Powerlines In Houston Should be Buried

Wouldn't the sky look lovely without those powerlines?

I was astonished to read about this report:

Burying the more than 6,500 miles of above-ground Texas electricity transmission lines near the Gulf Coast would cost some $33 billion but would not be a cost-effective solution, according to a report commissioned by the state’s utility commission.

The report by Quanta Technology released this week said the huge expenditure to bury the lines within a 50-mile radius of the coastline would likely only cut utility storm restoration costs by $27 million a year. The report was ordered by the Texas Public Utility Commission in late 2008 in the wake of Hurricane Ike’s extensive damage.

Fifteen storms struck Texas from 1998 to 2008, requiring about $1.8 billion in restoration costs, or $180 million annually, the report said. About 80 percent of the costs were attributed to the distribution system and 20 percent attributed to transmission.

Ok, if this article is correct, they are comparing the cost of burying power lines to the cost of restoration of those lines after they have been damaged by wind, falling tree limbs, lightning, etc. By that measure, it is obviously uneconomical for the power companies to do it.

But that is an insane way to measure something like this. The cost of downed powerlines is not merely born by the power companies! It's born by the businesses and homes that have to go without power for some period of time. And the cost of preparing for that risk (from buying candles and flashlights and wind-up radios to continual backing up of data). How much work time was lost because of Ike? That must have cost Houston area businesses millions if not billions. The company I worked for was closed for a couple of days. Many were closed for much longer times. This lost economic activity might be the biggest single cost associated with power outages.

To appropriately price this out, they should have accounted for that.

In addition, there is a lot of routine maintenance that must be done to prevent wind-related damage. Crews are always driving around trimming trees near powerlines, whether there is an outage or not. You have to count removing that cost as a benefit as well. Not only that, when there is a power outage, the power companies suffer lost revenues. Were those lost revenues counted in Quanta's model?

Furthermore, overhead powerlines have costs associated with them totally unrelated to the cost of repairing them after outages. Obviously putting up powerlines has a cost. Those poles aren't free. For powerlines that already exist, that is s sunk cost. But there is a replacement cost--those poles don't last forever--and in new developments, the cost of installing powerlines must be included. Also, it is illegal to plant trees a certain distance from powerlines. This limits property rights and limits shade in Houston--one of the hottest cities in the U.S. It's hard to say what this costs us, but it does have a cost. Likewise, overhead powerlines are ugly. Ugly has a cost that is hard to quantify, but it does exist. A more beautiful city is a city that is that much more liveable and desireable and competitive.

Given all this, and given the fact that the freaking federal government is trying its best to give infrastructure money away, I think we should ignore that foolish report, get some stimulus money, hire some unemployed construction workers, and start burying our goddamn power lines (and phone and cable lines).

(By the way, thanks to the Houston Business Journal for reporting this. I couldn't find anything in the Houston Chronicle about it! Did they drop the ball?)