How to prevent future blackouts

Deep in upstate New York's piney woods, near Adirondack National Park, stands a drab building that represents the future of electric power transmission - and one of America's best hopes at preventing a repeat of this weekend's massive blackouts.

Inside the two-story switching station, thousands of high-tech silicon valves coolly cajole hundreds of electricity streams into a workable flow that powers the region's homes and businesses. It's a marvel of physics - a traffic cop that keeps the chaotic world of protons and electrons from collapsing into gridlock and fuels a society of Osterizers and plasma TVs.

The trouble is, most electricity switching stations - and the cable networks they control - are more Stone Age than Silicon Valley. Yet now, after the worst blackout in North American history, the complex world of switching stations, power lines, and control grids that Americans have long taken for granted may be about to get an overhaul. As residents from Cleveland to New York hear the thrum of air conditioners and refrigerator compressors again, pressure is building to reengineer the nation's transmission network.

Division exists, however, over how best to do it. Energy companies want less regulation and more power lines. Consumer groups want more regulation - even if it means higher rates. Either way, new technology is needed and, given the outrage after the great blackout of '03, it's probably inevitable.

"There's plenty of technology on the horizon that can make today's overloaded, antiquated grid work more effectively," says David Talbot, a senior editor at MIT's Technology Review magazine. He ticks off a list: smarter controls, giant electrolyte batteries, new software programs that can anticipate problems before they ever happen.

Those technologies are getting a lot of discussion these days. The switching station in upstate New York - near the town of Marcy - is a prime example of one of the most commonly cited solutions: smarter controls.

But fixing the nation's electrical grid will involve more than just spending money on new technology. There are also touchy political issues, as Kurt Yeager, president of the Electric Power Research Institute notes.

Transmission companies, for instance, often get locked in battles with homeowners and conservationists over the construction of new towers and lines. An example is the Cross-Sound Cable, which will bring power from the port of New Haven, Conn., to the site of a shut-down nuclear power plant in Shoreham, Long Island. Connecticut officials, including the attorney general and the city of New Haven, have filed lawsuits to try to prevent the electricity from flowing.

Add in issues from the Army Corps of Engineers and the impact on spawning fish. Now the company is looking at years more until it wins final approval to bring electricity to 330,000 homes. "We got caught up in a twisted regulatory and political process," says Rita Bowlby of Cross-Sound.

Even beyond the not-in-my-backyard syndrome, the lack of any federal "road rules" means few companies want to invest in expensive new technologies. "No one's comfortable with who's going to own assets, and who's going to get a return on investment," says Ernest Moniz, an MIT physics professor who was an undersecretary of Energy under President Clinton. "There's an emerging consensus that some rules of the road are needed, but no consensus on what those would be.... Until that's resolved, it's going to be difficult to get the investment in new technology and new capacity."

In the old system, regulations were typically set by state utility commissioners, who oversaw companies that enjoyed a monopoly in certain areas. Now the system is moving toward a larger, broader grid with few of those old boundaries.

Last year, the Federal Energy Regulatory Commission (FERC) proposed a "standard market design" to try to establish some of the needed rules, but certain parts of the country - such as the Northwest and Southeast - have resisted.

On Sunday, Energy Secretary Spencer Abraham told "Fox News Sunday" that the Bush administration supports a three-year delay for the controversial measure. "[It] goes to the question of whether or not we would mandate and force down the throats of regional areas of the country a federal approach to deregulation of the marketplace," he said.

But the Bush administration has made at least one key change: It has increased the amount a company can receive for its investment in new transmission lines. In the past, it allowed a 10 to 11 percent rate of return on equity. Now it has upped that to 14 to 15 percent.

This was one reason Trans-Elect decided to attempt to build new lines in California at the infamous "Path 15" area, a bottleneck in sending electricity between northern and southern California. "FERC is trying to stimulate more demand," says Bob Mitchell, executive vice president of the company.

Consumer groups worry about a rush to build more power lines. To them, what's really needed is tougher regulation - and a shift away from the chaotic market system.

"In the old days, reliability was a major goal," says Wenonah Hauter, head of the energy project at Public Citizen in Washington. "Now the goal is just to make money, and they do it by overloading the wires."

She says even a new federal agency with additional enforcement powers won't change the system enough. FERC, she says, didn't do anything to avert the California crisis of 2001 - nor last weekend's blackouts.

What is ultimately done to fix the nation's electrical system will depend in large part on what precisely went wrong. Four days after the cascading blackout that left 50 million people in the dark in the US and Canada, authorities still haven't pinpointed the exact cause of the mishap.

They have isolated it to several large transmission lines outside Cleveland that failed just before the massive outage. As one line went down for still-unknown reasons, power was transferred to other lines. They heated up and sagged. One apparently bowed into a tree.

Eventually several other lines failed. An alarm that was supposed to alert the utility, FirstEnergy Corp., about the disruptions didn't work.

Within seconds, parallel lines were overloaded and shut down. Then power plants themselves began to disconnect.

Even more mysterious - and ominous - is why the failure wasn't contained locally and ended up cascading across the country, affecting power in eight states and Canada. Mechanisms exist to halt just such a spread. They worked in a few isolated areas. Boston, northern New Jersey, and Pennsylvania, for instance, were spared blackouts because their systems automatically disconnected from the failed grids. In Vermont, power plant operators noticed "rogue waves" coming from New York and split off their system on their own. But why didn't other computers and engineers respond to the cascading doom?

As authorities in both the US and Canada search for answers, the great blackout of 2003 was a sober reminder of just how critical electricity is to the functioning of modern life. When the lines went mute, ATM machines didn't work. Gas stations couldn't pump fuel. Computers flickered off. Grocery stores in the Midwest hawked perishable items - steaks and ice cream - on the streets rather than let them go to waste. Manufacturing plants shut down, as did subways and, frighteningly, elevators.

While the power has largely been restored in all the affected areas, officials are still tallying up the damage. By some estimates, the outage cost the nation $30 billion a day at its peak. The estimated tab in New York City alone is $800 million in lost economic activity and overtime paid to emergency crews.

Yet it isn't just the economic cost and inconvenience that worries many officials. If a system malfunction or human mistake can cause such a catastrophic failure, what about a group deliberately trying to sabotage the grid?

Congress is planning to hold hearings when it returns in September about the vulnerability of the electrical system to a terrorist attack. Authorities have fretted for years about how a few taps of a keyboard could lead to the shut down an entire grid, but the threat is now taking on fresh urgency.

Last January, Foreign Policy magazine ran an article that contained elements of eery foreshadowing. It imagined a terror attack on the nation's power grid at 4 a.m. during a sweltering night. Suddenly, "a national electric system already under immense strain is massively short-circuited, causing a cascade of power failures across the country," wrote Thomas Homer-Dixon. "The financial system and the national economy come to a screeching halt."

Still, for all the disruption and dire warnings, there was certainly something positive in the blackout: the response of the people. In cities from Cleveland to Detroit to New York, residents reacted to the outage with calm and compassion - particularly once terrorism was ruled out as a cause.

New Yorkers offered couches to commuters stranded in the city overnight. Stores gave away ice cream as an antidote to the heat. Emergency crews and ordinary citizens heroically rescued people trapped in elevators and subways. Virtually no looting was reported anywhere.

The esprit de corps was epitomized by Bart McHenry, a tourist from Orange County, Calif., caught in the blackout in New York. As traffic snarled Thursday night in the absence of stop lights, Mr. McHenry waded out into the middle of Seventh Avenue and did his best impersonation of a cop. He waved his arms and directed traffic in what looked like a spontaneous form of ballet. Drivers would high-five McHenry as they drove by. He would reply, sonorously: "New York loves you."