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A Trio of Storms Could Mean Grid Modernization in Hard-Hit Areas

Dec 20, 2017 3 MIN. READ

In a recent Utility Dive article, ICF's Judah Rose weigh in on how Florida, Puerto Rico and Texas all have an opportunity to reassess their power system.

When Hurricane Sandy knocked out power to millions of Northeast residents in 2012, it forced a reckoning for the electric power industry. Utilities began investing in resilience and the region took a strong interest in microgrids, distributed resources and modernization. Five years later, New York is in the midst of overhauling its utility sector from the ground up, with its Reforming the Energy Vision proceeding. And other states have undertaken less-sweeping changes, resulting in other modernization proceedings.

Repair or more?

For the utility industry, which has historically been resistant to change, storms and prolonged outages have a way of presenting options. When infrastructure must be rebuilt or enhancements added, the question becomes whether to simply repair or do more.

"It would be pretty myopic not to consider new approaches to resilience in Texas and Florida after Harvey and Irma. It is clear that extreme weather events are becoming more common, and old approaches to grid hardening are less and less the right choice," said Sonia Aggarwal, vice president of Energy Innovation, a research group.

Harvey, Irma and Maria struck Texas, Florida and Puerto Rico, respectively, with varying degrees of severity. Puerto Rico was especially hard hit, with all of the island's 3.5 million residents losing power in the storm and 80% of transmission and distribution lines going down. But in each location, experts say there are opportunities to consider new ways to move forward.

Puerto Rico

"Puerto Rico is the one that is front and center right now — it was the most extreme, and has some special circumstances," said Judah Rose, senior vice president at consultancy ICF. 

Puerto Rico's system is laid out inefficiently, Rose said: about two-third of the generation is located in the south of the island, where there is little load. That means moving the power to larger towns entails inefficient transmission lines traversing mountain terrain.

"Whatever they can do to site power plants further north would be an important priority," Rose said, pointing to efficiency gains and less pressure to increase redundancy on the transmission system.

"Anything they can do to reduce the over-reliance on long-distance transmission is an important step."

Aggarwal said the first priority is getting power back on for hospitals and other emergency facilities in Puerto Rico, but then changes to modernize the grid could be considered. "It would be very smart to follow on quickly with a concerted effort to rebuild the island’s power system in a more resilient and reliable configuration, using renewables, demand response, storage, and microgrids," she said.

But taking on a widespread modernization program is not cheap, and PREPA's debt problems are well known. The power agency is more than $9 billion in debt, and the territory's debt is around $70 billion.  

Rose also said the economic difficulties faced by Puerto Rico and its utility will need to be taken into account as officials develop a plan. "PREPA is in a form of bankruptcy and there is an important need to rethink and consider different structures to facilitate the capital investment," he said. "One of the options they may want to give consideration to is privatization."

Selling PREPA to private owners could also help bring some legal and regulatory stability to the utility's situation, in turn helping to mobilize capital, said Rose. Privatization was floated in a June opinion piece published in the Wall Street Journal and written by four members of Puerto Rico's Financial Oversight and Management Board. In the editorial they said privatizing would allow the utility to “modernize its power supply, [and] depoliticize its management."

"In light of the storm, there has to be even more capital mobilized and they need to think about where that is coming from," said Rose. "Perhaps privatization is an idea that should be considered."

Texas

Texas, despite its formidable size, faces some issues similar to those in Puerto Rico, such as the use of long and vulnerable transmission lines to serve customers. But Karl Rábago, executive director of the Pace Energy and Climate Center, said the state needs to find ways to "ramp up CHP, microgrids, distributed solar and storage."

While Texas' renewable portfolio standard has developed significant wind generation, Rabago said the state's generation is not sufficiently diverse or distributed. Cheap gas has dampened the outcry for changes, which means much of the state is served by large gas plants with power moved by large transmission lines.

"The bigger the line, the more customers impacted by it," said Rabago. In Texas, the push for greater resilience will likely come from municipalities, he said.

"The real drive needs to come from the cities and towns. It's going to be up to the counties and the mayors," he said, explaining that Texas' deregulated market structure means an overarching review like New York's REV would be more difficult.

"But they have got to ask themselves: If they are in line for another direct hit, what do you do between now and then? Pour a lot of concrete? Lift things up, the Sandy response? Do we maintain and harden or do we systematically replace?"

In Puerto Rico, "they're going to have to rebuild from the ground up," he said. "It's horrible, but it is an opportunity to say 'we're going to rebuild a more resilient system. The trouble is, they're in such a panic, they may just patch it and restore it as opposed to replacing it."

Florida

In Florida, state regulators are gearing up for a closer look at the grid. Chairman Julie Brown issued a statement following Irma, indicating that a proceeding would be opened.

"The PSC plans to review Hurricane Irma’s impacts on electric utility infrastructure and the utilities’ post-storm restoration performance as soon as reasonably feasible," Brown said. "As part of this proceeding, forensic data will be collected on the transmission and distribution facilities impacted by Hurricane Irma’s winds, and the utilities' tree trimming practices and pole inspection cycles will be analyzed."

Following the review, Brown said the PSC will "identify opportunities to improve utility practices and procedures."

The PSC held a workshop Oct. 3 to discuss Florida electric utilities’ ten-year site plans, identifying system upgrades and modifications needed to maintain adequate reliability.

A spokesperson for Brown said she could not comment on the review, adding "Florida is still in recovery mode from Hurricane Irma, and we are currently working out the details on the proceeding to review Hurricane Irma’s impacts on electric utility infrastructure and the utilities’ post-storm restoration performance."

Rose said where Florida heads next must be guided by data — examining, for instance, the extent to which hardened utility poles were able to withstand the storm. "We don't really know what's happened there yet," he said.

Peter Robbins, a spokesman for Florida Power & Light, told Utility Dive that about 40% of the system has been hardened, with traditional wooden utility poles replaced by either a composite or concrete and some power lines buried underground. And when Irma hit, those modernized poles were largely able to withstand the winds.

Rose said in the coming weeks and months, data like that will need to be examined closely. "There is tremendous interest in system hardening, and where they go next should be informed in part by scientific analysis," he said.

This article was originally published on Utility Dive and written by