The modern world runs on electricity. As individuals, we depend on electricity to heat, cool, and light our homes; refrigerate and prepare our food; pump and purify our water; handle sewage; and support most of our communications and entertainment. As a society, we depend on electricity to light our streets; control the flow of traffic on the roads, rails, and in the air; operate the myriad physical and information supply chains that create, produce, and distribute goods and services; maintain public safety, and help assure our national security.
The incredibly complex system that delivers electricity in the United States was built up gradually. It started with numerous small local systems in the early 1880s and grew to become three large independent synchronous systems1 that together span the lower 48 United States, much of Canada, and some of Mexico, each of which is one of the largest integrated machines in the world. These interconnected grids have achieved significant gains in efficiency with increasing scale, as well as improved reliability owing to redundant paths over which electricity can flow. Today, power plants using fossil fuels, nuclear energy, and renewable resources supply these machines. They move power to consumers over hundreds of thousands of miles of high-voltage transmission lines and thousands more miles of local distribution lines.
While our society is becoming ever more dependent upon electricity, the electric system is undergoing a complex transformation that includes changing the mix of generation technologies; adding small-scale energy resources connected to the distribution system; incorporating generation and storage on customers’ premises; and improving the capability to monitor and control electricity generation, flows, and uses.
While major pollution-control investments and activities have reduced the electric system’s environmental impacts over the past century, these impacts remain a problem locally and globally. The need for environmental improvement will continue to be a major force shaping the power system for decades to come. Not only will the electric system continue to shift to a lower-carbon resource mix, but this lower-emission electricity will also be called upon to provide energy to activities, such as transportation and industrial processing, that currently operate on fossil fuels.
Our economy and lifestyles require that electricity be accessible, affordable, reliable, and continuously available. For that to happen, the grid2 must perform at two levels: (1) The network of high-voltage power lines that spans the country must be able to move power from large generating plants out to local regions; and (2) Lower-voltage distribution systems must be able to move the power to, and occasionally from, factories, businesses, homes, and other end users. The grid must continue to perform these actions as it evolves to accommodate increasing numbers of distributed energy resources, which are often customer-owned, attached to local distribution systems, and have more “smart” technology—the ability to sense and interact with conditions on the grid and with customers’ usage patterns and preferences. These many changes are introducing large shifts in the way the system operates. And these changes are occurring during a period of flat or declining growth in electricity generation (EIA, 2016).
For at least the next several decades, few electricity consumers, let alone whole communities, will go completely “off grid.” Many consumers will install equipment that meets their needs for at least some of the time. Sometimes they will
1 As explained in Chapter 2, the U.S. portions of these systems are divided into three interconnections: Eastern, Western, and Texas. Within each interconnection, 60 Hz power is synchronized across the entire system.
2 Some use “the grid” only to refer to the high-voltage transmission system. Others use “the grid” to refer to the entire system of wires that moves electricity, including the lower-voltage distribution system. In this report, the committee adopts the latter usage. Chapter 2 provides an overview of the physical structure, operation, and governance of both the high-voltage transmission and lower-voltage distribution systems.
also want to sell surplus power back to the grid. But the fraction of consumers who are able to provide their own resilient electric supply in entirety, without connecting to the grid, will be limited for both economic and social equity reasons.
Finding: For at least the next two decades, most customers will continue to depend on the functioning of the large-scale, interconnected, tightly organized, and hierarchically structured electric grid for resilient electric service.
In this context, interruptions in the power supply are disruptive for consumers and for the electric system itself. Interruptions typically arise from physical damage in a local part of the system—for example, lightning strikes, trees that fall on wires, cars or trucks that crash into power poles, or aging equipment that fails. Indeed the majority of the outages that affect the typical customer in the United States in any given year are the result of events that occur to the distribution system. Less frequently, large storms, other natural phenomena, and operator errors cause outages across the large high-voltage, or “bulk power,” system.
A wide variety of events—hurricanes, ice storms, droughts, earthquakes, wildfires, solar storms, and vandalism or malicious attacks on the hardware and software elements of the electric system—can lead to outages. When the power goes out, life becomes difficult. Communications, business operations, and traffic control all become more challenging. If the outage is brief, most people and organizations can and do cope. As the duration and spatial extent of an electricity system outage increase, costs and inconveniences grow. Critical social services—such as medical care, police and other emergency services, and communications systems—can be disrupted and lives can be lost.
This report is about minimizing the adverse impacts of large electric outages through building a resilient electric system.3 A complex modern economy that depends on reliable electric supply requires a resilient electric system. While any outage can be problematic, in this report the committee focuses on large-area, long-duration outages—blackouts that last several days or longer and extend over multiple service areas or states.
While utilities work hard to prevent large-scale outages, and to lessen their extent and duration, such outages do occur and cannot be eliminated. Given the many potential sources of disruption to the power system, what is perhaps surprising is not that large outages occur, but that they are not more common. For decades, the planners and operators of the system have taken care to assure that the electric system is engineered and routinely operated to achieve high levels of reliability. Increasingly, the system’s planners and operators are focusing on resilience as well.
The North American Electric Reliability Corporation (NERC)—the federally approved organization responsible for developing reliability standards for the bulk power system—defines reliability in terms of two core concepts:
- Adequacy. The ability of the electricity system to supply the aggregate electrical demand and energy requirements of the end-use customers at all times, taking into account scheduled and reasonably expected unscheduled outages of system elements.
- Operating reliability. The ability of the bulk power system to withstand sudden disturbances, such as electric short circuits or the unanticipated loss of system elements from credible contingencies, while avoiding uncontrolled cascading blackouts or damage to equipment.4
In practice, the system is planned and operated to varying reliability standards. The bulk power system achieves a relatively high degree of reliability across the United States as a whole. For example, adequacy of electricity generation capability is usually measured against a one-day-in-ten-years (1-in-10) loss of load standard, which is typically interpreted to mean that the generation reserves must be high enough that voluntary load shedding due to inadequate supply would occur only once in 10 years (Pfeifenberger et al., 2013). By its very nature, however, the highly complex electrical system—the very epitome of a “cyber-physical system”5—is spread out all across the continent. Because it is built up
3 In parallel with the preparation of this report, which was requested by the Department of Energy (DOE), DOE has also been sponsoring a 3-year Grid Modernization Initiative. That initiative includes a project to develop metrics to measure progress on grid modernization. It is pilot-testing metrics on reliability, resilience, flexibility, sustainability, affordability, and security (DOE, 2015; GMLC, 2016). This report focuses specifically on the issue of resilience.
4 NERC goes on to state, “Regarding adequacy, system operators can and should take controlled actions or procedures to maintain a continual balance between supply and demand within a balancing area. These actions include: Public appeals; Interruptible demand (i.e., customer demand that, in accordance with contractual arrangements, can be interrupted by direct control of the system operator or by action of the customer at the direct request of the system operator); Voltage reductions (also referred to as “brownouts” because lights dim as voltage is lowered); and Rotating blackouts (i.e., the term used when each set of distribution feeders is interrupted for a limited time, typically 20–30 minutes, and then those feeders are put back in service and another set is interrupted, and so on, rotating the outages among individual feeders). All other system disturbances that result in the unplanned or uncontrolled interruption of customer demand, regardless of cause, fall under the heading of operating reliability. When these interruptions are contained within a localized area, they are considered unplanned interruptions or disturbances. When they spread over a wide area of the grid, they are referred to as cascading blackouts—the uncontrolled successive loss of system elements triggered by an incident at any location” (NERC, 2013).
5 The National Science Foundation describes “cyber-physical systems” as “engineered systems that are built from, and depend upon, the seamless integration of computational algorithms and physical components” (NSF, 2016).
from millions of complex physical, communications, computational, and networked components and systems, there is simply no way it can be made perfectly reliable.
The concepts of reliability differ from resilience, which is the focus of this report. The Random House Dictionary of the English Language defines resilient as follows: “the power or ability to return to the original form, position, etc. after being bent, compressed, or stretched . . . [the] ability to recover from illness, depression, adversity, or the like . . . [to] spring back, rebound.” Resilience is not just about being able to lessen the likelihood that outages will occur, but also about managing and coping with outage events as they occur to lessen their impacts, regrouping quickly and efficiently once an event ends, and learning to better deal with other events in the future. Also, a detailed analysis of failure data (Figure 1.1) reveals additional insights that will be explored further in the subsequent chapters of this report.
Flynn (2008) has outlined a four-stage framing of the concept of resilience: (1) preparing to make the system as robust as possible in the face of possible future stresses or attacks; (2) relying on resources to manage and ameliorate the consequences of an event once it has occurred; (3) recovering as quickly as possible once the event is over; and (4) remaining alert to insights and lessons that can be drawn (through all stages of the process) so that if and when another event occurs, a better job can be done in all stages.
The National Infrastructure Advisory Council created a diagram that illustrates this framing (NIAC, 2010). The committee has adopted this diagram, modifying it only slightly to add verbs at each stage (Figure 1.2A), and has structured this report to follow these stages. Because the power system is hierarchical, these same concepts apply at several different levels of the system, including at the interconnection, region (some of which are operated by regional transmission organizations), local transmission and distribution systems (typically the domain of utilities), and the end-use level (on the customer side of the meter). Figure 1.2B shows this hierarchy in the abstract, and Figure 1.2C illustrates it for the Western Interconnection. While these figures display a physical hierarchy, there is an analogous hierarchy, but with different boundaries, for the information systems that support sensing and provide control.
Finding: Resilience is not the same as reliability. While minimizing the likelihood of large-area, long-duration outages is important, a resilient system is one that acknowledges that such outages can occur, prepares to deal with them, minimizes their impact when they occur, is able to restore service quickly, and draws lessons from the experience to improve performance in the future.
As the committee elaborates in the chapters that follow, the 21st century power system in the United States is not just technically complicated; it is also comprised of diverse and often overlapping institutions and actors. Across the United
States, there are differences in the resilience threats faced by power system operators, in the resources dedicated to mitigating them, and in the capabilities available to utilities and other grid operators in restoring their systems after an outage event. These variations play out in numerous ways. For example, some regions have a single grid operator that administers competitive wholesale power markets and reliability functions. In other parts of the country, individual utilities dispatch and balance power supplies on their own in response to changing demand. In some states, there are multiple market participants (e.g., generating companies, “wires” companies that transmit power, marketing companies). In
other states, the utilities remain vertically integrated with the same firm having responsibility for both power delivery and generation. Some areas have seen the reliable introduction of many new and different pieces of electrical equipment (e.g., small-scale solar panels, large wind turbines, flywheel storage systems, large-scale electric generating power plants) owned by parties other than the utility or the local grid operator. Other regions are just beginning to manage such changes on the system.
Some utilities have embraced high-speed information and communications technologies to provide them with greater awareness of the state of their system, including the location of outages, while others have made fewer investments in such technologies. Some utilities have substantial resources dedicated to improving cybersecurity while others have close to none. As noted earlier, it is NERC’s responsibility to set minimum reliability requirements to address the risks associated with the “weakest link” in the bulk power system. As discussed in more detail in Chapter 2, there is much more variability among states in terms of reliability standards, with individual states setting their own reliability requirements through public utility commissions (and boards for publicly or customer-owned distribution utilities).
Over the past 30 years, numerous headline-making outages have resulted from diverse human and natural causes, including operational errors and meteorological events. A few such outages disrupted electricity service to more than 10,000 MW of customer load (demand).6 The events that cause outages of this scale leave millions of customers without power, result in economic damages7 estimated in the billions of dollars, pose serious threats to health and public safety, and could potentially compromise national security. While the United States has fortunately not experienced a major outage caused by a physical or cyber attack, both are a serious and growing risk. Regarding cyber attacks, many attempts to penetrate the system occur every day. Box 1.1 describes four large-area, long-duration outage events that occurred in the past two decades in North America, ranging from the January 1998 ice storm that affected the interconnected power systems in the Northeast United States and Eastern Canada, to the impacts resulting from Superstorm Sandy in 2012.8Box 1.1 also includes description of a cyber attack that disrupted service on the Ukrainian power system in 2015, which did not result in a large-area, long-duration outage but is noteworthy as one of the most prominent examples of cyber disruption of electricity infrastructure. As Box 1.1 makes clear, there is a wide variety of human and natural causes of outages, with significant impacts on economic and human quality of life.
Finding: Large-area, long-duration electricity outages that leave millions of customers without power can result in billions of dollars of economic and other damages and cause risk of injury or death. A variety of human and natural events can cause outages with a variety of consequences. The risks of physical or cyber attacks pose a serious and growing threat.
An all-hazards approach to resilience planning is essential, but, with the exception of a few general strategies, there is no “one-size-fits-all” solution to planning for and recovering from major outages. The notion of resilience has to address multiple types of events and operate in a system with multiple overlapping institutions, service providers, grid configurations, ownership structures, and regulatory systems. As outlined above, the system is also comprised of multiple and changing technologies and is constantly evolving. Together this complex physical–cyber–social system is the context and motivation for the National Academies’ study presented here.
Throughout this report, the committee identifies and discusses a range of technical, institutional, and other strategies that, if adopted, could significantly increase the resilience of the U.S. electric power transmission and distribution systems. It is relatively easy to identify actions and strategies that could improve resilience. Much harder, however, is fostering and realizing the political and organizational support to implement these strategies and actions. The very structure of governance and investment in the electric grid is decentralized. And investment in the grid competes with other social and economic demands as well as for the time and attention of stakeholders. This is especially hard in the face of scarce resources, fragmented government, and the reality that many of the scenarios of large-area, long-duration outages are beyond the realm of experience of most individuals and governing systems.
6 More than 10,000 MW means more load than that required to power all of New York City. In 2015, the summer coincident peak demand of Zone J (New York City) of the New York grid was 10,410 MW. The population of New York City’s five boroughs is 8.5 million people, and the population of the New York City Metropolitan Statistical Area (which includes parts of New Jersey, Connecticut, and Pennsylvania) is more than 20 million. The New York City Metropolitan area accounts for roughly $1.431 trillion in economic activity (NYISO, 2016; USCB, 2016; IHS Global Insight, 2013).
7 The events that cause such large-scale outages cause damages to physical structures, including the electricity system, as well as impacts on economic activity. The costs of weather-related power outages are estimated to be billions of dollars annually, with estimates for Superstorm Sandy at $14–26 billion (EOP, 2013). The potential long-term economic effect of such events in terms of losses and gains in economic activity and accounting for rebound is a more difficult estimate but clearly can be very large.
8 Most of the damage from Sandy occurred after the winds had dropped below hurricane force and the storm had lost its tropical cyclone characteristics. Thus, the committee uses the term “Superstorm Sandy” and not “Hurricane Sandy” when it refers to this event.
Some causes, like major solar coronal mass ejections (see Chapter 3), have very low probabilities of occurrence—sometimes measured in centuries. Others, such as cyber attacks, may become increasingly likely to impact the operations of the grid. Drawing on the tools of decision analysis, an analyst can help a unitary utility-maximizing actor determine how much to spend either to harden a system or to minimize the consequences of disruptive events. However, neither U.S. society, nor its power system, is governed by a single rational actor, but rather is collectively managed by many.
By design and of necessity in our constitutional democracy, making such decisions is an inherently political process. This committee of experts can identify risks and options, outline strategies to improve the understanding of relevant public and private decision makers, and suggest ways to assure that relevant factors are identified and considered. However, ultimately, the choice of how much resilience our society should and will buy must be a collective social judgment.
Large-area, long-duration outages are rare events. And investing in a more resilient system has the classic characteristics of “public goods” issues—localized and concentrated costs with broadly diffused and difficult-to-measure benefits—that are inherently difficult to address. It is unrealistic to expect firms to make voluntary investments whose benefits may not accrue to shareholders within the relevant commercial lifetime for evaluating projects. Moreover, much of the benefit from avoiding such events, should they occur, will not accrue to the individual firms that invest in these capabilities. Rather, the benefits are diffused more broadly across multiple industries and society as a whole.
In some parts of the United States, rural electric cooperatives, vertically integrated utilities, and utility regulators may be better able to take a longer-term perspective that considers such broader societal benefits. But too often decision makers are pressed by short-term considerations of cost and choices about where expenditures should be directed for various and sometimes competing purposes, and so they must have a strong basis for approving expenses for activities that may not yield benefits for decades or longer. At the national level, the Federal Energy Regulatory Commission and NERC have the ability to adopt a somewhat longer-term perspective, although they too face short-term pressures and fiscal constraints.
No single entity is responsible for assuring the system is resilient in the face of all of them. Strategies to assure more systematic planning and to cover the costs of needed investments are discussed in Chapter 7. Many of the actions designed to reduce system vulnerability to one specific event can actually provide effective protection against a variety of events. For example, in regions where flooding is not an issue, undergrounding power lines can make the system less vulnerable to the impacts of severe storms as well as vehicle
accidents. This may make such actions and investments easier to justify. Experience demonstrates the normal cycle of public reactions to major events with big impacts on society: there is a tendency not only to identify parties that can be blamed for failing to prevent the event and its impacts, but also to call for greater protective action against exactly the type of event just experienced. Regulators and other decision makers need to have well developed plans that can be implemented during such a “policy window” and designed for robustness against a wide range of threats.
There are some communities at considerably greater risk than others, including those at vulnerable locations in the electricity system or those within or close to natural hazards. When those communities take action, the results can serve as a stimulus and template for others to follow. Some modest government pilot funds to initiate such examples can be a socially prudent investment. At the same time, it is important that the United States devise ways to increase the likelihood that lessons learned from demonstrations can be diffused more widely. National organizations such as the National Association of Regulatory Utility Commissioners, the Edison Electric Institute, the National Rural Electric Cooperative Association, the American Public Power Association, and the National Governors Council can play important roles, raising awareness, sharing best practices, and providing guidance to members. Public and private partnerships such as the Electricity Subsector Coordinating Council, which gained importance following Superstorm Sandy, also serves as a viable forum for enhancing coordination and communication; conducting drills and exercises; and sharing tools and technologies to enhance grid resilience.
Throughout this report, the committee has tried to be attentive to the tension between two competing realities. One is that the electric power system and its regulation are decentralized across the many states and regions. The other is that a coherent strategy will not emerge without stewardship at the federal level and/or from organized leadership from public and private institutional partners that support actions in the national interest. The Department of Homeland Security (DHS) is specifically charged with identifying potential vulnerabilities and assisting in the development and implementation of strategies to reduce risks and increase resilience. However, neither DHS nor the set of local actors that typically interact with DHS control or run the power system. Moreover, the department is stretched very thin and has relatively modest technical expertise in the context of electric power systems.
As the energy sector lead agency and with its focus on research, DOE does have a longer-term perspective and hence is in a position to lay the groundwork and demonstrate the feasibility of a variety of technologies and strategies that, when adopted by others, can considerably enhance the resilience of the grid. Multiple DOE offices have programs related to electric power grid resilience. Specifically, the Office of Electricity Delivery and Energy Reliability and Office of Energy Efficiency and Renewable Energy have responsibility for directing work on many of the nation’s grid modernization and system integration programs and thus have a vital role to play in this area.
The Electric Power Research Institute can also make important contributions—including improving awareness of technologies and practices that are emerging globally—but the amount of fundamental longer-term work they can support is limited. The National Rural Electric Cooperative Association is undertaking a range of research activities that adopt a longer-term perspective. Many states around the country are also working on specific resilience projects, often in the aftermath of those states having experienced disruptive events that have focused policy makers’ attention on the issue.
In the chapters that follow, the committee identifies and discusses many things that both the federal government and industry can do to advance the resilience of the power system. In Chapter 7, the committee returns to the broader issues of who is in charge, how electricity system operators, regulators, and society more broadly should choose what is worth doing, and how to pay for it.
Chapter 2 describes the nation’s electric system as it now exists and as it is integrating and adapting to new technologies and changing regulatory and market environments. This chapter provides context for the rest of the report by describing current conditions and factors affecting grid resilience and discussing how these systems might evolve over the coming decades (even if they are changing in unpredictable ways). Chapter 3 describes the many causes of grid failure: the range and types of threats that can, and at least in some cases definitely will, arise to disrupt the operations of the electric grid. Chapters 4 through 6 discuss ways that grid planners and operators, along with the rest of society, can prepare for and reduce the frequency and duration of disruptions (Chapter 4), manage and mitigate the consequences of outages as they occur (Chapter 5), and restore the system to normal operations as rapidly as possible (Chapter 6). These three chapters identify and discuss things already taking place, things that could improve the performance of each aspect of resilience, and things that deserve further attention from researchers and analysts; from owners, operators, and planners of the grid; and from government policy makers. Discussions of topics such as distributed energy resources and microgrids are spread throughout these chapters. Depending on how they are deployed, distributed energy resources and microgrids can be used for many purposes—they can help mitigate and prevent outages (Chapter 4), can help sustain electricity service to critical facilities during an outage (Chapter 5), and can aid in system restoration (Chapter 6). Throughout these chapters, as well as Chapters 2 and 3, the committee makes many specific recommendations
for strategies to increase the resilience of the U.S. electricity transmission and distribution system. While these specific recommendations will advance this purpose, the committee believes that the nation should adopt a more integrated perspective across the numerous, diverse institutions responsible for the resilience of the electricity system. Thus, the final chapter (Chapter 7) brings together a broader set of overarching recommendations intended to bring such an integrated perspective to the issue of electricity system resilience. The report Summary contains both the overarching recommendations and a synopsis of the chapter-specific recommendations.
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