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America’s Power Problem

America’s energy sector and power grids are in crisis. According to the American Society of Civil Engineers’ (ASCE) 2017 Infrastructure Report Card, United States energy infrastructure received a grade of D+. Power in the United States flows through an outdated system that is flawed and antiquated and presents serious economic, national security, and consumer risks. Given these multilateral threats, investment to update our energy infrastructure is worth the massive cost. The federal government, however, has taken no action to upgrade our energy infrastructure. Though infrastructure is a relatively non-partisan issue on the surface and polls well across the board, it has not taken center stage in our political discourse. Nonetheless, the United States must rebuild its power grids and energy infrastructure to protect national security, mitigate risk during severe weather events, support efforts to curb climate change and expand overall access to utilities. The burden of this cost can be shared through public-private partnerships that bring utility companies into the fold with federal, state, and local governments. 

Much of the United States energy system was built before 2000 and some electric transmission and distribution lines were constructed in the 1950s and 60s. These systems have a 50-year life expectancy but are still operating today, 20 years past their proposed life expectancy. This outdated system contributes to the fact that the United States endures more power outages than any other developed nation on Earth. This number is continuing to rise as the frequency of strong weather events such as Hurricane Harvey in 2017, during which 800,000 customers lost power, increases. A 2017 report by the Department of Energy titled “US Energy Sector Vulnerabilities to Climate Change and Extreme Weather” showcased that in light of the rising incidence of extreme weather events, numerous power generation facilities across the nation are all at risk. Energy infrastructure must be adapted to a changing climate as electrical production cannot sustain its current levels.

The United States power grid and its outdated infrastructure are increasingly prone to cyberattack by nations and rogue actors. In 2017, Russian agents were successfully able to infiltrate US utilities although they did not trigger widespread blackouts. The Department of Homeland Security and the FBI designated responsibility to a Russian group that gained access to industrial control systems, which monitor power flows and balance the supply and demand of electricity. Although no major blackouts occurred from this infiltration, the threat to the power grid is only increasing. In 2018, presidential advisors stated that the nation should potentially prepare for a “catastrophic power outage” from a potential cyberattack. As a result, the power grid and overall energy infrastructure must take national security interests into account going into a future with increasing usage of cyber warfare.

Though many might not think of energy infrastructure as an immediate concern, it is an issue that has impending consequences for the lives of all Americans. Energy facilitates all activities in this country, thus infrastructure investment must be a priority for the US government. The ASCE estimates that $934 billion in investment would be needed to overhaul the power grid and all energy production infrastructure. While this number points to an incredibly large undertaking, much of the cost can and should be offset by public-private partnerships. The World Bank defines public-private partnerships as “a long-term contract between a private party and a government entity, for providing a public asset or service, in which the private party bears significant risk and management responsibility, and remuneration is linked to performance.” These agreements allow for federal, state, and local governments to work with companies and investors in the private sector to bring the highest level of expertise and equipment to the rebuilding of US energy infrastructure. In an industry such as utilities, where barriers to entry for competitors are high and private companies have the most expertise, public-private partnerships can be valuable. Collaboration with the private sector can bring greater net investment to infrastructure projects. The question, however, if whether state and local governments have the ability to take on this burden. Public policy must be able to accommodate the assets, staffing, and contracts needed to facilitate a public-private partnership. In nations such as India, public-private partnerships have been successful and P3 investment has allowed for major upgrades in the nation’s infrastructure. India is the world’s largest market for public-private partnerships which have allowed the nation to continuously evolve its infrastructure capabilities. Even in the US, public-private partnerships in some sectors have taken hold and experienced great success. One such example is a public-private partnership in the information technology sector in Seattle in which Gigabit Squared, a private company, facilitated the distribution of high-speed internet for Seattle residents. Expanding P3 investment to energy infrastructure in the United States would allow for rapid improvements in infrastructure and divert the cost from the government.

Public-private coordination between the US government and private utility companies can be particularly valuable in mitigating the risk of a major cyberattack and the effects that can be seen from such an attack. Even though the United States possesses major capacity to strike back in the event of a cyber attack, energy infrastructure needs to be rebuilt in order to prevent any infiltration into American utilities. In particular, utilities are major targets for hostile enemies, and as cyber warfare continues to permeate the modern image of conflict, energy infrastructure must adapt and focus on reducing risk and potential damages. To mitigate the risks that are presented by extreme weather events, a ‘storm-hardening’ plan must take effect for energy infrastructure. In restructuring the energy infrastructure of this nation, investment in transmission and distribution, refinery, and generation systems that are built to withstand major storms must occur. These systems would also need to facilitate the rapid restoration of energy in the event of power outages. Efficiency is key and the energy infrastructure of this nation cannot afford to be vulnerable to weather in times of crisis.

In rebuilding energy infrastructure, new projects must focus on eliminating “access gaps” that are felt among all areas of infrastructure. These gaps create inequities that are prevalent in some of the most economically disadvantaged areas of the country. Barriers to the best utilities and services are impeding economic development in many areas and new energy infrastructure must emphasize expanded access to services. In accordance with this, federal policy must review the viability of renewable energy sources in rebuilding energy infrastructure. With increasing viability for alternative energy, energy infrastructure should focus on sources of energy that are greener and will be supported in a changing climate. Everything that is connected to an electrical grid is only as clean as the grid itself. Thus, greener electricity must be a focus to “lift all electric boats.” Overall electrification of energy, as opposed to fossil fuels, will require targeted policy in order to facilitate an efficient and sustainable system.

Infrastructure investment is one of the few policy areas that polls well among almost all Americans. This trend begs the question as to why nothing can be accomplished to improve our energy infrastructure. We live in a political climate that is defined by partisan schisms in every area of policy. It would seem as though improving a public good that facilitates the entire American economy would be a no-brainer on both sides of the aisle. Democrats and Republicans agree that infrastructure is an important area of policy, but throughout this current administration, infrastructure has made headlines sporadically and then disappeared into the abyss of policies that the public forgets. People agree that infrastructure is important, but it does not arouse the intense emotions that policies like immigration and healthcare do. The messaging around infrastructure must change on both sides of the aisle. Infrastructure is often framed as a massive cost that the United States can’t afford. Politicians discuss infrastructure in terms of a rising deficit or mounting debt. They are missing the essential point that reform is essential to the economic survival and advancement of the United States. As a result, the government must step up and improve policy and focus on rebuilding its infrastructure to continue its economic vitality on the global stage.

In the increasingly globalized economy of today, American infrastructure should be supporting economic growth, not hampering it. Our power grid and energy infrastructure is dangerously outdated and deserves a massive investment not only to support economic interests but for security and consumer interests. The US cannot be operating with a decrepit system that is deteriorating day by day. Solutions for rebuilding can involve public-private partnerships and must take into account the implications of climate change, mitigate the risks that are presented by security threats and extreme weather events, and close access gaps for utilities across the board. Congress has balked on any substantive infrastructure project, even though it polls well throughout society. The nation must come together to push for this crucial policy issue for the sake of economic development, national security, and the future of the US as a whole.

Photo: Image via Daniel Hoherd (Flickr)