Energy Assurance State Examples and Regional Markets Jeffrey R. Pillon, Director of Energy Assurance National Association of State Energy Officials

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1 + NGA State Learning Lab on Energy Assurance Coordination May 13-15, 2015 Trenton, New Jersey Energy Assurance State Examples and Regional Markets Jeffrey R. Pillon, Director of Energy Assurance National Association of State Energy Officials

2 + Energy Assurance is the Capability to: 2 Plan and Respond to events that disrupt energy supply and assure a rapid return to normal conditions. This is a coordinated effort involving the private energy sector s response, augmented by State, Local, Tribal, Territorial, and Federal governments as needed; and Mitigate Risks through policies, programs, and investments that provide for more secure and resilient energy infrastructures that also reduces interdependencies impacts.

3 + In the last four years there have been 44 weather and climate disasters costing over a billion-dollars 3 Source: National Oceanic and Atmospheric Administration

4 + National and State Guidance 4 National Response Framework Emergency Support Function #12 Energy Annex National Infrastructure Protection Plan State and Local Energy Assurance Guidelines

5 + Quadrennial Energy Review April 2015 Support the updating and expansion of state energy assurance plans: (a partial excerpt ) Strengthen and expand state, local, and tribal energy assurance planning and resilience efforts by incorporating innovative technologies and measures to improve resilience. Build state in-house energy assurance expertise. Build regional energy assurance capability to allow states, localities, and tribes to better identify the potential for energy disruptions, quantify the impacts of those disruptions, and develop comprehensive mitigation and response plans. As part of these plans, states should also assess needs for backup electricity at retail gasoline stations along emergency evacuation routes. DOE should encourage strong intergovernmental coordination to ensure state and local energy assurance plans interface with one another, as well as with Federal and private sector disaster and emergency response plans. Source: QER page 2-39 see:

6 + Enhancing Emergency Preparedness for Natural Disasters -- National Petroleum Council December 18, 2014 Recommendation 5: States should increase engagement with oil and natural gas industry in their energy assurance plans, and industry members should assist the states in such efforts. DOE should continue to work with the states and the National Association of State Energy Officials to refine and enhance their State Energy Assurance Plans to include: Clearly defined accountability of stakeholders Assessment of vulnerabilities and risk assessments of supply chains Local, cross-regional, and cross-industry dependencies and interdependencies Fuel supply and distribution points for first responders Consideration for impacts to resiliency in state and local policy decisions. Recommendation 6: Both DOE and states should establish routine education and training programs for key government emergency response positions. Recommendation 7: Both DOE and states should improve their comprehensive drill and exercise programs and include industry participation. Reciprocal invitations extended by companies to DOE and states are recommended. Source:

7 + Gathering Data & Information for Consequence Assessment 7 Understanding the State energy profile Capacities & Utilization Energy flows, consumption & prices Identify who in the State is responsible for tracking trends, statistics Know what data is collected and how to get it and what it means Vulnerability Assessment See the Energy Information Administration, Energy Explained at: eia.gov and States profiles

8 + State Energy Risk Assessment Initiative 8 Initiative members: Department of Energy, National Association of State Energy Officials, National Governors Association, National Association of Regulatory Commissioners and National Conference of State Legislatures Goals: Increase States awareness of risk related to energy infrastructure systems to help them better prepare for disruptions and to make more informed decisions Inform and assist States on available analytical capabilities and resources for identifying and evaluating energy infrastructure risks Provide a suite of scalable, easily-applied analytical tools, methods, and processes to enable States to better assess risks to energy systems and assets

9 + Risk The potential for an unwanted outcome resulting from an incident, event, or occurrence, as determined by its likelihood and the associated consequences. Consequences: If something happens, what are the human and economic impacts to society? Must also consider how impacts will affect interdependent infrastructures and behavior of impacted populations Vulnerabilities: Are there weak links in the energy supply chain and infrastructure? Are components antiquated/old and failure prone? Are there infrastructure colocations or bottlenecks? Includes consideration of energy infrastructure attributes and interdependencies Threats/Hazards: What can happen? What is the frequency/probability? Source: NIPP 2013Partnering for Critical Infrastructure Security and Resilience 9

10 + State Energy Assurance Planning Responding to energy emergencies & reducing risk to critical energy infrastructure 10 Nearly all states, some territories, and 43 local governments have energy assurance plans to: Respond to energy supply disruptions, assure the continued operations of essential public services, and mitigate or reduce risks to critical energy infrastructure Create and sustain State level expertise Track energy supply disruptions Prepare workforce development plans and training Conduct energy emergency exercises Revise state policies, procedures, and practices Benefits for States and Local Governments: Enhance the speed and effectiveness of the energy emergency response Improve coordination across state agencies as well as among states and regions Expand situational awareness Improve recovery and restoration capabilities and reduce risks For more information visit: naseo.org/energyassurance

11 + Energy Emergency Assurance Coordinators 11 Communications and Information Sharing Points of contact for States, DOE and industry in event of and energy emergency. What are your internal and external notifications procedures communications plans? Provide assessment, notification, news and updates on actions taken. Primary and secondary contact for each sector (petroleum, electricity, natural gas) from each state

12 + ISERnet 12

13 + Energy Assurance Planning Framework 13 Executive Summary and Management Guide Introduction and purpose of the document(s) Summary description of the state s energy use and expenditures Description of events that have caused energy shortages, the state s response, and the risk of future events Description of state agencies, their roles and responsibilities (include organizational charts), and relationship with Federal, Regional, and Local Authorities Linkage and coordination with: Federal response plans Other states response plans Local and Tribal government plans Private sector/energy sector plans

14 + Energy Assurance Planning Framework 14 (Cont d) Energy Emergency Response Plans Natural gas including local distribution companies (LDC) and interstate pipelines Electricity including LDC, transmission, independent system operators, and energy resources used to generate electricity Petroleum for transportation and heating (include ethanol, biodiesel, and other alternative fuels) State Plan for Enhancing Resilience and Protecting Critical Energy Infrastructure Energy Infrastructure Risk Assessments Mitigating vulnerabilities, threats and hazards and enhancing resiliency

15 + Detailed description of response measures 15 Program Elements Description of the Measure What is the Intent of the Measure When the Measure should be used Legal Authority and draft executive orders Coordination Role of the private and public sectors Relationship to the state s emergency management plan Affects on other jurisdictions, regional entities and the federal government How will local governments be effected or have a role? Implementation Estimated budget and staffing Estimated computer requirements and security Policies and Procedures Implementation lead time and administration including the roles of other state or local agencies Evaluation mechanisms

16 + Detailed description of response measures 16 (Cont d) Impact Assessment Estimated demand reduction Estimated reductions in fuel consumption Estimated increase in supply Interdependency effects Social impacts Economic/financial impacts Information management Programmatic threats (for instance those associated with new or obsolescence technology) Risk Management Historical performance and deviation of response measure (i.e. lessons from the past) Define and monitor critical elements for the successful performance of the response measure Identify medium-to-long term impacts to reduce unintended consequences.

17 + A Reference Guide to State Energy Assurance Plans All but six State Energy Assurance Plans are posted to the ISERnet. Look under the EEAC page for the link to Energy Assurance Plans (EAP). At the top of the EAP page see the link to: Reference Guide to State Energy Assurance Plans Look at your neighboring State plans and opportunities to conform plans and develop regional contingencies. Planning elements referenced include: Planning Process Details Energy System Descriptions Roles and Responsibilities Communications Assessment Tracking Tools and Geographic Information Systems Interdependencies Risk, Consequences, Vulnerability, and Resiliency Assessments Note: based on a review of 23 State plans Petroleum Emergency Response Plans Electricity Emergency Response Plans Natural Gas Emergency Response Plans Renewables and Energy Efficiency Smart Grid Cybersecurity Critical Energy Infrastructure Plans Training and Workforces Development

18 + Coordination of Plans 18 Planning interfaces Private Sector Petroleum refiners and pipelines Petroleum local retail jobbers/distributors Natural Gas producers interstate pipelines Government Federal Response Plans State Disaster Plan State Energy Assurance Plan Private Sector Electric ISO Electric Transmission Electric Local Distribution Utilities Natural Gas Local Distribution Utilities Local Energy Assurance Plan Other Critical End Used Sectors

19 + Interdependencies are Important to Regional, State and Local Emergency Response 19 Interdependencies operate at multiple levels Facilities and assets Networks (physical, cyber) End-to-end systems Communities, regions and states Between states and multi-state Cross-national border and global Can cause cascading failures with significant public health and safety, economic, environmental and national security impacts Can impede emergency response and recovery

20 + Regional Multi-State Energy Assurance Exercises The Role of Exercises and Training Red Wave Phoenix, AZ November 29-30, 2011 White Prairie Chicago, IL August 31-September, 1, 2011 Amber Borealis Boston, MA June 16-17, 2011 Essential activities to sustain Energy Assurance capabilities and preparedness Red Earth Raleigh, NC March 1-2, 2011 National EA Conference National Harbor, MD June 29-30, 2012 All states have participated in regional and state level exercises and have written reports summarizing lesson learned and identified improvements to their plans

21 NIPP Sector Partnership Model Cross Sector Coordination 21 Energy has two Subsectors Oil/Gas and Electric Each has an SSC

22 + Local Government Energy Assurance 22 Planning

23 + Continuity of Operation Planning 23 Prime Objectives for Local Governments Include: Ensuring the continuous performance of government s essential operations during a disaster Reducing loss of life and minimizing damage to property Achieving a timely and orderly recovery from a disaster Protecting key assets, including facilities, from damage Mitigating disruptions to operations Ensuring minimal loss of energy and electricity to key assets Source: Local Government Energy Assurance Guidelines Version 2.0

24 See: 24

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26 + Update your Energy Assurance plans! Its not as much work as you might think. Update your emergency contact information in a separate document Provide a greater depth to the plans by including draft executive orders, press releases, implement procedures, etc. (see Framework) Develop more contingencies to deal with liquid fuel shortages Conclusions Update and expand your cybersecurity response and mitigation plans Work with private energy suppliers to validate your plans so they understand them and so they interface with the private sector plans Update your Energy Emergency Assurance coordinators contacts and have plans to communicate regionally (multi-state) and locally when events occur December 2013 Ice Storm Provide for training and exercise of new Staff, management and policymakers

27 + Thank you! Jeff Pillon, Director of Energy Assurance NASEO