The Grid: The Fraying Wires Between Americans and Our Energy Future

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By: Gretchen Bakke

Rating: A-

The Grid is the massive infrastructure that powers the entire US. It includes the power plants, wires, batteries, utility poles, transformers, relays, and generators…the list goes on. The energy that powers the grid comes mostly from nuclear power, natural gas, coal, and oil. Over the years there have been several efforts to add renewables to the mix but there are many challenges in the way. This topic is very prevalent in our country right now but the issues are not fully presented. This book presented a lot of the issues and gave some historical context to understand them well.


The first electric grid in 1870. 

The first US grid started in San Francisco with 20 street lamps powered by a steam engine. The early grids were linked in a series, meaning if one bulb was out, they all were. Edison introduced the parallel circuit to eliminate this. By 1892, parallel circuits were on both coasts.

Electric light resulted in an abundance of small local power grids, but the invention of AC enabled the creation of larger grids.

Prior to AC, the grid was made up of small local DC “microgrids” that required incredible amounts of wire that could not travel far. All of the grids were owned by wealthy private, corporate, and municipal entities. Every grid had different volts and nothing was standardized.

AC allowed the transportation of low voltages across long distances that could be boosted into higher voltages via transformers. Suddenly, it became possible to build a power plant to supply power to cities several miles away.

Electricity was ripe for monopolization, but the nature of the product complicated this task.

In 1907, there were over 1,000 municipal electric companies. However, this was the age of monopolies like Standard Oil and US Steel. 

Samuel Insull, an Electric Entrepreneur, wanted to create an electric monopoly. But the problem was that he could not simply create a bunch of electricity, store it, and then distribute it like oil and steel. 

Electricity is impossible to store in large quantities. 

So the solution was to create a plant that could produce enough energy to supply the maximum level of consumption at all times. Even if this max level was only reached at certain times.

In order to avoid storing energy, Insull had to build a customer base that collectively used electricity around the clock. 

To attract customers, he cut his prices to manufacturers, homeowners, transportation companies, etc. He was soon selling electricity to several hundred thousand people. He then sold the excess energy he had in low use periods to industrial customers. This became the model for energy companies. 

Business Model: Match generation with consumption.

Many companies emulated this model. But rather than compete, they banded together and divided up the country to create various centralized grids. In the 1920s, ten businesses supplied the entire US with electricity. 

They succeeded in monopolizing the industry.

Problems with efficiency and the supply of oil have a major impact on the electricity industry. 

Coal-powered plants cannot turn 100 percent of the coal energy into electricity. The sweet spot for efficiency is actually 30 – 40%. This is because of physics and the heat generated by the machines. Anything above 50% becomes too expensive and unreliable due to the maintenance and labor required to keep it running.

Increases in the price of fuel is passed on to the consumer. This spurred the move from coal to oil in the 1960s. Enter the oil embargo of 1973, which caused the price of oil to skyrocket 70%. Again, this increase was passed on to the consumer. 

Consumers don’t like monopolies cramming increases down their throats.

By the 1970s, mass awareness of energy conservation led to legislative action and the erosion of electricity monopolies.

The spikes in prices brought public awareness to energy conservation. People cared about how much energy their household appliances consumed. Kids were taught in school to turn lights off when they leave rooms and to wear more clothes in the winter to use less energy heating their house.

This got Jimmy Carter elected. In 1977, he formed the Department of Energy and passed the National Energy Act. This legislation did several things, like end utility companies’ monopolistic control of power generation, required the installation of insulation in our homes, and encouraged the use of alternative energy sources, like solar, wind, and hydro.

On to present day.

Even minor problems on the grid can cause major disasters.

At least 70% of the grid’s transmission lines and transformers are 25 years old, and the average age of US power plants is 34. The United States has more outages than any other developed country. And the duration of outages is increasing. From the 1950s to the 1980s, the annual number of major power outages in the US rose from two to five. The annual number jumped to 76 by 2007 and to 307 by 2011. Overgrown foliage is the biggest impediment to keeping the electrical infrastructure reliable and secure.

Blackouts affect widespread areas due to the grid design and age. Each year you can see the dips in our GDP when there are prevalent blackouts. In 2003, the Davis Besse Nuclear Power Station in Ohio malfunctioned and cost $6 billion in lost business revenues for consumers’ businesses.

Utility Companies are strained.

The Energy Policy Act passed in 1992 and enforced in 2002 required that electricity production and distribution be separate to prevent a single company from controlling both. Ideally, creating competition and lowering prices. The problem is that the power plants were designed in the 1970s physically and financially to use both to be profitable. The result was layoffs and poor maintenance across the aging power plants. Another cause of the frequent and extended blackouts.

New Technology, like Smart Meters, could be used to upgrade the grid, but consumers have concerns.

Utilities once installed analog “watt-hour meters” on the premises of utility customers. Now many utilities are replacing the old analog meters with “smart” digital meters. Both meter types measure power consumption with sufficient accuracy, but digital meters help utilities determine the exact location of a power outage, provide a lot of usage data, and cut labor costs.

Smart meters allow some utility customers equipped with solar panels to draw power from and provide power to the grid in exchange for compensation, an arrangement known as “net-metering.” In 2015, net metering was available to utility customers in every US state except Alabama, Mississippi, South Dakota and Tennessee.

A smart grid could use computers to shift electricity consumption to lower-demand times of day and away from the peak demand hours between 5 p.m. to 10 p.m.

BUT Americans push back on the technology because it comes across as surveillance.

Bad weather has sparked the desire for more sturdy grids, and going smaller could be the answer.

Hurricane Sandy in 2012 affected close to 50 million people, cutting off their access to clean water, public transit, and power.

This was another wake-up call that the way energy is produced today needs to be reconsidered.

We want to fortify our grid to withstand occasional weather disasters.

A solution is microgrids. Smaller grids that can be disconnected from the large grid, or macrogrid, and be run independently to supply power. These microgrids need to run on multiple energy sources to be more resilient, like wind AND natural gas. Diversifications equals resilience. 

The Conundrum with Solar

The problem with wind and solar is that the design of the grid is incompatible with their inconsistent generation of power: wind varies with wind speed and solar varies with sunshine. The grid cannot handle the peaks and valleys. The peaks bring too much energy that would fry the system. The valleys would cause blackouts because the technology to store the energy at a grid level does not exist.

Widespread solar panels use, however, has triggered a solar energy revolution. For example, more than 12% of Hawaiians own rooftop solar panels that “on certain sunny days…produce more electricity than the state needs.” By law, Americans who own solar panels must send the power they produce back into the grid. Thus, solar panels operate as “tiny power stations.” 

As more people install solar, utilities earn less from generating power and have less to spend on grid maintenance, so in that way higher investment in renewable energy has undercut the grid’s resilience and makes utilities more expensive for the rest of us.

The Best Storage

The most important technical goal in the power industry is finding an effective way to store electricity. Power storage facilities for “pumped hydro” exist in mountainous areas. These are man-made lake beds located uphill from hydroelectric dams and reservoirs. Some of the electricity the dams make pump excess water up into the reservoir for future use to generate power.

Batteries are an obvious power-storage option, but few have enough capacity to be useful for the grid. The American grid currently incorporates only one battery – a 1,300-ton nickel-cadmium battery in Fairbanks, Alaska. It can supply 40 megawatts of backup power for approximately seven minutes. 

As a means of storage, batteries have the advantage of working anywhere, so if the public embraces electric cars, the cars’ batteries conceivably could back up the grid. This “vehicle-to-grid” system hinges on electric cars plugging into the grid whenever they’re parked.


The solution to converting our electricity to renewables is a lot more complicated than we are told. It will require some drastic innovation before it is a viable solution at a mass scale. The grid is one of the massive pieces that needs innovation to continue serving us well in the future. I recommend this book!

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Keep reading and learning. This is a grand challenge!

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