- Electric utilities have a legal obligation to plan for climate change and its impacts under public utility and state tort laws, and could face liability if they fail to do so, according to a new report from the Environmental Defense Fund and the Sabin Center for Climate Change Law at Columbia Law School.
- Electric utilities “should be reorienting risk assessment and management efforts” to address “increasingly knowable climate change impacts,” according to Michael Panfil, EDF’s director of federal energy policy and an author of the report.
- The use of tort law, which covers harm related to civil claims, could provide “another legal mechanism for reforming local electricity distribution,” according to Ari Peskoe, director of Harvard University’s Electricity Law Initiative. But he said “the best approach” remains using the utility regulatory commissions to ensure utilities are prepared for climate change.
Panfil acknowledges that the report’s conclusion is “novel,” but also says “the novelty is one that doesn’t depart from core legal obligations and longstanding understandings of our legal system.”
“To the extent there are obligations and requirements that entities avoid harm [and] reasonably consider risk, climate change should be no different,” Panfil said.
Public utility law “obligates electric utilities to meet, among other things, prudent investment, safe and adequate service, and reliability standards,” and tort law requires electric utilities to “avoid foreseeable harm when performing acts that could injure others, EDF’s report says. A. The group concluded that now includes climate change, as the consequences “become ever-more pronounced and pervasive.”
Addressing that risk will require utilities to utilize a two-stage planning process, said Panfil, including completing a climate vulnerability assessment, and then developing a climate resilience plan to reduce the risk to vulnerable assets.
But is it true that utilities are legally required to plan for climate change? Experts say this isn’t clear.
“The devil is in the details,” said Jonathan Adler, director of the Coleman P. Burke Center for Environmental Law at Case Western Reserve University School of Law. According to Adler, the answer is “maybe.”
“I think the real question is what sorts of specific harms are alleged to be reasonably foreseeable consequences of the utilities’ conduct (and which conduct we’re talking about),” Adler said in an email. “I think this is more difficult in the climate context than some others, though the increase in climate-related litigation means this is something utilities should pay attention to, even if I’m not convinced their obligations are as great as EDF might suggest.”
The Edison Electric Institute, which represents investor owned utilities, did not weigh in on EDF’s conclusions.
According to Karl Rábago, an energy sector consultant and former Texas utilities commissioner, while it is unclear if utilities have legal obligations under tort law to plan for climate change, just the threat of legal action could force adjustments to planning processes and regulatory thinking. If a utility is forced to pay damages or settle out of court for climate-related harm, utility commissions will take note, he said.
“Public utility commissions are not immune to public sentiment,” Rábago said. Regulators will be asking if the issue is within their jurisdiction, “and the growing evidence of harm, which itself increases the risk of liability, makes it more likely it is.”
But ratemaking and planning processes remain the most effective way to reform how utilities do business, according to Peskoe.
“Reform advocates can participate in those processes, but ultimately PUCs make the decisions,” he said in an email. “Tort law provides another avenue for advocates, although it’s more reactive.”
Peskoe said claims made under tort law can be “another tool in the toolbox for advocates to pursue reforms.”
“I suppose the goal of these tort cases would be to make utilities’ past practices so expensive … that they are essentially compelled to reform their operations or planning in response,” Peskoe said.
Rábago, who as a new commissioner in 1993 asked utilities about their plans to approach carbon regulation, said addressing climate change will require utilities to account for the risks and impacts.
“We still have not yet confronted this on a state by state regulatory basis,” said Rábago. “And we are still mostly having conversations about how we’re going to regulate carbon out of existence, as opposed to internalizing the risk and deciding that the public interest requires a mitigation of that risk.”
Panfil says the key in all of this, is that the impacts of climate change are now well-understood. “What we’re trying to do is take longstanding law and marry it to increasingly foreseeable climate risks,” he said.
Editor’s note: This story has been updated to indicate that the Sabin Center for Climate Change Law at Columbia Law School developed the report along with the Environmental Defense Fund.
Using a futurist mindset to plan the future of electrical transmission
Don Boesiger, Lead Studies Engineer, Transmission and Distribution Department, Ulteig
Dec. 7, 2020
Sponsored contentBy Ulteig
The North American electrical grid system is facing constant change, which is being accelerated with new technology, new power generation and increased load demand.
As utilities attempt to keep up with all of the changes, eventually the question arises: “How do we plan for a future of constant changes in which nearly every part of our daily lives requires reliable electricity?”
Heading into a Demanding Future
The fact is North America is going through a massive energy transition. Throughout the U.S. and Canada, legacy coal plants are being shut down or retrofitted for natural gas while at the same time, wind and solar farms are being built at an accelerating pace. In the meantime, the shift to electric vehicles is increasing with pressure from states (California) and provinces (British Columbia) that have announced the phase out of fossil fuels. This transition has taken on a momentum in and, of itself; there is no going back.
Along with this transition, we’re seeing:
- Renewable generation interconnections are growing at a faster rate than traditional synchronous generators with increasing system sizes, new blade and module designs, and controls within each type.
- Solar cells evolving with increased energy production and more efficient design, leading to larger arrays.
- Battery energy storage systems are increasing in capacity with new technology, efficiency, and controls.
- In areas where energy loads are increasing, higher voltage capacities with new controls are often needed.
These are just the tip of the iceberg when it comes to the changes we will see in the immediate and long-term future.
Planning with a Futurist Mindset
Transmission planners help utilities think about their transmission systems five to 10 years out. Imagine visual images of the electrical grid in 2030 – what it will look like and how it may power the world at that time. Helping utilities think that far ahead is my passion and it’s what I’ve dedicated my career to as an engineer focused on transmission planning.
Transmission planners apply a futurist mindset to the problems utilities may face to help them achieve a preferred future – that ideal vision where the utility is profitability generating and efficiently delivering reliable, affordable, environmentally friendly power to its customers.
By leveraging their experiences in working with multiple utilities of all sizes, transmission planning consultants apply their expertise to help utilities:
- See Around Corners to identify potential opportunities or risks, which can help a utility save time and money, as well as serve their customers better.
- Mitigate Risks of events such as extreme weather, earthquakes, flooding, and forest fires that could cause a cascading failure.
- Improve the environment by taking steps now to reach goals such as generating and delivering carbon-free power in the coming years and decades.
- Mitigate Violations by providing mitigation solutions for multiple violations (line rating overages) and voltages beyond the normal band. These solutions can save millions of dollars when multiple line upgrades can be solved with a well-placed transformer.
- Confirm Accuracy of project work by others and/or make recommendations for improvement.
Helping utilities plan their transmission systems well into the future takes more than expertise or powerful modeling software. It takes being open to possible futures and asking powerful, relevant questions.
For example, while assisting a utility in Texas, we imagined a number of different scenarios, from the more conventional to the more complex. In our wide area study, we asked ourselves what would happen if the utility were to eliminate all fossil fuel-generated power and replace it completely with renewable generation. Using sophisticated modeling software, we could project what might result and compare that projection to other possible scenarios.
The Key: Trust
When a utility hires a transmission planning consultant to bring in outside expertise, there are two areas where I recommend they pay special attention.
First, is the consultant curious? Are they on top of the latest NERC/FERC requirements? Can they cite the latest research studies and what those implications will mean for a utility? Are they being innovative – conducting their own research and sharing their research with the industry? A review of a transmission planning consultant’s CV will quickly offer clues about their passion to model the future and identify solutions to meet today’s problems.
Second, can you build a trusting relationship with them? It’s through strategic partnerships that a transmission planner can help a utility move beyond reactive decisions to proactive, forward-looking solutions. Identifying, accepting and acting on change is hard. It’s only in trusted relationships that people are open to new perspectives on how to address change.
The Bottom Line: When you find the right partner and are able to build a strong level of trust with their engineers, the pay-off for a utility can be measured in thousands, if not millions, of dollars in savings. Expanding your team’s capacity can also reduce stress and allow you to stay ahead of future demands and take control of constant change with a futurist mindset.
Don Boesiger is a lead studies engineer with the Transmission and Distribution Department at Ulteig. He has more than 20 years of experience in transmission, distribution, and substation engineering plus an additional 20 years of experience as a nuclear power plant supervisor while serving in the U.S. Navy. Boesiger is an expert in computer-based models and performing power system studies on utility and industrial/commercial electrical power transmission and distribution systems