Category Archives: Disaster planning

Dominion to Recover $140 Million for Burying Electric Lines for Outage-Prone Customers

A screen capture from a Dominion video shows the machinery used to bury electric lines.

A screen capture from a Dominion video shows the machinery used to bury electric lines.

by James A. Bacon

The State Corporation Commission ruled earlier this week that Dominion Virginia Power can recover up to $140 million on what it has spent to bury about 400 miles of electric distribution lines. By putting the overhead tap lines of the 6,000 most outage-prone customers underground, the electric company hopes to significantly reduce time spent restoring electric power after hurricanes, ice storms and other widespread service disruptions. The benefit to improved reliability will cost customers an average of fifty cents to the monthly bill.

The General Assembly had passed enabling legislation in 2014 but the State Corporation Commission (SCC) turned down Dominion’s first proposal to bury 4,000 miles of overhead lines serving some 150,000 customers on the grounds that there was insufficient data to show a positive cost-benefit ratio. But the SCC approved the pilot program, which will apply retroactively to overhead lines that Dominion has already buried, with the expectation the Dominion will regularly provide data on outages and restoration times to use in evaluating the program.

“If we were to get the full 4,000  miles of underground line, it would cut the typical hurricane outage period of seven to ten days in half,” says spokesman David Botkins. There is no way to estimate what difference the pilot project will make until the data comes in, but he said Dominion targeted “the most outage-prone and most difficult to repair tap lines” in its service territory — “the worst of the worst.”

In granting approval, the SCC wrote, “We find that the [project] satisfied statutory requirements, and is reasonable, prudent, and in the public interest.”

Even with the kind of automated equipment shown in the photo above — Dominion will not be handing the job over to ditch diggers — the expense is considerable. The cost of $140 million spread over 6,000 customers is $23,000 per customer. Dominion’s long-term vision, covering about 150,000 customers, would cost an estimated $2 billion.

But Dominion contends that cost-per-customer is not a relevant metric. Payback will accrue to all customers when restoration is shorter following large weather events, allowing the Commonwealth to return to normalcy sooner, says Botkins. In fact, an industry expert estimates that the economic benefits of the first 400 miles of undergrounding exceeds the cost by a ratio of over 2 to 1.

Stated the SCC ruling:

Dominion should be prepared to establish, with specificity, how the [Strategic Underground Program] has resulted in demonstrated system-wide benefits, as well as documented local benefits to the neighborhoods in which distribution lines have been placed underground. The Company has the burden to collect the data necessary to measure … “whether the SUP can be a cost effective means of ensuring reliability for its entire system.”

The buried lines are scattered throughout more than 80 cities, towns, and counties in Dominion’s service territory. In a typical example, The company placed 11 miles of overhead lines to underground in King George County; 24 separate projects impacted 68 customers.

In major outages, Dominion has a hierarchy of response. First, it attends to hospitals, water pumping stations, emergency centers and other critical needs. Next it tackles major circuits where a single repair job can put a large number of customers back on line. Then the company works its way down to subdivisions with a few customers, and finally to individual houses.

“The overhead lines in the back lots are very labor intensive,” explains Botkins. “It’s hard to get the truck back in there. The crew has to do a lot of the work by hand. It’s very time consuming.”

This Is What a Fiscal Meltdown Looks Like, II

Looks like you'll have to repair it yourself, boys.

Looks like you’ll have to repair it yourself, boys.

by James A. Bacon

The fiscal chickens are coming home to roost in Petersburg, which has racked up some $19 million in unpaid bills and is on track to run a $12 million deficit this year. The city is learning what happens when vendors are scared of not getting paid.

Yesterday, we heard that Central Virginia’s regional waste management authority was threatening to suspend the city’s garbage pickup and recycling services due to $632,000 in unpaid bills. Today we read that one vendor has repossessed $390,000 worth of new firefighter breathing apparatuses, while another, owed about $1 million, has terminated a contract to service police cars, fire trucks and other city vehicles.

First Vehicle Services Inc., a national vendor, claims to be owed $1.1 million, according to the Richmond Times-Dispatch. The city asserts that it owes only $844,000. The contract was terminated in April at the city’s request, city officials say, to move all repairs in-house as a budget efficiency.

Meanwhile, Richmond-based Fire Protection Equipment Co. repossessed 53 new breathing apparatuses purchased through a Federal Emergency Management Agency grant. Under the grant, FEMA would pay 90% of the $568,000 tab while the city paid 10%.

According to Deputy Fire Chief Brian Sturdivant, the FEMA funds arrived in two payments, but he doesn’t know what happened to the money:  “That’s a question for the city manager. We have followed the requirements of the grant, but once the paperwork leaves the fire department, it heads straight to City Hall.”

The new breathing apparatus replaced older equipment that was suffering wear and tear. Last month, older equipment failed for two firefighters, one of whom had to be treated for smoke inhalation.

Meanwhile, the fire department has suspended annual physicals for its firefighters due to an unpaid balance with its contracted physician.

Bacon’s bottom line: Now that vendors understand Petersburg’s perilous fiscal condition, they’re stampeding toward the exits. As they try to limit their exposure, one piece of bad news feeds the next. It’s ugly, and it’s terrifying, and it’s putting Petersburg citizens and employees at risk. But this is what happens when a local government experiences a financial meltdown.

Hopefully, Petersburg will serve as a sobering example for others. Virginians need to move beyond the gawking-at-the-fiscal-car-wreck phase and start asking serious questions. Is Petersburg a one-off situation, or is it suffering from systemic challenges that potentially threaten other Virginia localities? If other localities are in earlier stages of financial collapse, is their predicament due to managerial ineptitude, flawed policies, or structural issues beyond their ability to control? What can be done to ensure that similar meltdowns don’t happen to anyone else?

Guarding the Grid

transmission_lineby James A. Bacon

It’s easy to spin nightmare scenarios leading to the collapse of the electric grid. North Korea detonates a nuclear weapon a mile overhead, sending out a super-charged electro-magnetic pulse that melts down transmission lines and blows out substations. The electricity overload races ahead of anyone’s ability to control it in a cascading effect that knocks out power for vast swaths of the country. Because key components of the grid take more than a year to manufacture and deliver, electric power takes interminably long to restore. The economy collapses. Millions die.

If you find that threat implausible, how about this one? A massive discharge of radiation from the sun overwhelms the earth’s magnetic field, melts down transmission lines, blows out sub-stations, and…. you know the rest. Or, this: In coordinated strikes, terrorists knock out vulnerable sub-stations, triggering the meltdown of electric lines…. Or cyber-terrorists infiltrate a utility network, overriding the power company’s controls, creating overloads and triggering a meltdown…

Such story-lines sound over-wrought, the stuff of grade B movies or pulp novels. They could never happen in real life, you say. Yet there have been enough deliberate physical and cyber attacks on a small scale, as if someone is probing the system, that many experts deem the threat to be very real. And most of us can still remember the great Northeast Blackout of 2003, caused by sagging electric lines coming into contact with overgrown trees, which demonstrated how a failure in one location can ripple across an entire grid. Fifty-five million people in the U.S. and Canada were effected.

The United States and the Commonwealth of Virginia have been moving in their slow, ponderous way to protect against those threats, and Garry Kranz has written an excellent article in Virginia Business magazine describing what Dominion Virginia Power and others are doing to safeguard against the disaster scenarios.

Writes Kranz:

Dominion plans to spend up to $500 million over the next five to seven years on a variety of security initiatives. The strategy is to harden its transmission substations and other critical infrastructure, add more mobile transmission equipment and boost stockpiles of backup gear. It plans to bolster perimeter security with ultramodern construction and use sophisticated technologies to pre-empt intruders. …

Dominion also is investing in increased grid reliability through the construction of a new systems operations center in Henrico County. Costing an estimated $100 million, the center will be able to perform real-time monitoring of the transmission grid to maintain electric reliability. Projected to open in 2017, the facility will replace Dominion’s current operations center at the Innsbrook Corporate Center in Henrico, which has been around since 1992.

Another tool in the security toolbox is penetration testing.  A standard security technique for utilities and related industries, it allows companies through what is known as a “pen test” to systematically try to defeat internal security controls and procedures to pinpoint any weaknesses.

“We give penetration testers an advantage by moving them inside our network to see how far they get. Sometimes we tell our people the tests will take place, but often we don’t tell them. We want to see if our processes help them detect abnormal activity and report it,” says Engels, who does not share any improvements Dominion has made as a result.

Micro-grid technology also promises enhanced grid reliability, according to Jason Nichols, director of Scitor Corp.’s iSpace lab. Scitor is part of McLean-based defense contractor SAIC. Some military bases in Virginia already deploy micro-grids. Dominion also is funding micro-grid demonstration projects using renewable fuels at several state universities.

“If a portion of Virginia’s public grid goes down, a micro-grid gives the military base the potential to provide local generation to keep hospitals and other critical services running in some sort of degraded state,” Nichols says.

As it happens, while attending freshman orientation earlier this week at a certain unnamed university my son will be attending this year, I encountered a cyber-security professor who had just arrived for his first day on the job. He and I struck up a conversation about this very topic: cyber-security on the grid. What he told me was alarming. Speaking from his personal experience consulting with a major electric utility in the Southeast U.S. (not in Virginia), he found that the control systems cobbled different generations of technology as far back as the 1950s. Vulnerabilities were rampant. I was left with the impression that the only thing preventing infiltration by cyber-enemies was the overwhelming complexity of the chewing-gum-and-bailing-wire system that only a handful of long-time company employees even understood. Whether senior management comprehends the magnitude of these vulnerabilities is an interesting question. Continue reading

The Tradeoffs of Burying Electric Power Lines

How much is it worth to ensure faster restoration of electric service after a major storm? A lot, if it’s you. Perhaps not so much, if it’s someone else!

by James A. Bacon

Anyone who regards the State Corporation Commission as a wholly owned subsidiary of Dominion Virginia Power really isn’t paying attention. SCC commissioners have their own priorities, and they aren’t necessarily those of Dominion. An example was on display yesterday when the commission held hearings on a Dominion request to spend $140 million to bury its most vulnerable power lines so it could get customers back on line quicker after widespread outages.

The SCC had rejected an earlier Dominion proposal to spend $263 million on a plan to bury the 20% of overhead lines most responsible for outages and time lost. Dominion had argued that burying those lines would cut average electricity restoration times after major storms in half. After the SCC rebuffed that proposal, the utility came back with a scaled-back proposal to spend $140 million, adding a modest $6 per year to customers bills.

Based on their comments and questions, the commissioners did not look favorably upon it. Writes John Ramsey with the Richmond Times-Dispatch:

Commissioner Mark C. Christie said during the hearing that the utility’s calculation of the societal benefit to justify the plan is the wrong measurement since less expensive options to reduce outages — such as increased tree trimming — would have similar impact.

“The whole question about this thing is bang for the buck,” Christie said. “Certainly, you will get fewer outages when the storm comes through. But how do you know all the extra money you spent on undergrounding was more cost-effective than having more trucks out there or tree-trimming or whatever less expensive options?

“We know if you underground a line down a block, we know it’s going to benefit that block in all likelihood. Does that mean it was worth the expenditure that goes into peoples’ bills?

Dominion maintains a portfolio of a dozen different reliability programs, encompassing tree trimming, upgrading old equipment to current standards, and installing sensors to detect failing parts and prioritize investment, among others. (See “Towards a Smarter Grid.”) The company is continually fine-tuning its allocation of resources. For example, it has moved from trimming routes every three years to an approach that takes into account line voltage, how fast the trees grow and many other factors. The inability to trim trees outside of electric-line right of way, said Dominion lawyers at the hearing, places a major restriction on how aggressively the company can trim.

Bacon’s bottom line: Two points…

First: Electric reliability is part of the company’s DNA. One of the metrics Dominion uses to gauge its own performance is the speed at which it restores electricity service. Undoubtedly the SCC commissioners take reliability into account, but they appear to be more concerned at the moment with the impact of spending on rate payers. And who can blame them? Dominion, like other utilities across the country, has spent billions of dollars meeting tougher federal standards for toxic emissions, and it expects to spend billions more meeting the Clean Power Plan standards for carbon emissions. With all the concern over terrorism, cyber-attacks, electro-magnetic pulses and other threats to grid security, the company also is spending hundreds of millions on measures to harden the grid. Ultimately, citizens and businesses pay for all this. In the instance of restoring service after storms, the SCC seems to be prioritizing cost over reliability.

Second: Dominion has sought, or is seeking, SCC approval for a half dozen major electric transmission line projects that have aroused the ire of citizens concerned about the visual impact. Invariably, transmission-line foes suggest burying the line. That option has been prominently suggested for the controversial Surry-Skiffes Creek line which would impact views of the James River near the historic Jamestown settlement. I am speculating here, but I’m wondering if the SCC is skeptical about the cost of burying electric lines in any context, not just for ensuring reliability.

In terms of pure self interest, Dominion has no reason to object to burying distribution and transmission lines — as long as the SCC allows it to recover its costs. If Dominion balks at burying lines, it’s because the executives who deal with the SCC daily and know the minds of regulators anticipate a tough sell before the commission. It may be hard for people to wrap their mind’s around this, but the SCC is boss and Dominion is the supplicant.

Making NIT More Productive, More Resilient

NIT

Norfolk International Terminal (NIT)

by James A. Bacon

For the millions of Virginians living above the fall line, the struggle that Hampton Roads has with rising sea levels and increasing flooding may seem remote and far away. Why should we care? After all, does anybody in Hampton Roads give a hoot about our problems?

Kit Chope, vice president of sustainability for the Virginia Port Authority, gave a pretty darn good reason this morning for why Virginians across the Commonwealth should take an interest in the region’s increasing vulnerability to storm surges and flooding: Anything that disrupts port operations disrupts the economy of the state. Some 530,000 jobs and 10% of the state’s gross domestic product are tied to port activities, he said.

“What affects the port affects the state,” said Chope in a panel discussion of the 2016 Resilient Virginia Conference, during which a major theme was the long-term threat that sea level rise and flooding poses to Hampton Roads.

Upstream Virginia has gotten the message. Included in the $2 billion bond package approved by the General Assembly in the 2016 session is $350 million to upgrade cargo-handling cranes at Norfolk International Terminal (NIT). The capital investment has been billed primarily as a response to growing cargo traffic and the need to expand capacity. But there’s more to it than that, said Chope. Modernization also will provide more protection from hurricane storm surges that could inundate the facility and knock it out of operation.

The Port of New York and New Jersey, the third largest port in the country, got a taste of what could go wrong during superstorm Sandy. A nine-foot storm surge inundated the portsm washing hazmat materials and other debris into the water channels and rendering electrical power unreliable. Flooded terminals closed for a week, leading to the diversion of 25,000 shipping containers and 58 vessels (some to Hampton Roads). Another 15,000 containers were lost, along with 9,000 automobiles and 4,500 trucks and vehicles.

The ports of Virginia, the nation’s fifth largest port complex, are determined to avoid a similar capacity, Chope said.

Thanks to the bond package, new electricity-powered, rail-mounted gantries will replace the existing diesel-powered straddle cranes. The investment will make possible a 50% increase in the number of containers to be loaded and unloaded. Getting less attention is the fact that the Virginia Port Authority is studying how to protect the terminal from disruption. “Where are we most at risk? Where are our critical nodes? What are the potential points of failure?”

For example, electric vaults at ground level will be elevated above projected storm surge levels. Buildings will be hardened to protect IT systems used to track cargo and communicate with shippers. “Data is king,” Chope said. It must be protected.

The VPA’s resilience efforts have been internally focused mostly, but the port relies upon utilities, especially electricity, and is inextricably tied to the network of railroads, highways and local roads that link the terminals to major markets. If local roads flood, as they are prone to do in the City of Norfolk, that could hinder trucks driving in and out with containers. Everything is interconnected. “What’s good for the city is good for the port,” he said. “What’s good for the port is good for the state.”

A Humble Proposal for Addressing Recurrent Flooding

Flooding in Portsmouth. Image credit: Virginia Newsletter

Flooding in Portsmouth. Image credit: Virginia Newsletter

By James A. Bacon

The recurrence of tidal/surge flooding in Hampton Roads has increased from 1.7 days of “nuisance” flooding yearly in 1960 to 7.3 days in 2o14, and with continued land subsidence and sea-level rise, the flooding will become even more common. So say the authors of “Building Resiliency in Response to Sea Level Rise and Recurrent Flooding: Comprehensive Planning in Hampton Roads,” published in the January 2016 issue of the Virginia News Letter.

Of all the region’s localities, according to the paper, the City of Portsmouth has moved the fastest to incorporate adaptive strategies into its comprehensive planning. The low-lying city of about 100,000 citizens is extremely vulnerable, with 38% of households lying within AE Flood Zones and approximately 50 miles of roadway located less than 4.5 feet above mean high water.

Last year the city interviewed nearly 2,000 households to ask about the frequency of flooding, flood-related loss, risk perception and mitigation behavior. Nearly half the residents surveyed reported being unable to get in or our of their neighborhoods in the past year due to flooding; more than a quarter reported being unable to get to work. More than 18% report suffering some form of damage to vehicles.

“There is strong perception among residents that future economic opportunities will be curtailed by changing sea levels; this view is even more strongly held by residents who experience difficulty getting in or out of their neighborhoods due to flood in or out of their neighborhoods due to flood,” the authors write. “About 30 percent of residents agree that flooding specifically has negatively impacted the value of their homes.”

The authors are less clear about what can be done. They allude to three broad strategies for dealing with flooding: retreat, protection and accommodation. Retreat might entail restricting development in low-lying areas. Protection might include sea walls, living shorelines, improvement storm water drains, better street drainage or ditch maintenance. Accommodation might mean accepting inconvenience, disruption and property loss as the “new normal.” But the paper provides little guidance as to when and where these strategies might be appropriate or how they might be paid for.

Bacon’s bottom line: The authors note that households can adapt by installing pumps and drains, relocating HVA systems or buying higher-riding automobiles. But, other than relocating their residences to higher land, there doesn’t seem much else that individual households can do to protect themselves. Some kind of collective action is necessary.

Here’s the problem: In some areas, improvements will be too costly. In others, the real estate is of such low value, it’s not worth saving even at modest cost. But if local governments spend money on one neighborhood, every other neighborhood in the political jurisdiction will want their piece of the pie. And why not? Their residents pay taxes, too.

hot_spots

Flooding hot spots in Portsmouth. Image credit: Virginia Newsletter.

Here’s an idea I throw out for discussion: Create community development authorities that encompass those areas (such as the yellow-red islands shown in map of Portsmouth to the right) that are most prone to flooding. A flood-mitigation plan is developed for each district, with improvements to be paid for with taxes raised from property owners in that district. Then put it to a vote of the residents of the district. Let those closest to the situation weigh the costs (a higher tax) versus the benefits (less property damage, flood-free streets, etc.) and decide for themselves.

The result would be a public-improvement plan more tightly aligned with the local circumstances and less vulnerable to political log-rolling than anything a city-wide effort could pull off and far easier to sell politically.

Five-Year Dominion Spending to Upgrade Grid

Dominion's five-year spending priority: upgrading the grid.

Dominion’s five-year spending priority: upgrading the grid.

by James A. Bacon

Dominion Virginia Power plans $9.5 billion in capital expenditures through 2020, almost two-thirds of which will go to upgrading the company’s transmission lines, substations and distribution system. Other priorities include $700 million for new solar generation and, if approved by the State Corporation Commission, additional funds for undergrounding vulnerable distribution lines.

“We know our customers expect high reliability, clean energy and reasonable rates,” said Robert M. Blue, DVP president in a statement. “We focus on that in everything we do, from building new infrastructure to day-to-day maintenance and fast storm response.”

The capital spending, which will average nearly $2 billion a year, represents a major step-up from the past seven years in which Dominion spent $8 billion, much of it for environmental control equipment to reduce coal-fired power plant emissions of toxic chemicals.

Dominion has the fastest-growing demand for electricity of any utility in PJM Interconnection, which manages wholesale markets and the reliability of the regional electric grid for a 13-state region plus the District of Columbia. The company added 430,000 customers in the past decade, the press release states. Dominion also serves an increasing number of energy-intensive date centers in Northern Virginia.

“Our modern way of life requires lots of energy – and that means infrastructure,” Blue said. “To keep up with energy demand and meet new clean air requirements, Dominion Virginia Power and its parent company are constantly building everything from power stations to power lines, substations to natural gas pipelines.”

Of the $9.5 billion in planned expenditures, Dominion proposes to allocate $3.6 billion for transmission lines and substations, $2.4 billion for its distribution system, and $3.5 billion for new generation and environmental improvements.

While policy makers tend to focus mostly on electric rates and environmental impact, Dominion also emphasizes the reliability of the electric grid. Blue said that reliability, measured by minutes lost due to routine service disruptions, has improved 25% since 2008. “Our reliability in 2015 was 98.8%, which translates into approximately 2 hours of outage time per customer over the whole year.” (Reliability metrics do not take into account outages from major storms.)

Dominion’s proposal to run power lines underground would focus on the most outage-prone tap lines. The idea is to enable electric power to be restored more quickly to customers in the event of a hurricane, ice storm or other major weather-related disruption, which historically has hit the state on average every couple of years.