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Prepared Witness Testimony The House Committee on Energy and Commerce
Blackout 2003: How Did It Happen and Why?
Full Committee on Energy and Commerce
The Honorable Bob Taft
Mr. Chairman, members of the committee, thank you for this opportunity to testify. It is my hope that what happened on August 14th will awaken us all to the urgency of creating a modern, well coordinated system for the transmission of electricity. The unprecedented blackout that occurred posed severe threats to public health and safety and to the economy of Ohio, other states and provinces, and two nations. Although we will not know for some time the exact sequence of events that gave rise to the blackout, this incident revealed serious shortcomings in the transmission of electricity that could well create a real calamity in the future if not addressed. The blackout underscores our deep dependence on our energy infrastructure and the vulnerability of that system. The consequences go far beyond the personal inconvenience of lights, refrigerators or air conditioning. In Cleveland, the down-stream impacts lead to a near catastrophic failure of the city's water system, leaving tens-of-thousands in the metro area without safe drinking water and rendering beaches unsafe for days due to sewage contamination. The interruption of business activity resulted in the loss of millions of dollars of economic activity that will not be fully recouped through private insurance and state or federal programs. One major Ohio company lost steel making capacity for more than a week because of the damage from the blackout. Above all, the blackout shook the confidence of our citizens in a system that most take for granted. We must now do whatever it takes to establish an improved system that people can rely on to power their homes, their offices and their communities. In an immediate effort to assist with an answer to the question of "what happened?", I have directed the Public Utilities Commission of Ohio (PUCO) to begin a second by second account of events in Ohio that took place leading up to and during the blackout. PUCO Chairman Alan Schriber has been in contact with utilities and industry organizations operating in Ohio, to gather timelines and other data critical to the investigation. As a member of the joint U.S. - Canadian Task Force, he will make that information available to support the bi-national investigation. From the standpoint of preventing a future potentially more serious blackout, we support several initiatives that are underway or under consideration. First, we urge the Congress to require mandatory reliability standards for the transmission of electricity. Voluntary standards have been proven inadequate. Responsibility for enforcement of rigorous national standards for the safe and reliable transmission of electricity should be given either to a federal agency or state commissions operating to enforce federal standards. With respect to rail lines and natural gas pipelines, there is already precedent for state enforcement of national safety and reliability standards in Ohio and other states. Second, I strongly support FERC's proposal for an effective, empowered regional system that places direction and control of transmission with independent regional grid operators. The current system is both fragmented and weak. For example, in Ohio oversight of transmission is divided between two different organizations. We have companies that are members of the Midwest ISO, others that belong to PJM, and one company who's efforts to join a regional group has been delayed by legal and technical disputes. In addition, the Midwest ISO and PJM lack effective control over the transmission lines in Ohio they are supposed to oversee and coordinate with lines outside Ohio. Congress should act promptly to support FERC's plan for empowered, all-inclusive regional transmission entities. A three-year delay, as some are proposing, would impose an intolerable risk on the nation. I have directed the Public Utilities Commission of Ohio to conduct a review of whether Ohio's division among two separate regional transmission organizations poses a serious risk to the reliability of the delivery of power to customers in Ohio and, if warranted, provide recommendations to bring utilities within the state under a single transmission organization. Without strong federal action, such a result may not be achievable. In addition to mandatory reliability standards and strong, regional transmission organizations, we must not overlook the importance of investment in technology and infrastructure to upgrade the grid and its operating systems. It has been reported by many sources that investment in transmission has declined even as the burden on the lines has increased. After the blackout, a transmission system operator in Michigan reported his company should have received a "courtesy call" from an Ohio utility in regard to lines going out in Ohio. Quite frankly, in the 21st Century, a system that relies on "courtesy calls" is clearly outdated and must be modernized. Therefore, I encourage the Congress and the FERC to provide incentives and adequate return on investments to enable grid operators to upgrade transmission systems including the deployment of advanced technology to detect problems and provide rapid communication and coordination. Some may disagree that change is needed. Others will use the blackout as a platform for concerns that are not relevant to the cause of the outage or actions necessary to prevent new blackouts in the future. I believe we must support the joint U.S. - Canadian Task Force as it works to identify the causes of the blackout, adopt national mandatory reliability standards and establish a strong regional transmission system capable of upgrading technology, creating regional wholesale markets and managing the power grid so our lights will stay on. I urge the Congress to enact the required reforms at the earliest possible date as part of a comprehensive energy bill that addresses also the need to expand domestic energy supplies, reduce our dependence on imported oil and eliminates the ethanol penalty which unfairly discriminates against Ohio and other states in the allocation of federal gas tax dollars.
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