Currents

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currents G R A N D R I V E R D A M A U T H O R I T Y
fall 2011
a c elebr a tion of public powe r
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or over 75 years, GRDA has built its “power for progress” tradition by supplying abundant electricity for Oklahomans, serving as an economic de-velopment
engine for its native state and protecting the natural resources of the Grand River, as it winds its way through the state’s northeast corner.
Along the way, it has also forged strong and beneficial partnerships with many of the state’s public power communities by helping to provide low-cost,
reliable “power for progress” to their citizens.
However, just a generation or two ago, people still marveled at electricity’s uses and improvements to their lives. After all, it wasn’t until the 1940s that
our country was fully electrified. Way back then, getting the power flowing was often a struggle for these communities. Later, when electricity’s popu-larity
boomed, these community-owned systems experienced severe growing pains. In most cases, that’s when the relationships with GRDA began –
over 60 years ago. Most have lasted ever since.
In the pages of this special edition of the Fall Currents, you will read the story of these communities. You will read about an Oklahoma self-reliant
spirit and you will read about visionary leaders from days gone by. You will read about their struggles and their triumphs and their ongoing successes.
Along the way, you will also read about GRDA’s history, its mission, other partnerships and the role it has played in Oklahoma’s powerful story.
It is a special story we do hope you will enjoy. As always, thank you for your time and attention to our publication.
Sincerely,
GRDA Corporate Communications
GRDA Currents, Vol. 24, No. 3. GRDA Currents is produced by the Grand River Dam Authority for employees, retirees, families and friends. If you have any suggestions, news or story ideas, contact GRDA
Corporate Communications, PO Box 409, Vinita, OK 74301-0409, 918-256-5545, or via interoffice mail or email. Editorial: Justin Alberty, Shannon Cook and Melanie Earl. This publication printed by DPS Printing
is issued as authorized by 82 O.S. 1981, Sec. 861 et seq. 875 copies have been printed at a cost of $2,362.50. Copies have been deposited with the Publications Clearinghouse of the Oklahoma Department of Libraries.
In this issue ...
Honoring the tradition
On the cover- Autumn foliage blankets a neighborhood in the GRDA municipal customer community of Stilwell. The city of Stilwell and GRDA have been public
power partners since 1950.
Opposite Page- PUBLIC POWER SCENES IN OKLAHOMA (clockwise from top left) The original electric generation plant in Miami, Oklahoma (circa 1918); Miami’s
centennial clock, near downtown; A Skiatook bulldog keeps watch outside the Skiatook Chamber of Commerce building in the public power community; Early-day
GRDA employees show off the fleet in the late 1940s, near the “old steam plant” in the middle of what would become the MidAmerica Industrial Park; The Man-nford
Pirate mascot keeps a watchful eye over the public power community from his water tower perch; Early-day electric department employees at work inside
Sallisaw’s original generation plant; Following the tracks through Sallisaw, a GRDA public power community since 1952, to finally a shot from downtown Pawnee...
where the buffalo still roam.
public power
F
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A public power story ...
Turning the lights on for Oklahomans
The story of our nation’s public power history is as good as any story ever told. It has all the plots, subplots, characters and intrigue that fill the pages of best-selling
novels; keeping readers on the edge of their seats. But, the story of public power, with all of its ups and downs and twists and turns, is a true one.
As in any good narrative structure, there must be conflict. In the public power story, that conflict came in the form of public versus private and rural versus
urban, all staged against a backdrop of early 20th century America, and its introduction to electricity.
Electricity, as an energy source, was more powerful and effected more change than perhaps any other innovation of
the late 19th century. It impacted industry, homes, economies, transportation, communications, politics, policies and
government. Although it soon came to be synonymous with modern civilization, the battles that were set in motion
over electricity and the control of its sale were fought in a more primitive manner. In fact, the war over territory began
almost immediately.
Initially, competition between private companies and not-for-profit public power systems were over local franchises.
But, as the number of municipal power systems began to grow at a faster rate than private systems, the battle was in-tensified
by the private power companies’ call for state regulation and more control over these service territories.
How one utility was born That story played out in Cushing, Oklahoma nearly 100 years ago. Incorporated in 1894, the town granted a 20-year
franchise to the Cushing Electric Light & Power Company in 1912. That company, owned by a few citizens, was to
supply the town with electric lights at the maximum rate of ten cents per kilowatt hour. In 1916 – perhaps as an illus-tration
of how lucrative the electricity industry could become -- the utility sold its property and franchise rights to the
Minnesota Light & Power Company (MLPC) all the way up in Minneapolis. In turn, MLPC sold its property and
franchise rights to the Interstate Power Company of Dubuque, Iowa, in 1926.
During this time interest in a municipally-owned, locally-controlled power plant began to grow among Cushing lead-ers
and citizens. In 1927, momentum was strong enough that a bond issue was passed to build a modern street lighting
TIMELINE
Power for progress through the years …
GRDA’s 75 years of service to Oklahoma is intertwined
with the history of the state itself. In fact, GRDA has
grown right alongside Oklahomans’ increasing demand
for low-cost, reliable electricity. Throughout the fol-lowing
pages is a brief timeline that looks back on that
growth and the important public power partnerships
that spurred it through the years.
1800
Alessandro Volta
invents the first
electric battery.
Volta also proved
that electricity
could travel over
wires.
1803
United States acquires
most of Oklahoma
through the Louisiana
Purchase.
1834
Land is set aside as
Indian Territory.
1839
City of Tahlequah, in
Indian Territory, is es-tablished
as the Chero-kee
Capital, following
the Trail of Tears.
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system that the city would own. It was after the Cushing Board of Commissioners gave instructions to begin the preparations for plans for a municipal power
plant that the five-year struggle for ownership of the Cushing electric system really began.
For obvious reasons, the Interstate Power Company had a financial interest in seeing plans for a municipal plant fail, and invested quite a bit of time and money
to secure that end. A campaign to stop the plant was kicked off through advertising in the local newspaper. The ads not only opposed the plant, but also pointed
out what a mistake municipal ownership would be. A number of Interstate’s press agents were also sent to manage the campaign and soon thereafter the Cush-ing
Morning News opened its doors.
However, those in favor of the municipal system were able to weather the PR storm, and
even lawsuits as they continued to push for public power in Cushing.
Finally, on March 7, 1935, the Attorney General approved the bonds that would finance
the construction of the power plant and distribution system. That plant began operations
on January 5, 1936.
Of course, conflict, both external and internal, was a com-mon
denominator in the early years as electricity was be-coming
more popular and communities were experiencing
growing pains; in many of those cases, outside economic
forces played a pivotal role.
Early day difficulties That was evident in Wagoner, way back in 1898. Even then,
the city council was attempting to acquire electricity for
the township, though the customer base consisted of five
streetlights, a few homes and businesses. By 1910 though, they were successful and, over the objections of Mayor O.W. Munch,
the city council passed a bond to purchase Wagoner Light and Power. However, when the Great Depression tightened its grip on
Oklahoma, Wagoner was by no means exempt. The community struggled to keep the power on, and that early public power sys-tem
was soon placed in federal court receivership.
Further west, the community of Stroud also combined desire and determination to make its public-owned electric system possible. Residents simply would not
give up, even when unfortunate events and economic setbacks reared their ugly heads.
Although the proposal for Stroud’s electric light service was accepted in 1904, it wasn’t
until April 7, 1907 that electricity began to flow. Several street crossings and the local tele-phone
office were the first recipients. The city also passed Ordinance #83 to establish rates.
However, by the fall of that year, Stroud was experiencing a lot of powerless nights. The
coal supply that had been running low for some time finally ran out completely. The icy
winds of winter were also blowing and that only made the financial condition seem worse.
According to town history, the expense of the department was double the receipts; expenses
amounted to $400 and the receipts added up to $200. But many Stroud residents felt they
had come too far to give up. Some businesses even suggested an increased occupancy tax,
on themselves, as a way to fund the electricity system. Sunday schools across town even
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united in a fundraising effort for the plant. In better times, the city had furnished free lights for the churches
and members used this as an opportunity to show their appreciation. They rallied together to save something
that many residents had already invested in.
And they succeeded. They endured the winter and by the summer of 1908, Stroud’s plant was running 24
hours a day, had a new superintendent, and was financially secure.
Supply and demand For other municipalities the struggle was not about finances but rather, supply and demand. As growth came
to these Oklahoma towns and more and more custom-ers
wanted electricity, they often struggled to find suit-able
generation sources to meet those needs.
The Stillwater public power system predates Oklahoma
statehood by six years and for a time in its history, it
struggled to meet customer demand.
In 1901, Stillwater’s mayor and city council had passed
a handwritten ordinance which provided the city’s 269 residents the opportunity to receive electric light
service from the newly formed municipal electric utility Stillwater Power.
Listed in the ordinance were set prices for individuals, civic groups and churches. The price for the
new, modern convenience was $1.25 per month for two light bulbs. In just two short years though, the
demand outgrew the city’s original generating resources. According to a Stillwater Power history re-searched
and written for Stillwater Power’s 100th birthday in 2001, a 50 kW steam engine driven dy-namo
had to be purchased to meet the city’s needs. Later, in 1917, an 8,000 kilowatt generation plant
was also constructed.
Down in Cherokee County, the community of Tahlequah was facing a similar situation during the
1930’s. City leaders laid the ground work for low-cost reliable electricity at the turn of the century, see-ing
the need for electricity in their community as early as 1902. Local records state that a businessman
from Muskogee received the authority to operate a light and power plant. However, service would be
available only after the sun went down and last until midnight. Citizens were not permitted to use elec-tricity
during daylight hours until 1914.
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The city’s first electricity plant was built in 1919, near the railroad tracks, and gen-erated
power with diesel engines. A decade later, the community was seeing quite a
bit of growth both residentially and commercially (records indicate there were 1,110
customers using 1,112,000 kWh at cents per kWh). Tahlequah soon formed a util-ity
board to govern the ever increasing system but the question of how to generate
enough power to meet demand was not answered as easily.
The nation embraces electricity
These issues and more faced communities throughout this period of public power
history. However, while some municipals struggled locally, there was an even more
intense struggle going on nationally. Consolidation and mergers began to occur at
the turn of the century and by the late 1920’s more than 85 percent of the nation’s
power supply was controlled by 16 corporations.
President Franklin Delano Roosevelt, a proponent of public power, recognized
this clearly. Laws enacted under his New Deal broke up the major holding compa-nies.
Meanwhile, record high unemployment, drought conditions and the linger-ing
Great Depression had left Americans starving for work. As part of his recovery
plan, Roosevelt threw his full support behind the building of federal dams which
would provide flood control, irrigation and electricity. Suddenly, more people and
more electric generators were put to work. The sale of the low-cost electricity that
would be produced at these hydroelectric facilities would offset the cost of the fa-cility
construction. Also, there was a policy granting municipalities preference in
purchasing wholesale power.
Roosevelt seemed to view electricity not so much as a product, but rather, as a ser-vant
for citizens. In fact, while campaigning for the presidency he spoke of hydro-electric
power projects, saying they “…will be forever a national yardstick to prevent extortion against the public and to encourage the wider use of that servant
of the people- electric power.”
1873
The city of Sallisaw
is founded.
1874
The city of Paw-nee
is founded.
1879
Thomas Edison
demonstrates his
incandescent lamp.
1880
The city of Skia-took
is founded.
1888
The city of Wagoner
is founded.
1889
First land run is held
April 22. The City of
Stillwater is founded.
1891
The cities of Cush-ing
and Miami are
founded.
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Grand River Dam Authority’s arrival
The president’s open support for hydroelectric projects was not lost on a group of men in Oklahoma who were en-visioning
a massive dam across the Grand River Valley.
Actually, Henry Holderman had first envisioned that dam as early as 1896, when he floated the Grand River as part
of an engineering survey to determine the best locations to build it. By the late 1930s, a group of businessmen had
taken up the cause and were lobbying hard to get funding for the construction project. In fact, they were dubbed
the “Rainbow Chasers” because of their efforts, which included several trips to Washington, D.C. – at their own
expense – to secure the federal government’s assistance.
Meanwhile, in April 1935, the 15th Oklahoma Legislature passed the enabling act which created GRDA and gave
it the responsibility to build dams along the Grand River for the purposes of hydroelectric production and flood
control. With that structure in place, the lobbying continued.
In August of 1937, it paid off. That was when FDR made the offer of a loan and grant to GRDA for the construction
of Pensacola Dam. The loan totaled $11.5 million while the grant totaled $8.4 million. GRDA accepted the offer
in September 1937 and by July 1938, contracts were finalized for the construction project. Holderman’s vision, and
the Rainbow Chasers’ pot of gold, was becoming a reality. More importantly, abundant, low-cost, reliable electric-ity
– to meet the needs of all those Oklahoma public power communities – was on its way.
By now, it seemed a known fact that electricity had the power to change lives. But not everyone had the opportunity to realize that change personally. By the
1930’s, urban America had been revolutionized, nearly 90 percent of residents had electricity. Compared to the 10 percent of rural families who were able to
make use of electricity, the gap in the standard of living between the cities and the farms was a large one.
It wasn’t that people living in the country didn’t need electricity; one woman remarked she had been conscious of her need for electricity since she was old
enough to walk and carry water. For sure the need was there, but supplying power to less populated areas was thought to be too cost prohibitive by private
utility companies and out of the reach of municipal systems. The expense of stringing lines in the countryside, with so much open spaces between neighbors,
was not appealing.
“Electricity is a modern necessity of life, and ought to
be found in every village, every home and every farm... ”
1892
The city of Stroud is
founded.
1896
Henry Holder-man,
who dreams
of a dam across the
Grand River, makes
his first surveying
trip. The City of
Stiwell is founded.
1897
City of Collinsville is
founded.
1907
Statehood! Okla-homa
becomes the
46th state to join
the Union.
1909
City of Pryor Creek
is founded.
1935
The 15th Oklahoma
Legislature creates the
Grand River Dam
Authority.
1937
GRDA secures fund-ing
for the construc-tion
of the Pensacola
Dam.
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Once again though, President Roosevelt’s admiration for an electri-fied
country played a pivotal role. Included in the New Deal was the
Rural Electrification Act, which brought power to areas that private
power companies claimed, but did not serve.
“Electricity is a modern necessity of life and ought to be found in
every village, every home and every farm in every part of the United
States,” he said.
In small communities all across America, meetings were held by Ru-ral
Electrification Administration officials to discuss the possibility
of electrification. Hope, excitement and possibility filled hearts and
minds. Neighbors came together to form rural electric cooperatives,
investing in their communities and their future.
The Power of Cooperation
In four counties in Northeast Oklahoma, 14 local individuals, with
a strong belief in the area’s potential, pooled together $5,000 and ap-plied
for incorporation with the REA. As a result, on September 19,
1938, Northeast Oklahoma Electric Cooperative (NEOEC) was born. Right away, the first order of business – recruiting members – began. That meant going
through the countryside convincing friends and neighbors it would be worth the $5 membership fee to bring electricity to their homes and farms. Naturally,
some were skeptical about the imagined risks and supposed benefits of electric power. However, the fee, though hard to come by during the Great Depression,
bought each member a share in the cooperative.
The idea was to first build the line and then build the service. Providing new
customers with information about how electricity could boost productivity and
demonstrating the advantages of the modern machines and appliances soon in-creased
the initial demand in the countryside. It also made many endeavors a
good deal more profitable. Power Use Advisors taught members basic electri-cal
wiring and proper safety measures. Home demonstration clubs showed the
advantages of modern electrical appliances. Both membership and kilowatt us-age
increased.
The cooperative made plans to purchase low-cost power from the Grand River
Dam Authority, still in its infancy. However, World War II came along and those
plans were put on hold. The power generated at Pensacola Dam – Oklahoma’s
first hydroelectricity facility – instead powered the manufacturing of explosives
and munitions for the United States war effort.
Finally, in 1946, after the war and after GRDA had won the struggle to regain
control of the dam from Uncle Sam, GRDA and NEOEC were able to partner
together to bring low-cost power and progress to the region.
“We’ve sort of grown up with GRDA, right here in the fastest-growing area of the state,” said NEOEC District 8 Trustee Bill Kimbrell. “It’s been a good part-nership,
dating all the way back to the 1940’s.”
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Today, NEOEC (GRDA’s largest customer) continues to provide power and support to its membership and service area it helped to build. The two utilities
have a long history of working together to improve the lives of customers and economy of the entire region.
The growth that was stimulated by the placement of electric poles, covered in creosote, was comparable to that that which was brought by the laying down of
railroad tracks. The train signified progress, a means to get your surplus to the world that was before too distant (to exchange anything with). The light poles
brought that world even closer. The American dream was now achievable in rural areas and small towns, far removed from metropolitan areas.
Railways and power lines
As was the case with many small towns, it was the railroad that powered the founding and development of the town of Stilwell. In 1894, plans were made by
railroad developer Arthur E. Stilwell to connect Kansas City to the Gulf of Mexico. The railway, later named the Kansas City Southern, would track through
Indian Territory.
Permission to build on Indian lands was approved in 1893 and tracks were laid through the foothills of the Ozarks, creating opportunity as well as new com-munities
along the division points. Incorporated in 1897, Stilwell soon became a growing community that supported a well-balanced commercial and agricul-tural
climate. The fertile soil was cultivated and sown with seeds that would prosper the community. In no time, the land produced more than enough fresh
produce to supply the local markets. The railroad allowed farmers easy access to ship their surplus to Kansas City.
Though the whistle of the train is still heard throughout the day in the community of 3,700, public power has come aboard as an important partner in gener-ating
new development.
Important because it is
abundant and low-cost.
“There is no doubt that
the cost of electric-ity
plays into growth,”
said Mike Doublehead,
General Manager of
Stilwell Utilities.
Prior to 1950, Stilwell
generated its own elec-tricity
with a small coal
fired plant, with a to-mato
cannery, found-ed
during the 1930’s,
1938
Thousands of
Depression-era
laborers flock to
the site, look-ing
for work.
Concrete pour
begins.
1940
Pensacola Dam
is complete,
and Grand Lake
begins to fill.
1943-46
Uncle Sam takes
control of Pensacola
Dam, using it to gen-erate
electricity for
the war effort.
1946
Northeast Okla-homa
Electric
Cooperative begins
its wholesale elec-tricity
partnership
with GRDA..
1948
GRDA is the win-ning
bidder for the
purchase of the
Oklahoma Ordnance
Works Steam Plant.
1946-53
During a seven-year span, Claremore Collins-ville,
Cushing, Miami, Pawnee, Pryor, Sallisaw,
Stilwell, Tahlequah, Wagoner all begin receiv-ing
GRDA wholesale electricity.
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1964
GRDA completes
construction of the
Robert S. Kerr Dam,
its second hydro-electric
facility. Lake
Hudson is created.
1972
GRDA completes the
second phase of the
“experimental” Sa-lina
Pumped Storage
Project on the Saline
Creek arm of Lake
Hudson.
1977
The city of Skiatook
becomes GRDA mu-nicipal
customer.
1978
GRDA is set to enter the
thermal-generation field as
construction begins on the
Coal Fired Complex.
1985
GRDA celebrates 50
years of service to the
state of Oklahoma. The
city of Stillwater be-comes
GRDA munici-pal
customer.
1986
Unit 2 at the Coal Fired
Complex is complete.
Stroud becomes GRDA
public power partner.
contributing to the demand placed on the small coal plant. As the need for canned foods soared during WWII, the Stilwell Canning Company increased pro-duction
to include green beans, kale and spinach. When the war ended, the growth continued and by 1948, the facility was processing frozen strawberries. Of
course, that meant greater refrigeration needs and ultimately, the need for even more electricity.
City leaders searched for a more consistent power source and soon settled on GRDA. That partnership, which began on October 31, 1950, is still going strong today.
“Our mission is to be the premier city owned utility company in Oklahoma,” said Doublehead. “We want to provide dependable and reliable electricity to the
city of Stilwell and our partnership with GRDA helps us to do that.”
Securing a reliable provider of wholesale electricity allowed for even more commercial and industrial growth. Stilwell Foods merged with the Flowers Com-pany
and soon combined with Mrs. Smith’s Pies. The Schwann Food Company purchased Mrs. Smith’s in 2003. Today, the facility covers 610,000 square
feet and employs 1,100.
For Doublehead and Stilwell, the tie between such growth and low-cost, public power is clear.
“[With public power] decisions are made locally,” said Doublehead. “We know the people our decisions affect, they
affect our neighbors, and they affect us”
Powering Industry in MidAmerica
Sometimes public power is extended to meet continued growth, and sometimes, growth occurs because of the prox-imity
of public power.
When World War II was looming on the horizon, the federal government began scouting potential locations for ord-nance
plants. That search soon led to the Grand River area in Northeast Oklahoma, where GRDA’s Pensacola Dam
was set to provide hydroelectric power and the river itself was a steady water supply. One of the four such plants con-structed
throughout the country, the Oklahoma Ordnance Works (OOW) powder plant employed thousands from
1942 to 1945, but closed its doors shortly after Japan’s WWII surrender.
Things stayed that way for a few years, but the potential contained within the dormant OOW facilities – which in-cluded
10,046 acres, hundreds of buildings, 50 miles of railroad spur, four complete water systems and three complete
chemical plants – could not be ignored. A man named Gene Redden realized that combining those facilities with the
low-cost, abundant electricity in the area could ultimately lead to a very successful industrial park operation. That
idea drove his efforts and, in 1961, the Oklahoma Ordnance Works Authority (OOWA) was born.
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1990
Even as it turns 50
years old, Pen-sacola
Dam is still
an important part of
GRDA’s overall gen-eration
portfolio.
1996-2003
GRDA completes a $30
million upgrade on the
state’s oldest hydroelectric
generators- the six units at
Pensacola Dam.
2008
GRDA enhances the diversity of
its electric generation portfolio
by adding natural gas, through
its 36 percent interest in the
Redbud Plant.
2010
GRDA celebrates its 75th Anniversary and opens the doors
on its new Ecosystems and Education Center, on the shores
of Grand Lake. Work is completed on the expanded and
upgraded Energy Control Center, enhancing the reliability
and security of the GRDA energy delivery system.
Later on, the name changed to MidAmerica Industrial Park (MAIP), but the mis-sion
remained the same- to increase area employment by bringing new business to
the region and assisting existing businesses. The mission was accepted and has been
achieved. Owned and operated by a public trust, MAIP has grown into the larg-est
rural park in the nation. It is home to nearly 80 companies, ranging from very
small to companies named among the Fortune 500, and employs over 3,200 people.
The mission of MAIP meshes perfectly with the pledge GRDA made to the people
of Oklahoma, “to assist in area economic development and help our customers adapt
to changes in their business environments. The partnership between the two entities
has been working hand-in-hand to bring growth, industry and jobs to Northeastern
Oklahoma since OOWA was born.
“It’s a natural partnership,” said Sanders Mitchell, MAIP Administrator. “We proved
a large customer base for the GRDA and they provide low-cost electricity that is es-sential
for the development of this property.
Power, water, land and labor are what draw companies to MidAmerica. According
to Mitchell, “the big ticket item is the low-cost power … for power dependent com-panies
it is very critical, it is a real asset to those companies.”
The significance of having two GRDA facilities located adjacent to the park -- the Coal Fired Complex (CFC) and Transmission and Engineering Headquar-ters
-- is recognized immediately by potential companies.
Mitchell added that the closer the power source, the less down time will be experienced. If there are two miles of line between the company and the power
source, there are two miles of things that could go wrong. During the area’s worst two ice storms in recent years (January and December 2007) not one in-dustry
in the park lost power.
The local nature of Public Power
The local nature of public power lends itself to less downtime/shortened response time in public power communities. After all, when the community owns the
electric distribution system, hometown maintenance crews are just around the corner. When such quick response time is coupled with reliable service and low-cost
power, the result is a solid foundation to build a community and boost economic development.
That is what public power is really all about, and that is what has continued to help Oklahoma public power communities thrive.
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“Public Power is about quality of life...”
According to the 2010 United States Census, three of the top six fastest-growing counties in Oklahoma are in GRDA’s 24-county service area. In two of those
counties, Rogers and Wagoner, GRDA supplies power to the county seats (Claremore and Wagoner).
Meanwhile three other counties in the GRDA service area are in the top 12 fastest-growing. Again, in two of those counties – Payne and Cherokee -- GRDA
also supplies the county seats (Stillwater and Tahlequah). The other county, Delaware, is home to the majority of Grand Lake and is a large service area for
GRDA’s largest customer, Northeast Oklahoma Electric Cooperative.
The reliability of Public Power
For Claremore and Rogers County, being ranked among the fastest-growing Oklahoma areas has long been the norm. Located on historic Route 66, Clare-more
predates America’s Main Street by over 100 years. As early as 1893, Claremore was already showing signs of developing into a bustling community with
a healthy business climate. That climate is still nurtured today by organizations like the city-owned electric utility, the Claremore Industrial and Economic
Development Authority (CIEDA) and the Claremore Chamber of Commerce.
Calling the community of Claremore, “an important part of its public power team,” GRDA worked closely with
Claremore city officials on a electric reliability task force in the fall of 2004. Following that effort, the city passed
a bond issue that allowed it to upgrade its constantly-growing electric distribution system. As a result, the sys-tem’s
reliability went from 99.6 percent to 99.985 percent. While that may look like a small increase on paper,
its real impact shows up in even greater reliability along the tree-lined streets and neighborhoods of Claremore.
In fact, in 2007, the city won a reliability award from the Municipal Electric Systems of Oklahoma (MESO).
The reliability of hometown power: it’s on display everyday in Claremore.
Just over Keetonville Hill, and a short drive to the west along Highway 20, the city of Collinsville has been undergoing tremendous growth itself. According
to city statistics, the community has one of the fastest growing school districts in Oklahoma and housing permits have more than tripled since 1997. City lead-ers
are quick to state that being a public power community has attributed to that growth.
“Public power is about quality of life,” said Pam Polk, City Manager. “It keeps the costs down and is home-owned and operated. It is an investment that you
make in your community.”
It is an investment that Collinsville leaders wanted to make from the very beginning. Incorporated in 1889, the small but progressive community of 200 was
one of the first to have a municipally-owned light and power plant. An ad placed in the Collinsville News in 1909 advertised “Day Current Now On” reveal-ing
that the Collinsville Electric Light & Power Company was ready to furnish customers with electric fans, bells, alarms, light and heat.
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Through all the economic turns of the first half of the century, city leaders remained convinced that public power was still best
for Collinsville and its residents. The sentiment expressed in the Collinsville News, at a much earlier date, was that “the rev-enue
secured for the municipality has been a great relief from the worries of taxation necessary to maintain city government.
It has provided funds for many improvements which the average community doesn’t have.” Back then, residents entertained
hopes that public power would be a way for the city to attract new businesses and grow the community.
So a meeting was held in 1940 to determine whether or not to purchase power from GRDA. The report in the Collins-ville
News detailed the savings the partnership would bring to the community but the deciding factor was that, with
GRDA, the city would have the ability to supply power for industries “that might come here and use the cheap electricity.”
Polk agrees with the early leaders and their public power choice. And today, as she manages those very improvements referred to so long ago,
she is also quick to point out other benefits of partnering with GRDA.
“We have a good relationship with GRDA; they have been good to us, they are in the community to continually keep the programs going,” she said. “It’s a
good partnership; small towns are not able to afford the cost of some items.”
She referred to items like GRDA’s FLIR (Forward Looking Infrared) camera, which is used to inspect transformers, breakers and other electrical components.
The FLIR can detect potential problems before they are spotted with the naked-eye, and, most importantly, before they lead to an electric outage. Collinsville
has benefited from this GRDA equipment in recent years.
As for the economic benefit of a public power utility, Polk says it’s clear: “The money stays here. It goes back into the community in streets and in parks, con-tinuing
to improve upon both has been and is always part of the goal. It’s like the community is helping the community; it’s self-sustaining.”
Public power at work in Collinsville: a self-sustaining community, with low-cost, reliable electricity and high quality of life.
The same could also be said for Pryor. Another GRDA municipal customer community, Pryor has partnered with GRDA for over 60 years. With a public
power past similar to other Oklahoma communities – where citizens decided many years ago that owning the electric system was in the future’s best interest
– Pryor also shares the common public power present.
15
Cost-of-living is low in Pryor, where the overall utility rates consistently rank among the lowest in all of Oklahoma. However, the community has even more
to be proud of. In the Summer of 2011, the Council for Community and Economic Research listed Pryor as the third-cheapest urban area in which to live in
the United States. The council based that assessment on housing, transportation, health-care, grocery and other costs at more than 340 areas across the coun-try.
According to Bloomberg Businessweek, Pryor’s cost of living is 15 percent below the national average.
That is good news for one of GRDA’s longtime Oklahoma public power partners.
Oklahoma Power for Oklahoma Progress
Away from the power lines, GRDA’s greatest contribution to the development of Oklahoma is contained within the shorelines of nearly 70,000 surface acres
of lake waters. Combined, that is what Grand Lake (Pensacola Dam) and Lake Hudson (Robert S. Kerr Dam) offer the region.
In accordance with the responsibilities first given to GRDA in 1935, both lakes were created as reservoirs to not only control Grand River flooding but also
provide fuel for hydroelectric generation. Meanwhile, the lakes also helped to transform the rugged and rural landscape into a thriving water playground while
also serving as a foundation for a recreation and tourism industry that has fueled Northeast Oklahoma’s economy for over half a century.
Both lakes contribute to a broad tax base for Oklahoma while also providing storage and water supply for over 50 water districts and municipal water systems,
including Tulsa. All services associated with administering that water supply are provided by GRDA at no cost to Oklahoma taxpayers.
Because it has such a tremendous responsibility for the natural resources of the Grand River, GRDA takes its stewardship role very seriously. In April 2010, in
conjunction with its 75th birthday, GRDA opened the doors on the new Ecosystems and Education Center in Langley. Located just an angler’s cast from Pen-sacola
Dam and the birthplace of the organization, the new “Eco Center” is GRDA’s face on the lakes. Not only is it the new home of the GRDA Ecosystems
Management Department and a state-of-the-art water quality laboratory, the building also houses the GRDA Police Department and the Authority’s one-stop
permit shop, for those needing any kind of lake-related permit for Grand River waters.
For GRDA, fulfilling its ecosystems duties is a priority of the mission born in April 1935 when the Oklahoma Legislature created the agency and thus spurred
the creation of a low-cost, reliable power source that still benefits thousands of Oklahomans, along with thousands of acres of recreation opportunities and a
solid recreation and tourism industry that supports a broad tax base.
These things all lend themselves to the slogan that has characterized GRDA since its beginning: Oklahoma power for Oklahoma progress.
16
This is man’s deed
To recognize the completion of the monumental Pensacola Dam construc-tion
project, Mrs. Hope Holway, wife of longtime GRDA Consulting Engineer
W.R. Holway, penned the following poem (opposite page) in 1940.
Though it was written with the dam in mind over 70 years ago, the words
may ring true for much more today. They seem to represent the whole
legacy of not only the Grand River Dam Authority, but also the legacies
of those Oklahomans who recognized that electric power meant progress,
and then helped to bring that power to their towns, farms and businesses.
GRDA is proud of those deeds and proud of the role its employees continue
to play in powering Oklahoma.
17
Glorious and eternal
These towers and walls
Remember
Dreams of young men
Magnificent in hope
The long and crowded hours
When patient skill
Daring to create
Formed and shaped the plan
And labors heavy round
Brave constancy of toil
Making the vision real
The plan complete
18
PowerfulPartnerships
RODEO TIME … GRDA is proud to support the historic Pawnee Bill
Rodeo in the public power community of Pawnee. GRDA has supplied
the community’s wholesale electric needs for over 50 years.
READ ALL ABOUT IT … Skiatook Chamber of Commerce President Scott Neighbors
(above) does his part to help promote the powerful partnership between GRDA and
Skiatook Electric. That partnership has been going strong since the 1980s.
TELLING GRDA’S STORY ... Interim CEO Michael Kiefner (above left)
leads the 2010 Leadership Miami class on a tour of the GRDA Ecosys-tems
and Education Center.
19
PROUD TO POWER INDUSTRY … GRDA Assistant Superintendent of
Marketing Programs Laura Townsend, and Superintendent of Busi-ness
Development and Marketing Grant Burget present a plaque
to Michael Peters, Manager of Electricity Supply with AirProducts,
recognizing the long-standing partnership between the two
organizations. GRDA has been providing electricity to AirProducts’
MidAmerica Industrial Park facility for over 25 years.
POWER LUNCH … Several Oklahoma Public Power community representatives gather for
lunch during the Spring 2011 Oklahoma Public Power Conference at the Western Hills Lodge
on Fort Gibson Lake. From left, Steve Graves (Pryor), Paul Staehle (Collinsville), Dwayne Elam
(Wagoner), Gary Pruett (Pryor), Mike Doublehead (Stilwell), Will and Dianna Davis (Sallisaw).
OKLAHOMA POWER FOR OKLAHOMANS … A tour
group representing People’s Electric Cooperative
(Ada, Oklahoma) poses with GRDA’s Charles Barney
and Dan Hudnall for a quick shot during a tour of
GRDA’s Coal Fired Complex.
RELIVING HISTORY ... A “staged” shoot-out
during the Dalton Defenders Days in
Coffeyville, Kansas. Dalton Defenders Days
celebrates the fateful day of October 5,
1892 when the Dalton Gang was defeated
in Coffeyville (a GRDA public power com-mnity).
The Gang attempted to rob two
banks in the area, and all but one gang
member was shot and killed. The celebra-tion
is in honor of the four townspeople
who gave their lives defending the town
(photo and caption information courtesy
of Coffeyville C SPRINGTIME IN THE SPRINGS ... Downtown Siloam Springs, Arkansas (a hamber of Commerce).
GRDA public power community) is home to the annual Dogwood Festival
each year (photo courtesy of the Siloam Springs Chamber of Commerce).
20
Joyce Summers
ledgers to spreadsheets
GRDA employee spotlight ...
Over 32 years have passed since Joyce Anderson applied for a sum-mer
position at GRDA. She had no idea she began her career in
Public Power with the Authority, when she was hired as a tempo-rary
receptionist at Transmission and Engineering in the summer of 1979.
Graduating as Salutatorian of the Locust Grove Class of 1977, Joyce en-rolled
at Northeastern State University to study business and accounting.
“I knew that I wanted to
get a job doing some type
of office work,” she said,
basing her decision on a
bookkeeping class she
had particularly enjoyed
in high school. “Account-ing
seemed like the logi-cal
choice.”
It was after she had com-pleted
her Associates De-gree
in General Business
and Accounting that she
learned of the opening at
GRDA. She answered
the switchboard at the
receptionist desk for six
months when a position for
an accounting clerk opened.
Frigid temperatures and blustery winds greeted her as she began her proba-tion
period as a full-time employee in January 1980.
“It was just me and Erma Willis, we took care of all Systems payroll and
monthly accounting for Transmission,” she said.
All of the work was done by hand and an adding machine, according to
Joyce, there was not even an electric typewriter in the office. Using a man-ual
typewriter, pencils, red pens and carbon paper, the pair maintained all
the necessary ledgers and paperwork for the 80 employees at both facilities.
During this time GRDA was experiencing a lot of growth. Unit 1 at the Coal
Fired Complex had just been completed and was being placed into service;
that meant GRDA’s power capabilities and systems responsibilities, were ex-panding.
As the company grew, the job grew and in 1985 Joyce transferred
to the Energy Control Center (ECC) to manage the monthly accounting
for Systems Operations. And, for a while, she continued to do it the way
Erma had taught her, by hand. It wasn’t until the mid-1990’s that the tran-sition
from hand paperwork to computer was completed. It was also dur-ing
this time that the ECC Energy Accounting Department doubled in size
with the addition of Wynema Potter. The dynamic duo continued until Ja-mie
Wheeler was added in October 2007. The three are responsible for the
control area accounting, which includes the balancing out of MWh’s and
dollars for power bought or sold.
The challenges in accounting are the same with or without a computer. For
Joyce, this can be part of the fun and really rewarding when the right an-swer
is discovered.
“There are times when
something just does
not balance out. I tell
the girls you can bal-ance
and still be wrong.
This can be sort of like
a puzzle to figure out,
but when the solution
is found, you want to
celebrate,” she said.
Mary Beth Dailey Cur-rent
GRDA Transmis-sion
employee) and
Erma Willis at a baby
shower for Joyce in the
early 1980s).
Erma Willis and Joyce during the early days of
her GRDA career.
21
Although computers have changed the way she does her job -- and made it
easier -- Joyce still finds herself holding on to hardcopies of most everything.
“The information is much more accessible on the computer, it’s definitely
easier to pull something up instead of having to go search and search for it,
but…” she said, with her deep blue eyes sparkling.
There are already some who are glad she feels the way she does. Erma, when
she retired, had entrusted to Joyce a stack of index cards that employees
had filled out in the early 1940’s. The information included name, address,
age and place of residence. So each time she has moved offices, each time
her desk has been cleaned out, the cards have moved with her. She couldn’t
throw them away, they are people after all, not just paper. One day she re-ceived
a call from someone doing some genealogical research; they thought
the relative they were searching for had worked at GRDA. She checked her
cards and, sure enough, there was the person they were looking for. She
was able to help them with their research, providing a birth date and a little
bit of history.
So far, the cards and Joyce have moved five times. The last move was in
October 2010 into the newly renovated ECC. The renovation and addition
to the building, which had been under construction since 2009, added an
additional 10,000 square feet.
Before and during the building phase, Joyce’s department moved their of-fices
to a temporary construction trailer.
“It was well worth the wait,” she said. “The building is beautiful and I could
not have picked better people to share my office space with.”
The cards, and her
attachment to them,
perfectly illustrate the
way Joyce feels about
GRDA and the peo-ple
she has worked
with the past 30 years.
“One of the things I
like most about my job
is the people. I think
of GRDA as fam-ily,”
she said. “I have
worked with a variety
of people that have made lasting impressions on me. Both of my parents
were dead by the time I was 19, so lots of the people at GRDA have helped
define who I am,” she said.
Starting with the Authority at such a young age, a lot of the milestones in her
life were witnessed and celebrated by her co-workers. When she accepted Jeff
Summers proposal in February 1983, the linemen she worked with at Trans-mission
held her a wedding shower. They had been openly protective of her
from the beginning, and now, in their turn, each offered her fatherly advice.
“One of the things I like most about
my job is the people. I think of
GRDA as family. . .lots of the people
have helped define who I am. . .”
Joyce and husband Jeff.
22
“They were probably more interested in the cake,” she laughed. “But, these
were crusty old linemen; they were like my dad to me. They were genuinely
my family,” she said.
The GRDA girls she worked with celebrated her upcoming marriage too,
in their own way. The bachelorette party was held in Tulsa. Sitting at a table
with her friends, Joyce was surprised to see a Gorilla walk into the room.
And even more surprised when he walked, with music blaring from the large
boom box he balanced on his shoulder, toward their table and proceeded
to strip down to Tarzan.
The birth of her first child prompted the guys to once again hold a shower
in her honor. Sharing life with her co-workers, Joyce firmly believes that at
GRDA, it is more than a job; it is more than a paycheck.
“It’s so much more! It doesn’t matter how well they know you, if you have a
need, they will step up to fill it. That’s GRDA; it’s always been that way.
You know when babies are born, when parents die, and when someone
retires, they don’t stop being family,” she said.
Raised in a large family in the country around Locust Grove, Joyce un-derstood
family, the relationships and what they mean. She knew first-hand
that family provided the best of support systems, in good times and
bad. For that reason, she was able to appreciate the respect she saw the
younger hands at GRDA giving the older ones. She also recognized the
value the younger guys placed on the instruction and advice the older
ones gave them, it was indeed just like family.
The past 30 years has brought a lot of change. From 8-tracks to iPods,
hand-written ledgers to Excel programs, Joyce has witnessed the growth
of GRDA from a regional entity to a national entity. Spending her ca-reer
in Public Power, she believes in the benefits it brings to the state,
the community and the person.
“Public Power helps everyone,” she said. “Not just by employment, but it
also helps businesses and cities.”
More than just technology has changed; the Summer’s family which had
grown to three, two girls and a boy, increased to 15 with the addition of
seven granddaughters and two grandsons. The couple recently celebrated
their 28th anniversary.
Though busy with her kids and grandkids, Joyce still finds time to minister
to even more kids. A member of Word Fellowship in Chouteau for the past
15 years, she began working with the church’s youth group in 2003. Chaper-oning
events throughout the year, she spends a couple of weekends helping
Potter cook for approximately 40 hungry kids at church camp.
Reflecting on her families, the former first chair clarinet in the “Pride of
Locust Grove” marching band says it just feels like home to her. With only
one item on her bucket list, to learn to play the piano, a life shared is a life
well lived.
Starting at GRDA at 19, Joyce admits she was thinking more about that day,
or that summer than she was a career, but, in the end, she got that and so
much more. As she stated in her salutatory address to the audience crowded
into the Locust Grove Gymnasium on May 13, 1977, “you need to be sure
and say thank you to the people who help you along the way.”
“We need to remember that are jobs are important, and we need to take care
of them, but our co-workers are important too and there are times when
they need a friend.”
Joyce Summers, Wynema
Potter and Jamie Wheeler
make up GRDA’s Energy
Accounting Department.
Outside of her GRDA family, Joyce’s “other family” includes nine grandkids.
23
Term began during September board meeting ...
Stephen Spears will serve as
the GRDA Board of Directors
Chairman, and Greg Grodhaus
has been named Chair-Elect for
the upcoming year.
Cushing's Spears is new
GRDA Chairman of the Board
Stephen Spears, an 11-year member of the Grand River Dam Authority Board of Directors, will serve as GRDA Chairman during the next 12
months. He moved into that role during the Board’s September 14 meeting in Vinita.
Spears, who had served as chair-elect
since September 2010,
replaces GRDA Director David
Chernicky (Tulsa) as chairman.
Greg Grodhaus (Grove) will serve as
the chair-elect for the coming year.
A member of the GRDA Board
since May 2000, Spears serves as an ex officio director/designee for the Municipal Electric Systems of Oklahoma (MESO). He is the city manager/engi-neer
for Cushing and previously served as GRDA Chairman in 2006-07.
“I’m proud to be part of the GRDA organization, and the service it provides for the people of Oklahoma,” said Spears. “I look forward to working with
my fellow board members and GRDA staff in the year ahead.”
Grodhaus has been a member of the GRDA Board since May 2011, following his appointment to that post by Oklahoma Governor Mary Fallin. Now
retired from Tacit Networks, an internet technology company, he spent nearly four decades in the information technology industry.
“I’m proud to be part of the GRDA organization, and the
service it provides to the people of Oklahoma...”
24
more than just a
Reliability Enforcer
Editor’s Note: On January 1, 2007, the North American Electric Reliability Council became the North American Electric Reliability Corporation (NERC). The Council had
been formed in 1968 as to develop electric reliability standards that would be practiced voluntarily by utilities. However, following an August 2003 blackout that left
50 million people in North America without power, the wheels were set in motion to raise the profile of electric reliability issues and give more “teeth” to the oversight
organization. Today, compliance with NERC standards is mandatory and enforceable in the United States for all bulk power systems, like GRDA. What follows is an
interview with NERC President/CEO Gerry Cauley. In this piece, Cauley explains more about NERC, its standards, its relationship to utilities (like GRDA) and the overall role
it plays in ongoing electric reliability. This piece is reprinted, with permission, from the APPA Public Power magazine.
Early in 2010, you told a group of public power executives that you wanted [the North
American Electric Reliability Corp.] to be more than just a reliability enforcer, and to work
more closely with utilities to improve reliability. What steps has NERC taken since then to
move in this direction?
I don’t see NERC as being an “either/or” organization, either focusing just on compliance or just on reliabil-ity
improvement. We are striving to achieve a balance. We will continue to have our compliance role and our
enforcement role. However, we will balance this with a culture of continuous learning and continuous im-provement
of reliability. I think most companies in the industry will react positively to this, because I think
most of them want to do the right thing in terms of reliability.
The biggest change in the past year has been our introduction of transparency. We have built out a very strong
event analysis program, where we capture all of the events that happen on the bulk power system and cat-egorize
them one through five, with five being the most severe. We are engaging the industry in doing event
reviews for what happened and what the root cause was. We are also creating common themes and “lessons
learned” that we can put back out to the industry. I think most companies react positively to the informa-tion
flow, the feedback, and the transparency related to what has happened on the system and why it has happened. They can then say, “This is a good lesson
learned from NERC,” and they can then adopt appropriate changes.
In addition, prior to last year, compliance was operating in somewhat of a “shroud of secrecy,” because it was thought that compliance is confidential. What
we have done is taken the things that we find in the field that create compliance issues for people and publish this information as compliance application no-tices,
but with names removed. For example: “This is one of the most frequently violated standards. How are people interpreting this standard in ways that
lead them into getting a violation?” In other words, we are providing additional information beyond just the standard to help people understand what it takes
to be compliant.
A conversation with Gerry Cauley, North America Electric Reliability Corporation
By William Atkinson -reprinted with permission from American Public Power Association
25
We have even introduced a more efficient approach to this, called Case Notes. This involves creating quick summaries of the violations that come in. I ex-pect
the response rate from the industry to be very high and very positive. Again, I think most people want to do the right thing and will adjust their opera-tions
to do this.
In addition, we intend to work with the North American Transmission Forum and the North American Generator Forum to look for opportunities to de-velop
the concepts of recognizing reliability excellence. If someone has a best practice, or if an organization is a really high achiever in terms of reliability,
then we should provide them with the appropriate recognition.
In March 2010, the Federal Energy Regulatory Commission issued a series of reliability orders that caused many in the industry
to question if FERC, NERC and the industry are on the same page. How would you characterize the NERC-FERC relationship
today?
The relationship has improved substantially. I would almost characterize it as a 180-degree turnaround. I think the biggest difference today is that we have
the awareness and engagement of all five FERC commissioners. They have a lot of other responsibilities beyond bulk power reliability. However, the impor-tance
they place on this reliability has moved up.
A year ago and before that, I think they [FERC commissioners] were dependent on some of their staff to direct how things were going to happen. However,
after the March orders and feedback from NERC and the industry, I think they got a much better understanding and awareness of the importance of reliability.
There is currently a constructive dialogue taking place and it has improved a lot since
the spring of 2010. I meet with commissioners on a monthly basis, sometimes even
more frequently.
The commissioners are also getting a better understanding of all of the things that NERC
has to take on and accomplish, as well as our need to prioritize what we do. They are
giving us strong encouragement to prioritize on the things that are the most important
to reliability, and that is a good sign. It’s no longer just about the regulatory regime and
regulatory compliance. Now, the focus is on what NERC can do to be most effective in improving reliability.
We completed a summit in February, and all five commissioners attended, as well as about half of the NERC board and a lot of stakeholders. It turned out to
be a very positive dialogue on reliability. We also had a conference in July 2010 dealing with standards, and one in November 2010 dealing with compliance. As
a result, I think we now have a pattern of engagement and constructive dialogue. This is really helpful to us, and it is a complete turnaround from early 2010.
Many small municipal utilities that are not yet subject to NERC reliability audits are concerned that they may find themselves
increasingly subjected to federal reliability standards. Do you see this happening? If so, how soon?
I don’t see a particular major change at this point. Our set of criteria, which defines who falls under the NERC standards for the bulk electric system, has
been in place since 2007, when the standards became mandatory. They have remained relatively stable since then.
FERC has issued an order, giving us a year to devise a definition of bulk electric system and to provide some clarity to terms such as “radial generation.”
However, I see this as a move to gain consistency across the regions. I don’t particularly see it as an attempt to extend the reach of what is bulk power ver-sus
what is distribution. As a result, I think that, in terms of who is included and the reach of the reliability regulatory framework, this is still pretty stable.
However, I have had discussions with a lot of CEOs and other stakeholders in the industry related to NERC becoming more efficient in terms of who is
covered by the standards and who is not. I think this is a fair question for the longer term. That is, after we get the bulk electric system definition done and
into FERC at the end of the year, we can think about this further in terms of becoming more efficient in terms of what entities are covered by the standards.
logo courtesy of www.nerc.com.
26
The thinking I have at this point is that it could be a tiered approach, where smaller entities that have less impact on the bulk power system would have a
much smaller set of requirements to which they would be subject, while the grid operators for the bulk power system would have a more extensive set of re-quirements.
We will be taking this question on in the next couple of years. In the immediate term, though, I don’t think there will be any shift to be either
more expansive or less expansive.
NERC has been trying to reprioritize its standards development plans. Which do you see as needing the industry’s full attention?
The Standards Committee just completed a review of its standards projects. One of the concerns that the NERC board had in November 2010 was that it was
presented with a standards project plan that had 30 projects, all of which were going forward. The board sent the message back to the Standards Committee
that the program was not sufficiently prioritized. The Standards Committee has taken this to heart. They developed a prioritization tool and came back with
an updated plan at the February board meeting.
My own personal priorities are things that directly cause outages on the system. These generally relate to relay maintenance and testing, as well as the train-ing
and qualifications of operating personnel. These have also appeared on the Standards Committee list as priorities.
One concern I have going forward is transmission right-of-way clearance and maintenance. We issued an alert in October 2010, and a subsequent update in
November, noting what we think might be compromised clearances of transmission lines, relative to underbuild, such as poles and wires underneath the high-voltage
lines, or other objects and obstructions in the right-of-way. The rate that we are discovering these issues is much higher than I expected. So, in terms
of a future standard, that would be a priority for me. I would like to see a better standard on maintenance and inspection of rights-of-way.
Another new issue for me in the standards area is related to the cold weather event that we saw in the Southwest in February 2011, where a large percentage
of generators found that it was too cold for their equipment, pipes and instrumentation. As a result, they weren’t able to operate, resulting in rotating outages.
NERC is moving its headquarters to Atlanta. How will this affect the NERC staff ? When will the move be complete?
We signed the lease in fall 2010, and gained access to our temporary headquarters space in early November. We currently have about 30 people there. Con-struction
has begun on the permanent space in the same building. We expect to get the keys to that space by the end of May.
We have been working very closely with the staff for almost a year, when we first announced the new location. We have been very open and transparent
with them in terms of why we need to make the move [from longtime headquarters in Princeton, N.J. Ultimately, it is really about positioning NERC for
the long term, in terms of being able to maintain a very high quality staff. Atlanta’s desirable location and cost of living provides us with that draw. The
other piece of it involves giving us access to the industry in terms of a “go to” place. We expect to have a lot of meetings and other interactions with stake-holders
who visit NERC. Atlanta will be much more accessible for them.
We are working with each of our associates individually in terms of the impact of the move, and we are coordinating the timing so that we are able to
maintain all of our program areas at a high level while we are coordinating the move of each individual. This is why we are doing this over the course of a
year and a half, rather than moving everyone all at once.
In June 2010, you said that the industry was having trouble communicating results in terms of cyber security for critical infrastruc-ture,
because it lacked credibility with Congress and FERC. How do you see the industry overcoming this challenge?
I am very optimistic about the progress we have made in the last year. When I first came here, it was the most troubling area for me—whether we had a cred-ible
response to cyber and physical threats. I think we have done a number of things to address that.
27
First of all, we closed one of the gaps in the standards in terms of what was a critical asset that falls under the NERC standards. At the time, this was self-determined
by each of the regulated companies. We were able to create a new standard by the end of 2010 that establishes a “bright-line criteria” in terms of
what needs to be declared a critical asset. We recently filed this with FERC. This gives us some assurance that at least the highest priority equipment and as-sets
in the bulk electric system are going to be covered by our mandatory standards.
The second big thing we did in 2010, was to break through a barrier we had faced related to getting classified information from intelligence agencies and mak-ing
it fairly widely available to engineers and technicians in the industry who don’t all have clearances for classified information. We have been very success-ful
in the past year in putting together a team from NERC and the industry whose members have secret and top secret clearances. They are working with the
intelligence agency people to interpret [potential] threats to the grid in a way that does not disclose sources or other classified information. On this basis, we
issued a new Aurora Alert in 2010 that really gets to the solution of how to prevent aurora manipulation of power equipment.
The other big improvement has been our working relationship with senior levels of government in Homeland Security, Department of Defense, Department
of Energy, and others. They are sitting down at the table with us and talking about the role of government and industry in cyber security and physical secu-rity,
and what some of the most serious concerns are. This dialogue has been very helpful. It has helped government policymakers see that the industry is ac-tually
more on top of this and more resilient than they had previously thought. In addition, we can also get better clarity on what we need to do step up our
game in the industry, relative to the role of government.
FERC is in the process of evaluating the National Institute of Standards and Technology cyber security guidelines. NERC just sent
a revised set of cyber security standards to FERC for approval. How will these two cyber security initiatives work together? How
will NERC help the industry differentiate between the two?
I think NERC’s standards get at a totally different aspect than the NIST guides, so I don’t think they conflict at all. The NERC standards cover bulk power
equipment and bulk power cyber assets, and they are security-focused. The NIST guides that were recently filed with FERC deal principally with interoper-ability
criteria for smart grid equipment, primarily in the distribution arena. There are elements of the NIST guides that deal with security, but, once again,
they are mainly focused on smart grid on the distribution side.
In January 2011, we announced jointly with the Department of Energy, Department of Homeland Security, and NIST that we will work together to devel-op
a comprehensive set of security and risk management guides that will provide a set of voluntary security guides from the meter all the way up to the bulk
power system. I think this new partnership will help get at the current concern, which is security being dealt with on a piecemeal basis. This one set of com-prehensive
protocols will provide security for the entire electric system.
I attended the FERC conference in January on the NIST smart grid protocols. One of the concerns raised there was whether the guides were practical and
sufficiently vetted. This is something we need to take into account in this new initiative. If we produce some security guides, we need to go through the pro-cess
of vetting them and demonstrating them in the field to prove that they actually work in the field. This may take a couple of more years to accomplish
after we create the protocols.
In addition to cyber security, what new reliability challenges do you see on the horizon for NERC and the industry?
I think the biggest challenge is not anything specific. As I have mentioned, there are a number of things that need to be worked on, and I see this as the big-gest
challenge. That is, with so many things that need to be addressed, how do we balance and prioritize these so as to have the biggest impact on reliability?
In addition, while we have the known risks, we need to balance these with some unknown risks, such as solar-magnetic flares that might interrupt the electric
system. Balancing and prioritizing will continue to be an important focus for us.
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