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Tuesday, August 15, 2023

Northeast blackout of 2003

 
Northeast blackout of 2003
This image shows states and provinces that experienced power outages. Not all areas within these political boundaries were affected.
DateAugust 14–16, 2003
Duration2 hours–4 days, depending on location
LocationNortheastern United States, Southeastern Canada
TypeBlackout
CauseSoftware bug in the alarm system in the control room of FirstEnergy
Outcome55 million people affected
Deathsalmost 100

The Northeast blackout of 2003 was a widespread power outage throughout parts of the Northeastern and Midwestern United States, and most parts of the Canadian province of Ontario on Thursday, August 14, 2003, beginning just after 4:10 p.m. EDT.

Most places restored power by midnight (within 7 hours), some as early as 6 p.m. on August 14 (within 2 hours), while the New York City Subway resumed limited services around 8 p.m. Full power was restored to New York City and parts of Toronto on August 16. At the time, it was the world's second most widespread blackout in history, after the 1999 Southern Brazil blackout. The outage, which was much more widespread than the Northeast blackout of 1965, affected an estimated 55 million people, including 10 million people in southern and central Ontario and 45 million people in eight U.S. states.

The blackout's proximate cause was a software bug in the alarm system at the control room of FirstEnergy, an Akron, Ohio–based company, which rendered operators unaware of the need to redistribute load after overloaded transmission lines drooped into foliage. What should have been a manageable local blackout cascaded into the collapse of much of the Northeast regional electricity distribution system.

Immediate impact

According to the New York Independent System Operator (NYISO) – the ISO responsible for managing the New York state power grid – a 3,500 megawatt power surge (towards Ontario) affected the transmission grid at 4:10:39 p.m. EDT.

For the next 30 minutes, until 4:40 p.m. EDT, outages were reported in parts of Michigan (Detroit), Ohio (Cleveland, Akron, Toledo), Ontario (Toronto, Hamilton, London, Windsor), New Jersey (Newark), and New York (New York City, Suffolk, Nassau, Westchester, Orange and Rockland counties, Rochester, Syracuse, Binghamton, Albany).

This was followed by outages in other areas initially unaffected, including all of New York City, portions of southern New York state, New Jersey, Vermont, Connecticut, as well as most of the province of Ontario. Eventually, a large, somewhat triangular area bounded by Lansing, Michigan, Sault Ste. Marie, Ontario, the shore of James Bay, Ottawa, New York, and Toledo was left without power.

According to the official analysis of the blackout prepared by the US and Canadian governments, more than 508 generating units at 265 power plants shut down during the outage. In the minutes before the event, the NYISO-managed power system was carrying 28,700 MW of load. At the height of the outage, the load had dropped to 5,716 MW, a loss of 80%.

Essential services remained in operation in some of these areas. In others, backup generation systems failed. Telephone networks generally remained operational, but the increased demand triggered by the blackout left many circuits overloaded. Water systems in several cities lost pressure, forcing boil-water advisories to be put into effect. Cellular service was interrupted as mobile networks were overloaded with the increase in volume of calls. Many cell sites were out of commission due to power outages. Television and radio stations remained on the air, with the help of backup generators, although some stations were knocked off the air for periods ranging from several hours to the length of the entire blackout.

It was a hot day (over 31 °C, or 88 °F) in much of the affected region, and the heat played a role in the initial event that triggered the wider power outage. The high ambient temperature increased energy demand, as people across the region turned on fans and air conditioning. This caused the power lines to sag as higher currents heated the lines.

In areas where power remained off after nightfall, the Milky Way and orbiting artificial satellites became visible to the naked eye in metropolitan areas where they cannot ordinarily be seen due to the effects of air particulates and light pollution.

Most of the Amtrak Northeast Corridor service was interrupted, as it relied on electricity for its signaling and crossing systems; electrified commuter railways also shut down. Via Rail in Canada was able to continue most of its service. All airports in the affected area closed immediately, so there were no take-offs, and incoming flights had to be diverted to airports with power. The reliability of the electrical grid was called into question and required substantial investment to repair its shortcomings.

Duration

Most places restored power by midnight, as early as 6 p.m. on August 14, and the New York City Subway had resumed limited services around 8 p.m. Some areas lost power for only four to eight hours, these are: Albany and parts of Long Island in New York; three‐quarters of New Jersey; parts of Pennsylvania, Ohio and Michigan; New London County, Connecticut; parts of downtown Toronto, Mississauga, and London in Ontario; portions of western Ottawa in Ontario, including Kanata and south to Kingston; many areas of the Regional Municipality of Niagara in Ontario; and parts of Southwestern Ontario, particularly areas near the Bruce Nuclear Generating Station.

By the next morning (August 15), some areas of Manhattan regained power around 5:00 a.m, Staten Island regained power around 3:00 a.m. Half of the affected portions of Ontario regained power by the morning. By early evening of August 15, two airports, Cleveland Hopkins International Airport and Toronto Pearson International Airport, were back in service. By August 16, power was fully restored in New York and parts of Toronto.

Unaffected regions

Within the area affected, about 200,000 people continued to have power – in the Niagara Peninsula of Ontario; the easternmost corner of Ontario (centered on Cornwall); northwestern Ontario (west of Wawa); and the Buffalo, NY area, excluding southern Erie county, along the shore of Lake Huron via a feeder line to Owen Sound from Bruce Nuclear Generating Station. Three of the four Bruce B units were able to throttle back their output without a complete shutdown, then reconnect to the grid within five hours: the portion of New York state including parts of Albany and north and west of Albany, a small pocket of mid-east Michigan, the Upper Peninsula of Michigan, and small pockets in New Jersey. The unaffected area was protected by transmission circuit devices at the Sir Adam Beck Hydroelectric Generating Stations in Niagara Falls (coincidentally, the starting point of the Northeast blackout of 1965) at a switching station of the hydroelectric power station in Cornwall, as well as central New York state. Philadelphia and the surrounding mid-Atlantic areas were also completely unaffected because PJM disconnected them. The Saint Clair power plant in East China Township, Michigan, remained online for about 36 hours, and residents were informed that the plant would have to shut down in order to facilitate the reboot of the whole system. Orrville, Ohio, was able to restore power within an hour disconnecting the local utility from the larger grid and restarting the coal-fired generator.

Causes

A series of faults caused by tree branches touching power lines in Ohio, which were then complicated by human error, software problems, and equipment failures, led to the most widespread blackout in North American history.

Background

The load on any power network must be immediately matched by its supply and its ability to transmit that power. Any overload of a power line or generator can cause costly damage, so the affected device is disconnected from the network if an overload is detected.

The electrical resistance of a power line causes it to produce more heat as the current it carries increases. If this heat is not sufficiently dissipated, the metal conductor in the line will expand and lengthen, so that it sags between supporting structures. If the line sags too low, a flash over to nearby objects (such as trees) may occur, causing a transient increase in current. Automatic protective relays detect the excessively high current and quickly disconnect the line, with the load previously carried by the line transferred to other lines. If the other lines do not have enough spare capacity to accommodate the extra current, their overload protection will react as well, causing a cascading failure.

System operators are responsible for ensuring that power supply and loads remain balanced, and for keeping the system within safe operational limits such that no single fault can cause the system to fail. After a failure affecting their system, operators must obtain more power from generators or other regions or "shed load" (meaning to intentionally cut power or reduce voltage to a given area) until they can be sure that the worst remaining possible failure anywhere in the system will not cause a system collapse. In an emergency, they are expected to immediately shed load as required to bring the system into balance.

To assist the operators there are computer systems, with backups, which issue alarms when there are faults in the transmission or generation system. Power flow modeling tools let them analyze the state of their network, predict whether any parts of it may be overloaded, and predict the worst possible failure remaining, so that they can change the distribution of generation or reconfigure the transmission system to prevent a failure should this situation occur. If the computer systems and their backups fail, the operators are required to monitor the grid manually, instead of relying on computer alerts. If they cannot interpret the state of the power grid in such an event, they follow a contingency plan, contacting other plant and grid operators by telephone if necessary. If there is a failure, they are also required to notify adjacent areas which may be affected, so those can predict the possible effects on their own systems.

Investigation efforts

A joint federal task force was formed by the governments of Canada and the U.S. to oversee the investigation and report directly to Ottawa and Washington. The task force was led by then-Canadian Natural Resource Minister Herb Dhaliwal and U.S. Energy Secretary Spencer Abraham.

In addition to determining the initial cause of the cascading failure, the investigation of the incident also included an examination of the failure of safeguards designed to prevent a repetition of the Northeast blackout of 1965. The North American Electric Reliability Corporation, a joint Canada-U.S. council, is responsible for dealing with these issues.

On November 19, 2003, Abraham said his department would not seek to punish FirstEnergy Corp for its role in the blackout because current U.S. law does not require electric reliability standards. Abraham stated, "The absence of enforceable reliability standards creates a situation in which there are limits in terms of federal level punishment."

Findings

In April 2004, the U.S.-Canada Power System Outage Task Force released their final report, placing the causes of the blackout into four groups:

  1. FirstEnergy (FE) and its reliability council "failed to assess and understand the inadequacies of FE's system, particularly with respect to voltage instability and the vulnerability of the Cleveland-Akron area, and FE did not operate its system with appropriate voltage criteria."
  2. FirstEnergy "did not recognize or understand the deteriorating condition of its system."
  3. FirstEnergy "failed to manage adequately tree growth in its transmission rights-of-way."
  4. Finally, the "failure of the interconnected grid's reliability organizations to provide effective real-time diagnostic support."

The report states that a generating plant in Eastlake, Ohio, a suburb northeast of Cleveland, went offline amid high electrical demand, putting a strain on high-voltage power lines (located in Walton Hills, Ohio, a southeast suburb of Cleveland) which later went out of service when they came in contact with "overgrown trees". This trip caused load to transfer to other transmission lines, which were not able to bear the load, tripping their breakers. Once these multiple trips occurred, many generators suddenly lost parts of their loads, so they accelerated out of phase with the grid at different rates, and tripped out to prevent damage. The cascading effect that resulted ultimately forced the shutdown of at least 265 power plants.

Computer failure

A software bug known as a race condition existed in General Electric Energy's Unix-based XA/21 energy management system. Once triggered, the bug stalled FirstEnergy's control room alarm system for over an hour. System operators were unaware of the malfunction. The failure deprived them of both audio and visual alerts for important changes in system state.

Unprocessed events queued up after the alarm system failure and the primary server failed within 30 minutes. Then all applications (including the stalled alarm system) were automatically transferred to the backup server, which itself failed at 14:54. The server failures slowed the screen refresh rate of the operators' computer consoles from 1–3 seconds to 59 seconds per screen. The lack of alarms led operators to dismiss a call from American Electric Power about the tripping and reclosure of a 345 kV shared line in northeast Ohio. But by 15:42, after the control room itself lost power, control room operators informed technical support (who were already troubleshooting the problem) of the alarm system problem.

Sequence of events

The following is the blackout's sequence of events on August 14, 2003 (times in EDT):

  • 12:15 p.m. Incorrect telemetry data renders inoperative the state estimator, a power flow monitoring tool operated by the Indiana-based Midwest Independent Transmission System Operator (MISO). An operator corrects the telemetry problem, but forgets to restart the monitoring tool.
  • 1:31 p.m. The Eastlake, Ohio generating plant shuts down. The plant is owned by FirstEnergy, an Akron, Ohio-based company.
  • 2:02 p.m. The first of several 345 kV overhead transmission lines in northeast Ohio fails due to contact with a tree in Walton Hills, Ohio.41°21′22″N 81°34′10″W
  • 2:14 p.m. An alarm system fails at FirstEnergy's control room and is not repaired.
  • 3:05 p.m. A 345 kV transmission line known as the Chamberlin-Harding line sags into a tree and trips in Parma, south of Cleveland.
  • 3:17 p.m. Voltage dips temporarily on the Ohio portion of the grid. Controllers take no action.
  • 3:32 p.m. Power shifted by the first failure onto another 345 kV power line, the Hanna-Juniper interconnection, causes it to sag into a tree, bringing it offline as well. While MISO and FirstEnergy controllers concentrate on understanding the failures, they fail to inform system controllers in nearby states.
  • 3:39 p.m. A FirstEnergy 138 kV line trips in northern Ohio.
  • 3:41 p.m. A circuit breaker connecting FirstEnergy's grid with that of American Electric Power is tripped as a 345 kV power line (Star-South Canton interconnection) and fifteen 138 kV lines fail in rapid succession in northern Ohio.
  • 3:46 p.m. A fifth 345 kV line, the Tidd-Canton Central line, trips offline.
  • 4:05:57 p.m. The Sammis-Star 345 kV line trips due to under-voltage and over-current interpreted as a short circuit. (Later analysis suggests that the blackout could have been averted before this failure by cutting 1.5 GW of load in the Cleveland–Akron area.)
  • 4:06–4:08 p.m. A sustained power surge north toward Cleveland overloads three 138 kV lines.
  • 4:09:02 p.m. Voltage sags deeply as Ohio draws 2 GW of power from Michigan, creating simultaneous under voltage and over current conditions as power attempts to flow in such a way as to rebalance the system's voltage.
  • 4:10:34 p.m. Many transmission lines trip out, first in Michigan and then in Ohio, blocking the eastward flow of power around the south shore of Lake Erie from Toledo, Ohio, east through Erie, Pennsylvania, and into southern Erie county, but not most of the Buffalo metropolitan area. Suddenly bereft of demand, generating stations go offline, creating a huge power deficit. In seconds, power surges in from the east, overloading east-coast power plants whose generators go offline as a protective measure, and the blackout is on.
  • 4:10:37 p.m. The eastern and western Michigan power grids disconnect from each other. Two 345 kV lines in Michigan trip. A line that runs from Grand Ledge to Ann Arbor known as the Oneida-Majestic interconnection trips. A short time later, a line running from Bay City south to Flint in Consumers Energy's system known as the Hampton-Thetford line also trips.
  • 4:10:38 p.m. Cleveland separates from the Pennsylvania grid.
  • 4:10:39 p.m. 3.7 GW power flows from the east along the north shore of Lake Erie, through Ontario to southern Michigan and northern Ohio, a flow more than ten times greater than the condition 30 seconds earlier, causing a voltage drop across the system.
  • 4:10:40 p.m. Flow flips to 2 GW eastward from Michigan through Ontario (a net reversal of 5.7 GW of power), then reverses back westward again within a half second.
  • 4:10:43 p.m. International connections between the United States and Canada start to fail.
  • 4:10:45 p.m. Northwestern Ontario separates from the east when the Wawa-Marathon 230 kV line north of Lake Superior disconnects. The first Ontario power plants go offline in response to the unstable voltage and current demand on the system.
  • 4:10:46 p.m. The New England grid separates from New York, to stop the black out from entering New England.
  • 4:10:50 p.m. Ontario separates from the western New York grid.
  • 4:11:57 p.m. The Keith-Waterman, Bunce Creek-Scott 230 kV lines and the St. ClairLambton #1 230 kV line and #2 345 kV line between Michigan and Ontario fail.
  • 4:12:03 p.m. Windsor, Ontario, and surrounding areas drop off the grid.
  • 4:12:58 p.m. Northern New Jersey separates its power-grids from New York and the Philadelphia area, causing a cascade of failing secondary generator plants along the New Jersey coast and throughout the inland regions west.
  • 4:13 p.m. End of cascading failure. 256 power plants are off-line, 85% of which went offline after the grid separations occurred, most due to the action of automatic protective controls.

Effects

Major cities affected
City Number of people affected
New York City and surrounding areas 14,300,000
Toronto metropolitan area and surrounding areas 8,300,000
Newark, New Jersey, and surrounding areas 6,980,000
Detroit and surrounding areas 6,400,000
Cleveland and surrounding areas 2,900,000
Ottawa 780,000 of 1,120,000*
Buffalo, New York, and surrounding areas 1,100,000
Rochester, New York 1,050,000
London, Ontario, and surrounding areas 475,000
Kitchener-Cambridge-Waterloo, and surrounding areas 415,000
Toledo, Ohio 310,000
Windsor, Ontario 208,000
Estimated total[19] 55,000,000

*Ottawa-Gatineau is a special case in that it is divided by a provincial boundary and the Ontario and Quebec grids are not synchronously connected. This resulted in Gatineau having power while Ottawa did not. Locals may have witnessed the drastic cutoff when they were crossing the Portage Bridge which links the capital region (street lights on the bridge were still lit on the Quebec side of the structure).

Affected infrastructure

Power generation

With the power fluctuations on the grid, power plants automatically went into "safe mode" to prevent damage in the case of an overload. This put much of the nuclear power offline until those plants could be slowly taken out of "safe mode". In the meantime, all available hydro-electric plants (as well as many coal- and oil-fired plants) were brought online, bringing some electrical power to the areas immediately surrounding the plants by the morning of August 15. Homes and businesses both in the affected area and in nearby areas were requested to limit power usage until the grid was back to full power.

Water supply

Some areas lost water pressure because pumps lacked power. This loss of pressure caused potential contamination of the water supply. Four million customers of the Detroit water system in eight counties were under a boil-water advisory until August 18, four days after the initial outage. One county, Macomb, ordered all 2,300 restaurants closed until they were decontaminated after the advisory was lifted. Twenty people living on the St. Clair River claim to have been sickened after bathing in the river during the blackout. The accidental release of 140 kg (310 lb) of vinyl chloride from a Sarnia, Ontario chemical plant was not revealed until five days later. Cleveland also lost water pressure and instituted a boil water advisory. Cleveland and New York had sewage spills into waterways, requiring beach closures. Newark, New Jersey, and northern cities had major sewage spills into the Passaic and Hackensack rivers, which flow directly to the Atlantic Ocean. Kingston, Ontario lost power to sewage pumps, causing raw waste to be dumped into the Cataraqui River at the base of the Rideau Canal.

Transportation

A streetcar left stranded by the blackout in Toronto

Amtrak's Northeast Corridor railroad service was stopped north of Philadelphia, and all trains running into and out of New York City were shut down, initially including the Long Island Rail Road and the Metro-North Railroad; both were able to establish a bare-bones "all-diesel" service by the next morning. Canada's Via Rail, which serves Toronto and Montreal, had a few service delays before returning to normal the next morning.

Passenger screenings at affected airports ceased. Regional airports were shut down for this reason. In New York, flights were cancelled even after power had been restored to the airports because of difficulties accessing "electronic-ticket" information. Air Canada flights remained grounded on the morning of August 15 due to reliable power not having been restored to its Mississauga control center. It expected to resume operations by midday. This problem affected all Air Canada service and canceled the most heavily traveled flights to Halifax and Vancouver. At Chicago's Midway International Airport, Southwest Airlines employees spent 48 hours dealing with the disorder caused by the blackout's sudden incidence.

Many gas stations were unable to pump fuel due to lack of electricity. In North Bay, Ontario, for instance, a long line of transport trucks was held up, unable to go further west to Manitoba without refueling. In some cities, traffic problems were compounded by motorists who simply drove until their cars ran out of gas on the highway. Gas stations operating in pockets of Burlington, Ontario, that had power were reported to be charging prices up to $3.78 per US gallon (99.9 ¢/Litre) when the going rate prior to the blackout was lower than $2.65/gallon (70¢/L). Customers still lined up for hours to pay prices many people considered price gouging. Station operators claimed that they had a limited supply of gasoline and did not know when their tanks would be refilled, prompting the drastic price increases.

Many oil refineries on the East Coast of the United States shut down as a result of the blackout, and were slow to resume gasoline production. As a result, gasoline prices were expected to rise approximately 10 cents/gallon (3¢/L) in the United States. In Canada, gasoline rationing was also considered by the authorities.

Communication

Cellular communication devices were disrupted. This was mainly due to the loss of backup power at the cellular sites where generators ran out of fuel. Where cell sites remained up, some cell phones still went out of service as their batteries ran out of charge without a power source to recharge from. Wired telephone lines continued to work, although some systems were overwhelmed by the volume of traffic, and millions of home users had only cordless telephones depending on house current. Most New York and many Ontario radio stations were momentarily knocked off the air before returning with backup power.

Cable television systems were disabled, and in areas that had power restored (and had power to their television sets), cable subscribers could not receive information until power was restored to the cable provider. Those who relied on the Internet were similarly disconnected from their news source for the duration of the blackout, with the exception of dial-up access from laptop computers, which were widely reported to work until the batteries ran out of charge. Information was available by over-the-air TV and radio reception for those who were equipped to receive TV and/or audio in that way.

The blackout affected communications well outside the immediate area of power outage. The New Jersey-based internet operations of Advance Publications were among those knocked out by the blackout. As a result, the internet editions of Advance newspapers as far removed from the blackout area as The Birmingham News, the New Orleans Times-Picayune, and The Oregonian were offline for days.

Amateur radio operators passed emergency communications during the blackout.

Industry

Large numbers of factories were closed in the affected area, and others outside the area were forced to close or slow work because of supply problems and the need to conserve energy while the grid was being stabilized. At one point a 7-hour wait developed for trucks crossing the Ambassador Bridge between Detroit and Windsor due to the lack of electronic border check systems. Freeway congestion in affected areas affected the "just in time" (JIT) supply system. Some industries (including the auto industry) did not return to full production until August 22.

By region

New York

People walking across the Queensboro Bridge in New York City during the blackout

Almost the entirety of the State of New York lost power. Exceptions included Freeport and Rockville Centre on Long Island, which relied on localized power plants; the Capital District, where power dipped briefly (a few areas, such as portions of Latham, New York, did not lose power at all); the southernmost areas of the Southern Tier of Upstate New York, mostly near Waverly, which relied on power from Pennsylvania; the city of Plattsburgh; Starrett City, Brooklyn, which has auxiliary power; most of the city of Buffalo; and pockets of Amherst in the Buffalo area, running off university power. There were also some small pockets of power in the suburbs of Rochester, as a few smaller power companies operating in those areas were able to keep running. The North Shore Towers complex was unaffected by the blackout due to their on-site self-generating power plant. Power was also available at the Kodak Park facility and its surrounding neighborhood in the city. Power was lost at the Oak Hill Country Club in nearby Pittsford, where the 2003 PGA Championship was being played, which caused minor interruptions to the tournament. Also, that evening's Major League Baseball game between the New York Mets and the San Francisco Giants at Shea Stadium was postponed. In New York, all prisons were blacked out and switched to generator power. The two Indian Point nuclear reactors on the Hudson River near Peekskill, the two reactors at Nine Mile Point nuclear plant, the single reactor at Ginna nuclear plant near Rochester, and the FitzPatrick reactor near Oswego all shut down. With three other nuclear plants shut down in Ohio, Michigan, and New Jersey, a total of nine reactors were affected. The governor of New York, George Pataki, declared a state of emergency.

Verizon's emergency generators failed several times, leaving the emergency services number 9-1-1 out of service for several periods of about a quarter-hour each. New York City's 3-1-1 information hotline received over 175,000 calls from concerned residents during the weekend. Amateur radio operators attached to New York City ARES provided a backup communications link to emergency shelters and hospitals. Amateur radio repeaters were supplied with emergency power via generators and batteries and remained functional.

Major U.S. networks (CBS, NBC, ABC and Fox) and some cable television channels (HBO, MTV and Nickelodeon), centered in New York City, were unable to broadcast normally, so backup stations and flagship transmitters in Dallas were used for prime-time TV. ABC ran their news broadcasts from Washington, D.C. instead.

New York City

Much of Manhattan, including the headquarters of the United Nations, was rendered without power, as were all area airports (with the exception of Newburgh's Stewart International Airport, which had once been a military airbase and had its own generators). All New York-area rail transportation including the subway, the PATH lines between Manhattan and New Jersey, NJ Transit Rail Operations, Metro-North, and the Long Island Rail Road, were without power. Limited railroad service resumed early Friday morning through the use of diesel trains.

More than 600 subway and commuter rail cars were trapped between stations. New York's Metropolitan Transportation Authority (which operates the subway) and the Port Authority of New York and New Jersey (which operates the PATH lines) reported that all passengers were evacuated without serious injury. PATH resumed service on the Uptown Hudson Tubes by 9:45 p.m. that evening; system-wide service resumed at 11 p.m. By comparison, full service on the New York City Subway system returned gradually from Friday through Saturday morning.

Without traffic lights, gridlock was reported as people in Lower and Midtown Manhattan fled their offices on foot. For hours into the evening, the streets, highways, bridges and tunnels were jammed with traffic and pedestrians leaving Manhattan. Many civilians helped direct traffic. The normally four-hour bus journey from Manhattan to Washington, D.C. took more than eight hours. According to reports, it took four hours just to get out of Manhattan.

Hundreds of people found themselves trapped in elevators at the start of the blackout, requiring urgent response from the FDNY. By late evening, the New York City Fire Department had reportedly confirmed that all stalled elevators in approximately 800 Manhattan high-rise office and apartment buildings had been cleared.

Mayor Michael Bloomberg advised residents to open their windows, drink plenty of liquids to avoid heat stroke, and not to forget their pets. Temperatures were 92 °F (33 °C) with high humidity, as New York had just experienced a record-breaking rain spell that had started at the end of July. With cell phone operation mostly stalled by circuit overloads, New Yorkers were lining up 10 deep or more at pay phones as ordinary telephone service remained largely unaffected. Many people found themselves with no phone service at home.

While some commuters were able to find alternate sleeping arrangements, many were left stranded in New York and slept in parks and on the steps of public buildings. While practically all businesses and retail establishments closed down, many bars and pubs reported a brisk business as many New Yorkers took the opportunity to spend the evening "enjoying" the blackout. Tourists' hotel rooms were blacked out, except the hallways, and most of the restaurants in lobbies gave out free food to guests. Since most perishable items were going to spoil anyway, many restaurants and citizens simply prepared what they could and served it to anyone who wanted it, leading to vast block parties in many New York City neighborhoods. Any ice cream in frozen storage also had to be quickly served to any and all passers by.

The Indigo Girls were scheduled to perform that evening at Central Park SummerStage, and the band took the stage as planned to play one of the only shows in the affected area, using generators that had been filled with fuel that morning. Their performance was not a full-length concert, as they needed to end early to allow all attendees to exit Central Park before dark. The venue also had bathrooms, and vendors cooking food on propane grills.

Forty thousand police officers and the entire fire department were called in to maintain order. At least two fatalities were linked to the use of flames to provide light, and many non-fatal fires also resulted from the use of candles. New York City's Office of Emergency Management activated its Emergency Operations Center, from which more than 70 agencies coordinated response efforts, which included delivery of portable light towers to unlit intersections, generators and diesel fuel to hospitals, and a portable steam generator necessary to power air conditioning units at the American Stock Exchange.

New Jersey

Affected areas included most of Hudson, Morris, Essex, Union, Passaic, and Bergen counties, including the major cities of Paterson and Newark, although some sections of Newark and East Orange still had power. Small sections of certain towns in Essex, Hudson, and Union counties had power.

Power was returned first to the urban areas because of concerns of safety and unrest. Counties as far south as Cumberland were affected, where power was restored within an hour. Some towns in Bergen County only momentarily lost power, and had wild oscillations in power line voltage, ranging from about 90 V to 135 V every few minutes for an hour.

The day following the blackout, August 15, the New Jersey Turnpike stopped collecting tolls until 9:00 a.m.

Connecticut

Parts of New London, Hartford, New Haven, Litchfield, and Fairfield counties, from Greenwich to Danbury and Bridgeport were affected, although most of the state had power all evening, aside from a few momentary interruptions that caused computers to reboot. Metro-North trains stopped and remained on the tracks for hours, until they could be towed to the nearest station. Generally, most of the state east of Interstate 91, and some places west of I-91, had power during the duration of the blackout, with some of New Haven's eastern suburbs being seen as the easternmost extreme of the effects of the blackout.

A local controversy ensued in the days after the blackout, when the federal government ordered power companies to energize the HVDC Cross Sound Cable between New Haven and Long Island. This cable had been installed, but not activated due to environment and fishery concerns. The Attorney General of Connecticut (and future U.S. Senator), Richard Blumenthal, and the Governor of New York, George Pataki, traded insults over the cable. Connecticut politicians, without regard for public safety, expressed their outrage that the cable was being turned on, since it did not help anyone in Connecticut, as the cable would transport power from Connecticut to Long Island.

Massachusetts

A small area of western Massachusetts was affected. In Worcester the event was of sufficient magnitude to reboot some computers, while in Springfield the effect of the event was enough to cause the automatic startup of commercial and industrial backup generation facilities. Some areas were subjected to lower-than-normal voltage (as low as 100 volts AC) and brownouts for periods of up to 24 hours. The Boston area was spared from the blackout.

Michigan

About 2.3 million households and businesses were affected, including almost all of Metro Detroit, Lansing, Ann Arbor, and surrounding communities in southeast Michigan. The blackout affected three Michigan utilities: Detroit Edison (whose entire system went down), Lansing Board of Water & Light, and a small portion of Consumers Energy's system in the southeastern corner of the state.

Word quickly spread to the surrounding areas without power and many flocked to surrounding areas that still had power, resulting in crowded stores, packed restaurants, booked hotels, and long queues for the gas stations in these towns. Locales closest to the affected areas in the northern Detroit suburbs that did not lose power included the areas of Oxford and Holly, communities along M-24 and M-15, and into the Lapeer and Flint/Tri-Cities area. The city limits of Brighton and Howell were unaffected as well, as they received electricity from Consumers Energy via the Genoa-Latson 138 kV line which interconnects Detroit Edison and Consumers Energy.

Television and radio stations were temporarily knocked off the air and water supplies were disrupted in Detroit due to the failure of electric pumps. Because of the loss of water pressure, all water was required to be boiled before use until August 18. Several schools, which had planned to begin the school year August 18, were closed until clean water was available.

A Marathon Oil refinery in Melvindale, near Detroit, suffered a small explosion from gas buildup, necessitating an evacuation within one mile (1.6 km) around the plant and the closure of Interstate 75.

Officials feared the release of toxic gases. Heavy rains on August 17, coupled with the lack of sewage pumps, closed other expressways and prompted urban flood warnings. Untreated sewage flowed into local rivers in Lansing and Metropolitan Detroit as contingency solutions at some sewage treatment plants failed.

In the midst of a summer heat wave, Michiganders were deprived of air conditioning. Several people, mostly elderly individuals, had to be treated for symptoms of heat stroke.

In the Detroit area, local television stations' news helicopters were told by each station's management to "stay above the cars' headlights" at night, and to not venture into Downtown Detroit (due to the hazard of flying into an unlit skyscraper). During the days immediately after the blackout, many TV stations were back on the air, with limited resources. In one case, WXYZ-TV's news anchor was wearing a T-shirt and shorts, as opposed to his normal news suit, and apologized to viewers for the "rather warm conditions" in the station, as they only had one air conditioner and a couple of fans working.

The Downriver communities had to contend with basements flooded with sewage-laden water on the weekend immediately after the blackout due to water and sewage pumps offline from a lack of power, much to the general annoyance of residents in the areas. News crews of the areas broadcast notices during their coverages of the blackouts to the Downriver residents, explaining why the pumps had shorted out, as well as to limit water usage. "Most places have water pressure, some have low pressure...some have none, and some even have negative pressure. That means in the next few hours, people in the downriver communities should expect flooded basements from, so move all your valuables high up and out of the basements," as WDIV-TV warned.

West Michigan, including the communities of Grand Rapids, Muskegon, and Holland were mostly unaffected, although a large portion was within "seconds" of joining the blackout according to local U.S. Representative Fred Upton. Some communities in Southwest Michigan were impacted, being among the most western locations impacted. Although right across the border from Sault Ste. Marie, Ontario, Sault Ste. Marie, Michigan was unaffected by the outage, as the two cities are not electrically connected.

Ohio

Over 540,000 homes and businesses were without power. In Cleveland, water service stopped because the city is supplied by electric pumps and backup electricity was available only on a very limited basis. Water had to be boiled for several days afterwards.

Portions of the cities of Akron, Mansfield, Massillon, Marion, and Ashland were without power.

Cleveland declared a curfew on all persons under the age of 18. At Cedar Point amusement park in Sandusky, park employees had to help guests walk down the steps of the 205-foot-tall (62 m) Magnum XL-200 roller coaster, which had stopped on the lift hill due to the blackout. Several other guests had to be helped off rides as a result of the blackout. In Toledo, the Mud Hens baseball team postponed the game scheduled for that night. Some parts of the city were unaffected by the blackout, notably the suburb of Sylvania. Other surrounding cities like Bowling Green only experienced a brief outage.

Ontario

Toronto, on the evening of August 14
Volunteers, like Toronto lawyer Peter Carayiannis (pictured), received fluorescent jackets from the police to direct traffic in Toronto during the blackout. Traffic lights also went out of service.
Toronto Union Station during the blackout

The area affected by the blackout included all Southern Ontario, except Grimsby, Pelham, Niagara Falls and Fort Erie, from Windsor to Ottawa and all the way to the Quebec border, except for the Cornwall area. Also affected was Northern Ontario, as far north as Attawapiskat and Moosonee on James Bay and west to Marathon on the Lake Superior shoreline. Communities affected in northern Ontario included Timmins, Cochrane, Sudbury, Kirkland Lake, North Bay, Wawa, and Sault Ste. Marie. Most of Northwestern Ontario (including Thunder Bay) was not affected.

Traffic lights, which had no backup power, were all knocked out. All intersections were to be considered an all-way stop. Coupled with the beginning of the evening rush hour, this caused traffic problems. In many major and minor intersections in large cities, such as Ottawa and Toronto, ordinary citizens began directing traffic until police or others relieved them. Since there were not enough police officers to direct traffic at every intersection during the afternoon rush hour, passing police officers distributed fluorescent jackets to civilians who were directing traffic. Drivers and pedestrians generally followed the instructions from them, even though they were not police officers.

In Ottawa, the federal government was shut down. The Parliamentary Precinct and Parliament Hill were evacuated.

In Toronto, the Toronto subway and RT and the Toronto streetcar system were shut down. Many passengers had to be evacuated from subway trains by walking through the tunnels. Major Toronto hospitals reported that they had switched to generators and did not experience problems. The 9-1-1 system was operational. The streetcars remained suspended on August 18 and 19, resuming after assurances they would be exempt from any potential rotating blackouts.

Toronto officials asked residents to curtail unnecessary use of water, as pumps were not working and there was only a 24-hour supply. Entertainment events were canceled for several days. English band Radiohead rescheduled a planned August 16 concert in Toronto until the following October 15 due to the power outage. The opening of the Canadian National Exhibition, scheduled for August 15, was postponed to August 19. The roof of the Skydome in Toronto remained open in an effort to conserve power until August 21, when a thunderstorm struck.

Large disruptions of truck traffic in northeastern Ontario were reported due to the unavailability of fuel, including the backlog near North Bay. The tunnel and bridge between Windsor and Detroit were also closed, with the bridge's pillars illuminated by emergency floodlights, as to not pose a shipping and airplane hazard.

About 140 miners were marooned underground in the Falconbridge mine in Sudbury when the power went out. Mine officials said they were safe and could be evacuated if necessary, but were not, due to the risks of doing so with no power. They were safely evacuated by the morning. In Sarnia, a refinery scrubber lost power and released above-normal levels of pollution; residents were advised to close their windows.

On the evening of August 14, Ontario premier Ernie Eves declared a state of emergency, instructing nonessential personnel not to go to work the next day and that rolling blackouts could occur for weeks. Residents were asked not to use televisions, washing machines, or air conditioners if possible, and warned that some restored power might go off again. Although the full state of emergency was lifted the next day, residents were warned that the normal amount of power would not be available for days, and were still asked to reduce power consumption.

For two days of this recovery period, diversion of water from the Niagara River for hydroelectric generation was increased to the maximum level, normally used only at night and in winter in order to maintain the scenic appearance of Niagara Falls. The resultant drop in the river level below the falls meant that the Maid of the Mist tour boats could not dock safely, and their operation had to be suspended.

The Petro-Canada refinery in Oakville had to perform an emergency shutdown due to the lack of power. The plant's flare system produced large flames during the shutdown, leading to erroneous reports in the media that there had been a fire in the plant. The Petro Canada lubricants plant in Mississauga experienced a fire one week later while restarting normal operations.

Many Torontonians remember that night as a moment where the community came together: "Without power, residents of Toronto took to the streets to help direct traffic; florists arranged flowers for weddings by candlelight; and convenience stores served customers in the blackness. The night sky was a rarely seen canopy of dazzling stars, twinkling down on the darkened city through soft summer heat that lingered into the evening."

Pennsylvania

The blackout was confined to the northwest portion of the state. The state's most populated metros of Philadelphia and Pittsburgh were unaffected. According to emergency officials in Erie, Crawford, Venango, Clarion, Bradford, Forest and Warren counties, outages lasted into the night, but there were no serious injuries or incidents.

Emergency services

In New York, about 3,000 fire calls were reported, many from people using candles. Emergency services responded to 80,000 calls for help, more than double the average.

From 4 p.m. of August 14 to midnight of August 15, there were 60 all-hands or greater alarm fires, caused mostly by candles. The FDNY answered over 7,500 calls which resulted in the transmission of over 4,000 alarms.

Fatalities

The blackout contributed to almost 100 deaths.

Long-term effects

The blackout prompted the federal government of the United States to include reliability provisions in the Energy Policy Act of 2005. The standards of the North American Electric Reliability Corporation became mandatory for U.S. electricity providers.

In the United States, the Bush administration had emphasized the need for changes to the U.S. national energy policy, critical infrastructure protection, and homeland security. During the blackout, most systems that would detect unauthorized border crossings, port landings, or detect unauthorized access to many vulnerable sites failed. There was considerable fear that future blackouts would be exploited for terrorism. In addition, the failure highlighted the ease with which the power grid could be taken down.

The Ontario government fell in a provincial election held in October 2003; power had long been a major issue. The government may have been hurt by the success of Quebec and Manitoba, which were not affected whereas Ontario was shut down. The extra publicity given to Ontario's need to import electricity from the United States, mostly due to a decision of the government not to expand the province's power generating capabilities, may also have adversely affected the Conservative government. Premier Ernie Eves's handling of the crisis was also criticized; he was not heard from until long after Mayor Bloomberg and Governor Pataki had spoken out. Due to the regular announcements he gave in the days following the blackout, Eves enjoyed a moderate increase in the polls that his party took as a sign of an opportunity to call an election they could win, but they lost instead.

Restoration of service

By evening of August 14, power had been restored to:

Con Edison retracted its claim that New York City would have power by 1 a.m. That night some areas of Manhattan regained power at approximately 5 a.m. (August 15), the New York City borough of Staten Island regained power around 3 a.m. on August 15, and Niagara Mohawk predicted that the Niagara Falls area would have to wait until 8 a.m. In the New York City borough of Brooklyn power was not fully restored until around sunset on August 15.

By early evening of August 15, two airports, Cleveland Hopkins International Airport and Toronto Pearson International Airport, were back in service.

Half of the affected part of Ontario had power by the morning of August 15, though even in areas where it had come back online, some services were still disrupted or running at lower levels. The last areas to regain power were usually suffering from trouble at local electrical substations that was not directly related to the blackout itself.

By August 16, power was fully restored in New York and Toronto. Toronto's subway and streetcars remained out of service until August 18 to prevent the possibility of equipment being stuck in awkward locations if the power was interrupted again. Power had been mostly restored in Ottawa, though authorities warned of possible additional disruptions and advised conservation as power continued to be restored to other areas. Ontarians were asked to reduce their electricity use by 50% until all generating stations could be brought back on line. Four remained out of service on the 19th. Illuminated billboards were largely dormant for the week following the blackout, and many stores had only a portion of their lights on.

Preparations against the possible disruptions threatened by the Year 2000 problem have been credited for the installation of new electrical equipment and systems which allowed for a relatively rapid restoration of power in some areas.

Media coverage and official reports

In the United States and Canada, the regional blackout dominated news broadcasts and news headlines beginning August 15. U.S. and Canadian television networks pre-empted normal programming in favor of full-time, advertising-free coverage of the unfolding story. Once terrorism had been conclusively ruled out as a cause, many stations switched back to normal programming following an 8:30 p.m. EDT address by President George W. Bush. National news stations, such as the CBC and CNN, continued to cover the story by inviting politicians and electrical experts to discuss the situation and suggest ways to prevent blackouts. Internationally, coverage of the story focused on the development of the situation in the New York City metropolitan area.

Statements made in the aftermath

During the first two hours of the event, various officials offered speculative explanations as to its root cause:

  • Official reports from the office of Canadian Prime Minister Jean Chrétien stated that lightning had struck a power plant in northern New York, resulting in a cascading failure of the surrounding power grid and wide-area electric power transmission grid, resulted in the outage. (A lightning strike to a power substation north of New York City was similarly blamed for the 1977 blackout that plunged nearly the entire city into darkness for 24 hours.) New York state power officials replied that the problem did not originate in the United States, there was no rain storm in the area where the lightning allegedly stuck, and the power plant in question remained in operation throughout the blackout.
  • Canadian Defence Minister John McCallum blamed an outage at a nuclear plant in Pennsylvania, where state officials reported all plants were functioning normally. McCallum later said his sources had given him incorrect information.
  • New York governor George Pataki blamed the power outage on Canada, stating, "the New York independent systems operator says they are virtually certain it had nothing to do in New York state. And they believe it occurred west of Ontario, cascaded from there into Ontario, Canada, and through the Northeast." This was later proven to be false.
  • CNN cited unnamed officials as saying that the Niagara-Mohawk power grid, which provides power for large portions of New York and parts of Canada, was overloaded. Between 4:10 and 4:13 p.m. EDT, 21 power stations throughout that grid shut down.
  • New Mexico governor Bill Richardson, who formerly headed the Department of Energy, in a live television interview two hours into the blackout characterized the United States as "a superpower with a third-world electricity grid." In Europe, this statement was published accompanied with comparisons highlighting the tighter, safer and better interconnected European electricity network (though Italy would suffer a similar blackout six weeks later).
  • In the ensuing days, critics focused on the role of electricity market deregulation for the inadequate state of the electric power transmission grid, claiming that deregulation laws and electricity market mechanisms had failed to provide market participants with sufficient incentives to construct new transmission lines and maintain system security.
  • Later that night, claims surfaced that the blackout may have started in Ohio up to one hour before the network shut down, a claim denied by Ohio's FirstEnergy utility.
  • The president of the North American Electric Reliability Corporation said that the problem originated in Ohio.
  • By the morning of August 18, investigators believed that the problem began with a sudden shift in the direction of power flow on the northern portion of the Lake Erie Transmission Loop, a system of transmission lines that circles Lake Erie on both U.S. and Canadian soil.

Voluntary Blackout Day commemorations

In Ontario, some cities took part in power conservation challenges or events to remind citizens of the blackout, the most well-known event being the Voluntary Blackout Day hosted by the Ontario Power Authority (OPA). During these events, citizens were encouraged to maximize their energy conservation activities. Smaller cities such as London, Guelph, Woodstock and Waterloo took part in the challenges annually. The final Voluntary Blackout Day was held on August 14, 2010, with OPA moving to more year-round energy conservation efforts.

Demand response

From Wikipedia, the free encyclopedia
https://en.wikipedia.org/wiki/Demand_response
A clothes dryer using a demand response switch to reduce peak demand
Daily load diagram; Blue shows real load usage and green shows ideal load.

Demand response is a change in the power consumption of an electric utility customer to better match the demand for power with the supply. Until the 21st century decrease in the cost of pumped storage and batteries electric energy could not be easily stored, so utilities have traditionally matched demand and supply by throttling the production rate of their power plants, taking generating units on or off line, or importing power from other utilities. There are limits to what can be achieved on the supply side, because some generating units can take a long time to come up to full power, some units may be very expensive to operate, and demand can at times be greater than the capacity of all the available power plants put together. Demand response, a type of energy demand management, seeks to adjust in real-time the demand for power instead of adjusting the supply.

Utilities may signal demand requests to their customers in a variety of ways, including simple off-peak metering, in which power is cheaper at certain times of the day, and smart metering, in which explicit requests or changes in price can be communicated to customers.

The customer may adjust power demand by postponing some tasks that require large amounts of electric power, or may decide to pay a higher price for their electricity. Some customers may switch part of their consumption to alternate sources, such as on-site solar panels and batteries.

In many respects, demand response can be put simply as a technology-enabled economic rationing system for electric power supply. In demand response, voluntary rationing is accomplished by price incentives—offering lower net unit pricing in exchange for reduced power consumption in peak periods. The direct implication is that users of electric power capacity not reducing usage (load) during peak periods will pay "surge" unit prices, whether directly, or factored into general rates.

Involuntary rationing, if employed, would be accomplished via rolling blackouts during peak load periods. Practically speaking, summer heat waves and winter deep freezes might be characterized by planned power outages for consumers and businesses if voluntary rationing via incentives fails to reduce load adequately to match total power supply.

Background

As of 2011, according to the US Federal Energy Regulatory Commission, demand response (DR) was defined as: "Changes in electric usage by end-use customers from their normal consumption patterns in response to changes in the price of electricity over time, or to incentive payments designed to induce lower electricity use at times of high wholesale market prices or when system reliability is jeopardized." DR includes all intentional modifications to consumption patterns of electricity to induce customers that are intended to alter the timing, level of instantaneous demand, or the total electricity consumption. In 2013, it was expected that demand response programs will be designed to decrease electricity consumption or shift it from on-peak to off-peak periods depending on consumers’ preferences and lifestyles. In 2016 demand response was defined as "a wide range of actions which can be taken at the customer side of the electricity meter in response to particular conditions within the electricity system such as peak period network congestion or high prices". In 2010, demand response was defined as a reduction in demand designed to reduce peak demand or avoid system emergencies. It can be a more cost-effective alternative than adding generation capabilities to meet the peak and occasional demand spikes. The underlying objective of DR is to actively engage customers in modifying their consumption in response to pricing signals. The goal is to reflect supply expectations through consumer price signals or controls and enable dynamic changes in consumption relative to price.

In electricity grids, DR is similar to dynamic demand mechanisms to manage customer consumption of electricity in response to supply conditions, for example, having electricity customers reduce their consumption at critical times or in response to market prices. The difference is that demand response mechanisms respond to explicit requests to shut off, whereas dynamic demand devices passively shut off when stress in the grid is sensed. Demand response can involve actually curtailing power used or by starting on-site generation which may or may not be connected in parallel with the grid. This is a quite different concept from energy efficiency, which means using less power to perform the same tasks, on a continuous basis or whenever that task is performed. At the same time, demand response is a component of smart energy demand, which also includes energy efficiency, home and building energy management, distributed renewable resources, and electric vehicle charging.

Current demand response schemes are implemented with large and small commercial as well as residential customers, often through the use of dedicated control systems to shed loads in response to a request by a utility or market price conditions. Services (lights, machines, air conditioning) are reduced according to a preplanned load prioritization scheme during the critical time frames. An alternative to load shedding is on-site generation of electricity to supplement the power grid. Under conditions of tight electricity supply, demand response can significantly decrease the peak price and, in general, electricity price volatility.

Demand response is generally used to refer to mechanisms used to encourage consumers to reduce demand, thereby reducing the peak demand for electricity. Since electrical generation and transmission systems are generally sized to correspond to peak demand (plus margin for forecasting error and unforeseen events), lowering peak demand reduces overall plant and capital cost requirements. Depending on the configuration of generation capacity, however, demand response may also be used to increase demand (load) at times of high production and low demand. Some systems may thereby encourage energy storage to arbitrage between periods of low and high demand (or low and high prices). Bitcoin mining is an electricity intensive process to convert computer hardware infrastructure, software skills and electricity into electronic currency. Bitcoin mining is used to increase the demand during surplus hours by consuming cheaper power.

There are three types of demand response - emergency demand response, economic demand response and ancillary services demand response. Emergency demand response is employed to avoid involuntary service interruptions during times of supply scarcity. Economic demand response is employed to allow electricity customers to curtail their consumption when the productivity or convenience of consuming that electricity is worth less to them than paying for the electricity. Ancillary services demand response consists of a number of specialty services that are needed to ensure the secure operation of the transmission grid and which have traditionally been provided by generators.

Electricity pricing

Explanation of demand response effects on a quantity (Q) - price (P) graph. Under inelastic demand (D1) extremely high price (P1) may result on a strained electricity market.
If demand response measures are employed the demand becomes more elastic (D2). A much lower price will result in the market (P2).

It is estimated that a 5% lowering of demand would result in a 50% price reduction during the peak hours of the California electricity crisis in 2000/2001. The market also becomes more resilient to intentional withdrawal of offers from the supply side.

In most electric power systems, some or all consumers pay a fixed price per unit of electricity independent of the cost of production at the time of consumption. The consumer price may be established by the government or a regulator, and typically represents an average cost per unit of production over a given timeframe (for example, a year). Consumption therefore is not sensitive to the cost of production in the short term (e.g. on an hourly basis). In economic terms, consumers' usage of electricity is inelastic in short time frames since the consumers do not face the actual price of production; if consumers were to face the short run costs of production they would be more inclined to change their use of electricity in reaction to those price signals. A pure economist might extrapolate the concept to hypothesize that consumers served under these fixed-rate tariffs are endowed with theoretical "call options" on electricity, though in reality, like any other business, the customer is simply buying what is on offer at the agreed price. A customer in a department store buying a $10 item at 9.00 am might notice 10 sales staff on the floor but only one occupied serving him or her, while at 3.00 pm the customer could buy the same $10 article and notice all 10 sales staff occupied. In a similar manner, the department store cost of sales at 9.00 am might therefore be 5-10 times that of its cost of sales at 3.00 pm, but it would be far-fetched to claim that the customer, by not paying significantly more for the article at 9.00 am than at 3.00 pm, had a 'call option' on the $10 article.

In virtually all power systems electricity is produced by generators that are dispatched in merit order, i.e., generators with the lowest marginal cost (lowest variable cost of production) are used first, followed by the next cheapest, etc., until the instantaneous electricity demand is satisfied. In most power systems the wholesale price of electricity will be equal to the marginal cost of the highest cost generator that is injecting energy, which will vary with the level of demand. Thus the variation in pricing can be significant: for example, in Ontario between August and September 2006, wholesale prices (in Canadian Dollars) paid to producers ranged from a peak of $318 per MW·h to a minimum of - (negative) $3.10 per MW·h. It is not unusual for the price to vary by a factor of two to five due to the daily demand cycle. A negative price indicates that producers were being charged to provide electricity to the grid (and consumers paying real-time pricing may have actually received a rebate for consuming electricity during this period). This generally occurs at night when demand falls to a level where all generators are operating at their minimum output levels and some of them must be shut down. The negative price is the inducement to bring about these shutdowns in a least-cost manner.

Two Carnegie Mellon studies in 2006 looked at the importance of demand response for the electricity industry in general terms and with specific application of real-time pricing for consumers for the PJM Interconnection Regional Transmission authority, serving 65 million customers in the US with 180 gigawatts of generating capacity. The latter study found that even small shifts in peak demand would have a large effect on savings to consumers and avoided costs for additional peak capacity: a 1% shift in peak demand would result in savings of 3.9%, billions of dollars at the system level. An approximately 10% reduction in peak demand (achievable depending on the elasticity of demand) would result in systems savings of between $8 and $28 billion.

In a discussion paper, Ahmad Faruqui, a principal with the Brattle Group, estimates that a 5 percent reduction in US peak electricity demand could produce approximately $35 billion in cost savings over a 20-year period, exclusive of the cost of the metering and communications needed to implement the dynamic pricing needed to achieve these reductions. While the net benefits would be significantly less than the claimed $35 billion, they would still be quite substantial. In Ontario, Canada, the Independent Electricity System Operator has noted that in 2006, peak demand exceeded 25,000 megawatts during only 32 system hours (less than 0.4% of the time), while maximum demand during the year was just over 27,000 megawatts. The ability to "shave" peak demand based on reliable commitments would therefore allow the province to reduce built capacity by approximately 2,000 megawatts.

Electricity grids and peak demand response

The upper reservoir (Llyn Stwlan) and dam of the Ffestiniog Pumped Storage Scheme in north Wales

In an electricity grid, electricity consumption and production must balance at all times; any significant imbalance could cause grid instability or severe voltage fluctuations, and cause failures within the grid. Total generation capacity is therefore sized to correspond to total peak demand with some margin of error and allowance for contingencies (such as plants being off-line during peak demand periods). Operators will generally plan to use the least expensive generating capacity (in terms of marginal cost) at any given period, and use additional capacity from more expensive plants as demand increases. Demand response in most cases is targeted at reducing peak demand to reduce the risk of potential disturbances, avoid additional capital cost requirements for additional plants, and avoid use of more expensive or less efficient operating plants. Consumers of electricity will also pay higher prices if generation capacity is used from a higher-cost source of power generation.

Demand response may also be used to increase demand during periods of high supply and low demand. Some types of generating plant must be run at close to full capacity (such as nuclear), while other types may produce at negligible marginal cost (such as wind and solar). Since there is usually limited capacity to store energy, demand response may attempt to increase load during these periods to maintain grid stability. For example, in the province of Ontario in September 2006, there was a short period of time when electricity prices were negative for certain users. Energy storage such as pumped-storage hydroelectricity is a way to increase load during periods of low demand for use during later periods. Use of demand response to increase load is less common, but may be necessary or efficient in systems where there are large amounts of generating capacity that cannot be easily cycled down.

Some grids may use pricing mechanisms that are not real-time, but easier to implement (users pay higher prices during the day and lower prices at night, for example) to provide some of the benefits of the demand response mechanism with less demanding technological requirements. In the UK, Economy 7 and similar schemes that attempt to shift demand associated with electric heating to overnight off-peak periods have been in operation since the 1970s. More recently, in 2006 Ontario began implementing a "smart meter" program that implements "time-of-use" (TOU) pricing, which tiers pricing according to on-peak, mid-peak and off-peak schedules. During the winter, on-peak is defined as morning and early evening, mid-peak as midday to late afternoon, and off-peak as nighttime; during the summer, the on-peak and mid-peak periods are reversed, reflecting air conditioning as the driver of summer demand. As of May 1, 2015, most Ontario electrical utilities have completed converting all customers to "smart meter" time-of-use billing with on-peak rates about 200% and mid-peak rates about 150% of the off-peak rate per kWh.

Australia has national standards for Demand Response (AS/NZS 4755 series), which has been implemented nationwide by electricity distributors for several decades, e.g. controlling storage water heaters, air conditioners and pool pumps. In 2016, how to manage electrical energy storage (e.g., batteries) has been added into the series of standards.

Load shedding

When the loss of load happens (generation capacity falls below the load), utilities may impose load shedding (also known as emergency load reduction program, ELRP) on service areas via targeted blackouts, rolling blackouts or by agreements with specific high-use industrial consumers to turn off equipment at times of system-wide peak demand.

Incentives to shed loads

Energy consumers need some incentive to respond to such a request from a demand response provider. Demand response incentives can be formal or informal. The utility might create a tariff-based incentive by passing along short-term increases in the price of electricity, or they might impose mandatory cutbacks during a heat wave for selected high-volume users, who are compensated for their participation. Other users may receive a rebate or other incentive based on firm commitments to reduce power during periods of high demand, sometimes referred to as negawatts (the term was coined by Amory Lovins in 1985). For example, California introduced its own ELRP, where upon an emergency declaration enrolled customers get a credit for lowering their electricity use ($1 per kWh in 2021, $2 in 2022).

Commercial and industrial power users might impose load shedding on themselves, without a request from the utility. Some businesses generate their own power and wish to stay within their energy production capacity to avoid buying power from the grid. Some utilities have commercial tariff structures that set a customer's power costs for the month based on the customer's moment of highest use, or peak demand. This encourages users to flatten their demand for energy, known as energy demand management, which sometimes requires cutting back services temporarily.

Smart metering has been implemented in some jurisdictions to provide real-time pricing for all types of users, as opposed to fixed-rate pricing throughout the demand period. In this application, users have a direct incentive to reduce their use at high-demand, high-price periods. Many users may not be able to effectively reduce their demand at various times, or the peak prices may be lower than the level required to induce a change in demand during short time periods (users have low price sensitivity, or elasticity of demand is low). Automated control systems exist, which, although effective, may be too expensive to be feasible for some applications.

Smart grid application

5:19CC
Video about the demand response of electrical devices in a house combined with an electric vehicle. These are part of a smart grid.

Smart grid applications improve the ability of electricity producers and consumers to communicate with one another and make decisions about how and when to produce and consume electrical power. This emerging technology will allow customers to shift from an event-based demand response where the utility requests the shedding of load, towards a more 24/7-based demand response where the customer sees incentives for controlling load all the time. Although this back-and-forth dialogue increases the opportunities for demand response, customers are still largely influenced by economic incentives and are reluctant to relinquish total control of their assets to utility companies.

One advantage of a smart grid application is time-based pricing. Customers who traditionally pay a fixed rate for consumed energy (kWh) and requested peak load can set their threshold and adjust their usage to take advantage of fluctuating prices. This may require the use of an energy management system to control appliances and equipment and can involve economies of scale. Another advantage, mainly for large customers with generation, is being able to closely monitor, shift, and balance load in a way that allows the customer to save peak load and not only save on kWh and kW/month but be able to trade what they have saved in an energy market. Again, this involves sophisticated energy management systems, incentives, and a viable trading market.

Smart grid applications increase the opportunities for demand response by providing real time data to producers and consumers, but the economic and environmental incentives remain the driving force behind the practice.

One of the most important means of demand response in the future smart grids is electric vehicles. Aggregation of this new source of energy, which is also a new source of uncertainty in the electrical systems, is critical to preserving the stability and quality of smart grids, consequently, the electric vehicle parking lots can be considered a demand response aggregation entity.

Application for intermittent renewable distributed energy resources

The modern power grid is making a transition from the traditional vertically integrated utility structures to distributed systems as it begins to integrate higher penetrations of renewable energy generation. These sources of energy are often diffusely distributed and intermittent by nature. These features introduce problems in grid stability and efficiency which lead to limitations on the amount of these resources which can be effectively added to the grid. In a traditional vertically integrated grid, energy is provided by utility generators which are able to respond to changes in demand. Generation output by renewable resources is governed by environmental conditions and is generally not able to respond to changes in demand. Responsive control over noncritical loads that are connected to the grid has been shown to be an effective strategy able to mitigate undesirable fluctuations introduced by these renewable resources. In this way instead of the generation responding to changes in demand, the demand responds to changes in generation. This is the basis of demand response. In order to implement demand response systems, coordination of large numbers of distributed resources through sensors, actuators, and communications protocols becomes necessary. To be effective, the devices need to be economical, robust, and yet still effective at managing their tasks of control. In addition, effective control requires a strong capability to coordinate large networks of devices, managing and optimizing these distributed systems from both an economic and a security standpoint.

In addition, the increased presence of variable renewable generation drives a greater need for authorities to procure more ancillary services for grid balance. One of these services is contingency reserve, which is used to regulate the grid frequency in contingencies. Many independent system operators are structuring the rules of ancillary service markets such that demand response can participate alongside traditional supply-side resources - the available capacity of the generators can be used more efficiently when operated as designed, resulting in lower costs and less pollution. As the ratio of inverter-based generation compared to conventional generation increases, the mechanical inertia used to stabilize frequency decreases. When coupled with the sensitivity of inverter-based generation to transient frequencies, the provision of ancillary services from other sources than generators becomes increasingly important.

Technologies for demand reduction

Technologies are available, and more are under development, to automate the process of demand response. Such technologies detect the need for load shedding, communicate the demand to participating users, automate load shedding, and verify compliance with demand-response programs. GridWise and EnergyWeb are two major federal initiatives in the United States to develop these technologies. Universities and private industry are also doing research and development in this arena. Scalable and comprehensive software solutions for DR enable business and industry growth.

Some utilities are considering and testing automated systems connected to industrial, commercial and residential users that can reduce consumption at times of peak demand, essentially delaying draw marginally. Although the amount of demand delayed may be small, the implications for the grid (including financial) may be substantial, since system stability planning often involves building capacity for extreme peak demand events, plus a margin of safety in reserve. Such events may only occur a few times per year.

The process may involve turning down or off certain appliances or sinks (and, when demand is unexpectedly low, potentially increasing usage). For example, heating may be turned down or air conditioning or refrigeration may be turned up (turning up to a higher temperature uses less electricity), delaying slightly the draw until a peak in usage has passed. In the city of Toronto, certain residential users can participate in a program (Peaksaver AC) whereby the system operator can automatically control hot water heaters or air conditioning during peak demand; the grid benefits by delaying peak demand (allowing peaking plants time to cycle up or avoiding peak events), and the participant benefits by delaying consumption until after peak demand periods, when pricing should be lower. Although this is an experimental program, at scale these solutions have the potential to reduce peak demand considerably. The success of such programs depends on the development of appropriate technology, a suitable pricing system for electricity, and the cost of the underlying technology. Bonneville Power experimented with direct-control technologies in Washington and Oregon residences, and found that the avoided transmission investment would justify the cost of the technology.

Other methods to implementing demand response approach the issue of subtly reducing duty cycles rather than implementing thermostat setbacks. These can be implemented using customized building automation systems programming, or through swarm-logic methods coordinating multiple loads in a facility (e.g. Encycle's EnviroGrid controllers).

Similar approach can be implemented for managing air conditioning peak demand in summer peak regions. Pre-cooling or maintaining slightly higher thermostat setting can help with the peak demand reduction.

In 2008 it was announced that electric refrigerators will be sold in the UK sensing dynamic demand which will delay or advance the cooling cycle based on monitoring grid frequency but they are not readily available as of 2018.

Industrial customers

Industrial customers are also providing demand response. Compared with commercial and residential loads, industrial loads have the following advantages: the magnitude of power consumption by an industrial manufacturing plant and the change in power it can provide are generally very large; besides, the industrial plants usually already have the infrastructures for control, communication and market participation, which enables the provision of demand response; moreover, some industrial plants such as the aluminum smelter are able to offer fast and accurate adjustments in their power consumption. For example, Alcoa's Warrick Operation is participating in MISO as a qualified demand response resource, and the Trimet Aluminium uses its smelter as a short-term nega-battery. The selection of suitable industries for demand response provision is typically based on an assessment of the so-called value of lost load. Some data centers are located far apart for redundancy and can migrate loads between them, while also performing demand response.

Short-term inconvenience for long-term benefits

Shedding loads during peak demand is important because it reduces the need for new power plants. To respond to high peak demand, utilities build very capital-intensive power plants and lines. Peak demand happens just a few times a year, so those assets run at a mere fraction of their capacity. Electric users pay for this idle capacity through the prices they pay for electricity. According to the Demand Response Smart Grid Coalition, 10%–20% of electricity costs in the United States are due to peak demand during only 100 hours of the year. DR is a way for utilities to reduce the need for large capital expenditures, and thus keep rates lower overall; however, there is an economic limit to such reductions because consumers lose the productive or convenience value of the electricity not consumed. Thus, it is misleading to only look at the cost savings that demand response can produce without also considering what the consumer gives up in the process.

Importance for the operation of electricity markets

It is estimated that a 5% lowering of demand would have resulted in a 50% price reduction during the peak hours of the California electricity crisis in 2000–2001. With consumers facing peak pricing and reducing their demand, the market should become more resilient to intentional withdrawal of offers from the supply side.

Residential and commercial electricity use often vary drastically during the day, and demand response attempts to reduce the variability based on pricing signals. There are three underlying tenets to these programs:

  1. Unused electrical production facilities represent a less efficient use of capital (little revenue is earned when not operating).
  2. Electric systems and grids typically scale total potential production to meet projected peak demand (with sufficient spare capacity to deal with unanticipated events).
  3. By "smoothing" demand to reduce peaks, less investment in operational reserve will be required, and existing facilities will operate more frequently.

In addition, significant peaks may only occur rarely, such as two or three times per year, requiring significant capital investments to meet infrequent events.

US Energy Policy Act regarding demand response

The United States Energy Policy Act of 2005 has mandated the Secretary of Energy to submit to the US Congress "a report that identifies and quantifies the national benefits of demand response and makes a recommendation on achieving specific levels of such benefits by January 1, 2007." Such a report was published in February 2006.

The report estimates that in 2004 potential demand response capability equaled about 20,500 megawatts (MW), 3% of total U.S. peak demand, while actual delivered peak demand reduction was about 9,000 MW (1.3% of peak), leaving ample margin for improvement. It is further estimated that load management capability has fallen by 32% since 1996. Factors affecting this trend include fewer utilities offering load management services, declining enrollment in existing programs, the changing role and responsibility of utilities, and changing supply/demand balance.

To encourage the use and implementation of demand response in the United States, the Federal Energy Regulatory Commission (FERC) issued Order No. 745 in March 2011, which requires a certain level of compensation for providers of economic demand response that participate in wholesale power markets. The order is highly controversial and has been opposed by a number of energy economists, including Professor William W. Hogan at Harvard University's Kennedy School. Professor Hogan asserts that the order overcompensates providers of demand response, thereby encouraging the curtailment of electricity whose economic value exceeds the cost of producing it. Professor Hogan further asserts that Order No. 745 is anticompetitive and amounts to “…an application of regulatory authority to enforce a buyer’s cartel.” Several affected parties, including the State of California, have filed suit in federal court challenging the legality of Order 745. A debate regarding the economic efficiency and fairness of Order 745 appeared in a series of articles published in The Electricity Journal.

On May 23, 2014, the D.C. Circuit Court of Appeals vacated Order 745 in its entirety. On May 4, 2015, the United States Supreme Court agreed to review the DC Circuit's ruling, addressing two questions:

  1. Whether the Federal Energy Regulatory Commission reasonably concluded that it has authority under the Federal Power Act, 16 U. S. C. 791a et seq., to regulate the rules used by operators of wholesale electricity markets to pay for reductions in electricity consumption and to recoup those payments through adjustments to wholesale rates.
  2. Whether the Court of Appeals erred in holding that the rule issued by the Federal Energy Regulatory Commission is arbitrary and capricious.

On January 25, 2016, the United States Supreme Court in a 6-2 decision in FERC v. Electric Power Supply Ass'n concluded that the Federal Energy Regulatory Commission acted within its authority to ensure "just and reasonable" rates in the wholesale energy market.

FERC issued its Order No. 2222 on September 17, 2020, enabling distributed energy resources to participate in regional wholesale electricity markets. Market operators submitted initial compliance plans by early 2022.

Demand reduction and the use of diesel generators in the British National Grid

As of December 2009 National Grid had 2369 MW contracted to provide demand response, known as STOR, the demand side provides 839 MW (35%) from 89 sites. Of this 839 MW approximately 750 MW is back-up generation with the remaining being load reduction. A paper based on extensive half-hourly demand profiles and observed electricity demand shifting for different commercial and industrial buildings in the UK shows that only a small minority engaged in load shifting and demand turn-down, while the majority of demand response is provided by stand-by generators.

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