Resilience Lab Workshop for NCSL

Transcription

1 Resilience Lab Workshop for NCSL Managing Risk beyond Blue Sky Conditions May 26, 2016 Denver, CO Miles Keogh & Sharon Thomas NARUC Research Lab

2 Purpose & Objectives Utilities naturally face and manage risk. What is risk? What risks face utilities? Do we want to avoid risk? When? At what cost? How do we make risk-informed choices? Today we ll explore these questions in the context of a fictional power company: Atlantis Utilities 2

3 Atlantis Utilities Atlantis Utilities serves 2.5 million ratepayers Complains that its distribution assets haven t undergone a major systemic improvement since the late 1980s. The company s SAIFI scores are at their worst in 20 years as accidents and storms seem to occur with increasing regularity. Consumer advocates claim that companies are sacrificing reliability and resilience investments for profit, the Atlantis Utilities company argues that some belt-tightening has resulted from rate caps that are due to end in the next year. 3

4 In the news Middle of the country experiencing extreme derecho storms and Cold temperatures dubbed a polar vortex While the west coast experiences an earthquake and A shooting of a transformer bank is reported in East Carolina Political pressure is extremely high to approve resilience investments by the company 4

5 Please tune in to your television and radio today for an EMERGENCY ADDRESS FROM THE GOVERNOR 5

6 Atlantis Proposal Atlantis Utilities has submitted a notice that they will file a case with your commission for cost recovery for a series of resilience improvements. Their preference will be to establish a rider that funds a System Resilience Charge where cost categories evaluated under the upcoming case will be pre-approved for investment. 6

7 Atlantis Utilities Anticipated Events Storms with high incidence of derecho Hurricanes Cyber attack Floods Physical attack Miscellaneous system failures Earthquakes Changing workforce realities Geomagnetic events and electromagnetic pulse attacks 7

8 Proposed Investments Improving vegetation management contractor Distribution-level system visualization technologies Advanced metering infrastructure for all customers Raising and re-siting of substations against flooding Training and telemetry equipment for existing utility restoration crew linemen Hiring and training of new linemen in-state Unmanned drone infrastructure surveillance pilot program Ballistic shielding of transformers Visual shielding of substations Advanced cybersecurity through national defense contractor Improved onsite cybersecurity and application of NERC CIP standards Immediate geomagnetic shielding of key substation components Distributed rooftop solar and fuel cell rebate program for residential and commercial customers 8

9 Vegetation Management Pruning, removal and roadside management Changing vegetation management contractor to improve performance and save money $150 million According to a study sponsored by the Electric Power Research Institute, the U.S. economy is losing between US$104 billion and $164 billion a year to power outages, and another $15 billion to $24 billion a year to powerquality issues. On average, vegetation typically causes 20% to 40% of all power outages at a power utility. Vision vs. Reliability: Finding the Balance

10 Distribution System Visualization 14 Phasor Measurement Units, 4 Phasor Data Concentrators, distribution system sensors (+ humans) Robust situational awareness, allowing a more responsive, flexible system that integrates information from a variety of sources $1 million The company will save considerably through increased awareness of congestion areas and an ability to make more efficient choices 10

11 Universal AMI 500,000 smart meters The meters will connect to a distribution automation system and enable outage management, customer empowerment, demand response, and other functions $35 million While demand response and customer empowerment elements are rated with a positive cost benefit, outage management costs will be reduced by 40% 11

12 Raising and Re-siting Substations Contracting engineers and landscape architects to re-site and raise substations in wind & flood risk Eliminating the risk of substation damage during major storm events $250 million When an event includes flooding, access to and repair of substations during storms is compounded, exponentially increasing restoration costs and ETRs during the most severe weather events 12

13 Linemen Training & Telemetry Tools Improved training and equipment (1000 ipads!) for existing 1000 utility restoration crew linemen Current infrastructure is out of date in terms of visualization technology and limits remote operations $100 million Improved telemetry capability will create a more efficient and cost effective system with faster restoration time 13

14 Hiring New Linemen Hiring and training of 2000 new linemen in-state The company estimates a significant workforce retirement in the coming decade and notes mutual assistance agreement challenges $250 million Restoration and loss of power will be significantly limited in the likely event of repeated superstorms like Sandy unless the linemen workforce is bolstered 14

15 UAV Drone Infrastructure Program Unmanned Aerial helicopter drones carry cameras and other sensors and can be flown into areas with damaged transportation systems Data indicate that restoration times can be cut by 25% by assessing damage and prioritizing restoration with the 10 requested unmanned aerial vehicles $4 million Although this may be rarely used, it can also be helpful for monitoring remote systems such as transmission rights of way during normal operating circumstances 15

16 Ballistic Shielding for Transformers Bulletproof shielding for transformers protects against physical attacks and wind-blown debris The company argues it reduces the likelihood that armed miscreants could damage transformers with small arms fire and improvised explosive devices $15 million for all transformers on the Atlantis system These blankets would also protect other nearby equipment in the event of an overload or explosion at any transformer 16

17 General Security Upgrades & Substation Visual Shielding Better training for guards, better communications, surveillance, and personnel protection equipment; brush clearing and fence line improvements at facilities Company argues it will help random acts of sabotage and wildlife interactions with equipment $1 million Wildlife mitigation benefits alone will yield positive cost-benefit 17

18 Advanced Cyberdefense through Defense Contractor Outsourced network defense for SCADA and business process systems by a multimillion dollar defense contracting company The company notes recent cyberattacks emerging from unknown sources $30 million The company argues that outsourcing to experts allows the company to focus on its core business and the related risks 18

19 NERC CIP Down to the Meter Application of NERC cybersecurity standards to the distribution system, hiring 40 full-time compliance employees Company notes it has no institutional infrastructure to assure cybersecurity and needs an auditable framework $18 million Company argues that the use of an established compliance system with an outcome-orientation assures basic requirements for cyber will be met 19

20 Geomagnetic Shielding Immediate geomagnetic shielding of key substation components Shielding will protect against the likely occurrence of space weather effects on the electric components of generation and substations $1 billion Geomagnetic threats are one of the few threats to the system that could impact service and population in severity unseen by any of the other threats address in this proposal. Effects of GMD would be devastating on an interregional scale. The Commission to Assess the Threat to the United States from Electromagnetic Pulse (EMP) Attack 20

21 Rooftop Solar & Fuel Cell Rebate Distributed energy rebate for emergency backup generation using clean energy sources Distributed resources reduce pressure on the system during weather events and other calamities $150 million The company notes that these DG assets would not allow customers to go off grid but would reduce peak during periods of infrastructure stress; would also help to meet State RPS 21

22 Rider vs. GRC Total Cost: just over $2 billion Average monthly bill: $ million meters, 3 year payoff Should the company be allowed to handle these costs through a special tariff rider, or do these expenses need to be booked under a general rate case? What should the company invest in and on what should they base these choices? 22

23 Since you have to make a decision with imperfect information Which experts could you consult? What about sensitive information? What about intervenors? What conditions would you place on approval? What do you say to support disapproval? 23

24 Round II EVALUATE THE PROPOSAL 24

25 CALAMITIES 25

26 Heat Wave! Geomagnetic disturbance/misc. system failures Timing: July National Center for Atmospheric Research issues geomagnetically induced current warning Power line sag (345 kv), heat impact on substation equipment Customers out: 300,000 ETR: up to 7 days Cost: $65 million Calamity 1 26

27 Nefarious Behavior! EMP Timing: March Multiple transformers impacted, widespread E-3 effects, emergency responders focused on critical restoration (nuclear), mass evacuations through constrained transportation systems, widespread system failures Customers out: 2.5 million (+) ETR: 170 days Cost: $25 billion Calamity 2 27

28 The Icemen Cometh Not! Existing workforce strike + polar vortex, ice storms Timing: November Poles and distribution lines destroyed or severely damaged, some road damage Customers out: 350,000 ETR: 19 days Cost: $45 million Calamity 3 28

29 Dark Matter! Substation attack + loss of system visualization in critical area Timing: December Loss of system visualization, entire transformer bank shot at Customers out: 0 ETR: n/a Operations normalization: 150 days Cost: $1 billion Calamity 4 29

30 Superstorm Sundae! Hurricane with flooding, mudslides and wind shear Timing: late August Substation flooding, downed transmission and distribution lines, road outages and major transportation failures Customers out: 1 million ETR: 28 days Cost: $95 million Calamity 5 30

31 Timing: April Business as usual! Blue sky days ahead Demand follows projections based on historical data, squirrels and trees do their thing Cost: $0 Calamity 6 31

32 Round 3 REPORT TO THE GOVERNOR 32

33 The Governor 33

34 ANALYSIS 34

35 Miles Keogh Sharon Thomas Director of Grants & Research Senior Program Officer THANK YOU! (FUNDED WITH SUPPORT FROM THE US DEPARTMENT OF ENERGY THANK THEM TOO!) 35