The big blackout of 2003 didn’t just put a big splotch of the Northeast in the dark. It laid down a big national Rorschach test on the question of energy deregulation.
Just because people were in the dark about what put 50 million people in the dark did not stop them from assigning blame. Or seizing political advantage by candlelight.
People were still walking home across the Brooklyn Bridge when National Association of Manufacturers executive Mark Whitestone called the office on a cell phone from the Shenandoah Mountains to demand a new national energy policy. Among other things, the program should increase “the supply of all sources of cost-effective renewable, alternative and conventional energy sources,” he said.
President Bush spoke from the wilderness, too. From a national park outside Los Angeles on Friday, he called the blackout “a wake-up call.” Time to modernize the national energy grid, Bush said.
But the president of the Electric Power Research Institute thinks the electric industry won’t invest in new transmission lines until the nation decides, one way or another, on energy deregulation. Until they know they can earn money on their investment, companies will sit on their wallets.
“The confusion has been a major obstacle, a disincentive for investment,” EPRI president Kurt Yeager told me.
Exelon Corp.’s chief of wholesale market development says industry investment has kept pace with demand. Even so, says Steven Naumann, regional coordination and planning have been stymied by local opposition to power lines in the East and resistance to regionalism in the South and West.
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With people still hot under the collar–and not just because the air conditioning was out–this seems like no time to push through a major overhaul of the energy policy. And yet, that’s exactly what we can expect.
Congress already was scheduled to take up the energy issue this fall. But suddenly, a topic that would have been lucky to draw a long yawn suddenly will turn red hot.
So hot, in fact, that Rep. Billy Tauzin of Louisiana already has launched an investigation into the Big Blackout. Tauzin hasn’t launched a probe so fast since he quit taking contributions from the accounting industry and immediately began probing Andersen’s accounting of the Enron disaster.
Before all the yakking and political hacking is over with, the Big Blackout will have been put to more uses than a Popeil Veg-O-Matic.
Critics will use it to slice any suggestion that industry deregulation can work. Power companies will dice the data, and say they really didn’t do anything wrong. President Bush will use it as an opportunity to push through his plan to give industry eminent domain to string power lines in our backyards.
Bush’s program also is expected to help the likes of energy giant AEP to push through its long-stalled plan to build a 765,000-watt power line through 90 miles of state and federal forests in West Virginia.
As they do so, there are some interesting data points to keep in mind. It’s no illusion that electricity demand has outgrown supply. Electricity use in the U.S. grew 24 percent from 1990 to 1999, but capacity expanded only 7 percent, according to the Energy Information Administration.
Critics of deregulation say companies have put a lot more money into power plants than transmission lines. Even so, utilities have added enough new power lines to expand the nation’s grid by 7 percent during the 1990s–matching the rate of growth in megawatts.
Growth of regional energy groups means many of those lines are placed more smartly than in the past, so the system can handle more capacity.
The debate over energy will focus on three key questions. There will be a push to make companies meet mandatory federal reliability standards, replacing the voluntary system now in place. Some in Congress will want to require electric companies to join regional transmission groups that plan investment on a regional basis rather than state-by-state. And we’ll see a big push for federal control over the siting of transmission lines.
These issues are complex, and they are important. But until the Big Blackout, they seemed destined to work their way through the lobbyists’ lair without much public notice.
The blackout shed some light on issues we otherwise might have missed.
That’s a switch that could do us all a lot of good.