Electricity systems are hard to run. They were hard to run when the system was composed entirely of regulated entities, and they remain difficult to run today. The difficulties stem largely from the laws of physics and the ability of customers to consume electricity at their whim, neither of which has changed at all since we first began producing electricity commercially. The collapse of the electricity grid in the Northeast on 14 August 2003 exemplifies a simple proposition: “When difficult tasks are taken on, sometimes there are failures.”

In this Guest Editorial in the November 2003 issue of the Electricity Journal, NERA Vice President Jonathan Falk maintains that because we do not keep count of the blackouts that did not happen, we naturally tend to focus on the ones that do. If we are to reap the benefit of complex systems, we must occasionally accept their failure. The Northeast blackout was costly; whether or not we should undertake the effort and investment to avoid another one depends upon how often they tend to arise, what it would take to avoid them, and how much we dislike unreliability. When we have diagnosed the cause, we will be in better shape to assess whether or not it’s worth doing anything to project against future occurrences. Changing policies simply because something bad has happened, before we know the causes, however well-intentioned, is unlikely to improve the situation.

This abstract is republished with permission from the Electricity Journal, Volume 16, Issue 9, November 2003, Copyright (c) 2003 Elsevier Science, Inc., http://www.elsevier.com/locate/tej. All rights reserved.