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'Third World' Power Grid

August 15, 2003

In former Energy Secretary Bill Richardson's accurate but painful words Thursday on CNN, the United States is "a superpower with a Third World [power transmission] grid."

The dramatic Eastern regional power failure shook millions of Americans and Canadians and sent a clear message heard not just in New York but in California, not just in Michigan but in Florida. The risks of another widespread blackout are unacceptably high because the nation's electric transmission grid ranges from old to ancient. There is too little capacity and existing lines are inefficient. When one part of the carefully balanced grid fails, the rest of the system is in danger of toppling like so many dominos.

Californians, who know a thing or two about blackouts, breathed easy Thursday in air-conditioned offices, homes and shopping malls. But nothing has been done in the two years since the energy crisis shocked the state into recognizing the inherent dangers in its aging and overworked electric transmission grid. The reason? There's no clear economic interest for anyone -- government, public utilities or private investors -- to act. There's no incentive to build transmission lines, no regulator with the power to force new construction and frustrating but understandable opposition among homeowners who don't want huge transmission towers in their backyards.

Federal officials in the United States and Canada undoubtedly will produce a thorough investigation into what caused and abetted Thursday's unprecedented blackout. But understanding what went wrong isn't enough.

The country's high-stakes energy debate too often focuses narrowly on the economic benefits supposedly accrued by deregulating energy markets. Thursday's dramatic failure underscored the need for continued strict regulation because deregulated energy markets can fail just as badly as regulated systems if the infrastructure can't deliver.

The state Public Utilities Commission and the California Energy Commission bear major responsibility for determining the right strategy, in concert with neighboring states. Southern California Edison and Pacific Gas & Electric own most of California's transmission capacity but the energy crisis hangover means they don't have the money to build new distribution. Reliable power is a national security issue. Public money and leadership will be needed to fix transmission, and the leadership should start in the White House. It should encourage solutions by setting incentives that will keep power flowing.

Failing that, it might be time to recruit L. Paul Bremer III, the top U.S. civilian administrator in Iraq, who's learned a hard lesson or two about bringing electricity to Third World countries.

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