“The City That Never Sleeps” goes dark
With the recent blackout in New York City, we’re reminded that energy resilience, emergency preparedness, and having a backup plan for power outages can be critical for your facility.
Every business relies on energy for critical tasks, but with this dependence comes risk. As organizations seek to become more sustainable, it’s vital to plan not only for short-term energy needs, but also for long-term energy security. Businesses that lack energy resilience and aren’t prepared for a power outage are leaving themselves open to much more than just downtime.
Just one quick power cut can bring a company – or in this case, a city – to its knees.
A massive power outage immobilizes New York City
Midtown Manhattan and parts of the Upper West Side experienced a large blackout on July 13. Iconic parts of midtown, including Times Square and Rockefeller Center, were left in the dark.
The outage began at 6:47pm, leaving 72,000 customers without power for about 5 hours. Thousands of people were trapped in subway cars and elevators. Traffic lights ceased to function, resulting in manual direction of cars, ambulances, and pedestrians.
The loss of power had negative consequences for businesses in the affected areas. Revenue loss on a busy summer Saturday night in NYC can prove detrimental to a business’ bottom line. For instance, it is estimated that 29 tons of food were tossed due to a lack of proper refrigeration, as restaurants had to replace their spoiled inventory of perishable food items. In addition, Broadway lost over $7.5 million in potential sales, being forced to refund ticket sales back to ticket holders – these losses don’t even account for other theater operating expenses lost that night.
ConEdison has blamed the power outage on a failed relay protection system at a substation on West 65th St. This system is designed with redundancies to provide high levels of reliability. However, a 13kV distribution feeder had a fault which neither the primary nor backup relay system successfully isolated, which then brought down distribution networks across Midtown and the Upper West Side.
The true cost of energy loss
It’s sometimes only when a power outage happens that organizations truly realize how much their operations rely on a consistent supply of energy, and any vulnerable areas in operation come to light. But by that time the damage is already done.
Achieving energy resilience is more than just keeping the lights on – it is about protecting your business processes. The cost of an energy loss can be catastrophic. A power outage can hit more than your production – there’s loss of inventory, equipment damage, even damage to customer relationships and brand reputation. This can destroy a company’s value – not to mention the careers of those unprepared to deal with a power failure.
If businesses don’t want to be impacted by the very real threat of a power loss, they need to start focusing on generating their own energy and making more efficient use of their current energy supply.
The growing risks of power interruption
There’s no doubt that the risks of power supply interruption are growing, which is reflected in the growing concern among businesses.
Recent research by Centrica Business Solutions shows that energy security is seen as one of the fastest-growing business risks, with 35% of businesses viewing energy security as a substantial risk to their long-term economical success. Alarmingly, 73% of businesses feel less than “very well prepared” for an interruption in power supply, and as more processes and offerings become digitized, 87% of businesses believe that resilience measures are vitally important.
What makes an energy-related failure so hard to protect against – and therefore so damaging – is unpredictability. But studying the various causes of those failures shows that there are ways that businesses can be better protected.
What businesses need is an energy resilience strategy.
Integrating energy resilience into your strategy
The good news is that there are effective distributed energy solutions available to protect organizations and ensure that they maintain business continuity – whatever power reliability challenges they may face.
Integrating energy resilience into a long-term energy strategy will provide the best outcomes. There’s a direct correlation between businesses that have a well-planned energy resilience strategy and positive business outcomes in the event of a failure. Recent research conducted by Centrica Business Solutions shows that businesses who make detailed plans are 34% more likely to report strong financial performance.
The most forward-thinking businesses are those who are taking control of their energy supply. They are facing a changing energy landscape by increasing the amount of power they self-generate as opposed to relying entirely on energy from the grid.
The ‘peak of the storm’ when critical processes are compromised is not the time for thinking – it's the time to activate a robust contingency plan. We recommend 3 steps to develop your resilience plan:
- Understand your environment and areas of risk – Gain a deeper understanding of your complete energy profile with a real-time view of systems and processes that allows you to pinpoint your potential vulnerabilities.
- Assess the business impact of power loss – Identify critical and non-critical systems and understand the effect of power loss on each. In this way, you will be able to prioritize energy resilience solutions and know which essential systems must be kept on at all times.
- Design your resilience plan – Use the data gathered in steps one and two to design your action plan. This should take into account critical loads, relative priorities, and response speeds for back-up power solutions, which should be able to respond automatically. Consider on-site generation equipment – such as cogeneration, back-up generators, and solar power with storage – to assist in providing interrupted sources of power.
How we can help
As a market leader in the global energy industry, Centrica Business Solutions has the capabilities to support your end-to-end resilience strategy. This includes working with you to analyze your business needs, understand specific risks, and create a robust contingency plan.
We can also design and implement resilient energy solutions, including using our intelligent insights technologies to improve performance of your energy assets and pinpoint vulnerabilities. Our on-site generation solutions can also provide you with a more efficient and stable energy supply – and increase your energy flexibility.