The US Blackout: Lessons For India

People’s Democracy

Organ of the Communist Party of India (Marxist)


No. 36


US Blackout:

For India


blackout in the US and Canada that took place on the 14th of last month cut a
wide swathe across north-east America, leaving more than 50 million people
without electricity, some even more than 24 hours. Major cities including New
York went dark, with homes, shops being without power and even the underground
shutting down. The economic losses are staggering, by rough calculations equal
to billions of dollars. While the neo-conservative orthodoxy claim that this has
nothing to do with deregulation and open access being introduced in the US
electricity sector, serious questions are beginning to surface about the
increasing vulnerability of the North American Grid as a result of these
policies. The key question here is that with open access being pushed in the US,
the amount of power being traded on the grid has increased substantially. The
net result is that the Grid is now being driven closer to instability, in which
partial or full blackouts are an inevitable consequence.





are certainly not uncommon to grids. We have them in India once or twice a year,
and even the US has seen such blackouts earlier, although much fewer in number
than us. Any electrical system such as the electricity grid, has to be in
continuous balance each second; the demand from consumers must be met by power
supplied by the generators. Normally, blackouts happen when a generating plant
trips, suddenly creating a large demand from consumers in that area which cannot
be met from the immediate surroundings. It then sucks power out of nearby
systems, which may survive if they have adequate reserve capacity. If not, the
imbalance can create conditions, which lead to the connected generating plants
also tripping and a cascading trip of plants across the grid. The collapse of
the plants finally leads to the collapse of the system as a whole, in which
parts may ride out if they disconnect from the grid early enough to work as
isolated islands. Interestingly enough, the evidence indicates that this
blackout, unlike earlier ones, did not start this way. It was more the system
instability spreading across the grid rather than a particular region sucking
out large amounts of power that lead to the blackout on August 14. The
instability preceded the blackout rather than the other way around.


are systems not designed to work in isolation anyway? Would that not be safer
than such cascading trips and huge blackouts? To answer this, we must understand
that larger the system, the greater is the ability to survive disturbances. The
system is less prone to failure, as the reserve of all the plants connected to
the grid can be used to overcome the problem of a plant tripping or any other
disturbance in one particular area. However, there is a cost to this. We now
have a risk of a larger area being hit by the disturbance, which earlier would
have been localised. The benefits — much greater stability, lower costs, more
even supply and demand — far outweigh these risks.


North American grid was held by the US
Academy of Engineering

as the most important technical achievement of the 20th century; in the eyes of
the engineers it was more important than the more glamorous performers such as
the internet, sending man to the moon, etc. It underlies the way North American
society works in which the availability of power 24 hours of the day is taken
for granted. Its failure therefore has created concerns about what is happening
in the electricity sector. It is no longer an area where experts debate esoteric
concepts such as “open access”, “competition”,
“electricity pool”, etc., but of vital concern to all the people.





North American grid consists of 3 semi-autonomous grids — one to the east and
northeast including large parts of Canada, one to the west (west of Rocky
Mountains) and the third being the state of Texas.

recent blackout that took place started from the Mid Western region of Ohio,
which is essentially a part of the Eastern Grid. 
Here, there was an existing shortage of power in Northern Ohio, leading
to large withdrawals from South Ohio. The problems started when an additional
power plant – the 680 MW
Lake Unit 5 —
The additional power being drawn to compensate for this lead to some of the
transmission lines overloading and snapping of the links between North and South


Ohio region has a large demand and it sought to compensate this loss of supply
by drawing power from surrounding Michigan and Ontario area. This lead to a huge
amount of power being transmitted to the Cleveland area via an indirect route
— from New York-Ontario as also from Michigan. Such large flows across the
34,000 miles of High Tension cables of the Eastern grid lead to system
oscillations and various transmission lines tripping. The connected instruments
show frequency and voltage fluctuations across large parts of the system. Plants
in various states — Michigan, Ontario, New York started also to trip. At this
point, the Ontario system tried to isolate itself from the New York system. This
resulted in huge power flows taking place to Ohio with now no power coming in
from New York. The Ontario system went down as a result. On the New York side,
suddenly there was a huge surplus of power with nowhere to go. The New York
system also gave way. What was minor occurrence in Ohio had now become a major
nationwide blackout.

are certain points that emerge from this. The problem started with a loss of the
665 MW from one plant in Northern Ohio. This should not have had such major
consequences. Systems are designed to take care of such problems and also
protective measures should have automatically caused the systems to island
themselves and ride out this disturbance. What happened is that the recent
policies of deregulation have meant that the grid always sees large amounts of
power flow due to power trade introduced in the last few years. The grid was
already close to its margin in some parts, particularly in the mid West. The
North American Energy Reliability Council had already identified this as a
problem area. A disturbance, which would have been easy to ride out otherwise,
finally blew up the system that was already in a state of extreme stress.



recent power sector reforms, even in India, are aimed at facilitating power
trade. The whole idea is that if energy can be traded easily, the prices will
come down through competition. Therefore, the task of the policy makers —
according to the current neo-conservative ideology — is to put in place a
system that allows markets to operate and removes the regulators (in the US) or
the public sector/government. Such a policy encourages power flows across large
distances for reducing the price, even by a few cents. What nobody is talking
about is that such additional power flows means that the grid (the high voltage
transmission system) must be augmented to allow for such flows to take place
safely. If we do not, increased blackouts are the likely consequence


are the likely savings of such power trade in the US against the costs of
augmenting the grid? By most optimistic computations, the savings are likely to
be of the order of 5 per cent at most, and only 1 to 2 per cent in probability;
a maximum saving of about 3 to 5 billion dollars. If the markets fail, as they
did in California, the consumers could fork out even more than $50 billion that
the California consumers lost. In addition, the cost of improving the grid –
according to the Federal Electricity Regulatory Commission — is of the order
of $50-100 billion.


the US, various criticisms are now surfacing over increased de-regulation and
rise of outages. The utilities are cutting back on maintenance and the systems
are becoming more and more unreliable.


one central fact stands out in all this. Increasingly, there is nobody
responsible for the system as a whole. With regulators losing their teeth, a
fragmented system in which generators and utilities are being separated,
reliability and stability is nobody’s baby. The most important technical
achievement of 20th century American engineers is now being jeoparadised for the
supposed gains of open access and power trade.


US example is important for us in India. The Electricity Act 2003 follows the US
fascination of deregulation. It has asked that all SEBs have to ensure open
access. This means that all SEBs have to allow its network to be used for
transmitting power from any generator (even a captive generator) to any bulk
consumer. The Act also specifies that electricity should be a tradable
and this indeed its entire raison d’etre.


our earlier criticism of this concept of “open access”, welcomed by
both the BJP and the Congress, we had raised two issues. One is if there is a
scarcity of electricity as there is in India today, encouraging competition and
power trade will only lead to profiteering and push up the prices. The other is
that insisting on “open access” is asking the SEBs to sink huge
amounts in transmission for which commensurate benefits are few. In effect, the
government wants to subsidise power traders and private generators by asking
already bankrupt SEBs to spend huge amounts for augmenting the existing
transmission system.

problem with the electricity reforms, both here and in large parts of the world,
is that the attempt is to convert electricity to any other commodity.
Unfortunately, the electrical system obeys laws of physics. We may decide that A
will buy power from B, but the power flow does not happen this way. The flow
will occur based on the entire set of grid conditions existing then.


the transmission system or the grid be made in such a way that large power flows
are not a problem? The answer probably is that even if very large sums are
spent on the grid, the electrical system with large power flows operating with
the logic of the market, will always be more unstable then a system that allows
local systems to be largely self-sufficient with only surplus and deficit being
traded through links. This was how the grid was developed and still remains the
most sensible way to operate the grid.


entire development of power grids was based on power flows only as a back-up
from other plants in case one fails and meeting shortages or distributing
surplus from one area to another. It can be made to take in additional power
flows if the direction and the quantum can be pre determined. One can then
design these into the system. But building a system that can take any amount of
power flow in any direction is both prohibitively expensive and inherently


are then such reforms being pushed? The answer lies in that increasingly,
speculative capital and trade is taking control of the capitalist economies of
advanced countries. It was Enron, which decided that the new economy meant power
trade as business and not generation/transmission business. To help these
traders, the government should chip in, not only in dismantling the existing
regulatory controls but also funding the transmission network. The people would
pay for these, pressurised by the lack of reliability of the system and finally
increased power costs. So instead of lower electricity rates, the prices would
actually rise. While the people would pay larger amounts, the power traders will
make more and more money.


advanced capitalism is seeing growth of the speculative economy, why is India
following suit? Is it that speculative capital is becoming more entrenched here
too or is it the neo-colonial belief whatever is good for US must be good for
India today? The US blackout is only a precursor to what will happen here too
and obviously much more often. With a fragmented network, increased power
flows and a government that does not understand the difference between
electrical power and soap as commodities, we are likely to see even higher costs
of electricity accompanied by a lack of reliability as the Indian government
follows the US style reforms.