Monday, December 17, 2012

In the aftermath of Hurricane Sandy, Consolidated Edison (ConEd) is evaluating whether to underground the entirety of its distribution network, an undertaking that would cost $40 billion.

ConEd is also speaking with the New York Public Service Commission (PSC) about increasing its $2bn annual investment in electric, gas and steam infrastructure.

Sandy took out one-third of ConEd's service territory, or about 1 million customers, quintupling the number of outages the company had seen in recent years from the worst storms, typically Nor'easters.

The majority of the utility's distribution cable is already underground – 94,000 miles of more than 130,000 miles total. To take the rest of the system underground – more than 37,000 miles of overhead lines and 49,000 transformers – would also require taking telecom and cable lines underground, for an additional $20bn, bringing the total cost of undergrounding the infrastructure to $60bn.

A ConEd study two or three years ago evaluated the cost of undergrounding the distribution network in Westchester County and Staten Island in New York. IT was estimated it could triple people's rates to put things underground. The Sandy recovery costs have provided a point of comparison between preventive and reactive measures. Sandy narrowed the gap between the cost of recovery and prevention.

New York Gov. Andrew Cuomo on Dec. 3 requested $42 bilion from the federal government for Hurricane Sandy recovery.  The estimated economic toll is $60 billion just for New York – that doesn't include New Jersey.

ConEd has so far committed to spend $250 million to reinforce its system for flood prevention, but has not yet identified exactly what measures it will take. The company has so far spent $330m on Sandy recovery costs, and expects that number to rise to between $350m and $450m. ConEd has estimated it would cost $800m for substation reinforcement – elevating equipment or building flood walls around substations that are near the waterfront. Ten substations are vulnerable to a major hurricane or storm.  (Energy Biz, 12/16/2012)

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