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N.Y. Regulator, Con Ed Embrace Plan to Climate-Proof Power Grid

First-in-the-nation ruling requires New York's biggest utility to integrate climate science into all of its planning, construction and budget decisions.

Mar 12, 2014

New York regulators are requiring the state's biggest electric utility to armor the grid against all sorts of sweeping global warming impacts that could black out the nation's financial capital and disrupt services like cell phone networks and water and gasoline supplies.

The Feb. 20 ruling mandates Con Edison to carry out an immediate and comprehensive assessment of climate risks to its power grid, a lifeline of New York's economy. The utility must factor the data into all of its long-term planning, construction and budget decisions—and also use new flood maps that put much more of New York in vulnerable flood zones.

The ruling by the New York Public Service Commission is "a recognition that something has to be done to make the system withstand what appears to be the 'new normal,'" said Robert Thormeyer, a spokesman for the National Association of Regulatory Utility Commissioners (NARUC) who was not involved in the New York case. "They're taking a holistic approach to looking at how we can fit [climate change] into our everyday planning."

The PSC also approved Con Edison's short-term $1 billion resliency plan, as the first step in what is expected to be the nation's most extensive effort to climate-proof an electric grid. Under the plan, by 2016, Con Edison will add a foot to floodwalls around substations and transformers to help prevent storm water from swallowing and frying the equipment. It will also strengthen poles to withstand thrashing winds, move many high-voltage power lines underground and install back-up fuel supply systems to prevent soaring demand during heat waves from crashing the grid.

The first-in-the-nation decision to require a utility to integrate climate science into its operations comes a year and a half after Superstorm Sandy's 9.8-foot storm surge drowned Lower Manhattan, other neighborhoods and the FDR Drive freeway. More than a million Con Edison customers were left in the dark after key substations were submerged, and after fallen trees and strong winds crippled three-fourths of overhead power lines and poles.

The storm hinted at what could be a permanent threat to the city as earth's climate warms.

According to regional climate projections, by the mid-2050s, nearly a quarter of New York City—including almost all of its power plants—will be in a floodplain due to surging seas. Con Edison owns more than 130,000 miles of underground and overhead electric cables and wires, plus some 7,200 miles of natural gas pipes.

The PSC indicated that all the utilities it regulates—including more than 100 electric, gas, steam, water and telecommunications providers—should be required to follow Con Edison's lead. National Grid, another large utility in the state, has said it will voluntarily file its own climate change preparedness study with the PSC by the end of the year.

New York is one of a handful of states where regulators and utilities are starting to discuss climate resiliency after being hit by weather extremes with billion-dollar price tags. But much of the work has focused on rebuilding and recovery—not protecting the grid from the future threats.

"Very few [utilities] have undertaken a truly systemic look at how climate change will affect them," said Michael Gerrard, who directs the Center for Climate Change Law at Columbia Law School, which intervened in the Con Edison case with the PSC.

According to Thormeyer of NARUC that could change as New York's utilities launch their adaptation efforts. "When a state does something that's relatively unique, people will take from it and say, 'maybe we can apply this here.'"

How It Happened

The PSC's ruling was the result of an aggressive campaign by Columbia University climate experts and environmental leaders to make Con Edison's resiliency strategy more extensive.

The effort launched in January 2013 after Con Edison submitted its rate case to the PSC for approval. The application proposed a $2.4 billion spending increase through 2016, of which $1 billion would go toward making the grid more resilient to future storms and flooding. 

The climate community believed Con Edison's spending focused too narrowly on protecting the system from another Sandy, and so they intervened in the case. The plan "did not look at the other kinds of climate-related changes that could occur," said Gerrard of Columbia. "It was not comprehensive."

Gerrard said Con Edison actively cooperated. "Con Edison is run by engineers; they speak math," he said. "We came in with a quantitative presentation about climate projections, and they quickly grasped how this really could affect their system reliability."

Robert Schimmenti, Con Edison's vice president for engineering and planning, said that in the wake of Sandy, "We wanted to be in a better position very quickly. ... We're ready to adapt and adjust as new information comes in" about the impacts of climate change.

The utility and Columbia launched a collaboration to expand the scope of the utility's resiliency proposal, which now covers four categories: strengthening infrastructure to withstand future storms and flooding; making the natural gas system more resilient and preventing gas leaks; developing a new risk assessment and cost-benefit analysis to reflect climate threats; and studying "alternative resiliency" strategies to keep the grid running even in extreme weather. Participants also included Pace Law School's Climate and Energy Center, the Natural Resources Defense Council and the Environmental Defense Fund, as well as officials from New York City's sustainability office and the state's Attorney General's office.

The PSC required Con Edison to continue to work with the groups on a one-year-long Climate Change Vulnerability Study. The project will determine which parts of the grid are most at risk from long-term climate impacts and how to best protect the system.

Con Edison agreed to add three feet to the Federal Emergency Management Agency's flood maps in order to establish accurate construction standards for infrastructure in flood zones. The FEMA flood maps do not account for future climate impacts, and therefore underestimate the extent of New York's flood risk. The utility will revisit the standards every five years to determine if more protections are needed based on the latest climate science.

Scientists estimate that sea levels will rise by 2.6 feet in the region by the 2050s. The added ocean height would be disastrous for New York—it means that a storm much smaller than Sandy could cause the same amount of damage, engulfing all of Lower Manhattan and swaths of Staten Island, Brooklyn and Queens.

Con Edison has spent about $600 million to restore the grid to pre-Sandy conditions, Schimmenti said. As part of its $1 billion plan, the utility has already spent $100 million to build higher floodwalls and a network of flood doors and high-capacity pumps for its substations ahead of the 2013 hurricane season, which ended with no major storms.

Heat could cause further damage to the grid in the future, causing exploding transformers, damaged circuits and rolling blackouts as homeowners and businesses crank up their air conditioners. By the 2050s, heat waves in the region are projected to last longer and occur more often. The number of days with temperatures above 90-degrees Fahrenheit is expected to triple, to between 29 to 45 days.

"Heat is the most deadly type of weather event in the United States," Radley Horton, a climate scientist at Columbia University's Earth Institute who provided testimony to the PSC, said in an interview. "It's also precisely when the power grid is vulnerable to failures due to high demand."

Rising humidity levels could also strain and stress the grid over time, though to what extent is unclear. The collaborative plans to develop long-term humidity projections and include them in Con Edison's planning process.

Planning for New Normal

The PSC decision reflects a broader attempt to force utilities and other infrastructure providers to plan for a dramatically different future.

"If you're planning to build a structure that will be finished in 2018, and you hope it will still be around in 2080, then it's important to think about what the climate conditions will be like then," Gerrard said.

Massachusetts regulators recently took such an approach when they approved a new natural gas-fired power plant with only a limited life span. It requires the plant to gradually lower carbon dioxide emissions over time until it closes in 2050.

In Maryland, the state utility commission allowed the utility Pepco to charge its customers a monthly "grid resilience" fee to provide steady funding for infrastructure upgrades. Rather than wait for disaster to strike, the utility is anticipating the need to adapt to or bounce back from climate events.

Such measures will undoubtedly carry a massive price tag and spur pushback from ratepayers who ultimately foot the bill. While Con Edison's initial $1 billion resiliency plan is not expected to drive up customer rates in the next few years, additional projects and upgrades in the coming decades would certainly impact rates.

"The challenge is, how are we going to prioritize everything and do it in a way that doesn't overburden customers?" Thormeyer of NARUC said. "We need to do this proactively and in a way that addresses the most vulnerable parts of our system first."

Horton, the Columbia climate scientist, argued that adapting the utility grid to the impacts of climate change will cost far less than all the damages and disruptions that could plague a vulnerable system.

"We can either pay now, or pay far more later," he said.

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