It's one of the hallmarks of modern life, but most people never give it a second thought — until it's not there.
When the lights go out, we get nervous. We worry about the food in the freezer and fridge. Worry about charging cellphones. Worry about keeping kids entertained and the house cool.
Extreme weather, especially ice, can play havoc with the delivery of electricity. The deadly tornadoes, high winds and heavy rain that tore through central Oklahoma in May caused tens of thousands to lose power. Ice storms in late 2007 led to more than 640,000 customers across the state without power, some for several weeks.
The National Academy of Engineering calls the electric grid the most important engineering feat of the 20th century. No one company or single government agency built it. It wasn't centrally planned like the interstate highway system.
Behind that flip of a switch is an entire network of people, equipment and electrons that keep our families comfortable, our lives convenient and the economy moving forward.
But the grid faces challenges in the 21st century, as electric utilities increasingly abandon cheap, plentiful coal in favor of natural gas and renewables like wind and solar. Getting that electricity from generation site to customer will require new transmission lines and lots of money. Other challenges range from the complex to the simple, from cyber terrorists targeting utility computer networks to an inquisitive squirrel jumping on the wrong piece of electrical equipment.
It wasn't always that complicated. The earliest electric lines connected city homes to the local power plant, then farms to the rural electric cooperative. Utilities sprung up and were regulated by the states. The federal government got increasingly involved after the Dust Bowl with hydroelectric projects and during the Great Depression with loans under the Rural Electrification Act. Huge blackouts in the Northeast in 1965 and 2003 led to more federal involvement in grid reliability.
Even today, there is no national grid that can transmit electricity from a nuclear plant in Georgia to a business in Colorado, or from a hydroelectric dam in Washington to a home in Chicago. It's a matter of physics and economics: Electricity needs high-voltage lines to efficiently transmit over long distances, and those lines are expensive to site and build.
At its highest level, the nation's grid is split into three separate interconnections: the Western Interconnection, the Eastern Interconnection and the Texas Interconnection, known by its acronym ERCOT, or Electric Reliability Council of Texas. Electricity can flow between those interconnections, but it's limited by a small number of direct-current transmission lines.
The grid is a patchwork of regional transmission organizations, government agencies and companies all working together — and occasionally in opposition to each other. But the goal is to keep electricity flowing reliably, affordably and with fewer harmful emissions.
“Coordination between the many institutions that govern or operate the U.S. grid will be necessary to ensure that power sector investments made over the next 10 years provide for affordable, reliable, and clean electricity in the decades ahead,” the Bipartisan Policy Center said in a report on grid modernization earlier this year.
Southwest Power Pool
In Oklahoma, the Southwest Power Pool will have an increasingly important role to play in how and where state residents get their electricity. The regional transmission organization, based in Little Rock, Ark., and covering parts of nine states, is taking steps toward a competitive electricity market at the wholesale level.
By early 2014, SPP will launch its integrated marketplace, which will combine 16 separate areas known as balancing authorities into one area to balance supply and demand. The consolidation will offer investor-owned utilities, cooperatives and municipal generators access to electricity from diverse generating sources across the region. It means if the price is right, a utility in Oklahoma could be getting electricity from a nuclear plant in Kansas or a hydropower generator in Missouri.
SPP also pools costs from its member utilities to pay for transmission projects in the region. Each utility member pays allocations based on its customer base, usage and voltage size of the transmission project. In the past, transmission was built at the lowest cost to meet local needs. Now it's planned on a regional basis for the short-term and at 10- and 20-year intervals.
SPP's latest plan shows $1.5 billion in new transmission projects over the next 10 years. Its 20-year plan, which focuses on high-voltage transmission lines of 345 kilovolts, has projects totaling another $560 million.
Oklahoma customers pay among the lowest retail electricity rates in the nation, but the state's per capita income also is below the national average. Generation accounts for roughly 60 percent of a retail customer's electricity rates, while transmission costs account for about 10 percent, according to the Energy Information Administration. The remaining 30 percent goes to distribution, the network of power lines and transformers that serve neighborhoods.
Consumers across the Southwest Power Pool's footprint are expected to benefit from the transmission upgrades and market efficiencies. For example, SPP estimates its implementation of the integrated marketplace will have annual net benefits of up to $100 million across the region. Customers will benefit from the planned transmission projects with fewer line losses, increased reliability, lower emissions and fuel savings.
Still, costs are expected to be passed on in some way to utility ratepayers, said Oklahoma Corporation Commissioner Dana Murphy. Those costs could come in higher overall rates or in separate riders, specific amounts recovered from ratepayers for a single purpose such as a transmission upgrade.
Murphy said those higher costs will come as Oklahoma utilities also do environmental upgrades to meet federal regulations. A recent Corporation Commission report on electric system planning estimated the environmental costs could total more than $839 million in the next decade.
“The bottom line is I think rates for all utility customers will go up; it's just a matter of modulating that, making sure that it doesn't hit all at once and it's not overwhelming,” said Murphy, who also serves as vice president of SPP's Regional State Committee of public utility commission regulators. “That is an incredible challenge.”