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There is no electrical grid
By Alan Caruba
After the Great Blackout of 2003 shut down a hundred power plants, plunging fifty million people in an area of 9,300 square miles into darkness, I suggested the problem was that we don't have enough generating facilities. I was only half right. We do need more facilities to meet the growing demand for electricity, but what we really need is an electrical grid to transmit it.
My friend, Dr. David Wojick, knows a lot about such matters and, back in 1999, he wrote, "there is no true grid. Power lines, no matter how big, are still much like extension cords. Each goes from an area where power was planned to be generated to where it was planned to be used. The system was not designed to take power from where it is cheap and sell it where it is expensive, on an ever changing basis, in a market. Since the system wasn't designed to do that, it generally doesn't."
With elegant simplicity, Dr. Wojick pointed out that "If we want a grid-based market in electricity, we must first have a grid."
What we have, however, is an antiquated system comparable to the Pony Express. It consists of nearly 160,000 miles of high-voltage transmission lines. About the only reliability built into the system is the guarantee that, when something goes wrong again, we will get another massive blackout.
What happened in August was that Ohio's section of the regional power grid had at least 64 glitches in the four hours leading up to the nation's worst blackout. Eight States and parts of Canada blinked out. That is a catastrophe. It will happen again.
The reason is also fairly simple. Over the past twenty-five years, industry investment in the current transmission system has declined at a rate of $115 million a year. Experts in the field estimated it will cost at least $56 billion to upgrade existing lines and add more capacity to meet the growing need for electricity. Currently, the industry plans to spend an average of $3 billion annually for the next decade, well under what is required.
As Congress debates an energy bill, one thing is abundantly clear to everyone. The nation needs mandatory quality standards on transmission, faster approval of the construction of power lines on federal lands (that constitute around 30% or more of the entire US landmass), and the repeal of the Public Utility Holding Company Act.
Utilities need to make money. For that they need investment. It is not particularly profitable to invest in transmission today because it takes more than thirty years to realize gains on such investments. Congress has to craft legislation that eliminates the roadblocks to profitability and Dr. Wojick suggests the answer is to deregulate transmission. Not transmission access, but transmission ownership. Transmission lines need to be turned into toll roads for electricity. After that you let free market competition kick in to keep the cost of electricity under control.
Electricity is still the best bargain in town, but it is still subject to the laws of supply and demand. A nation that resists and restricts the construction of new generating facilities is going to end up paying a lot more for electricity and, failing to provide the transmission lines necessary, will end up in the dark.
This, of course, just makes too much sense in an era in which the federal government, i.e., Congress, insists on regulating everything in sight. However, The Interstate Transmission Act of 2003, introduced by Rep. Albert Wynn (D-MD) and Rep. Richard Burr (R-NC) would require the Federal Energy Regulatory Commission to adopt transmission rules to promote capital investment in the system. This is a small step in the right direction, but what we really need is a great big leap in the right direction.
So, whether you live in Canada or the US, lay in a supply of candles and batteries or go to the local Home Depot to pick up a generator to get you through the worst of the next blackout because, my friend, it's coming. And keep repeating to yourself, there is no electrical grid, except when it fails.
Alan Caruba is the author of "Warning Signs." His weekly commentaries are posted on www.anxietycenter.com, the Internet site of The National Anxiety Center. © Alan Caruba 2003
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