Because Ohio is such a prodigious source of electrical energy, and because
Akron-based FirstEnergy Corp. was implicated so heavily in last year's
prodigious blackout, there was considerable interest in the meeting that Gov.
Bob Taft held the other day with the top dogs at Ohio's four investor-owned
utilities. There were, to be sure, some encouraging words heard about improving
reliability. But they were only marginally reassuring, not so much because of
what the utilities have or haven't done, but rather because of market conditions
and Congress' failure to enact legislation mandating compliance with rules
promulgated by regional grid managers. On the plus side, the executives representing Cinergy, American Electric
Power, Dayton Power & Light and FirstEnergy said they have: Boosted spending on their transmission and distribution functions. Cinergy has spent an average of $70 million a year over the past decade in
Ohio, and a total of about $1.5 billion across its entire system in Ohio,
Kentucky and Indiana, on upgrades to the network that allows it to move power
from its generating plants to its customers and to connect to the regional
transmission grid. (By comparison, Cinergy has spent about $1.45 billion
systemwide since 1990 on pollution controls.) Installed computerized enhancements that allow system managers to have a
better picture of what is going on throughout the network. Beefed up their tree-trimming programs. Don't laugh -- a tree limb brushing
against a sagging FirstEnergy high-tension line near Cleveland is widely
regarded as the trigger for the cascade of events last Aug. 14 that shut down
power to 50 million customers in the Midwest, Canada and the northeastern United
States. Though southern Ohio was spared, the blackout hit more than 2 million
people in the northern half of the state, caused Cleveland's water supply system
to fail and disrupted business activity. The commissions that investigated the 2003 blackout generally agreed that
another important factor was an inadequate system for managing the flow of
electricity across the grid. Indeed, one of the chief recommendations to come
out of the post-blackout reviews was that Congress require utilities to comply
with standards set by regional transmission organizations, rather than rely on
voluntary pacts. The two regional entities that manage power flows in Ohio negotiated a
protocol in December to jointly manage their lines. That's progress. But it's
still a system that relies on voluntary participation. Legislation that would establish a mandatory grid management network is
idling in Congress. In part this is because some congressional leaders pushing
for a comprehensive energy bill want the grid reforms to be part of it, figuring
that will strengthen chances for passage. But some utilities, mainly in the
South and West, are opposed -- in no small part because they want to make sure
the grid functions mainly as a backup for their own power supplies in markets
they control, rather than as a vehicle for wheeling and dealing power over large
distances and establishing a competitive market for electricity. Congress, in the near term, should pass a stand-alone bill that requires all
utilities to participate in programs that improve the reliability of the
electrical supply. Then it should address the underlying question of competition
vs. regulation within the industry. The system we have now is a hodge-podge
(Ohio, at least on paper, is deregulated, for example, while Kentucky is not)
that makes a repeat of the 2003 blackout more likely.
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