http://energytechstocks.com/wp/?p=1005With reserve margins the lowest they’ve been in at least 40 years, and reliability problems being allowed to fester, the United States is “wide open” to a crippling power blackout, according to veteran electric utility and energy analyst Daniel Scotto.
A blackout lasting several days and affecting millions of people “could occur anywhere in the U.S.” this summer, Scotto said.
In the five years since the last major blackout wreaked havoc on the U.S., very little has been done to correct the underlying problems, Scotto told EnergyTechStocks.com in an interview. “People believe electricity will just be there when they need it,” Scotto said. “But we have undermined the reliability of the whole network. We are on thinner ice than we imagine.”
Scotto, who is president of Whitehall Financial Advisors LLC in Greenwich, CT, recalled that 40 years ago it was customary for utilities to operate with a 20% reserve margin. (A reserve margin is the amount of unused generating capacity available to be used during periods of peak demand.) That figure fell to 15% to 18% in the 1970s and stayed there for decades, but now has been allowed to fall to just 12% nationally, with parts of the east and Midwest operating at below 10%. At the same time, the reliability of transmission lines “is an issue that hasn’t really been addressed” since line problems in 2003 caused a widespread blackout, Scotto noted.
<more>