Since Superstorm Sandy barreled into New York and New Jersey, business has never been more aware of power grid reliability and the cost of outages.
Weather is the cause of most outages. And although many will argue whether it is manmade or not, few disagree that climate change is creating more frequent and damaging weather in some regions. For many building owners, the chances of a painfully costly outage are no longer in the realm of lightning strikes. And the grid is old and fragile, reducing its ability to withstand, and recover from, stormy weather. Seventy percent of its transmission lines are over 25 years old; its power plants average more than 30 years.
While estimates of economic impact are tricky, it's certain that outage costs are large and growing. A report published in August by the President's Council of Economic Advisers put the average annual costs for U.S. weather-related outages between 2003 and 2012 at an inflation-adjusted $18 billion to $33 billion. The report's estimate for Sandy alone is $40 to $75 billion.
There has been a lot of discussion about building a new national smart grid with increased reliability, efficiency, and ability to balance renewable sources and supply/demand. But that is a mammoth investment that will take many decades to construct. It's not a fix that building owners can count on for the near term.
As senior editor Jennie Morton points out in this month's article on preparing your building, there are steps that building owners can take to maintain power or at least minimize their losses. The first is to establish your critical loads so that you can move to the second step: determining your minimum needs for UPS, emergency, and other power alternatives.
Another solution is installing equipment that allows individual buildings to function as their own self-sufficient microgrids, like islands in a storm. Brevoort tower, a multifamily co-op in lower Manhattan used its own natural-gas CHP system to keep the lights on during Sandy. The same idea on a larger scale is the concept of an "energy improvement district" similar to a business improvement district. An example is the FortZED program in Fort Collins, CO. The mission: transform a 2-square-mile downtown area into an urban zero-energy district (ZED). Smart technologies planned for FortZED include advanced mixed-fuel technology, micro-wind turbines, solar PV and thermal systems, and fuel cells. It will serve some 7,000 residences and businesses.
Such small-scale versions of the centralized system may be implemented far more widely and quickly than updates to the nation's ponderous power grid. But there is a twist: much of the investment is likely to come directly from building owners and customers rather than through the utilities.