Superstorm Sandy killed about 100 people in the U.S.,wrecked neighborhoods along the Eastern Seaboard and snarled transportation for days. The storm also left a trail of crumpled transmission towers, flooded substations, splintered power poles and miles upon miles of downed power lines last month. The web that delivers power failed for some 8.5 million people on the East Coast and inland. Utilities will be dealing with and paying for the consequences for years. And the issues are not just for those in hurricane zones.
In some cases, failure was inevitable. It's almost impossible or prohibitively expensive to build a mountaintop transmission tower to withstand hurricane-force winds, says Otto Lynch, a transmission engineer and vice president of Power Line Systems Inc.
But in many other instances, a system failed because it was old or because it wasn't designed properly. Some of the nation's oldest electric distribution systems are in the Northeast, dating to the 1930s.
In 2009, the American Society of Civil Engineers gave energy infrastructure a grade of D+. Since then, "We've taken one step forward and two steps back," says Lynch, who is working with fellow engineers to develop the group's next report card, which will be released in 2013.
In this year's "Failure To Act" report on the state of electric infrastructure, ASCE says that, by 2020, there will be a $37.3-billion gap in transmission spending and a $57.4-billion gap in distribution investment. By 2040, that gap will be $111.8 billion for transmission and $219 billion for distribution. The transmission and distribution shortfall account for 88% of the overall gap in energy spending, according to ASCE.
For transmission, at least, the problem isn't a lack of money, Lynch says. Utilities are stepping up to the plate and want to invest in new transmission lines to improve reliability and move renewable and cheap power throughout the U.S.
Investment in transmission—lines that deliver power from plants or across states to cities—has been encouraged through an attractive profit allowed by federal regulators and, in some cases, required by federal standards. Annual transmission investments are on track to peak at a record level of $15 billion next year, almost double the amount for 2006, before leveling off. But the gap in investment threatens the development of a modern, coast-to-coast electric highway designed to deliver affordable, often renewable, power.
The gap is caused by federal and state policies and regulations—such as the frequent expiration of renewable tax credits—that make it increasingly difficult to build new transmission lines. Utilities, historically averse to uncertainty, are choosing to wait.
"There's a conservatism in play," says Don Mundy, Black & Veatch senior vice president of strategic planning. Mundy says, "Utilities typically think, 'Let's really wait a while to see if that's really going to work and that's going to stick, and if we are sure of that, then we'll build that transmission.' "
Power distribution—delivery of electricity to end users—is a different story, however. Investments in the distribution system peaked in 2006 and are on the decline. Utilities often have little financial incentive to build new lines to replace the old ones. Some wait until a point of failure before replacing poles or lines.