It was an incident so carefully orchestrated, so devastating to our electric power infrastructure, that the former chairman of the Federal Energy Regulatory Commission is still nervous about it 10 months later. He referred to it in The Wall Street Journal earlier this week as the "most significant incident of domestic terrorism involving the grid that has ever occurred."
The Journal's story recounts the attack on PG&E's Metcalf transmission substation, a facility southeast of San Jose, Calif., that feeds power to Silicon Valley. Under the cover of night, snipers cut telephone cables to the facility and proceeded to fire at transformers, eventually disabling 17 of them.
In this case, PG&E was able to reroute power from other facilities to prevent a blackout, but it took just shy of a month to make the necessary repairs to bring the Metcalf facillity back online. The sophisticated coordination of the attack, the vulnerability of our electrical infrastructure, and the havoc a major blackout can wreak on an increasingly plugged-in world are why Jon Wellinghoff, the former FERC chairman, is now bringing attention back to this April incident.
It certainly switches up the American security narrative from cyber attacks to physical threats. There were 13 reported cyber attacks at utilities over the past three years, and 274 instances of vandalism over the same period. While cyber attacks receive tremendous media coverage, physical attacks on the grid do not receive the same attention. Really, it's not until we experience massive blackouts that many of us think about the grid at all.
Maybe we should think about it more often, as it turns out that the American power grid is in terrible shape. Consider this warning from the American Society of Civil Engineers, in which he organization currently gives our power grid the unimpressive grade of "D+."
The electric grid in the United States consists of a system of interconnected power generation, transmission facilities, and distribution facilities, some of which date back to the 1880s. ... Aging equipment has resulted in an increasing number of intermittent power disruptions, as well as vulnerability to cyber attacks. Significant power outages have risen from 76 in 2007 to 307 in 2011.
The 2007-to-2011 timeline omits one of the worst blackouts in recent history: the 2003 incident that shut down the Northeast, from Ohio to Canada, leaving 50 million people without power. That blackout wasn't caused by either a cyber threat or a physical attack, just plain old ineptitude at FirstEnergy, but it does highlight how fragile our system really is.
Reliability standards -- complete with heavy fines -- have since been enacted, but the grid continues to age. Paradoxically, it is also becoming more complex, as new wind and solar generating assets are stapled on to an increasingly patchwork system. No surprise then, that rolling blackouts like one in San Diego in 2011 that knocked out power to 2.7 million people continue to happen, despite the new standards.
Stephen Berberich, the chief executive of the operator responsible for running high voltage transmission systems for many utilities in California, told The Wall Street Journal that physical attacks potentially pose a bigger threat to the grid than cyber attacks. Here's hoping we never find out if he's right.
Our grid isn't the only important American energy story
Imagine a company that rents a very specific and valuable piece of machinery for $41,000 per hour. (That's almost as much as the average American makes in a year!) And Warren Buffett is so confident in this company's can't-live-without-it business model, he just loaded up on 8.8 million shares. An exclusive, brand-new Motley Fool report reveals the company we're calling OPEC's Worst Nightmare. Just click here to uncover the name of this industry-leading stock, and join Buffett in his quest for a veritable landslide of profits!
Aimee Duffy and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.