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When Mother Nature Outsmarts the Power Grid: Planning for Power Outages

With the unpredictability of global weather patterns (as evidenced by Hurricane Sandy, which battered the U.S. Mid-Atlantic coast causing billions of dollars of damage) it's more important than ever for businesses to assess the potential impacts of power outages and have contingency plans in place.

Craig Guillot (November 2012)

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“Smart Grids” and Infrastructure Upgrades
There is the potential that outages could become more frequent in the future as the U.S. energy industry is trying to meet current demands while changing fuel sources. Shifting from nuclear to wind or solar supply can create a “volatility” in supply. The Allianz report recommends that existing grids become “smarter,” meaning local governments and utility companies should develop new grids with metering, control, and communication functions to handle the future growth of renewable energies.

Massoud Amin, director of the Technological Leadership Institute (TLI) at the University of Minnesota, says smart grid is a way to minimize the potential for blackouts, or to shorten their duration. Smart grids are generally next-generation power supply systems that use digital technologies such as computers, secure networks, sensors, and controls to enhance reliability. In its optimal state, a smart grid would extend from the power production facility all the way to appliances in a home or machinery in a business.

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Consequences of Blackouts. Click 'enlarge' to see entire diagram.

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Potential Causes of Power Blackouts. Click 'enlarge' to see entire diagram.

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“Smart grids have unprecedented flexibility, functionality, and self-healing capability. They can react to and minimize the impact of unforeseen events and power outages,” Amin says.

While they might not necessarily prevent blackouts, they can significantly decrease the time it takes to restore power in an outage. In 2007, the U.S. Congress passed the Energy Independence and Security Act (EISA), which established a policy to modernize the U.S. electricity system to meet future growth and demand. Amin says the electricity needs of the country will triple by 2050. Efforts by the U.S. Congress in recent years, EISA as well as the American Recovery and Investment Act, have helped fund the Smart Grid Investment Grant Program, which offers government-matching investments for the private sector. Over the past year, the program has resulted in $7.8 billion in projects for upgrading the grid.

Amin says every state in the country has conducted projects but it could be a while before full systems are in place. Smart meters are now being distributed to households and businesses and should meet their deployment targets by 2014, with funded infrastructure projects completed by 2015.

“It will take five to 10, and possibly as many as 20 years to deploy the technologies to create complete, end-to-end smart grids,” Amin concludes.

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About the Author

Craig Guillot
Craig Guillot is a New Orleans-based writer and photographer who covers business, trade, and real estate. He has written for publications including CNNMoney.com, Bankrate.com, and Investor's Business Daily. You can read more about his work at www.craigguillot.com.

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