Energy and Measures for Risk Mitigation and Transfer

Assuring the availability and continuity of critical energy infrastructure, as well as paying for the costs of infrastructure restoration and reconstruction, has long been a topic of great intensity and controversy, due to the potential for devastating losses as well as the complexities inherent in the cyber aspects of critical infrastructure. The consequences of actual and future catastrophic events and their resulting financial damages require continued efforts to explore cost recovery mechanisms that would increase policy options for state and federal officials, enhance market signals and the climate for commercial insurance, and restore vital services at the lowest possible costs to energy utilities and their customers.

In August 2004, the CIP, then using its previous name “The Critical Infrastructure Protection Program (CIPP),” received an initial grant from the US Department of Energy (DOE) and one of its research institutions, the National Energy Technology Laboratory (NETL) under the broad rubric of Energy and Measures for Risk Mitigation and Transfer.

Under the grant, in 2005 the CIPP conducted research and held a workshop on the availability and role of commercial insurance, Protecting the Electricity Sector's Infrastructure: Building the Business Case for Commercial Insurance.

Continuing in 2006, CIPP researchers examined how certain Gulf Coast states – Florida, Louisiana, Mississippi and Texas – and the federal government responded to the unprecedented energy infrastructure destruction inflicted by Hurricanes Katrina, Rita and Wilma.  On October 31, 2006, CIPP researchers presented an overview of their findings to DOE and experts the Department invited from outside the agency.  In 2008, CIPP researchers provided the final in a series of updates to its cost recovery report, taking into account events from the four covered states in the intervening two years.  The report is entitled: Critical Electric Power Infrastructure Recovery and Reconstruction: New Policy Initiatives in Four Gulf Coast States After 2005’s Catastrophic Hurricanes.  

Also in 2007, CIPP researchers working under the DOE grant performed quantitative and qualitative assessments of forty-seven "State Energy Emergency Response Plans" (SEERPs). Since 1990, states have a basic, conditional requirement under federal law to develop such "contingency plans" in order to provide more effective state and regional coordination to energy shortfalls and emergencies, and to provide the Secretary of Energy with an awareness of the states' plans, responses and legal authorities. The 47 plans were evaluated against the National Association of State Energy Officials (NASEO) State Energy Assurance Guidelines, Version 2 (November 2005). Through a thorough examination of the NASEO Guidelines, CIPP researchers developed a set of topical metrics and supporting submetrics. These indicators were organized into a data matrix, which formed the quantitative underpinnings of the evaluations. The evaluation team reviewed each plan at least four times to mitigate the potential for bias, particularly when assessing the more subjective aspects of the SEERPs. After concluding the evaluations in August, CIPP researchers prepared a report which included statistical analyses including visuals (maps, graphs, box plots, frequencies, etc.). The draft report was presented to DOE's Office of Electricity Delivery and Energy Reliability on September 17, 2007. The draft was updated on February 28, 2008; Revision 1 incorporates several suggestions made by the sponsor and adds one additional state plan to the evaluations along with associated qualitative and quantitative revisions.

Research was funded by a grant from the US Department of Energy (DOE): Grant DE-FG26-04NT42250.  The information provided in the documents provided via links on this web page represent individual and collective views of researchers and may not reflect those of the grant sponsor, the Critical Infrastructure Protection Program (CIP Program) or its parent institution, George Mason University School of Law.