Blacked Out: Managing Crisis When the Lights Turn Off
Unfortunately, blackouts are reality for modern utilities. They can happen at any time, and at any scale. The key to making it through a blackout is being prepared and having a successful strategy in place for managing the risks and troubles associated with blackouts.
For this article, we’ll break down what utilities can do to better manage blackouts, regardless of location. Then, we’ll look at a specific region (South America) and how blackouts could potentially derail its economy. By the end, you’ll have an understanding of not only how to better manage blackouts, but also why it’s so important we do so effectively.
Understand Where the Risks Are
For major blackouts, the first thing to manage is the risk and be proactive when it comes to preventing them. German insurance agency Allianz defines some of the causes of blackouts as increased demand for the grid, aging infrastructure, severe weather events, and other factors that may be beyond control. The important part is ensuring things that are within your control are taken care of and those that are beyond are planned for.
Also important is the fact that as everything gets more interconnected, the risk increases.
“The vulnerability of the power supply industry, the industrial and commercial companies and the public and private sector is high due to the interconnectedness and dependency of all areas on Information and Communication Technology (ICT), navigational systems and other electronic devices.”
Know There is No Perfect Solution
As Allianz points out, many utilities are turning to renewable energy to help better manage blackouts, though this isn’t always going to work out. As Allianz notes, renewable energy still has its drawbacks when it comes to managing blackouts.
“A downside of renewable energy particularly, wind and solar technologies, is the volatile supply of power,” the company writes. “Not only may a scarcity of electricity result in a power blackout, but an oversupply can also lead to grid instabilities as they alter the frequency within the network.”
So, while renewables may be part of a solution, even they have their issues.
Have a Way to Get the Word Out
An important part of any blackout is communication. For utilities, this is key. Customers need to be updated on what’s going on and any form of communication is important. In large-scale blackout scenarios, panic can set in quickly if the customer base remains uninformed. Public radio is a great way for utilities to ensure their customers know what’s going on, since public broadcasting is generally well-equipped to weather a blackout and an emergency radio is standard in many households. Also, car radios are widely available.
These techniques will help utilities better manage in a time of crisis. For some countries, blackouts are a major destructive force. What if, however, these blackouts on were on purpose? How would you manage them then? For the answer, we turn to South America.
Blackouts come in varying degrees of bad.
For South Africa, blackouts present a massive issue that the country has yet to solve. The thing is, these blackouts aren’t the result of a catastrophic grid failure, but actually managed by Eskom Holdings, a state-owned utility. The grid can’t handle peak electricity usage, and Eskom has repeatedly asked consumers, both residential and commercial, to cut down on usage during this time. For industrial consumers, this could mean reduced production and decreased profits.
When consumers don’t comply, Eskom runs managed blackouts to keep the grid stable. As Bloomberg’s Paul Burkhart points out, Eskom just can’t keep up.
“The state-owned utility can’t provide reliable electricity to run Africa’s second-largest economy,” he writes. “It has a long-term plan to expand generating capacity by more than 40 percent, while facing a 225 billion-rand ($20 billion) funding shortfall through 2018. The company has faced supply shortages for years and has said it may be another five years before it can guarantee the lights will always be on.”
Eskom argues that these blackouts are necessary to keep the grid from completely collapsing.
“If South Africa experienced a complete blackout, it would take us two weeks to restart the system,” Dr. Steve Lennon, sustainability executive for Eskon. “The consequences would be severe across the entire country and in every sector.”
So, what would that mean for South Africa’s economy?
To put it plainly: not great things.
As previously stated, blackouts can derail industry production. On top of that, it also can drive industry from the region, as skepticism could cause businesses to think twice before moving in. This effectively halts any economic growth in the region.
“Eskom is in dire straits,” Teneo Intelligence’s southern Africa risk analyst Anne Fruhauf said. “South Africa cannot dream of reaching a higher-growth path without an increase in baseload capacity.”
As Eskom provides more than 95% of the country’s electricity, it’s very aware of the issue.
“Eskom is committed to keeping the lights on whilst at the same time maintaining a sound basis for sustainable operations,” the company told Burkhart in an email.
Under the direction of a new CEO, Eskom is looking to increase its capacity through new plants and upgraded infrastructure. However, these efforts have been marred by setbacks and construction delays.
There is certainly support behind the company, as failure simply isn’t an option.
“It has to succeed,” Eskom’s former CEO Jacob Maroga told Burkhart. “It’s the heartbeat of the economy.”
Hydrostor receives $4m funding for A-CAES facility in Canada
Hydrostor has received $4m funding to develop a 300-500MW Advanced Compressed Air Energy Storage (A-CAES) facility in Canada.
The funding will be used to complete essential engineering and planning, and enable Hydrostor to plan construction.
The project will be modeled on Hydrostor’s commercially operating Goderich storage facility, providing up to 12 hours of energy storage.
Hydrostor’s A-CAES system supports Canada’s green economic transition by designing, building, and operating emissions-free energy storage facilities, and employing people, suppliers, and technologies from the oil and gas sector.
The Honorable Seamus O’Regan, Jr. Minister of Natural Resources, said: “Investing in clean technology will lower emissions and increase our competitiveness. This is how we get to net zero by 2050.”
A-CAES has the potential to lower greenhouse gas emissions by enabling the transition to a cleaner and more flexible electricity grid. Specifically, the low-impact and cost-effective technology will reduce the use of fossil fuels and will provide reliable and bankable energy storage solutions for utilities and regulators, while integrating renewable energy for sustainable growth.
Curtis VanWalleghem, Hydrostor’s Chief Executive Officer, said: “We are grateful for the federal government’s support of our long duration energy storage solution that is critical to enabling the clean energy transition. This made-in-Canada solution, with the support of NRCan and Sustainable Development Technology Canada, is ready to be widely deployed within Canada and globally to lower electricity rates and decarbonize the electricity sector."
The Rosamond A-CAES 500MW Project is under advanced development and targeting a 2024 launch. It is designed to turn California’s growing solar and wind resources into on-demand peak capacity while allowing for closure of fossil fuel generating stations.
Hydrostor closed US$37 million (C$49 million) in growth financing in September 2019.