COLUMBUS, Ohio, June 10, 2015 /PRNewswire/ -- Eight electric
utilities and energy companies today announced an initiative to
provide improved responses to major events affecting the electric
transmission grid by giving transmission-owning entities access to
domestically warehoused long lead-time critical equipment.
Affiliates of American Electric Power (NYSE:AEP), Berkshire
Hathaway Energy, Duke Energy (NYSE:DUK), Edison International
(NYSE:EIX), Eversource Energy (NYSE:ES), Exelon (NYSE:EXC), Great
Plains Energy (NYSE:GXP), and Southern Company (NYSE:SO) have
signed a memorandum of understanding to pursue development of Grid
Assurance™, a limited liability company that expects to offer
subscribers cost-effective solutions for enhancing grid resiliency
and protecting customers from prolonged transmission outages.
As proposed, Grid Assurance will own and provide subscribers
with timely access to an inventory of emergency spare transmission
equipment that can otherwise take months to acquire. Grid Assurance
filed a petition with the Federal Energy Regulatory Commission
(FERC) late yesterday seeking confirmation that this service can be
part of a transmission-owning entity's strategy to effectively
address grid resiliency mandates. Grid Assurance will not be
FERC regulated, but plans to charge cost-based subscription fees,
similar to FERC-regulated transmission formula rates. Cost-based
subscription fees are expected to facilitate subscribers' ability
to recover expenses.
Restoration of the transmission grid can be hampered by long
lead times required to design, build and deliver critical
replacement equipment including large transformers, circuit
breakers and other specialized electrical equipment. As proposed,
Grid Assurance will be more cost-effective than companies
independently securing emergency spare equipment for high-impact,
low-frequency events due to economies of scale, diversification and
improved logistics.
Grid Assurance plans to own and maintain equipment at secure,
strategically located warehouses to facilitate the equipment being
placed in service faster than traditionally possible. Grid
Assurance expects to offer additional logistics support to expedite
transportation of equipment to impacted sites. Subscribers can call
on equipment when they experience certain events, such as physical
attacks, electromagnetic pulses, solar storms, cyberattacks,
earthquakes and severe weather events. Grid Assurance can
complement existing programs transmission owners have, and industry
initiatives, like the Spare Transformer Equipment Program (STEP)
coordinated through the Edison Electric Institute, to enhance
access to spare transformers and other equipment by providing a
more comprehensive inventory of critical spare equipment.
Contingent on regulatory approvals, Grid Assurance is expected
to begin accepting subscribers and identifying inventory in
2016.
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SOURCE American Electric Power