Blackouts from wind, lightning vex U.S. utilities

Posted 7/21/2006 2:01 PM ET

By Eileen O'Grady

HOUSTON — Power outages that left more than 1.5 million customers without lights this week have fired up criticism that U.S. utilities aren't investing enough to fortify electrical lines against wind, lightning and falling trees.

Blackouts in the Midwest and the mid-Atlantic states left neighborhoods without power just as a heat wave settled across most of the country, giving the electricity industry a public relations headache.

Utilities blamed violent storms packing hurricane-force winds that snapped trees and downed power lines. But consumer advocates said the outages point to deeper issues that give the U.S. worse power problems than other developed countries like England, France, and Japan.

"It's a huge customer issue," said Jim Owen, spokesman for Edison Electric Institute, a Washington-based utility trade group. "Utilities understand this is a priority."

Some experts say U.S. power companies are cutting costs by spending less money than many other countries to harden infrastructure against Mother Nature.

"U.S. power prices are cheaper than in the rest of the world, but we have lower reliability. It is a choice that we've made," said Jay Apt, executive director of the Electricity Industry Center at Carnegie Mellon.

The U.S. power grid held up well to the strain of record electric use against a nationwide heat wave this summer but saw distribution lines falter in delivering power to individual homes and businesses during the recent storms.

PECO, a unit of Exelon Corp., said it was hit by the worst summer storm ever to cross its Pennsylvania territory. The storm cut power to about 365,000 customers.

"It covered our service territory in less than two hours, from west to east," said spokesman Ted Caddell. "You can't fight Mother Nature, you can only deal with it afterward."

Around Chicago, Commonwealth Edison, Exelon's Chicago-based unit, reported 110,000 customers without power on Tuesday after storms pushed through.

David Kolata, an Illinois consumer advocate, said he wants Illinois regulators to investigate the number of outages which he said seemed excessive based on that storm's severity compared to more powerful ones that later hit Missouri.

Trimming trees or costs?

Utilities spend millions each year to trim trees away from power lines, add circuit ties which allow neighborhoods to receive power from different substations, and upgrade transformers and conductors.

But increased spending won't always reduce outages, said Gautam Mukherjee, a director of Cambridge Energy Research Associates in Boston. "It's a sophisticated system, but a gust of wind can knock it out," he said.

According to Apt, Americans on average lose about 214 minutes of power per year compared with 70 minutes in the United Kingdom, 53 minutes in France and six minutes in Japan.

"Countries like Japan invest a great deal more into the infrastructure, harder utility poles and towers," Apt said. "But the cost of power is twice as high."

Burying power lines is the best option to avoid storm damage but is extremely expensive and vulnerable to problems such as water intrusion and overheating, Mukherjee said.

An EEI study completed this month showed the cost of underground lines can be $1 million per mile, or 10 times that of above-ground lines, and their outages last longer.

Even so, EEI said about half the capital spent by utilities on new power lines in the past 13 years has gone for underground lines, especially in densely populated areas.

Deregulation of the power industry has had no impact on distribution operations, said EEI's Owen, a service that remains regulated at the state level.

"Regulators are eager to do what they can to reinforce the distribution system, but they have to be in a position to pass the costs along to customers. There's no free lunch," he said.

Copyright 2006 Reuters Limited. Click for Restrictions.

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