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Utility System Hardening
Taking Resiliency One Step Further
Rising customer reliance on energy for daily needs. More dramatic weather patterns. A heightened sensitivity to the costs of extended utility outages. Regulatory pressures growing more intense. Each of these factors is driving utility asset owners increasingly to consider formalized programs for utility system hardening.
Recent events - including hurricanes, ice storms, derechos, and even fires - have shown that regulators and customers will no longer tolerate extended electric system outages. The political, regulatory, and customer outcries during, and after, each major prolonged outage incident are growing at an ever-increasing pace. Yet relatively little is actually being done to harden electric systems in most areas of North America.
Several states, including Florida, Texas, Oklahoma, and Kentucky, have forged the the way with prescribed regulatory requirements, many of which have existed for some time. However, the regulatory environment around utility system hardening remains cautious and inconsistent. When considering a system hardening program, utilities should ask a wide range of questions: Which programs will provide the best outcomes for the optimal spend? What should our hardening priorities be? And, what costs can be recovered in rates?
For their part, regulators also tend to have limited experience with system hardening measures. Consequently, they often focus on very narrow solutions - the overall result often being that the best solutions are not what regulators, utilities, or their customers might perceive them to be. Often, as these programs are considered, there is not enough focus on how to best accomplish specific goals or look at a broad enough range of opportunities to improve system performance.
Unfortunately, the regulated programs that currently exist generally focus on a narrow range of potential types of damage and/or hazards that historically are seen only in very specific geographic areas. In recent years, however, there has been an effort to define problems and potential solutions more broadly, with much of the discussion focused on "resiliency." Resiliency is a helpful concept as far as it goes. It describes the efforts needed to improve a system's ability to bounce back after a major damaging event without over-promising that damage can be completely avoided or eliminated. The term "resiliency" also mirrors the vocabulary used by federal emergency management experts. "Resiliency", however, can be unhelpful for what it fails to do. While it focuses on bouncing back, essentially as a reaction to any single event, resiliency as a strategy can sometimes ignore or overlook opportunities to prevent damage and mitigate a storm's impact in the first place. That is why, from a program perspective, while resiliency may sound good for public consumption, the industry nevertheless should think in much broader terms.
Realistically, if asset owners and regulators want to address the issue