Measuring the Resilience of a Grid's Worth

In a recent report titled "Resilient by Design: Utility Strategies for Climate-Ready Distribution Systems," the resilience plans of 17 utilities across the United States have been reviewed. This comprehensive study sheds light on the growing focus on resilience in the utility sector, with capital expenditures for resilience rising from $136.6 billion in 2021 to over $160 billion in 2023. A significant portion of this investment, approximately 36%, is directed towards adaptation.

However, determining the monetary value of resilience remains a complex task. Mac Keller, resilience manager at SEPA, acknowledges this challenge. Some utilities, such as the one serving Indianapolis, are innovating by developing data-driven resilience metrics. These metrics model the relationship between outages and weather, as well as the recovery time after outages, using operational data. By quantifying system resilience spatially and temporally, these metrics can provide a transparent, data-backed means for regulators to accept them.

The first step towards valuing resilience, according to the report, is understanding the risk. This can be achieved by using historical records and climate projections. Utilities like Entergy New Orleans prioritize projects based on their cost-benefit ratios, considering factors such as avoided outage time and storm restoration savings.

Despite these efforts, the report highlights the challenge of measuring the outcome of a resilience investment and quantifying its value to regulators. Mishal Thadani, CEO of Rhizome, notes that utilities are balancing costs and benefits when incorporating resiliency into their distribution system planning.

To address this challenge, the report recommends considering approaches to valuing resilience, along with developing, refining, and tracking resilience metrics, and using advanced data-driven planning tools. However, it's early days, and there's not a generally accepted silver bullet for valuing resilience.

Tracking investments and their performance is not quite the same as putting a monetary value on them. Loss can be quantified in terms of outages and the percentage of people losing power during a specific event, but it can also be part of a more detailed picture. For instance, Oncor's metrics include the number of customers experiencing long interruption durations and the timeframes of power restoration. Consumers Energy has established trackable goals, such as "no customer outage longer than 24 hours," to benchmark system performance over time.

The report also discusses the $500 billion gap in the capital needed to harden generation, transmission, and distribution systems against the effects of climate change. Despite this daunting figure, the majority of utilities are still far from figuring out how to put a monetary value on resilience.

PG&E, for example, is investing in undergrounding power lines and covering conductors, but finds the cost of operation exorbitant for lines reaching rural areas. Instead, PG&E is deploying remote grids to service hard-to-reach customers, aiming to reduce their exposure to fire risk.

In conclusion, while the journey to valuing resilience in utilities is challenging, it is a necessary step towards building climate-ready distribution systems. The report suggests that it's what folks are looking for, but it's unclear how we'll get there. As the utility sector continues to innovate and refine its resilience metrics and planning tools, we may soon find a solution to this complex problem.