The Grid by Gretchen Bakke

Anthropologist Gretchen Bakke has written about a system integral to the American lifestyle that we associate more with engineers: the electrical grid. The Grid describes how we arrived at the system we have, the forces that are operating on it and how they might shape its future.

The grid is more than a set of wires on poles. It is also a system of companies, markets, laws, regulations, government agencies, cultures and individual people. As an engineer, I feel it is important for me to be aware of the business, policy and cultural aspects of my work. Technology cannot be easily isolated from these things. An engineer who focuses completely on technology risks putting a lot of effort into a solution that fails for important non-technical reasons.

Having commented on engineering, I should mention that Bakke’s book is written for laymen.

She explains the science and technology of electricity in terms that I think most people can understand.

One of the reasons she doesn’t need to resort to deep technological or scientific explanations it that technology is not the biggest barrier to the grid of the future. Of course, technology is very important, but much of what we need to make our grid more resilient and wireless is already in our hands, or will be within our grasp in the near future.

The harder things to wrangle are the business and regulatory aspects of the grid. Renewable energy sources (especially variable sources like wind and solar), distributed generation (which is becoming increasingly affordable), increased efficiency, flat or declining demand, and regulatory reforms over the last three decades have put the squeeze on electric utilities. Our electric utilities, and the system of large, central generation plants they operate, were built for the business and regulatory setting of the early 20^th Century, when rapidly increasing demand meant that the consolidation of generation into large plants controlled by highly-regulated monopolies made sense as a way to provide ever cheaper power for an ever growing population of customers.

By the 1960s, this model of growth was failing putting upward pressure on electric prices. Regulatory reforms starting in the 1980s introduced competition to electric markets that put another squeeze on utility profits.

These historic changes are still in action and accelerating. Environmental regulation and customer expectations about the use of renewable energy are also a growing pressure on the system, especially because the variability of solar and wind energy make it difficult to balance demand and generation on the grid, which must be done constantly and almost instantaneously.

In addition to describing how our grid came to be and the troubling weaknesses it has in light of our changing environment and expectations, Bakke looks to the future. Of course, no one knows what the grid make look like, but current developments have the potential to scale up to shape the grid.

A future grid is likely to be a highly computerized system of integrated microgrids that can operate independently when the larger grid is out. It will include many generators distributed across the grid (large, central power plants are on the way out) that take advantage of alternative and renewable energy sources. New developments in energy storage, such as the batteries that will be in fleets of electric cars, and a host of smart meters, homes and appliances will help us balance the grid. We’ll need to develop standards that allow all this new technology to communicate and work together as it also controls the existing parts of the grid that continue to be useful. Continued regulatory reform will be needed to adapt to these changes and possibly to force openness into a market that existing power monopolies may be tempted to guard. Utilities will need to find new business models, and we all might need to be open to what they could be, because it is unlikely that they’ll be able to keep going by selling kilowatt-hours in the old fashioned way.

If you’re interested in this book, you may also be interested in

The Age of Edison by Ernest Freeburg

The Big Roads by Earl Swift

Make a Joyful Sound by Helen Elmira Waite

Bakke, Gretchen. The Grid: The Fraying Wires between Americans and Our Energy Future. New York: Bloomsbury, 2016.

Depreciation Systems by Frank K. Wolf & W. Chester Fitch

Depreciation System, by engineering professors Frank K. Wolf and W. Chester Fitch, describes methods for estimating depreciation for utilities. Rates of regulated public utilities are usually based on balancing the public need for affordable rates with then investor’s need for a reasonable rate of return. While it is only one factor in setting utility rates, a reasonable accounting of depreciation is needed to determine the rate base and assure that the capital of the investors is recovered.

Depreciation can be estimated in several way, some more practicable and popular than others. Wolf and Fitch present these methods in a systematic and orderly fashion. They present a system of classification by which methods can be compared or contrasted using a handful of more basic concepts or methods. This permits them to be thorough, though the result is sometimes tedious. Fortunately, they do not give equal attention to every possible combination of elements because some are not used or are not very workable.

Some of the methods they describe have been in use for more than a century, but the book was written in the early 1990s, so the authors assume the readers will be using computers. Because this is mostly a matter of spreadsheets, the computerized calculation methods hold up even after 20 years. However, depreciation methods do not change rapidly; many depreciation professionals are still using software that was developed in the mid-1980s, which is still considered current (at least from a methodological point of view).

Like most references or textbooks, this does not make for interesting reading. I undertook the task for professional reasons. It is a good reference, though. In some cases it may be a little too complicated for someone new to the profession. In general, the authors try to focus more on the concept than the more complex details (you can’t write a reference that prescribes a solution to every problem a depreciation professional might face), while still presenting thorough descriptions, with examples, of the major methods in use.

If you’re interested in this book, you may also be interested in:

Public Utility Depreciation by NARUC

Wolf, Frank K., & W. Chester Fitch. Depreciation Systems. Ames, IA: Iowa State University Press, 1994.

Lights Out by Ted Koppel

Much of the world, and America is particular, is heavily networked through a vast, distributed communication system of computers, cables, and transceivers. All this runs on electricity. Our major infrastructure is dependent on electrical power: water, sanitation, healthcare, communication and transportation. These systems, indeed even the systems that generate and distribute electricity are increasing controlled by networked computers.

This makes America extremely vulnerable to cyberattacks aimed at the electric system. If a major section of the power grid goes out, millions of people could be left without clean water, waste disposal and food. A well-orchestrated cyberattack could leave large parts of the country without power for as long as a year.

Journalist Ted Koppel explores this situation, and criticizes America’s state of unpreparedness and sometimes denial, in his book Lights Out. There are three major parts to his book.

First, he explores the vulnerability of the electrical system to cyberattack. I think he makes a fairly convincing case that the system is vulnerable and that some agents very likely already have the capacity to cause major damage to the system that could affect huge parts of the country.

Second, he looks into the state of our policies and preparedness. As you might expect for a nation of 50 co-sovereign governments, it is a patchwork. In addition, the major actors in preventing, planning for, and responding to catastrophes are focused on natural disasters or physical attacks by terrorists. These things shouldn’t be ignored, but the scale of a cyberattack on the electrical system could have a much larger scope in terms of the populations and territories affected.

Finally, he looks at how prepared the country is for the aftermath of such an attack. The answer is we are woefully unprepared. He looks into the prepper movement and the vast resources the Church of Jesus Christ of Latter Day Saints has put into readiness. He finds some models there, but no one has the resources to respond to such a massive disaster.

Of course, the issue is not simple. Preventing such an attack is difficult even if all the competing interests (utilities, federal agencies, local and state governments, privacy advocates, and many others) could agree on what to do, who should do it, and how far their authority should extend. It is all hugely expensive, especially preparing to respond to a massive outage, and it would take years to get ready.

Even so, Koppel clearly thinks we should acknowledge this vulnerability and start doing something about it. An imperfect plan, even if it is too little to late (it’s already too late because cyberattacks are already happening and major attacks could be launched with the press of a button), is better than no plan. He looks to the civil defense planning during World War II and the Cold War. Much of it was misguided or for show, but we learned valuable lessons that helped us make more effective responses and develop better policies.

Koppel writes as a journalist for a wide audience, and that was his intention. Readers do not need a background in engineering, utilities or security to understand the issues he brings up or their implications.

If you’re interested in this book, you may also be interested in

The Age of Edison by Ernest Freeburg

The Big Roads by Earl Swift

The Essential Engineer: Why Science Alone Will Not Solve Our Global Problems by Henry Petroski

Make a Joyful Sound by Helen Elmira Waite

Koppel, Ted. Lights Out. New York: Crown, 2015.

The Power Makers by Maury Klein

Maury Klein’s book The Power Makers is a history of power from the Thomas Newcomen’s steam engine to the foundations of America’s electric grid.

Unlike many historians who look at the history of electric power, Klein gives a lot of attention to steam. We haven’t had steam engines directly powering industrial plants for decades, but steam turbines are still central to the production of most electricity in the United States. Even nuclear power plants use steam turbines to run their generators, they just use the heat from nuclear reactions rather than from the combustion of coal or natural gas to boil water and heat the steam to more than a thousand degrees.

Klein gives attention to many lesser known names in the history of power. He shows that Thomas Edison and George Westinghouse had rivals other than each other, such as Elihu Thomson. Nikola Tesla is well known as the genius who invented the AC motor, but other engineers helped develop his prototype into a commercial product, such as mathematically talented engineer Benjamin Lamme. Many talented inventors tried their hands at making electric lighting and power systems better. Only some of them had the vision, business sense, good partners and luck to turn their ideas into successful products. Few of them are widely known today.

Electrification had clear, direct effects in industry and transportation. Klein discusses how it’s influence reached into other sectors of the economy. Corporate management and finance changed to meet the needs of a growing new technology. For instance, Edison General Electric was able to take advantage of a new New Jersey law that allowed corporations to own businesses in other states. Electric companies grew, expanded and consolidated through numerous mergers and acquisitions. They had a demand for capital that nearly rivaled the railroads, another transformative technology that had shortly preceded electric power.

As the availability of electricity grew, certain industries were able to grow, too. Some chemical and metals manufacturing required abundant electric power to catalyze chemical reactions or generate the high temperatures of electric furnaces. Manufacturers flocked to Niagara after a lager hydroelectric power station started operation there in 1895.

Klein brings the many thread of his story of power together by reflections on three great fairs: the 1876 Centennial Exhibition in Philadelphia, the 1893 Columbian Exposition in Chicago and the 1939 New York World’s Fair. In the first, a giant steam engine that powered exhibits by means of belts and pulley was a significant attraction. By the second, electricity was on display, and the White City fairground was a model for testing AC power systems. By the 1939 fair, large power utilities of the type we would recognize today were becoming common. By then it was no big deal to flip a switch or pull a lever and get power so, unlike the previous to fairs, no dignitary undertook a show of doing it; the power was on from the start.

If you’re interested in this book, you may also be interested in

The Age of Edison by Ernest Freeburg

Empires of Light by Jill Jonnes

The Grid by Gretchen Bakke

How We Got to Now by Steven Johnson

The Lighthouse Stevensons by Bella Bathurst

Lights Out by Ted Koppel

Make a Joyful Sound by Helen Elmira Waite

1939 by David Gelernter

Planck by Brandon R. Brown

The Powerhouse by Steve Levine

Rust by Jonathan Waldman

Steam by Andrea Sutcliffe 

Technology in World Civilization by Arnold Pacey

Klein, Maury. The Power Makers: Steam, Electricity, and the Men Who Invented Modern America. New York: Bloomsbury Press, 2008.

Blue Revolution by Cynthia Barnett

Barnett, Cynthia.  Blue Revolution: Unmaking America’s Water Crisis.  Boston: Beacon Press, 2011.

America has a problem.  We’re a thirsty nation.  Actually, it’s more like we’re addicted to water, abusing it.  We subsidize its use on a grand scale in industries that use it inefficiently, even wastefully, and in locations where it is naturally hard to come by.  We allocate it based on facts that are no longer true, and were doubtful or changing even as we made our policies.  In our sometimes blind enthusiasm, we overreached and now we are mire in unintended consequences.  To top it off, we rarely change our ways until a crisis is already upon us.

Cynthia Barnett describes these problems in her book Blue Revolution.  She also looks around the country and the world for solutions.  Her essential solution is a water ethic.

At one time, people were intimately connected to water.  Farmers watched for rain.  Children fetched pails of it from the stream or worked a pump handle.  Communities were built around watermills where people brought in grain or carried away flour. 

Of course, water is no less essential to modern life.  We depend on it for drinking, cleaning, sanitation and green lawns.  It is essential or the energy that light and cools our homes and powers our computers.  The abundance of food in our groceries stores is partly a testament to the abundance of water used to irrigate fields that don’t get enough rainfall for the crops we grow.

What is different is the way we view water.  For most of us it is cheap, nearly free in comparison to other utilities and services we use in our homes.   We can get as much as we want whenever we want by opening a valve.  Water is something we hold back with dams, divert with canals, and pump through pipes.  It bends to our will—except when it doesn’t.

Our water policies and technologies have often had unintended consequences.  We turned deserts into productive fields, but much of the water is lost to evaporation.  We moved water great distances to supply cities, but it encouraged profligacy that threatens those distant, expensive supplies.  Dams that were engineering marvels may soon stand at the ends of empty lakes.

Sure, changes in technology and policy are needed to stop, and hopefully reverse, these problems.  Barnett doesn’t stop there.  Our approach to water arises from the way we value it, think about it, and relate to it.  Our present state came from valuing water little, thinking about it little unless it was our job, and relating to it little except for those who intensely depended on a highly subsidized supply.

The water ethic Barnett proposes would value water, both in the sense of personal appreciation and economic cost and opportunity.  It would seek the best use of the water we have, especially what is locally available.  It creates opportunities for people to contact water and understand where it comes from and how it is affected by use.  It is something that spreads organically from person to person, neighborhood to neighborhood, business to business, and city to city.

It is an ethic that is within reach, too.  Barnett describes how places that have long had extreme relationships with extreme water environments, like the Netherlands, Singapore and Australia, have changed their relationship with water.  These are not just policy shifts, they are cultural changes.  Even in the United States, there are places where a new water ethic is taking hold and people understand how important and fragile water is.

If you’re interested in this book, you may also be interested in

Elixir by Brian Fagan

Water by Marq de Villiers

Water by Steven Solomon

When the Rivers Run Dry by Fred Pearce

Google

Public Utility Depreciation by NARUC

I don’t usually read reference books, or textbooks, all the way through like I did with Public Utility Depreciation Practices. Because of my new job as a “depreciation engineer,” I undertook reading this guide from the National Association of Regulatory Utility Commissioners (NARUC).

The title describes the content of the book. It includes some historical and legal background, but the bulk of the book is aimed at the practicalities of determining depreciation expenses.

The main elements going into depreciation rate determination are depreciation base, service life, net salvage, and depreciation computation methods. Depreciation base is the starting point; it represents the initial investment of capital that is to be recovered as a cost through depreciation. Generally it is the book cost (original cost of the infrastructure including materials, equipment, labor and related costs).

Most methods of computing depreciation are referred to as age-life methods. These methods spread the cost of the expected life of a piece of infrastructure. The preferred method is straight line depreciation. To apply these methods, one will need to know or estimate the life of the infrastructure under consideration and the net salvage value. The depreciation rate is the difference between the base and the net salvage, divided by the life of the infrastructure. With the exception of unique pieces, like types of infrastructure are lumped together because they are expected to have a similar life (wooden poles, steel poles, copper wire, conduit, etc.).

Life expectancy can be estimated by several methods. Survivor curves are developed from statistical studies of the life of particular types of infrastructure, though other methods may be used depending on the type and quality of data available.

Net salvage is estimated based on experience. The gross salvage is the price received for the equipment or materials retired. The cost of removal is subtracted from this to calculate the net salvage. Sometimes it can cost more to remove infrastructure than the value of the retired equipment and materials, so net salvage can be negative.

Calculating depreciation is more art than science. Projections of future values are inherently tricky. Growth can cause infrastructure to become inadequate before it is expected, or slower than expected growth can extend the life infrastructure. New regulations can make infrastructure obsolete in an instant, as can new technologies. In addition, utilities are constantly adding and retiring infrastructure. Amidst this uncertainty, regulators must balance the level of service needed by utility customers with the returns needed by utility investors in a complex environment.

Admittedly, a book from 1968 may seem dated. However, many of the practices described are still in use. Government regulation of monopoly utility rates in the United States has been occurring for more than a century, and the practices to not change rapidly. Even so, some of the practices described were considered obsolete, or near obsolescence, at the time of publication, and are not likely to be encountered now unless you’re a financial historian combing through moldy account books.

National Association of Regulatory Utility Commissioners. Public Utility Depreciation Practices. 1968. Washington, DC: Author, 1974.

Seamless Government by Russell M. Linden

Linden, Russell M. Seamless Government: A Practical Guide to Re-Engineering in the Public Sector. San Francisco: Jossey-Bass, 1994.
ISBN 0-7879-0015-X

Russell Linden’s book is a guide to the principles and practice of re-engineering in public sector agencies. He defines and explains the concepts of re-engineering and provides a thorough, step-by-step process for conducting a re-engineering project.

I was interested in the way he addressed the problem of defining customers. He identifies three groups: customers, who pay the agency; consumers, who use the agency’s services; and constituents, who have an interest in the mission of the agency. It is a simple way to organize stakeholders and identify potential beneficiaries, but it does not get the agency out of the need to resolve competing interests. For instance, my program will be streamlining the process for issuing construction permits. It will have little impact on the customer (the General Assembly) or the constituents (the public and environmental groups), but will be a benefit to the consumer (permit applicants).

In addition, I finally got the type of handling of case studies that I hoped to find in some of the other books. I was well impressed with the chapter devoted to the case studies of two agencies.

I would have liked to know more about the difficulties, specifically what does not work and sources of resistance to re-engineering. I think this could be well addressed by two more case studies. One would demonstrate how an agency used pilots, trickle-down and tell and sell and why these techniques failed. The second would demonstrate how and agency addressed the fears and resistance of managers, specialists and central staff.



I originally wrote this review in 1999 when I read the book for a class. I don’t remember what construction permitting process improvements I had in mind, but the probably had something to do with state and federal permits for wastewater facilities. I think my old agency is still behind the ball when it comes to using information technology in the permitting process. The job is made more difficult by the addition of new rules, new interpretations of existing requirements, and tight deadlines for getting state rules and practices in line with the present federal regime. I’m full of opinions about both the state and federal approach to wastewater regulation, especially permitting. I’ll refrain from further editorializing here. Presently, I provide management consulting and administrative services to utilities. You can find out more about my consulting practice here.

What's New May 16, 2009

Alternative Fuels and Energy Resources Articles and Links (Updated)
Bill Introduced to Bring Back the Streetcar
Bill Would Create National Tunnel Inspection Program
Bill Would Require Surface Transportation Inspections by Public Employees
Bill Would Create National Tunnel Inspection Program
City Utilities of Springfield (MO) Joins Water Coalition
Coverage of Infrastructure Economic Stimulus
Drinking Water Week May 3-9
How to Write a Manual by Elizabeth Slatkin
May 9 is National Train Day
Missouri Communities Receive $1.36 Mill in Brownfield Grants
Missouri Receives $185 Mill for Weatherization, Energy
My Googleganger never rests: http://getsatisfaction.com/people/keenan_273643
Pharmaceuticals in Water (Updated)
What I Read (3)
What's New May 1, 2009