry).

Recommendation 5.8: The Department of Energy should work with the National Association of Regulatory Utility Commissioners and state regulators to undertake studies of the technical, economic, and regulatory changes necessary to allow development and operation of privately owned microgrids that serve multiple parties and/or cross public rights-of-way. These studies should also consider the potential consequences of such changes.

Recommendation 5.9: State legislatures and public utility commissions should explore economic, ratemaking, and other regulatory options for facilitating the development of private microgrids that provide resilience benefits. Rate structures can be developed to cover the costs of upgrading and maintaining grid assets while also recognizing and rewarding the benefits that distributed energy resources provide to the grid.

Facilitating Utility-Operated Islanded Feeders

Traditional radial distribution feeders are designed only to move power from substations out to customers in one direction. More modern distribution systems that include distribution automation and intelligent bi-directional sectionalizing switches,⁷ and other advanced distribution technologies, such as smart meters and micro-phasor measurement units, can reconfigure distribution system topology and feed distribution circuits from more than one location (Grijalva and Tariq, 2011; Grijalva et al., 2011). As the amount of utility and privately operated DG⁸ on distribution systems grows, there is no technical reason why, during an extended

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⁵ FERC Order No. 828, 81, Fed. Reg. 50,290, 156 FERC ¶ 61,062 (2016).

⁶ See, for example, the Outback FX 2.5kW 120VAC 24VDC 55A Sealed Inverter/Charger GTFX2524 from CivicSolar: https://www.civicsolar.com/product/outback-gtfx2524-sealed-grid-tie-24v-25kw-inverter, accessed July 13, 2017.

⁷ See, for example, the IntelliRupter® PulseCloser® Fault Interrupter from the S&C Electric Company: http://www.sandc.com/en/products-services/products/intellirupter-pulsecloser-fault-interrupter/http://www. sandc.com/en/products--services/products/intellirupter-pulsecloser-fault-interrupter/, accessed July 12, 2017.

⁸ DG is a subset of DERs. DERs can include storage and non-generation resources.

outage, an intact distribution feeder could not be operated as an islanded micro-grid, supplying customers with limited critical electric service (Narayanan and Morgan, 2012). However, progress will be needed on a variety of technical and regulatory fronts. For example, as DG resources grow in size, simple “plug and play” arrangements are no longer feasible because issues of stability, as well as frequency and voltage control, become critical (Nazari et al., 2012; Nazari et al., 2013). Distribution systems with smart meters can drop customers before reconfiguring as an island, but issues of synchronizing DG resources and assuring adequate stability also need to be addressed (Nazari and Ilic, 2014). In most cases, it is unlikely that the amount of power available to an islanded feeder would be sufficient to meet all local loads. That means that methods would need to be developed to limit the load imposed by individual customers and perhaps to cycle supply among customers over time. Any operation of islanded feeders using DG resources must be planned and executed in a fashion that does not create a safety hazard for residents or utility repair crews.

Today, an inability to observe the details of what is going on (i.e., lack of visibility) in distribution systems is a significant technical barrier to the islanded operation of DGs and microgrids. Generally, this issue is lessened in transmission systems, as transmission systems typically have greater visibility. During a power outage, transmission system operators can often readily and accurately identify most fault(s) and isolate them from the rest of the grid. Thus, the rest of the system can continue its normal operation while line crews work to repair the isolated part of the grid in a safe manner. If utilities undertake a similar approach for distribution systems and implement smart meters and micro-phasor measurement units in distribution systems, or at least at the points of interconnection of DGs/microgrids, they can identify energized lines during outages and isolate them to ensure line crew safety, while serving critical loads.

Recommendation 5.10: Utilities that have already implemented smart meters and advanced distribution systems with sectionalizing switches should explore the feasibility of establishing contractual and billing agreements with private owners of distributed resources and developing the ability to operate intact islanded feeders as islanded microgrids powered by utility- and customer-owned generating resources to supply limited power to critical loads during large grid outages of long duration.

Recommendation 5.11: Utility regulators and non-governmental entities should undertake studies to develop guidance on how best to compensate the owners of distributed generation resources who are prepared to commit a portion of their distributed generation capacity to serve islanded feeders in the event of large outages of long duration. Additionally, the National Association of Regulatory Utility Commissioners should establish a working group to advise members on the issues they will likely have to address as the possibility grows that some utilities or customers may wish to be able to operate islanded feeders during large outages of long duration.

Facilitating Emergency Use of Hybrid and Fuel Cell Vehicles for Backup Power

With appropriate inverters, plug-in hybrid electric vehicles and fuel cell vehicles are effectively mobile generators that customers could use to provide emergency power to critical loads in their homes, and in theory to an islanded feeder, during a major outage. Like other mobile generators, this service depends on continued availability of fuel, whether natural gas, gasoline, or something similar. Battery electric vehicles with no combustion system only store modest amounts of energy (i.e., 80 kWh at the high end), which would likely be exhausted early in the course of a large-area, long-duration outage. Thus, purely electric vehicles do not offer the same level of resilience benefit for homeowners but could be coupled with DG such as PVs. Inverters designed for vehicle-to-home power transfer have not entered the market in the United States, although there are numerous demonstration projects, in part because of technical, economic, and liability questions that must be negotiated among grid operators, homeowners, and vehicle manufacturers.

Recommendation 5.12: The Department of Energy should work with the manufacturers of plug-in hybrid electric and fuel cell vehicles to study how such vehicles might be used as distributed sources of emergency power.

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