Preface.  This is a book review of Munson’s “The Business of Power and what it means for the future of electricity”. Although it was written in 2008 and some efforts have been made in some places to improve the grid, it is still falling apart, deregulation made matters worse.

I live in California, and am witnessing another effect of the poor maintenance of the electric grid: wildfires. I had a front-row seat in 1991 when our home burned down in Oakland.  For any of you who may suffer in the future from wildfire or any disaster, I recommend you read my post about how insurance companies deny claims to prevent them from doing so: Delay, Deny, Defend: Why Insurance Companies Don’t Pay Claims and What You Can Do About It by Jay M Feinman.

Most forms of alternative energy depend on the electric grid (nuclear, wind, solar, geothermal, hydropower, wave, tidal, batteries). But the grid is falling apart because of privatization and the splitting of the grid into thousands of competing, uncoordinated entities with little economic incentive or subsidies to maintain the grid. Shareholders and executive perks are far more important in privately owned utilities than their rate payers.

Richard C Duncan proposed an “Olduvai Theory” that the current industrial civilization would have a maximum duration of 100 years from 1930 to 2030. A key indicator that the “End Was Near” would be when partial and total blackouts began to grow common.  And it is getting more common in the poorest nations of Venezuela, North Korea, Syria and others.  Much as I write about why fossil fuels are essential for civilization, so is the electric grid (which is nearly two-thirds dependent on fossil fuels in the USA) for many reasons explained in this post: “A nationwide blackout lasting 1 year could kill up to 90% Americans“.  An unreliable grid would also make producing microchips which are essential to just about every product that runs on electricity, from toasters to cars to financial systems:  “Microchip fabrication plants need electricity 24 x 7 for four months“.

Alice Friedemann  www.energyskeptic.com  Author of Life After Fossil Fuels: A Reality Check on Alternative Energy; When Trucks Stop Running: Energy and the Future of Transportation”, Barriers to Making Algal Biofuels, & “Crunch! Whole Grain Artisan Chips and Crackers”.  Women in ecology  Podcasts: WGBH, Jore, Planet: Critical, Crazy Town, Collapse Chronicles, Derrick Jensen, Practical Prepping, Kunstler 253 &278, Peak Prosperity,  Index of best energyskeptic posts

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Munson, Richard.  2008. From Edison to Enron: The Business of Power and What It Means for the Future of Electricity 

We’ve only been able to use electricity about a century, with profound changes in lifestyle.  We stay up late, move about on streetcars and elevators, use electric motors throughout industry or at home in our washing machines, refrigerators, air conditioners, ovens, television, computers, and so on.

There are still about 2 billion people who don’t have access to electric power, and population is growing faster than electrical wires are expanding.

Electricity can’t easily be stored, and delivering it is incredibly tricky, with the grid needing to balance supply and demand every microsecond.

It’s a huge business – electric utilities have assets worth over $600 billion – the nation’s largest industry.   It’s extremely capital intensive, requiring massive amounts of investment – up to 100 times more investment per delivered unit of energy than oil systems.

The electric industry donated over $21 million dollars to politicians,  mainly for subsidies to allow old and dirty plants to keep polluting.  Utilities also court Wall Street, which sells their bonds.

You could consider the electric grid of North America to be the world’s largest machine, with wires stretching from coast to coast.

The grid is complex, fragile, and has a lot of problems:

• 200,000 miles of high-voltage transmission lines that must balance electricity consumption second-by-second
• Despite advanced computers, much of the electricity transmission system relies on mechanical circuit breakers and controls from the 1950s.
• Threats to the grid include sagging power lines, trees, hurricanes, and terrorists.
• The most frightening threat is if just one nuclear weapon were exploded at high altitude — 70% of the U.S. power grid could fail from EMPs causing cascading failures
• The efficiency of the utility industry hasn’t increased since the late 1950s
• 66% of the fuel burned to generate electricity is lost (i.e. 3 lumps of coal to deliver 1 lump of electricity).  As electricity travels along the lines, another 10% of energy is lost.
• Power blackouts and surges cost Americans $119 billion per year – a 44% surcharge
• Electric power generation is the largest pollution source, spewing mercury, sulfur dioxide, carbon dioxide, and many other pollutants into the air and water
• Power generation plants are old, inefficient, filthy.  The average plant was built in 1964 with 1959 technology.  More than 20% of plants are more than 50 years old.
• The electric grid is fragile.  Munson calls our grid a “rickety antique”.  Transmission lines were not built to handle the huge amounts of electricity transmitted now, which overloads them and leads to blackouts.  In 2003, it only took 3 minutes for 50 million Americans and Canadians to lose their electricity, the 4^th catastrophic failure in 10 years.  2 million lost power in 1996 when the conjunction of a squirrel burning on a transformer and a power line in Idaho came in contact with a tree caused an outage.  In 1998 an ice storm cut power to parts of the United States and Canada.
• Expansion. It’s hard to expand the grid because construction costs are high, the best corridors are not available because of urban development or go through wilderness areas, military reservations are in the way, and NIMBYism.
• It’s polluting and filthy. After Carson’s 1962 “Silent Spring”, American activists attacked utilities for the air pollution they generated that could lead to emphysema, lung cancer, and heart disease.  Electric power was the source of more than half of the nation’s sulfur dioxide emissions.

Thomas Edison saw electricity as vastly superior for lighting than gas lamps, which flickered, emitted ammonia and sulfur, blackened glass globes and rooms, and had to be lit and snuffed one by one.

The early electrical industry was:

• Ugly: in New York alone 20 different companies strung up their own wires on poles and buildings. The New York Times described downtown streets as “darkened by wires”. Wires remained up after business failures, sometimes fraying and causing short circuits.
• Corrupt: bribes of aldermen to get permits, price fixing (which led Congress to pass the Sherman Antitrust Act)
• Had no standards:  plugs were different sizes, voltages varied. If you moved, you risked your appliances no longer working.
• Bad for horses: exposed wires and fault insulation threatened horses wearing metal shoes pulling trams about on streets.
• Inefficient: large plants were most likely to fail and cost the most to construct. Turbine blades twisted, furnaces didn’t stay hot enough, and many other defects reduced reliability and performance.

Nuclear generated electricity – why it will never happen despite peak oil

Cost overruns on reactors nearly drove some power companies into bankruptcy.   In 1984 the Department of Energy calculated more than 75% of reactors cost at least double the estimated price.

Utility WPPSS in Washington state defaulted, scaring investors, who once thought there’d be over a thousand reactors running by 2000 with electricity too cheap to meter.  In fact, only 82 plants existed in 2000 and power prices soared 60% between 1969 and 1984 due to the cost overruns.

Nuclear executives tried to blame their problems on too much regulation and environmentalists, but regulations only came after reactors began to break down.   Intense radiation and high temperatures caused pipes, valves, tubes, fuel rods, and cooling systems to crack, corrode, bend, and malfunction.  Only then did the public create the Atomic Energy Commission (now the Nuclear Regulatory Commission) to regulate nuclear power facilities.

Munson lists quite a few problems, but you should search on “Nuclear Reactor Hazards  Ongoing Dangers of Operating Nuclear Technology in the 21st Century” to get a real good understanding of the magnitude of failures despite regulation.  Indeed, even the Wall Street Journal was forced to admit at one point that reactor troubles “tell the story of projects crippled by too little regulation, rather than too much.”

Some of this stemmed from nuclear engineers seeing uranium as just a complicated way to boil water.  But a reactor is not simple, there are over 40,000 valves, the fuel rods reach temperatures over 4,800 F, and it isn’t easy to contain the nuclear reactions.

Management was poor as well, with Forbes magazine calling the U.S. nuclear program “the largest managerial disaster in business history, a disaster on a monumental scale.”

Deregulation has been a disaster

Electricity generators make more money constructing more power plants, but not transmission and distribution due to the Public Utility Regulatory Policies Act in 1978 and the Energy Policy Act of 1992.

While power demand went up 30%, transmission capacity only grew 15%.  Suddenly there are a lot more companies moving power in unprecedented amounts, and they aren’t coordinating their efforts as well as the fewer, regulated utilities did.  There are no financial incentives to cooperate.

According to Michigan’s top utility regulator, “It would surprise a great number of Americans to know there is presently no government oversight of the reliability of this country’s electric transmission system”.

The Federal Energy Regulatory Commission would like to stop this balkanized system, but utilities have successfully fought off such regulation so far.  Munson says that this “greed, of course, only forces the rest of the nation to live with an old and uncoordinated transmission system”.

How to improve the industry

Munson spends many chapters explaining how utilities could be better regulated, encouraged to cooperate and innovate, how to discourage Enron-like behavior, and build more efficient power plants.

My own conclusions

I think it’s too late to do much about the poor state of the electric grid and how it’s operated — world oil production probably peaked in 2018, so the energy to fabricate, deliver, and maintain new infrastructure and fix existing facilities means it’s too late to add wind, solar, and so on to fill in the fossil fuel gap.

And don’t forget, this is a LIQUIDS FUEL CRISIS.  99% of transportation is oil-based.

At the same time, the financial system is in the largest bubble ever and on the brink of collapse. Where will the investment come from?  How can such delicate, fragile systems operate as social unrest grows?  How will it even be maintained let alone increased in size and stability as declining resources make growth impossible in a finite world?