In recent decades, utilities and communities have witnessed how the combination of aging electric grid infrastructure and increasingly extreme weather leads to more frequent and longer power outages. The costs have been steep—up to $150 billion annually for U.S. homes and businesses. Beyond the economic impacts, communities suffer health and safety threats when residents lose heating or cooling, and emergency services become strained. 

It is increasingly clear that communities and utilities must strengthen their energy systems to ensure these impacts are minimized or avoided. So, what defines strengthening an energy system? There are a variety of terms used to describe this, but what do they each mean and why are they important to utilities and communities? Understanding the distinctions between these measures is crucial, as they are slightly different but equally important.

  1. Energy reliability: The technical and operational ability of the electric grid to consistently deliver power to customers, even when power plants trip offline or instability emerges on sections of the transportation and distribution grid.
  2. Energy security: Reliable, long-term access to affordable energy sources. Whether because of supply bottlenecks or weather-related issues like storms, heat waves, floods or wildfires, some regions struggle to keep the resources on hand to meet electricity demand, particularly during peak periods.
  3. Energy resilience: Energy reliability and security are both components of resilience, which is the ability of a grid, community, building or energy system to withstand and rapidly recover from any challenge—be it high electricity demand, an extreme weather event, disruption to a source of energy supply or an infrastructure failure.

In this three-part series, we examine how successful partnerships among communities, utilities, and energy service providers can improve the grid and achieve mutually beneficial outcomes. We also explore case studies demonstrating how these types of partnerships have driven meaningful gains in energy resilience to benefit five communities.

ELECTRIC GRIDS FACE EMERGING CHALLENGES THAT REQUIRE ACTION

While the overall impact of each challenge differs from community to community, electric grids across the United States generally share three common challenges.

Grid Challenge 1: Aging Grid Infrastructure

Much of the U.S. electric grid was built in the 1960s and 1970s, and this infrastructure is approaching the end of its expected life cycle. In the U.S. Department of Energy’s words: “Our aging infrastructure is struggling to meet our modern electricity needs, such as renewable energy resources and growing building and transportation electrification.”

Grid Challenge 2: Extreme Weather

Since 1980, the National Oceanic and Atmospheric Administration reports there have been 403 weather and climate disasters in the United States in which overall costs exceeded $1 billion. More than 25 percent of those events—115—have occurred in just the last five years. More than 60 percent—246—happened in the last 15 years. A 2023 Climate Central report found that 80 percent of all major U.S. power outages reported from 2000 to 2023 were because of weather-related events, and the United States experienced about two times more weather-related outages from 2014-2023 than from 2000-2009. 

Grid Challenge 3: Rising Demand

Electricity demand has begun to rise across the U.S. for the first time in decades and is forecast to continue growing for years to come. Not only is electricity becoming more central to everyday lives through transportation and building electrification, but rapid growth in AI computing, data centers and technology manufacturing is quickly pushing the electric demand needle up in many areas.

AND THE CHALLENGE IS ONLY GROWING LARGER

This triad of challenges is only intensifying. The options are to either invest in solutions or accept a world in which electricity is less dependable. However, in reality, utilities and communities cannot and will not accept the latter option. 

Fortunately, technologies have emerged in recent years that can help to address the challenges head-on by creating a system of more flexible and dynamic energy supply and demand. The grid is most vulnerable during periods of high demand. Flexible demand technologies such as intelligent building systems and smart energy controls allow customers or utilities to shift demand to times when the grid is not under stress. Battery energy storage systems (BESS), microgrids and other distributed generation systems also provide localized energy solutions that enhance grid resilience and reliability during disruptions.

CONSIDERATIONS WHEN INVESTING IN ENERGY RESILIENCE 

Utilities and communities want secure, reliable and resilient energy for their customers and residents. However, implementing solutions to improve energy resilience requires navigating a few obstacles: 

Regulatory Approvals 

Securing approval for resilience-building projects can look quite different from traditional reliability-building investments. 

Financing Sources 

The evolving landscape offers new methods to value grid resilience, presenting an opportunity to explore diverse funding sources. The National Association of Regulatory Utility Commissioners reported that understanding the broader benefits of resilience investments can attract investors, policymakers, and regulators.

Development Hurdles 

These come in the form of permitting delays, public opposition such as NIMBYism, and long interconnection queues. 

A LOOK AHEAD

Quantifying the value of grid resilience in particular remains a challenge that can exacerbate regulatory, financing, and development obstacles. They need better empirical evidence to garner political support and funding for resilience-building initiatives.

Despite the challenges facing the electric grid and obstacles to resilience-building projects, there are myriad solutions and partnership opportunities to help utilities and communities work together to build resilience. In the next part of this series, we’ll focus on some of tools needed to build resilience together. 

Ameresco, Inc. is a leading energy infrastructure solutions provider dedicated to helping customers reduce costs, enhance resilience, and decarbonize to net zero in the global energy transition. Our comprehensive portfolio includes implementing smart energy efficiency solutions, upgrading aging infrastructure, and developing, constructing, and operating distributed energy resources. As a trusted full-service partner, Ameresco shows the way by reducing energy use and delivering energy infrastructure solutions to Federal, state, and local governments, utilities, data centers, educational and healthcare institutions, housing authorities, and commercial and industrial customers. For more information, visit www.ameresco.com.