COMMENTARY: Improving Reliability in the U.S. Water & Wastewater Industries

By Ryan Sitton

At the beginning of this year, an unprecedented freeze hit the southern part of the United States. The state of Texas, which has its own, self-contained energy grid, saw power outages that it had never experienced. At one point, nearly six million Texans were without power. The Electric Reliability Council of Texas (ERCOT) had managed the power system since 1970. Over those 50 years, the organization worked to ensure adequate power was available by forecasting power needs, regulating pricing, and monitoring the amount of generation available at any given time. The grid was designed to achieve reliability through the redundancy of building extra infrastructure to provide extra capacity if a unit went down. The great freeze exposed this strategy as inadequate. Redundancy only works when the pieces of a system don’t affect one another or when one event can’t affect all the pieces. The freeze slowed multiple power facilities which affected gas supplies, which then affected other facilities, causing a crisis to occur. This crisis identified a lack of optimization and a lack of calculation of system-wide risk.

For the past half century, private companies in commercial industries have worked constantly to improve reliability. Almost all large, complex processing facilities in the manufacturing, mining, chemicals, power generation, and refining industries have seen their reliability improve and their costs reduce. This was not achieved through redundancy. On the contrary, redundancy adds more cost per product made, not less. Most of these gains were made by commodity business arenas where competition built out new facilities and made enough product to fill demand. Once supply met demand, adding additional capacity to ensure reliability became costly. Instead, to be competitive, operators worked to get more out of existing facilities by optimizing their spend alongside their production.