Why Was the Blackout So Widespread?

Some Technical and Policy Questions to be Answered

The most recent North American energy blackout spread widely, affecting an estimated 50 million people in two countries. This is a larger geographic and population area than any previous energy blackout in the history of North America.

Investigations are being initiated at the state, provincial, national and North American levels to determine the sequence of events that created the blackout. These will try to identify what events may have started the blackout1

The more important question raised for these inquiries, however, is why and how the blackout spread so massively. Supposedly, the transmission grid was designed to prevent the massive spread of a problem to others on the grid.

"If we designed this system for this not to happen, how did it happen?" asks Michehl R. Gent, the CEO of the North American Energy Reliability Council (NERC).

NERC was created after the 1965 energy blackout. It's mission was to prevent such a blackout from ever happening again. Yet in 1977, and then again in 2003, such blackouts occurred. The NERC is a private, non-profit industry self regulatory organization. Can a private organization be entrusted with the regulation of an industry? Can voluntary compliance to standards and rules be relied on to provide electric power to a nation's population?

One report of last Thursday's events describes how Roger Harszy, an operations director for Midwest Independent System Operator, in Carmel, Indiana, was watching a computer screen on Thursday, August 14. It had just revealed to him that 1,000 megawatts of wayward electrical power were surging around the top of the Lake Erie loop from the Toronto area into Detroit, MI2

He observed that the "oscillating power phenomenon" occurred along four transmission lines, which he monitored from the control room at Midwest ISO, which oversees the movement of electricity in a 15-state region of the Midwest.

Describing the event, Gent explains that "300 to 500 megawatts...were moving west to east from Michigan to New York through Ontario, when the problem struck - either the failure of some power plants or of some transmission lines." He noted that suddenly there was a change in the flow of electric power and it reversed direction, "pulling 500 megawatts from east to west, out of New York -- a swing, in the space of a few seconds of as much as 1,000 megawatts, the output of a large power plant."3

Gent says he is at a loss to explain why this more widespread effect on the transmission system occurred.

In response to a question to the NERC about whether this sudden change of direction of electric power was a common occurrence on a smaller scale, David W. Hilt, the NERC Director of Compliance wrote:

"Power moves on the grid on a moment-by-moment basis. This is based on transmission lines and generators in service. Changes on a given line or a given interface on a smaller scale are somewhat common." David W. Hilt, Email, August 16, 2003

But such a change in the direction of such a massive amount of electric power is not common. Then why did it happen on August 14, 2003?4

The transmission grid system breakdown is a mystery that has to be understood in order to prevent such future breakdowns. Yet there are obstacles to identifying and understanding the nature of the problem.

One such obstacle, according to Gent, is the change in the politics of energy creation and transmission in the U.S. Under the current forms of 'deregulation' various owners of the different power entities are not likely to want to share information which might give up their own competitive advantage.

Elaborating on this problem, Jennifer Granholm, Governor of Michigan, describes the changes in the regulatory structure of the energy system. When Michigan began to deregulate its electricity market, the Michigan electric utility, Detroit Edison, became DTE and sold its transmission lines. She notes that the transmission system hadn't been upgraded in 20 years. She explains, "The people who own the transmission system are out of state and are not necessarily...accountable. The issue of who owns the transmission, who owns the generation, who owns the distribution, all of those are areas we're going to have to look at."5

While some of the media reports are looking for the technical cause of the breakdown, there are others emphasizing the political nature of energy regulation in the U.S. Gent comments that, "The grid is now being used in ways for which it was not designed."

The grid was designed as part of an electric power utility. This utility had its origins in the 1930s, when the U.S. Congress broke up large interstate holding companies, passing the Public Utility Holding Company Act (PUHCA). This law gave federal government sanction to monopoly operation of electric power companies over limited areas. In return for their regulated monopoly position, these companies agreed to provide reliable electric service to their customers at regulated rates6.

The corporate deregulation ferment in the U.S., in the 1980s and 1990s, however, required that utilities give access to the transmission lines to their competitors. Not only are the transmission lines being used by others than those who formerly built and maintained them as part of a state government regulated power entity, but also the transmission lines have become part of a system for selling and buying power. The lines are not now for transporting electricity so that it will be low priced and reliable. The transmission lines are instead seen as a market mechanism "to send power in different directions to different customers at different times at different prices in response to different demands."7

Will the blackout be used as a political excuse to provide for federal subsidies for private corporations to increase their ownership and control of the U.S. energy system, like the corrupt model of Enron? Or will there be a public debate of how to make the U.S. energy system into a reliable public service?

The current U.S. corporate model of private control of all public services has been called into question by the blackout. People around the world, and their governments, can see the consequences of adopting the U.S. 'deregulation' model for the management of public services. As Michigan's Governor Granholm explained, "the utility industry needs to become more heaviliy regulated to ensure accountability. As a result of deregulation, Michigan has become dependant on utilities across many states to feed its power needs - 'which makes it more difficult to hold people accountable'." She recognizes the problem of "reliability standards for utilities which are voluntary", and she observes, "And that just doesn't cut it."8