Aug 19 - Pittsburgh Post-Gazette

Two years ago, at about 4 p.m. EDT Time on Aug. 14, a 9,300-square-mile area stretching from the Midwest to New England began losing electric power in a rapidly spreading blackout that ultimately darkened a third of the country, leaving 50 million people without electricity.

It was the largest power outage in American history.

In the aftermath, a joint U.S.-Canadian task force investigated the causes of the blackout and recommended changes to be made in the nation's electricity industry, some of which were incorporated into the energy bill signed by President Bush last week.

But for many people the question remains, "Could it happen again?" A Carnegie Mellon University economist thinks that it not only could, but that it most likely will.

"Almost nothing has been done that would make it better," said Lester Lave, a professor of economics at CMU's Tepper School of Business.

The reason, Lave said, is that neither the improvements made to the operation of America's electric grid since the blackout nor additional changes included in the energy bill address a fundamental problem in the way that electricity is delivered to American consumers.

The problem, he said, is that the three stages of delivery -- generating the electricity, transmitting it over high-voltage lines and distributing it to end users -- are performed by separate parties that, though they may cooperate, are essentially independent. For decades, that wasn't the case -- most electric companies were monopolies that controlled all three stages in their respective markets.

But deregulation in the 1990s quickly changed all that, splitting the three stages to foster competition so that a customer in Pittsburgh, for example, could order electricity from a supplier Akron, Ohio. Such a scenario would likely involve at least four companies: the generator in Akron, an Ohio transmission company, a Pennsylvania transmission company and a distributor in Pittsburgh.

"Deregulation has tended to make things worse because you no longer had a utility that was responsible for providing reliability in its service area," Lave said.

Instead, the reliability of the grid -- the three elements from the generating plants to the transmission lines to the local distributors -- depends on the cooperation of and communication among the various providers.

Two years ago this week, that cooperation and communication broke down. At the time, electric companies relied on "courtesy calls" to learn what was happening with one another, but there were no set procedures for making sure information was shared promptly and completely.

"It was a completely informal system that relied on people knowing one another and trusting one another," Lave said. "The principal [cause of the blackout] was human error in the system. Human beings could have intervened any number of times to prevent most of [those affected] from being blacked out," but those discussions didn't occur, or at least didn't take place fast enough.

The U.S.-Canada Power System Outage Task Force, a panel of government officials, came to a similar conclusion after its investigation of the blackout. It said the fiasco was caused by "deficiencies in corporate policies, lack of adherence to industry policies and inadequate management," rather than a simple shortage of electricity.

If the companies involved had done a better job of communicating with one another, Lave said, the number of customers affected by the blackout, which started with a series of power line failures in Ohio, could have been as low as 100,000 rather than 50 million.

The Energy Policy Act of 2005, which President Bush signed last week, provides for the creation of an Electric Reliability Organization to develop reliability standards that it will propose to the Federal Energy Regulatory Commission, which regulates the interstate transmission of energy. If approved, those standards will be enforceable under federal law.

But even that, Lave said, will not be enough to ensure there will be no recurrence of blackouts. "Even under the energy bill, individual transmission lines are still controlled by individual companies," he said in an interview this week.

If a set of transmission lines falls into disrepair, PJM Interconnect, which acts as an intermediary between electric companies in 13 states including Pennsylvania, could direct the owner to do something about it. But, "PJM doesn't have the power to compel Duquesne Light to do anything, and Duquesne Light could easily say, 'We don't have the money to do that.' "

On that score, Duquesne Light says not to worry. Spokesman Matt Pitzarella said the company "has been very proactive this year and will continue to be for the next several years" in upgrading its infrastructure.

He said Duquesne Light had conducted four helicopter fly-overs to examine its 620 miles of transmission lines, using infrared cameras to identify equipment "that could be reaching the end of its natural life."

He also said the company had replaced 175 transformers this year, and expected to spend $500 million to $600 million "over the next few years" on improving its overall transmission and distribution infrastructure.

Even so, no one company can ensure the reliability of the grid. For that, Lave says, an independent agency is needed.

Comparing the transmission of electricity and air traffic, he suggests that electricity providers need something akin to the National Transportation Safety Board to investigate both "crashes" and "near misses."

Extending the analogy, he also suggests that grid operators need a facility such as the Federal Aviation Administration's Command Center that would continuously monitor "traffic" data from across the country to help prevent such disasters. Until such an agency is in place, he believes that the nation's electrical grid is just another accident waiting to happen.

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