The road to resilient power is a balancing act

To bridge the $500 billion resilience gap, utilities must prioritize mutual benefits and collaboration with stakeholders.
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Judsen Bruzgul is senior director of climate adaptation and resilience and climate center senior fellow at ICF, and Neil Weisenfeld is a senior energy resilience expert at ICF. This contributed content represents the views of the authors, not those of Canary Media.

Extraordinary weather events are becoming ordinary, and utilities need to grapple with this fact. They are only beginning to invest in the kinds of resilience projects needed to protect U.S. energy infrastructure. By 2050, investor-owned utilities in the U.S. will need to devote more than $500 billion to prepare for a changing climate.

In 2020 alone, the U.S. saw a record number of billion-dollar disasters. From major storms to heat waves to wildfires, these disasters are drastically damaging our homes and businesses — and our electricity infrastructure.

We’ve seen what happens when our grid and power systems aren’t prepared for these disasters. Electricity service shuts down, sometimes for days or even weeks at a time, and our communities are left without crucial services. These outages can pose a grave threat, especially for people who rely on electricity to power medical devices. In February, severe winter weather caused major blackouts across Texas, leaving more than 4 million residents without power at the height of the storm.

Utilities must face the daunting task of preparing for these disruptions. According to an ICF analysis, U.S. investor-owned energy providers face a greater than $500 billion resilience investment gap through 2050. A huge number of adaptations are needed to prevent damage from climate-change-related hazards.

Utility decision-makers, faced with costly investments, lengthy timelines and competing priorities, are often under pressure to take action with limited information. They need to get better information. To effectively harden our systems, utilities need to clearly understand evolving climate trends in their service regions, potential weak spots in their infrastructure and core assets, and, most importantly, how to overcome these vulnerabilities while balancing pressing, competing priorities outlined by regulators and stakeholders.

Utilities can become key players in advocating for resilience investments in a multitude of ways, including initiating conversations with stakeholders and communities; identifying mutual benefits; creating flexible, integrated solutions; and collaborating with local entities.

Stakeholder communication and identifying mutual benefits

Utilities should engage with stakeholders as they determine what kinds of resilience projects are needed to harden their unique energy infrastructure and assets. They need to communicate early in the process with relevant stakeholders, including the community, regulators and local government entities, to identify their needs and priorities and explain the tangible benefits that resilience investments provide. Two-way communication allows utilities to closely align their goals with stakeholders’ concerns, lessening potential friction.

Investments that protect utility infrastructure, such as safeguarding a substation from flooding, should be presented along with their co-benefits,” including safety and security improvements or even financial gains and savings. Effectively capturing the full range of these benefits for multiple stakeholders can help build mutual support for a resilience strategy.

Communicating the general benefits and direct results of these hardening activities to stakeholders is challenging, but many utilities are doing it. For example, Con Edison, the energy utility powering New York City, recently announced that it is integrating climate science directly into its planning processes across the business.

Devising integrated solutions

Utilities face the challenge of prioritizing resilience while also investing in programs to serve their communities, navigating regulatory shifts and carbon-reduction goals, and at times facing major budget constraints. One approach is to integrate resiliency investments with projects or programs that share complementary objectives.

Utilities are key players in accelerating electrification, modernizing the grid, reducing consumption and helping federal, state, and local governments meet lofty decarbonization goals, so aligning resilience goals with those efforts is a smart approach. Pursuing an integrated solution or project, such as increasing energy efficiency through thermal design in buildings, can save customers money while simultaneously keeping buildings safer under extreme weather conditions, allowing funds to stretch further and support a multitude of goals. Likewise, linking resilience investments aimed at reducing load during periods of high heat to seemingly competing objectives, such as electrification of transportation and buildings, can amplify the mutual benefits for utilities and customers alike. Adopting a holistic view of programs is an important step to reveal mutually beneficial goals and find solutions that bring value to both customers and the grid.

Investing in collaboration

Utilities can also tap into outside tools and connections to accomplish resilience goals, ranging from local entities to federal programs.

Local agencies often have interdependent infrastructure with utilities. Collaboration can ensure that investments in grid resiliency are coordinated and interlinked. For example, Portland General Electric partnered with the city of Portland, Oregon to build a first-of-its-kind fire station outfitted with a solar-plus-storage system that can completely isolate itself from the grid in order to maintain critical operations during outages. On the federal level, President Joe Biden’s recently proposed 2022 budget calls for significant funding for infrastructure hardening, which could create opportunities for utilities to collaborate with government agencies on resiliency projects. In 2020, the Federal Emergency Management Agency’s Building Resilient Infrastructure and Communities grant program set aside $500 million for states, local governments, tribes and territories to support activities that will strengthen preparedness efforts. The Biden infrastructure plan proposes to increase funding for that program to $1 billion.

Climate change will continue to put infrastructure and lives at risk. But by reinforcing these assets and supporting communities, utilities can play a vital role in mitigating this risk.

(Article image courtesy of the American Public Power Association) 

Judsen Bruzgul , PhD is Senior Director of Climate Adaptation and Resilience at ICF, and ICF Climate Center Senior Fellow.

Neil Weisenfeld is Senior Energy Resilience Expert, ICF.