Power Play: A More Reliable U.S. Electric System; U.S. Utilities Have a Lot to Learn about Avoiding Power Outages. They Can Benefit from the Experience of Foreign Utilities, Other U.S. Industries, and Even Their Own Nuclear Power Plants

Article excerpt

The United States ranks toward the bottom among developed nations in terms of the reliability of its electricity service. Catastrophic events, such as the August 14, 2003, blackout that put 50 million people in the dark, are well known, but that is only the most visible evidence of a problem that is pervasive in the U.S. electric system. Frequent small outages are endemic throughout the country. Although these might seem to be relatively minor inconveniences to homeowners, they can create serious problems for businesses. (See sidebar, "The Effects of Power Outages"). Other countries demonstrate that much greater reliability is achievable, and the U.S. nuclear power industry has demonstrated over the past three decades how vast improvements can be made in the United States.

The average U.S. customer loses power for 214 minutes per year. That compares to 70 in the United Kingdom, 53 in France, 29 in the Netherlands, 6 in Japan, and 2 minutes per year in Singapore. These outage durations tell only part of the story. In Japan, the average customer loses power once every 20 years. In the United States, it is once every 9 months, excluding hurricanes and other strong storms.

Despite decades of sober technical reports written by investigation teams in the aftermath of blackouts, the frequency of electric power outages in the United States is no less today than it was a quarter-century ago. Whether measured in terms of city-sized blackouts or smaller events, the statistics show that reliability has not improved. Indeed, if the data show any trend in the past few years, it is toward lower reliability.

The causes of outages in the United States show there is considerable room for improvement. If outages from major storms are excluded, the causes of each hour of outage include equipment failure (24 minutes), as in the 1965 Northeast blackout; untrimmed trees near power lines (6 minutes); and mistakes by power company personnel (4 minutes), as in the 1977 New York blackout and the 2005 Los Angeles outage. This history of blackouts creates ample public demand to increase reliability, opening a window of opportunity for the industry.

Congress made an effort to boost reliability with a provision in the Energy Policy Act of 2005 that calls for the creation of an Electricity Reliability Organization (ERO), but the details of the plan make it unlikely that the new ERO will be capable of doing all that is needed. It is more likely that it will merely lock in place the status quo. The United States does not have to look far to find a better model for enhancing reliability. U.S. nuclear power producers have developed an extremely effective mechanism for improving the performance of the entire industry, and at least some of the lessons from that effort can be applied to the entire power industry

Where we've been

In 1962, as the scattered power systems in the eastern United States were about to be interconnected, 10 voluntary regional reliability councils were established to coordinate the planning and operation of generation and transmission facilities owned by their members. After the 1965 blackout, the U.S. Federal Power Commission recommended that a national reliability coordinating council be created, and in 1968 the North American Electric Reliability Council (NERC) was formed to coordinate the regional councils. One of NERC's primary functions has been to develop voluntary reliability standards for the regional generation and transmission of power.

In January 1997, recognizing that the familiar landscape of rate-of-return regulation was about to be replaced by a competitive market for electricity, a NERC panel proposed federal legislation that would establish an electric reliability organization with power to establish and enforce mandatory standards. The U.S. Department of Energy endorsed that recommendation in 1998.

Seven years later, the Energy Policy Act of 2005 followed that recommendation, creating a new section of the Federal Power Act that gives FERC responsibility for reliability and the authority to certify an ERO. …