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Energy in Transition


Is your strategy for responding to extreme weather events up to the challenge?

This author no longer works for DNV GL.

I’m a big fan of Yogi-isms. “It ain’t over ‘til it’s over” is regarded as one of the most well-known quotes from Yogi Berra, a former Major League Baseball catcher who played for the New York Yankees. He first said this during the 1973 National League pennant race.

This saying also is appropriate when thinking about hurricane season, which in the Atlantic runs from June 1 through November 30. Statistically, September is the most active month, so we are past the historical peak of the season. So far, 2014 has been a relatively quiet year for Atlantic hurricanes but as Superstorm Sandy showed us two years ago—making U.S. landfall in late October—strong hurricanes can and do happen later in the season, bringing the potential for substantial damage to electricity infrastructure and outages for customers.

Severe weather is the leading cause of power outages in the U.S. Statistics assembled by the U.S. Energy Information Administration indicate that power outages caused by severe weather events such as hurricanes, thunderstorms and blizzards account for 58 percent of outages observed since 2002 and 87 percent of outages affecting 50,000 or more customers. As shown in Figure 1, weather-related outages have increased 10-fold since 1992.

Figure 1. Observed outages to the bulk electric system, 1992-2012. (Source: Energy Information Administration)

Figure 1. Observed outages to the bulk electric system, 1992-2012. (Source: Energy Information Administration)

A 2013 report from the Executive Office of the President estimated that between 2003 and 2012 the cost to the U.S. economy of power outages caused by severe weather amounted to an inflation-adjusted annual average of $18 billion to $33 billion. A U.S. Congressional Research Service study published in 2012 estimates the annual weather-related outage costs at $25 billion to $70 billion. Damages in the U.S. from Sandy amounted to $68 billion, making it the second-costliest hurricane after Katrina. Clearly, the effects of weather on the power grid and the economy it supports are substantial.

Superstorm Sandy was one of 11 weather and climate-related disasters exceeding $1 billion in damage in 2012. In 2013, there were nine billion-dollar weather and climate disasters in the United States (Figure 2) . In virtually all of these cases, a major driver of economic loss was related to power outages.

Figure 2. U.S. 2013 Billion-dollar Weather and Climate Disasters

Figure 2. U.S. 2013 Billion-dollar Weather and Climate Disasters. (Source: NOAA)

Following Sandy, there has been substantial focus among utilities and regulators with respect to increasing the resilience of the U.S. electric system. Billions of dollars are being spent to harden the grid and to improve the ability to sense and respond to outages. ConEdison in New York City and Public Service Electric and Gas in New Jersey are both reported to be spending on the order of $1 billion to harden their systems, and many other utilities are following suit.

Common to all of these efforts is the dilemma posed by the uncertain nature of extreme events. What hazards may occur, where, and how often? How could the electric grid be impacted? What are the consequences of those impacts? What can we do to prevent damage to the grid? How can we minimize the effects of grid failure? What are the investments with the greatest return? How will climate change affect the efficacy of investments?

Utility and regulatory decision makers must determine how much to spend in order to create a power system that is resilient to severe weather, and how best to allocate financial resources among alternative measures. To help in this endeavor, DNV GL has developed the ADAPT risk management framework, which is used to assess potentially devastating risks to electric power systems and prioritize the capital and operational investments needed to mitigate them, while providing a cost-effective portfolio of measures for prevention, preparation, response, and recovery.

To discover the potential effects of a “Future Sandy” hitting Long Island, we worked with the U.S. National Center for Atmospheric Research (NCAR) and the Long Island Power Authority (LIPA) to analyze various scenarios. This case study explores the Long Island scenarios and offers new ways to prepare for the impact of extreme events.

Is your strategy for responding to extreme events up to the challenge? To learn more about our ADAPT framework email us at energyadvisory.energy@dnvgl.com.

Related materials:
Probabilistic risk-based modelling tool for the power industry
Enhancing resilience to severe weather and climate change
DNV GL: Adaptation To A Changing Climate (Video)
Adaptation to a Changing Climate Report
One year later: Superstorm Sandy underscores need for a resilient grid
When the Bough Breaks: Managing Extreme Weather Events Affecting Electrical Power Grids, IEEE P&E, Sept/Oct 2014
Assessing Climate Change Hazards to Electric Power Infrastructure – A Sandy Case Study, IEEE P&E, Sept/Oct 2014


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