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Half of US Population at Risk of Power Loss Due to Frigid Winter

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Power Grids at Risk of Electricity Shortages During Frigid Winter, Warns NERC

According to industry regulators, power grids supplying over half of the US population may face electricity shortages during an extended cold snap or severe winter storm. The North American Electric Reliability Corp. (NERC) stated in its winter reliability assessment that regional system operators in a vast area from Texas to Quebec are at risk of insufficient electricity supplies during peak winter conditions. This outlook is even more concerning than last year's report, which indicated that a quarter of Americans were at risk. The report now includes densely populated areas on the East Coast, which heavily rely on natural gas during their transition to renewable energy. The vulnerabilities of the grid were exposed during recent storms, such as the Texas deep freeze in 2021. Despite efforts to weather-proof equipment, many utilities and power generators are still at risk due to potential fuel supply disruptions and plant shutdowns during extreme weather conditions. In Texas, the state grid operator has already warned of an "unacceptable" risk of emergencies during powerful winter storms. The NERC report highlights the need for proactive measures to ensure the reliable performance of the power grid and the availability of fuel supplies. Prolonged cold snaps and extreme weather events pose significant challenges to the grid's stability and can lead to increased power consumption. As the demand for electricity grows and the transition to renewable energy continues, it becomes crucial to address these vulnerabilities and strengthen the resilience of power grids to safeguard against potential power shortages during frigid winters.

Implications of Power Grid Vulnerabilities for New Businesses

The North American Electric Reliability Corp.'s (NERC) warning about potential electricity shortages in the power grids that supply over half of the US population presents significant implications for new businesses. The predicted shortages during extended cold snaps or severe winter storms could disrupt operations, particularly for businesses heavily reliant on electricity.

Operational Challenges

Businesses, especially those in the manufacturing and tech sectors, could face operational challenges due to power shortages. This could lead to production halts, data loss, and service disruptions, affecting both profitability and customer trust.

Increased Costs

The potential for power shortages also means businesses may need to invest in backup power solutions or pay premium prices for guaranteed electricity supplies. These additional costs could strain the finances of new businesses.
Strategic Planning
The NERC report underscores the importance of strategic planning and risk management for new businesses. Companies need to consider potential power shortages in their contingency planning and develop strategies to mitigate these risks. In conclusion, while the transition to renewable energy and the strengthening of power grid resilience are long-term solutions, new businesses must prepare for the potential short-term challenges posed by power shortages during severe winter conditions.
Story First Published at: https://financialpost.com/pmn/business-pmn/half-of-us-population-at-risk-of-losing-power-from-frigid-winter
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