How many Idas can electricity users afford?

One of the less obvious outcomes of the Great Blizzard of 1888 was that, by the following year, crowds of New Yorkers were following workers around yelling “timber!” as they chopped down wooden utility poles. The ferocious winter storm pushed the city to get serious about burying the growing network of power and telegraph lines strung over its streets. Climate change wasn’t part of the conversation back then. But a dose of extreme weather helped tip the balance in a continuing tussle about the hazards of overhead lines and the costs of putting them underground.
New Orleans lost power as Hurricane Ida put all of the transmission lines that feed the city out of action. One giant tower that withstood Hurricane Katrina in 2005 crashed into the Mississippi. Entergy Corp, which supplies power in much of Louisiana, said the hardest hit areas may experience outages for weeks. As is usually the case after a catastrophic storm, we can expect calls to bury the region’s power lines along with the swift response that doing so just costs too much.
The big difference between now and 130-odd years ago is that climate change has not only entered the conversation, it is inescapable. Gauging the exact links between climate change and Ida will take time. But as the latest report from the Intergovernmental Panel on Climate Change makes clear, rising temperatures resulting from man-made emissions are fueling extreme weather events and, left unchecked, will make them more frequent and more intense.
That changes the cost-benefit analysis for vital infrastructure. Only last month, PG&E Corp, the wildfire-prone utility in Northern California, raised eyebrows by announcing a plan to bury 10,000 miles of wires, an enormous undertaking. Meanwhile, Texas’ freeze in February unmasked critical weaknesses across both its power and gas networks, spurring legislation to harden at least some of them against harsher weather.
The whole point of energy networks is to defray their costs across as many customers as possible. Hooking up a remote village to the grid usually costs much more than connecting a new city subdivision per capita. But the social and financial compact holds, with some occasional grumbling, because costs remain manageable.
Will that hold with climate change? A couple of years ago, I looked at how much more Californians could afford to pay for their power to cover growing wildfire-related costs because the state has some of the highest power prices in the US. Luckily, Californians also tend to use less power and earn more money than others elsewhere, so utility bills take a smaller bite from personal income — on average.
The problem is, though, averages only get you so far in a state that’s home to both Silicon Valley and the Central Valley. The fact that the state had to come up with a wildfire insurance fund and that San Francisco keeps threatening to defect from PG&E’s grid illustrates how much pressure the grid’s compact faces already.

—Bloomberg