Like Captain Kirk and the crew of the Starship Enterprise, electric utilities once had a Prime Directive which every employee at every utility understood and spared no effort to uphold. The old-timers in the business called it Continuity of Service - keeping the lights on and the engines of progress running. Today we refer to it as Reliability.

That was then. This is now. Today a number of adverse forces outside utilities' control have collided to increase the difficulty of achieving the Prime Directive by several orders of magnitude.

Comes now the Blackout of 2003. Politicians immediately swing into action, managing to find the spotlight even while a hapless public huddles in darkness. Greedy, incompetent utilities and even political opponents are blamed for the problem, and we are assured that if we will simply put them and their political allies in charge, the electric supply will once again be made safe and secure for Truth, Justice and the American Way. Details of how this will be done are few, but they seem to include large government spending programs and greater governmental control.

While this may be good for the politicians, it will not prevent future blackouts or improve the security of the nation's electric system. Regardless of how qualified to solve this problem we may or may not believe the federal government to be, little can be gained by enacting sweeping and expensive legislation based on sound bites or erroneous concepts. To be effective, any action undertaken will have to be based on science, not just on political principles or wistful thinking.

In fact, we can never legislate better electrical reliability, simply because electricity operates according to its own laws – the Laws of Physics, and these laws can never be changed or repealed regardless of how hard politicians and pundits wish, or how many laws they enact or regulations they promulgate.

Amid the finger-pointing and pontificating in the realms of politics and the media, many false statements and concepts have found their way into the public's thinking, some threatening to become incorporated into whatever actions will eventually be taken. For this reason it is well to step back for a moment and take a hard look at the forces which have brought us to this point.

First, it's important that we understand the transmission grid. Simply put, all transmission lines of all individual electric utilities and other owners in the US and Canada are interconnected, forming what we call the North American Electricity Grid or, simply, the grid. Every generator, line and customer connected to the grid is connected to every other generator, line and customer.

Anything which happens to the grid affects, to some degree, every customer and device connected to it. That's because, although the grid consists of thousands of individual transmission lines, it is actually a single huge and complex mechanism whose complexity increases exponentially as new devices and customers are connected to it.

Now, once upon a time, electric utilities operated as integrated companies, each company's three primary components -- generation, transmission and distribution -- operating under the control of a single management structure. Planning for growth was straightforward; as a utility's load grew, it built the generation, transmission and distribution facilities needed to serve that load.

Each utility company had its own service territory, and couldn't encroach on another's, although it could engage in voluntary power transactions with its neighboring utilities. Because they did not compete with each other, utilities tended to cooperate in addressing mutual operational concerns and in operating the grid safely and reliably.

Much of that has changed. In the 1990's, prompted by new federal regulations, utilities began to dis-integrate, breaking generation, transmission and distribution out into separate companies with separate management organizations. Not only were these companies separate, but the information which they were allowed to share among themselves was limited as well.

Power delivery (transmission and distribution) continued to be regulated businesses, while power generation became a market-based, competitive business. No longer were utilities confined to sell the power from their generating plants within their own territories. They were allowed to sell it to any customer in any other utility's territory as well. More important, power generation would no longer be left just to the utilities. Anyone could get into the generation business -- and did.

In1996, the Federal Energy Regulatory Commission required utilities to open their transmission lines to anyone, including competitors, who wanted to use them. New generating plants sprang up everywhere, their developers keeping costs down by building them near fuel supplies and transmission lines, but not necessarily near the loads to be served. They often sold their power to far away customers, depending on the grid to flow or "wheel" power, sometimes across one or more utilities' lines, to establish a complete contract path from generator to customer.

The owners of the lines along the contract path get paid for the use of their facilities, so where's the problem? It's this: the electricity being wheeled refuses to follow the contract path. Recalling that the grid is a single mechanism in which anything affecting any part of it affects all parts of it, the actual path from any generator to any load includes, to some degree, every line on the grid. Engineers refer to this phenomenon as "loop flow".

Regardless of what path is contracted or who gets paid for the use of its facilities, electricity follows the "path of least resistance" (actually, the path of least impedance). This is perhaps a surprise to regulators and policy makers, but certainly not to the utilities and their engineers who had warned us about loop flows well in advance.

As a result, the grid's individual transmission systems, originally planned and designed to handle each utility's own loading requirements, are now subjected to new forces beyond the control of their owners. The utilities, many of whom lie outside the contract path and therefore don't even get paid for the use of their systems, find their systems being overloaded anyway. Predicting and planning for these new external power flows becomes almost impossible.

Proponents of a competitive electricity market argue that electricity is like any other commodity, and can be expected to obey ordinary economic principles of supply and demand. This simply isn't the case. Electricity differs in that it must be produced at the exact instant it is consumed. Ordinary economic concepts of supply and demand, which the market will balance over time, do not apply to electricity, for which supply and demand must be in perfect balance at every instant.

Any imbalance, such as that caused by a large outage, can cause power to sort of slosh about the grid until equilibrium can be found and balance restored. This affects everyone and everything connected the grid. When large blocks of power are involved, disturbances to the grid can be quite large, even to the point of causing it to become unstable and start breaking apart, which is what occurred with the 2003 Blackout.

New regulations also brought troublesome cultural changes. Utilities, as part of a industry which once operated openly, coordinating and cooperating among its individual members, found themselves in a new environment which required confidentiality – not only among competitors, but sometimes even among groups within the same company. But confidentiality is incompatible with the cooperation and information sharing necessary to operate and regulate the grid.

Long-range planning became next to impossible. Utilities which had formerly planned for growth as far as thirty years in the future, could no longer do so. Not only was the future far less predictable, but the need to compete with neighbors made the financial risk of guessing wrong very high. Utilities began to pull in their planning horizons dramatically and, lacking a clear and predictable future, became reluctant to commit to new transmission capacity.

Another force which has made transmission planning and construction more difficult has come from the public. The NIMBY Syndrome (Not In My Back Yard) which has swept the country has, in some states, even evolved into the dreaded BANANA Syndrome (Build Absolutely Nothing Anywhere Near Anything). Power facilities are among those to which opposition is greatest.

We have heard that the United States is a first-world nation operating with a third-world electricity grid. Nonsense. The US grid is the finest, most modern and most reliable in the world, far from third-world status in which frequent blackouts and daily power rationing are required. But because we are now asking the grid to do things which it was never designed to do, it has become inadequate to an extent.

We have been told the lack of financial incentives have deterred utilities from investment in transmission resources needed to maintain reliability. This is only partially true. Unpredictable power flows, increased financial risks and overwhelming public and political opposition have also hurt transmission planning and construction efforts by utilities.

There are those who claim that deregulation of the electric industry is to blame for the Blackout. Regardless of whether we view electricity deregulation as right or wrong, the way in which we have gone about it has definitely been wrong. The benefits expected from deregulation have not materialized in most cases, and never will because deregulation models were based on economic and political considerations with little regard for science. Transmission still remains tightly regulated, but operates under different regulatory rules than in times past. And even under the previous form of regulation we had occasional blackouts.

Will greater government regulation improve grid reliability? Hardly. In fact, it will probably make it worse. Instead, we need to put our most qualified minds to work on the problems. These minds may be found within the utilities and the consultant organizations on which they rely for advice. There is a tendency within government and the news media to distrust expertise from the private sector, and reliance on these true experts will, no doubt, be criticized. But if we disregard this abundant resource in favor of pseudo-experts from the worlds of politics, the news media, bureaucracies and special interest groups, we abandon any hope for real solutions.

If the current policy of open access transmission is to succeed without degrading reliability, there must be a central control authority to coordinate, plan and operate the grid, but this authority should not be the federal government. The North American Electric Reliability Council or its North American Electric Reliability Organization division, both non-governmental entities, would be ideal, but they have no enforcement authority. Perhaps the specter of government planning and control will provide the incentive for utilities to voluntarily submit to some measure of regulatory and enforcement authority by these independent organizations.

The Blackout of 2003 should not have happened, but it did. In spite of it, the United States has perhaps the highest electrical reliability in the world. But perfect reliability can never achieved. There will always be outages and, especially as the grid increases in complexity, blackouts will always be a possibility.

The task before us, then, is not to eliminate outages, but to minimize their magnitudes and impacts. Any choice, any benefit, any progress has its costs. A secure electricity supply will by necessity entail economic, social and political costs. The trick will not be to eliminate these costs, but to strike the right balance.

Copyright 2004 CyberTech, Inc.