How Utilities Are Planning for Extreme Weather Events and Mitigating Risks

Scientists who maintain the world’s temperature records, which date back to 1880, calculate a global temperature anomaly each year to determine how much temperatures have changed compared to temperatures from 1951 to 1980. In mid-January, they announced that 2023 was the hottest year on record. Furthermore, they said every month from June through December 2023 came in as the hottest on record for each of the months. Notably, July 2023 ranked as the hottest month ever recorded.

NASA researchers say extreme weather across the planet, including heat extremes, wildfires, droughts, tropical cyclones, heavy precipitation, floods, high-tide flooding, and marine heat waves, will become more common and severe as the planet warms. That’s a big problem for power grids, because extreme weather often causes outages and damage to grid assets.

Michael Levy, U.S. Networks lead and Global Head of Asset Resilience at Baringa, a global management consulting firm, is highly focused on extreme weather risks and developing plans to help mitigate the threats. He suggested accurately forecasting dollars of risk at the asset level from extreme weather events is very important to his clients.

“Every facility all across the U.S. is having a heightened awareness of some of these extreme weather events, and more importantly, how they can protect themselves and their customers against those in the future,” Levy said as a guest on The POWER Podcast.

“Utilities have always been really good, generally, at keeping the lights on and maintaining a fair level of reliability,” said Levy. “In general, they’re making the right investments—they have the right ambitions—but what’s challenging about these extreme weather events is that because they’re so infrequent at individual locations, and the impacts are so severe, what we find is that utility clients often are really challenged to estimate those high-impact, low-frequency events, and integrate them into their investment plans.”

However, Levy said advances in attribution climate science are helping utilities overcome some of the challenges. “Scientists are now able to associate, with reasonable level of accuracy, what increasing warming means physically for the rest of the world in terms of how the frequency and severity of these extreme weather events may change,” he explained.

Because attribution science has improved so much, climate scientists are now able to predict with a reasonable level of precision, what the climate is going to look like several decades from now. That allows utilities to plan for such a future.

“One of the big things that we focus on with our utility clients is converting those climate forecasts into dollars of risk, and that way, it gives them an addressable baseline that they can substantiate spend against,” said Levy. “If you’re undergrounding lines to protect them against wildfire, elevating substations to protect them against flooding, all of those things cost money, and we’re increasingly seeing regulators—they want to see the benefits, they want to see that the money is being spent prudently. So, that’s what we’re talking to our clients about today,” he said.

And utilities have proven that sound planning does pay off. Levy pointed to actions taken in Florida following particularly active and intense hurricane seasons in 2004 and 2005. Soon thereafter, the Florida Public Service Commission adopted extensive storm hardening initiatives. Wooden pole inspection and replacement programs were adopted, and vegetative remediation solutions were implemented, vastly improving grid reliability. Additionally, investor-owned electric utilities were ordered to file updated storm hardening plans for the commission to review every three years.

However, the proof is in the pudding, and for Florida, grid hardening has tasted very good. Levy compared the effects experienced from Hurricane Michael in 2018 to those of Hurricane Ian in 2022. “When Ian came, despite being a bigger and stronger hurricane, they had no transmission lines down, which, of course, are very costly and time intensive to replace, and they were able to restore customers three times as fast, despite having more customers out. So, they’re experiencing what we like to call at Baringa ‘the rewards of resilience,’ because investing in resilience is a fraction of restoration costs,” said Levy.

Still, different parts of the country experience different types of risk. In some areas, extreme heat is the biggest concern. In other regions, winter storms cause the highest risks. Flooding, wildfires, and sea level rise are also high on the list in some locations. “The challenge is that every utility has a finite amount of capital to spend, because they’re bounded by resources and customer affordability. And, so, assessing this extreme weather risk allows them to have the confidence that they’re buying down the most risks possible, given those constraints that I had mentioned, while also future-proofing their network,” Levy said.

To hear the full interview with Levy, which contains insights on digital transformation and how utilities are benefiting from data analysis, artificial intelligence and how it’s being used across the industry, electrification and how it’s affecting power company investments, virtual power plants and how they benefit grid operators, and distributed energy resources and how they enhance reliability, listen to The POWER Podcast. Click on the SoundCloud player below to listen in your browser now or use the following links to reach the show page on your favorite podcast platform:

For more power podcasts, visit The POWER Podcast archives.

Aaron Larson is POWER’s executive editor (@AaronL_Power, @POWERmagazine).

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