Grid Assurance Stockpiles Utility Transmission Equipment

On May 6, six energy companies launched Grid Assurance, an independent company with the purpose of providing spares for critical electric transmission equipment. The hope is that the company can enhance grid resiliency by providing electric transmission owners with faster access to long-lead-time equipment that would be necessary to recover from catastrophic events that impact the nation’s electric grid.

The firm was founded by affiliates of American Electric Power, Berkshire Hathaway Energy, Duke Energy, Edison International, Eversource Energy and Great Plains Energy. All companies signed a memorandum of understanding in June 2015. Grid Assurance secured regulatory assurances from the Federal Energy Regulatory Commission for the structure and other components of the company before launch.

Restoring critical elements of the transmission system can be delayed by the extended lead times required to design, build and deliver replacement equipment, such as circuit breakers, specialized components and large transformers, which can take 18–24 months.

Michael Deggendorf, senior vice president of Kansas City Power & Light, was named CEO of Grid Assurance and will oversee its formation and operation.

“Grid Assurance is an industry-led, proactive response to the numerous potential risks facing our nation’s transmission system, including several weather and catastrophic events like earthquakes or physical and cyber attacks,” he said. “Grid Assurance will help protect consumers and communities from the devastating impacts that delays in restoring electricity can have on quality of life and the nation’s economy.”

Once Deggendorf brings on key management team members, the company will begin marketing to and accepting subscribers. The next step will be to order critical equipment, based on secured subscriptions. Subscription to inventory and services will be open to all transmission owners.

The company will provide an inventory of equipment at secure, strategically-located warehouses in the United States and will offer logistical support to facilitate expedited delivery of that equipment to affected sites following a “qualifying event,” which can include a physical attack, a cyber attack, an electromagnetic pulse, a solar storm, an earthquake, a severe weather event, or another catastrophic occurance.

“Due to the benefits of inventory pooling, diversification and improved logistics, Grid Assurance is a more cost-effective, efficient way for transmission owners to prepare for high-impact, low-frequency events that could severely damage the transmission system, and there has been considerable interest from potential subscribers,” Deggendorf said. “It would be significantly more expensive for every transmission-owning entity to independently procure and securely house the spare equipment necessary for recovery from rare, but potentially catastrophic, events.”

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