Review on Energy Resilience

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The Electricity Journal

journal homepage: www.elsevier.com/locate/tej

Microgrids and resilience: Using a systems approach to achieve climate adaptation and mitigation goals

Katrina M. Kelly-Pitou⁎, Anais Ostroski, Brandon Contino, Brandon Grainger, Alexis Kwasinski, Gregory Reed University of Pittsburgh, United States

A R T I C L E I N F O

Keywords: Sustainable energy Microgrid Sustainable development Energy policy Climate change policy Climate change adaptation Adaptive capacity Ecological modernization

A B S T R A C T

Although energy resource sustainability has been researched extensively, the understanding of how we use and interact with electricity sustainably is less understood. New electrical designs, like microgrids, provide oppor- tunities to better address the immediate needs of electrical sustainability and urban development. This paper analyzes the role of microgrids in urban development and examines how greater systemic thinking between infrastructure planning and energy policymaking can increase a city’s resilience.

1. Introduction

Meeting the challenges of long-term sustainability depend heavily on decisions that are being taken now. The most critical decisions that are being made are centered on our electricity infrastructure. Electricity plays a crucial role in all aspects of the global political economy, in- cluding both the source of power behind our homes and hospitals, but also as a main contributor to greenhouse gas emissions. In 2015, emissions of carbon dioxide (CO2) by the U.S. electric power sector were 1925 million metric tons, or about 37% of the total U.S. energy- related CO2 emissions of 5271 million metric tons (EIA, 2017). Whilst the challenges of carbon emissions reductions have generally relied on centralized governmental coordination stemming from the UNFCCC, resilience measures are actions that are best taken and coordinated at the city level. In an era of constant regulatory fluctuation, taking ef- fective decisions at the local level can better contribute to the long-term challenges of sustainability. Microgrids in particular, can play an ef- fective role in helping a city to overcome its carbon emissions reduc- tions, and can also serve as a critical tool for addressing the economic and social dimensions of sustainable development such as in the case of many Japanese cities. Though several countries around the world are using microgrids for social purposes, microgrid deployment in the U.S. remains limited. Yet expanding upon the use and understanding of microgrids in the U.S. can help to build adaptive capacity to climate change, or the intersection between climate mitigation and adaptation,

actions. At the same time, expanding upon the usage of microgrids can help

to provide a more diverse array of financing options for countries and nations who are looking to address their climate vulnerabilities im- mediately, yet are capitally constrained. Microgrids provide a more useful, and perhaps more attractive, area for sustainable investments when considering their potential to connect their social and environ- mental potential aims to a return on investment. This paper therefore examines the role of microgrids within the broader realm of resilience and sustainability, to better understand the motivations behind a re- silient city plan based on the deployment of microgrids. It then moves to analyze the most recent trends in microgrid development to in- vestigate how these new flexible technologies could better enhance broader urban development and sustainability. By explaining how en- vironmental and social considerations can be applied to the design of microgrids, this paper shows how applying sustainability metrics in- creases the attractiveness of microgrids as an area for sustainable in- vestment. The conclusions of this paper provide a better understanding of how both energy resilience goals and broader sustainable develop- ment strategies could be more strongly coordinated to deploy energy solutions that are dually useful in reducing the short- and long-term risks that stem from climate change.

https://doi.org/10.1016/j.tej.2017.11.008

⁎ Corresponding author. E-mail address: [email protected] (K.M. Kelly-Pitou).

The Electricity Journal 30 (2017) 23–31

Available online 29 November 2017 1040-6190/ © 2017 Elsevier Inc. All rights reserved.

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2. Research background

Climate change policy was born directly out of the environmental policy agenda area of sustainable development. Addressing climate change is therefore, an internationally recognized component of maintaining the stability among environment, economy, and broader civilian society. Climate change plays a significant role in increasing the earth’s average surface temperature, fostering the phenomenon known as global warming.1 If current fossil-fuel consumption trends continue, the average surface temperatures of the earth could rise by as much as 6.4 ° by 2100 (Stocker et al., 2013). Even under the most optimistic scenario, temperatures will still rise by 1.1–2.9 ° before this century’s end (Stocker et al., 2013). Climate change poses a noted threat to global ecosystems, but poses an equivalent threat to the global political economy. It exposes many major security risks such as increasing vo- latility in food production, decreased reliability in energy supplies, and greater frequency of extreme weather events. These risks impact eco- nomic activity directly, but also indirectly in the case of price fluctua- tions in energy markets.

Overall, American climate studies for have focused on the inability of the U.S. to engage in the international climate arena. Rather than identifying how the U.S. could better engage with the international arena, studies on U.S. carbon emissions reduction began to focus on state and city-level examinations. (Bulkeley et al., 2011; Urpelainen, 2009; Matisoff, 2008; Betsill and Bulkeley, 2004). This is what is re- ferred to as the “bottom-up” approach within U.S. climate policy lit- erature, which looks at the merits of state and local climate mitigation policy. The literature here has mainly focused on identifying the ben- efits of using a decentralized approach to climate mitigation.

This research shifted the place of the U.S. within international cli- mate discussions towards being domestically focused. Although this is problematic for the international arena, taking a domestic approach has had merits for climate progress by the U.S., which can be summarized into four main points. First, research has shown that using local levels of government within carbon mitigation policies are more likely to result in experimentation with new policy tools, and thus produce new types of tools (Buzbee, 2005). Second, the local level also allows solu- tions to be specifically tailored, requiring less government interference. Third, these solutions are likely to be easier to test at a municipal or state level, which is likely due to the fourth main aspect, that passing climate policy is easier done at the local level (Buzbee, 2005; Adler, 2005). Overall, the literature reviewing how the local level might be an effective strategy for change has yet to quantitatively show that these policies produce significant change.

Today, the pledges from cities and states only encompass about 10% of the greenhouse gas emissions in the U.S. California’s climate pro- grams, known for being the most aggressive in the U.S., only are re- sponsible for about 6% of America’s overall share (Buzbee, 2005). Al- though research has pointed to the need for bottom-up climate actions to eventually become intertwined with a top-down approach to legis- lation, there has been a lack of attention to the types of institutional adjustments that are needed to amount to serious action on carbon emissions reductions.

Although research has predicted that the lower-level “push” for sustainability will perhaps result in larger-scale legislation (Bang et al., 2007; Selin and VanDeveer, 2007), current climate legislation does not necessarily support the intersection between adaptation and mitigation efforts. Instead, there is significant worry that fragmented schemes without international coordination and consensus on needed reductions will instead lead to a “race to the bottom,” in which firms would re- locate to regions with lower environmental standards (Newell, Pizer and Raimi, 2013, p. 123). This fear is founded on the notion that in- dustries will relocate to cities, states, or countries that do not mon- etarily regulate environmentally, so to avoid paying environmental fees (Newell, Pizer and Raimi, 2013 pp. 123–146). This fear is even more acute when it comes to emissions trading schemes, where bottom-up

legislation has been a concern. In the U.S., given the diversity of climate policies and number of local governing bodies, fragmented local-level approaches could potentially create an internal race to the bottom. Heavy polluters avoiding states like California, Washington, and Oregon could seek to relocate to Pennsylvania, Ohio, and West Virginia, states that lack carbon policies. Although bottom-up approaches have been effective in the initial launching phases of emissions schemes, without international consensus on the targets, it becomes difficult to ensure emissions trading schemes are meeting their environmental ambitions (Newell, Pizer and Raimi, 2013, pp. 123–146). Despite the positive progress on launching markets as displayed by the EU ETS, the Regional Greenhouse Gas Initiative, and New Zealand, the progress has been slow meeting ambitious reductions (Newell, Pizer and Raimi, 2013, pp. 123–146). Although the bottom-up approach is useful and easier, nations still need to agree on the larger-scale contributions needed for climate change. Without doing so, “regulating states will bear a disproportionate share of the costs from such regulation with no guarantee of reaping proportionate benefits,” (Adler, 2005).

In order to achieve strong carbon policies, governing areas need to better focus on the policy-outcomes that lead to success in carbon policy. Success in carbon policy is defined as “the ambition or stipu- lation of ambitious objectives that could produce real change in beha- vior, and compliance, to the extent to which implementers, including target groups, work to follow the stipulated requirements,” (Bressers, Bruijn, Lulofs, and O’Toole, 2011, pp.187-208). In general, this success refers to meeting targets that contain agreed upon ambitions, reduc- tions for quantity, and a baseline year for achievement. Although there has been significant research that investigates what types of actions are needed to achieve success in both the short and long term, there is a significant research gap on the types of coordination between these two actions to ensure meaningful carbon reductions are achieved. Rather than focusing on the short-term impacts or long-term causes of climate change, deep carbon reductions may be made more achievable by fo- cusing on the intersection of these actions. This would require identi- fying both the infrastructures and institutions that are needed to protect society from climate risks. This therefore requires increasing the im- mediate resilience of systems, but in a manner that coincides more neatly with long-term emissions reductions.

3. Building a conceptual framework for resilience

In order for economies and nations to reduce the impacts of climate change, a range of measures have been developed to move societies and institutions towards a more sustainable means of living. These measures are actions that are taken to remove the concentration of greenhouse gases from the earth’s atmosphere, and are referred to as emissions reductions (IPCC, 2014). Global emissions by gas also include methane, nitrous oxide, and fluorinated gases (IPCC, 2014). Reductions are needed across a variety of gases, but carbon dioxide reductions play a significant role in achieving effective results. Carbon dioxide emissions from fossil fuels and industrial processes, as well as from forestry and land use, contribute to over 76% of emissions globally (IPCC, 2014). However, addressing the consequences is an extensive process as nearly all current methods of economic consumption and production rely primarily on activities that produce carbon. These emissions are gen- erally produced across six main categories including: electricity and heat production; industry and agriculture; transportation; buildings, and energy (IPCC, 2014). Therefore, reducing carbon emissions re- quires fundamentally creating change in production and consumption in each of these sectors.

The research investigating how to create meaningful change for carbon emissions reductions is a relatively new topic within the social sciences. Despite the subject being new, political scientists have pro- duced a high quantity of research that touches upon how to create change in the short term and in the long term. Today, these research investigations are most generally separated into two main areas of

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investigation: climate adaptation and climate mitigation studies (, p.141). These two subfields of climate change policy complement each other, but are generally separated due to their different time dimen- sions, and thus, differences in policy design (Klein, Schipper, Dessai, 2005, pp. 579–588). Adaptation policies are “initiatives and measures [undertaken] to reduce the vulnerability of natural and human systems against actual or expected climate change effects” (IPCC, 2007, p.86). These measures are likely to be considered short-term, focusing on what nations are doing now to reduce the impacts of climate change effects in the next one to four years. Adaptation policy investigations focus on the immediate damage that results from climate change. These policies focus heavily on procedures such as vulnerability studies, risk assess- ments and strategies, or infrastructure protection policies (Wellstead and Stedman, 2014, pp. 999–1010). Contrarily, mitigation measures consist of actions to limit the magnitude or rate of long-term climate change (IPCC, 2007, p.225). These policies tend to have 20-year out- looks, but can be shorter. Mitigation measures typically address energy supply as it relates to less carbon-intensive processes. The fundamental differences of the areas are that mitigation studies examine how to reduce the causes of climate change whereas adaptation studies seek to understand how to reduce the impact of climate change (Fig. 1).

Although the two areas of adaptation and mitigation are tradition- ally separated, there is now significant interest in exploring the inter- connectivity that lies within adaptation and mitigation techniques. This is referred to as the “adaptive capacity” of nations (Wellstead and Stedman, 2014, pp. 999–1010). Adaptive capacity is the “ability or potential of a system to respond successfully to climate variability and change, and includes adjustments in both behavior and in resources and technologies,” (IPCC, 2007, Section 17.13.1). These adjustments must “enable sectors and institutions to take advantage of opportunities or benefits from climate change” (IPCC, 2007, Section 17.13.1). The adaptive capacity of a government, or policy area, connects mitigation and adaptation measures by looking at the nature of change that in- stitutions have gone through. Here, governmental rules and structures specifically are needed to “promote the adaptive capacity of society and allow society to modify its institutions at a rate commensurate with the rate of environmental change” (Bang et al., 2007, p. 457). It is im- portant to note here that adaptive capacity has dual aims. The first, an institutional change is needed to support society as it moves to address climate change, and secondly, there is a need for technical change when considering the need for physical adaptation within existing infra- structures (Fig. 2).

When looking at the critical stakeholders that are involved in adaptation and mitigation measures, one is able to see that the inter- section of these two areas requires combining community experts, en- vironmental experts, infrastructure operators, energy industry mem- bers, and broader society − that is, all societal stakeholders involved in the energy decision-making process. Although adaptive capacity is a useful concept in that it promotes the institutional intersection between adaptation and mitigation measures, it does not necessarily promote the types of actions that are needed for better connecting adaptation and mitigation measures (Kelly, 2017). Just as adaptation measures infer that vulnerability and risk assessments are useful (as mitigation implies

that renewable energy integration through long-term policies are cri- tical) the scholarly literature on what types of policy actions are needed for adaptive capacity are limited. However, when taking the notion of “systems” that are needed for adaptive capacity, one must shift from a policy-centric view of societal changes, towards a multi-disciplinary approach. Yet doing so shows how the notion of adaptive capacity also is related closely to the concept of resilience that already exists from an engineering perspective. By surveying the place of resilience within the existing academic literature, and expanding upon the notion to include broader societal environmental and social goals, one can see how the concept of resilience can be used to more broadly support sustainable energy development. At the same time, expanding upon the existing understanding of resilience helps to retain a technical focus that is critical to any effective energy transition strategies.

3.1. Resilience as strategy for increasing adaptive capacity

Although adaptive capacity studies are currently less researched when compared to adaptation and mitigation studies, one can see how the notion of resilience can usefully contribute to better understanding the actions that are needed for adaptive capacity (Kelly, 2017). Resi- lience refers to immediate changes, and therefore, relates more to adaptation than mitigation measures. Resilience describes the capacity of a system to maintain or recover functionality in the event of dis- ruption or disturbance. However, the concept of resilience has changed significantly from its origins and it is important to clarify the termi- nology for studies today.

Originally, resilience began as an engineering concept. Resilience from this standpoint is concerned with building systems that are able to recover from accidents, whether through anticipation, recovery, or “hardening,” the application of physical strength to help protect against sudden events (Mandi and Yaragatti, 2008, p. 132–144). From an en- gineering standpoint, this concept began as a response to complex systems management. Within systems management, failure to prepare for an event was typically accredited to human error; however, as re- search proved that organizational factors were actually the cause of more recent instances of disruption in energy supplies, resilience emerged as a concept for merging the human and technical world.

Resilience today is a broader notion that refers to the “ongoing web of interactions and adaptations” that characterizes complex behavior within energy systems (Mandi and Yaragatti, 2008, p. 132–144). In reality, what this concept indicates is both people and the built en- vironment [which they operate within], must continually change be- havior in response to risks (Marnay et al., 2015, pp 44–57). From an engineering standpoint, resilience is important for maintaining con- tinuity within systems, but from a policy perspective, resilience is im- portant for maintaining the stability of economic development. There- fore, resilience from a climate perspective should be understood as both a technical and economic strategy. Resilience measures should be ac- tions that are taken today to protect communities from the immediate damages of climate change, but also that are taken to help remove the long-term impacts of climate change. Resilience actions are strategies that should be used to make systems stronger, and to help make systems smarter than they have been in the past (Kelly et al., 2015).

If resilience is to be used to help understand what measures need to be taken both now and in the long term from a dual policy and technical perspective, then it is important to link the goals of resilience within an ecological context. From an engineering standpoint, the goals of resi- lience are clear in that continuity, or quick recovery, is the end goal for preparation. However, from a policy standpoint, the end goal would be to create actions that reduce the risk from immediate impacts and the long-term risks that stem from climate change. Therefore, it is im- portant that two aspects are integrated into resilience: short-term goals that remove the vulnerability of existing systems, and also ensuring that these measures support the long-term goals needed to reduce carbon emissions reductions. In the same way that adaptation measures shouldFig. 1. Adaptation, mitigation, and adaptive capacity.

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be designed to support mitigation goals, resilience energy systems de- signs need to be conceptualized in a manner that supports the long-term objectives of climate change.

4. Defining resilience

In order to define the aims of resilience, its first important to con- sider the most applicable uses of a resilience strategy. When looking at the critical stakeholders and actions that are a key part of adaptation and mitigation goals, it seems that the stakeholders involved in resi- lience would be infinite. However, when looking at the policy actions that are needed for resilience, one is able to take a slightly more lim- iting viewpoint of what actions need to be prioritized to deploy resi- lience. Mitigation requires large-scale dramatic changes to the energy supply and consumption of any given area; adaptation measures are focused on smaller-scale changes that are made generally to existing infrastructures to help prepare against risks. Therefore, bridging the gap between these two areas requires retaining a focus on the built environment, or understanding how infrastructures can help commu- nities to both protect against the immediate risks of climate change, but also avoid the long-term risks of climate change. This means that these new types of infrastructure designs must provide both protection from extreme events now, but also help to integrate renewables into carbon- dense areas. From this standpoint, it becomes slightly evident that cities can be a useful area for identifying where resilience actions should take place. Urban areas are both carbon-dense but also extremely vulnerable to climate risks in the short term in that they feature a high density of population including hospitals, schools, and residents.

A city’s long-term climate change challenges can be summarized within two main strands: the implementation of energy efficiency programs; and increasing renewable generation in the system. However, many current decarbonization strategies consist solely through the sourcing of renewable power purchase. For example, the City of Pittsburgh plans to pool local government purchasing power and resources to support the installation of 25 MW of renewable energy in the local utilities service territory over the next five years under its existing renewable power purchasing plan. As a municipal authority, the City lacks the financial weight that is needed to finance any larger installations, like new power plants. Therefore, the sole means of transitioning the City’s energy consumption towards greener electricity

supplies has currently been limited to the purchasing of green power. Yet, when applied to the context of a city, resilience describes the

capacity of a city to prepare itself against the immediate risks of climate change and that actions taken to decrease the immediate vulnerabilities of climate change will also help to achieve the long-term aims of local mitigation goals. Resilience from an urban studies standpoint implies a dual focus on the short and long term and involves critical actions that are being taken now to ensure that the people living and working within cities are able to both survive and thrive. Therefore, when de- fining resilience with such a context requires identifying the actions that can be taken now to both harden immediate infrastructures but also help to integrate long-term carbon reductions goals. This requires going beyond the traditional understanding of centralized and decen- tralized energy infrastructures and creating new types of energy sys- tems designs. As a first step towards strengthening the city’s grid in- frastructure, the development of microgrids can help mitigate the broader risks.

4.1. Microgrids as resilient energy infrastructures

Microgrids are playing an increasingly popular role in discussions relating to the reliability of the electrical grid. A microgrid is a group of interconnected loads and distributed energy resources within clearly defined boundaries that acts as a single controllable entity with respect to the grid. The microgrid can connect and disconnect from the built grid to enable it to operate in both grid connected and islanded mode. Much of what occurs during a disaster scenario, including both im- mediate emergency response and longer-term relief efforts, is highly dependent upon reliable access to electric power resources and de- livery, which often becomes a critical limiting factor in various situa- tions.

To date, microgrid developments have been primarily based upon new technology deployment (power electronics, energy storage, forms of renewable integration) for military bases and associated applications. Microgrid applications are focused upon grid islanding and synchroni- zation, black start capability, generation/load balance control, battery energy storage and frequency regulation, and load control with demand response. Current business cases for microgrids can be challenging and may not address social and community needs. With recent events throughout the world, many now consider an unpredictable

Fig. 2. Underlying assumptions of carbon reduction strategies.

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circumstance (natural disaster or terrorist attack) in a community where professionals or students maintain residence, hospital procedures are conducted daily (surgeries, standard medical appointments, re- search activity, etc.), and regular commuters come to their place of employment in the region (banks, administration, restaurants, etc.). Under this constraint, research teams must begin to look beyond the traditional definition of a microgrid.

Thus far, microgrids have been exceptionally useful in mainly adaptation terms, in that they have been used to provide immediate protection from the damages of climate change. Microgrids in parti- cular have been featured extensively in the literature surrounding ex- treme weather. If power systems are damaged (through natural dis- asters, terrorist threats, and other means), societal building blocks such as family, economics, local government, health, and education are di- rectly impacted. Families will have increased difficulty to maintain food, water, and shelter security with limited communication. Economically, supply chains will be disrupted, safety and security will be compromised, and reductions for distributing survival goods will result. Local government organizations will rely upon temporary power supply, and emergency response effectiveness will be impacted. Finally, healthcare systems will also depend on temporary power (traditionally diesel generation), and at the same time there will be a heightened need for healthcare services.

Using microgrids to address these purposes alone has resulted in the use of these technologies primary for security dimensions, or addressing immediate vulnerabilities. This means that individual organizations have used them for their individual purposes, yet not for broader so- cietal benefits. This means that when designing the function of the microgrid, it is designed and placed to achieve solely technical aims, and not environmental or social aims. When considering microgrids as part of a system this has drastic implications on the design on these infrastructures.

Within systems studies, the intent of how a system should function is referred to as optimization. Generally, this can come from many different disciplines. First, in economics, cost optimization would mean that the system’s design should function in a way in that it operates at minimal cost to the operator or owner; when applied to a microgrid, this can be referred to as using economic dispatch optimization (Liu et al., 2011, pp. 77–84). They can be optimized at various levels technically, including in relation to operating in relation to changing weather dynamics (Hassan and Abido, 2011, pp. 755–769). The specific type of function that a microgrid addresses is typically left to the design of electrical engineers who are able to uniquely develop optimization algorithms depending on the intent behind design of the microgrid. If city planners for instance, were to mandate what the microgrids should help to do in society, the inherent design of the microgrid would be one that reflects stronger environmental considerations. For instance, knowing that a microgrid would need to function in a manner that reduces carbon emissions could potentially be achieved by developing a voltage-loss algorithm.

However, when thinking of a microgrid as part of a system itself (when considering a microgrid in an urban location) then a microgrid could not only play an environmental role, but could also help to op- timize the performance of the city itself. If city planners and community members were to prioritize the areas of a city that need environmental and social support, then the microgrid aspects could be designed in a manner to maximize the cities goals. For instance, if a city knew it was aiming to reduce carbon emissions, then a microgrid might be ex- ceptionally useful if it was also able to integrate renewable energy re- sources into an urban setting. It could also be located specifically in an area where energy poverty is high for example, to help provide cheaper onsite generation when compared to traditional thermal electricity outlays.

When considering the potential for microgrids to act beyond their traditional security means, it becomes even more important to specifi- cally conceptualize the policy framework that a microgrid can help to

achieve. Doing so will not only help to optimize multi-use performance capabilities of individual microgrids themselves, but could also help to optimize the performance of an urban electrical system as a whole.

4.2. Mapping microgrids to environmental and social goals

Although microgrids have been featured predominantly within the research related to energy security, these new types of energy infra- structures can be designed and constructed to provide optimal (beyond technical) performance during disaster/disruption events. Microgrids currently rely on traditional engineering metrics for identifying what purpose they serve. However, many of the codes and standards first used to ensure the safety and reliability of facilities and their inter- connections do not consider natural disasters, and neither do they consider increasing terrorist threats and other unforeseen events, leaving the physical infrastructure with vulnerabilities. While they are designed to meet National Electric Safety Codes requirements, the level or magnitude of disaster events that these systems can withstand without damage is not clearly defined. At the same time, identifying how these resources can provide a need or service in terms of the en- ergy transition has not yet been identified.

Thinking of a microgrid within the context of new energy system helps to bridge the understanding between what the broader societal performance aims of a microgrid should or can be. A system is a con- struct or collection of different elements that together produce results that otherwise could not obtainable by the elements alone. The parts of a “system” can include people, hardware, software, facilities, and po- licies; that is, all things required to produce group-level results. These may results include functions, behavior and/or performance. The value added by the system as a whole, beyond that contributed independently by the parts, is primarily created by the relationship among the parts; that is, how they are interconnected (Maier and Rechtin, 2000). Therefore, when thinking of a microgrid as a system it needs to provide more than just technical support, but also fulfill social and environ- mental goals.

A “socially responsible microgrid” is a scalable, deployable concept that fulfills the need to provide essential electrical service to support critical public need as a priority (as in hospital services), and upon restoration, utilize electrical resources to supply power to other loads based upon a priority schedule. Thus, the proposed socially responsible microgrid aims to contribute to the main goal of the U.S. Presidential Policy Directive 21 (PPD-21), which is to strengthen “the security and resilience of (U.S.) critical infrastructure against both physical and cyber threats.” In particular, the socially responsible microgrid directly addresses special concerns in the PPD-21 with the energy sector which “identifies energy … systems as uniquely critical due to the enabling functions they provide across all critical infrastructure sectors.” Moreover, a socially responsible microgrid provides benefits to the community beyond the immediate needs during and after a disaster. As indicated in NIST’s Special Publication 1197, Community Resilience Economic Guide for Buildings and Infrastructure Systems, “increased community resilience also provides the benefit of making communities more attractive to business investments and new residents.” However, what benefits need to be provided and/or addressed by these micro- grids must be clearly established as boundaries by policymakers to coherently establish what a city’s economic, environmental, and social goals are. This would allow for better project sustainability, and would help to increase the attractiveness of investing in social and environ- mental needs.

5. Connecting microgrid development to broader climate policy goals

The design and integration of microgrids as part of an overall mi- tigation strategy is a helpful part of current adaptation strategies but needs to go beyond the current aims technical designs to fulfill

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technical, environmental, and social functions simultaneously (Alvial- Palavicino et al., 2011, pp. 314–323). Identifying how microgrids can provide a need or service beyond the terms of traditional technical support is important particularly when taking a financial or deployment standpoint. When considering that resilience measures are best (or most likely to be) coordinated at the city level, and that city-level govern- ments possess significantly fewer resources than a national-level gov- ernment, it becomes problematic to consider how to finance these mi- crogrids that could be used for embedding stronger resilience within existing electrical systems. Yet going beyond the technical design of new energy infrastructures, and in particular, microgrids, offer sig- nificant room for increasing the bankability of energy infrastructure projects. Doing so can help to incentivize the role of the investment community within broader development needs.

In general, making any type of system more resilient tends to in- crease the upfront capital cost: resilient changes need to be made over a period of time, and the returns provided by that resilience (or a resilient infrastructure) are only incremental. Technically, increasing the resi- lience of an infrastructure would mean lowering its vulnerability to risk, thereby increasing the attractiveness of the investment. However, proving the measured reduction of this risk, and therefore the value, tends to be complicated. From a regulatory standpoint, resilience as it stands is a technical issue, not a policy issue; resilience measures are strictly hardening measures such as building walls higher. Thereby, going beyond traditional hardening measures of adding onto built en- vironments without a policy mandate becomes a “business problem,” not necessarily a societal problem: these costs are viewed as extra, not as mandatory, to a project’s development, which inherently means the project under consideration gains additional regulatory-related risk (Onstwedder, 2015). This often results in the costs of anything beyond technical resilience being passed onto the community, or dismissed outright as a means to reduce the initial capital investment needed.

Yet proving, and mandating, the need for immediate resilience in terms of environmental and social goals helps to provide a more secure framework for returns on investment. In particular, linking the devel- opment of resilient energy frameworks to long-term and short-term climate goals provides a more quantifiable definition of resilience for investors to look towards. To effectively reduce the risk of climate in the long term, new technologies need to reduce the amount of carbon emissions present in the atmosphere. In the short term, there are a variety of vulnerabilities, but there are several specifics that can be quantified such as decreased mortality rate (from reduced exposure to particulate matter and carbon dioxide), decreased asthmatics, de- creased risk of cancer, etc. Identifying how exactly these infrastructures can specifically aim to support a quantifiable amount of reductions would help to make these technologies critical to reducing the exposure of climate change in the short and long term. This is helpful in that it removes a certain degree of regulatory risk, but also in that it allows microgrids to be considered as an integral part of cities operation and resilience itself.

For prospective financiers, viewing a microgrid as a critical part of a city’s resiliency makes these new energy systems an interesting area for investment in two ways. First, microgrids would provide immediate security to the operation of a city (not just a single building), thereby automatically making the entity relevant to the insurance industry. This is obvious in the short term, in that a microgrid installation could help to remove exposure to immediate dangers to a hospital, school, etc. The value of a microgrid when viewed from this perspective could poten- tially qualify for financial investment in the same way that a diesel generator is needed for backup in a state of emergency and is thus, financed through insurance mechanisms. However, a microgrid is slightly more challenging in that it is typically not treated as one part, but is looked upon as many components. Without quantifying beyond the technical benefits of a microgrid, the solution is likely to lose out on investment sources when compared to cheaper, more typically de- ployed solutions such as diesel generators. However, linking the

quantifiable benefits of microgrids to social and environmental di- mensions helps to expand upon the services that a microgrid is able to provide, and therefore, upon the utility of investment. For instance, structuring a microgrid so that it helps to integrate renewables and therefore, help reduce the negative health impacts that are associated with particulate matter, could help to quantify reduced risks in the long term. Therefore, this would allow a financier to combine the benefits of a microgrid in the short term in that it provides security, but in the long term as well, in that it provides additional incremental risk reductions. In the same way that quitting smoking is likely to be of value to an insurer (thereby incentivizing them to invest in non-smoking pro- grams), a microgrid can be considered a type of security that helps to reduce the immediate risks of climate change and the long-term ex- posure of a society to climate change as well. However, this would only be true if the microgrid were able to quantitatively display the en- vironmental and social benefits it would be able to provide for a community.

6. Mapping environmental risks in Pittsburgh

In order to quantitatively display the socio-environmental benefits established by a microgrid, it is first necessary to establish where the overall vulnerabilities of a city may be. As the risks from climate change impact cities in different manners, we can work with specific cities to understand the risks they are facing, and then spatially interpret them through GIS methods. For instance, the shocks that the city of Pittsburgh faces immediately are summarized in the city’s most recent resilience report (Fig. 3).

6.1. Data

Once the report laid out the main vulnerabilities, data was collected with the local Department of Homeland Security to identify where communities were dealing with the greatest impacts. This helped form a dataset that was unique to the city, and was informed by technical, environmental, and social impacts. Using spatially defined areas that are related to the individual neighborhoods in Pittsburgh, we created a current land cover map to help model the economic, environmental, and social risks to the city. This allows us to both quantify the impacts in a statistical manner, but also to provide a visual representation of where risks are overlapping, creating pockets of socioeconomic vul- nerabilities to an extreme degree. Other layered data included:

– Carbon emissions data, collected from the Pittsburgh’s Office of Sustainability and Urban Planning;

– Flooding data, derived from OpenData.gov, the federal govern- ment’s open data resource; and

– Power outages, dataset collected from the Office of Emergency Management and Homeland Security.

To visualize the risks and effectively identify the most vulnerable areas, the data was represented according to the City of Pittsburgh census tracts, which provide a stable set of subdivisions of the city.

Fig. 3. Shocks and stresses from climate in Pittsburgh.

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They allow better representation of the events that affect more than one area and those whose location has a particular level of uncertainty. All datasets were projected into UTM 37 South using a WGS1984 geo- graphic coordinate system with the raster datasets additionally re- sampled to a common spatial resolution of a 100 m grid. The carbon emissions data was divided into Total Electricity and Natural Gas, which were originally represented in kWh and MMBtu by ZIP code, in order to overlap and compare different types of vulnerabilities the data was normalized. The events, Natural Gas, and Total Electricity were then combined with equal weighting. The result can be seen in Fig. 4.

The event data, including power outage, flood, and water issues, allowed the construction of a heat map, illustrated in Fig. 5. Differently from the methodology descripted above, heat maps consider the density and proximity of events within a radius on the order of hundreds of meters.

What the analysis shows us is that, uniquely, there are areas with specific climate vulnerabilities that are not currently prioritized with

the local urban planning process. When looking at the map, one is able to identify areas of critical weakness in terms of the city’s resilience. Although this makes the long-term planning of sustainability difficult, the unique density of risk showing up in pocketed densities points to areas that might be incentivized by microgrids. This would help to address both carbon density, thereby increasing the sustainability of local energy infrastructures, but this could also help to increase the security of the grid, but incentivizing microgrids in the areas labeled as the “hottest” for risk. Microgrids here would be able to help provide resilience against common disaster-like events in these areas, as con- firmed through reinsurance companies’ natural catastrophe data. Interestingly, the pockets of the city with the highest carbon emissions and likelihood of experiencing power outages are also the pockets of the city that experience high flooding. Conceptualizing multi-use infra- structures here would help to reduce the risk to new infrastructures themselves and also would help to reduce the need for microgids from multiple areas of priority for investment. However, in order to do so,

Fig. 4. Economic, environmental and social vulner- abilities.

Fig. 5. Heat map of events.

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individual microgrids should be conceptualized to help showcase how their own technical resilience can contribute to the overall risk reduc- tion in those locations. By quantifying the amount of emissions reduc- tions or the amount of decreased flooding, for instance, within a certain neighborhood, this could help to promote the case for immediate in- vestment. This would be even more true if the areas with the highest risk profiles were also areas featuring critical infrastructure. In the case of Pittsburgh, this is true. The densest areas of “resilience risk” are those which feature the highest amount of hospitals and commercial centers. Therefore, microgrids here can include “additional resiliency” or avoided blackouts, for instance, as among the benefits in the cost- benefit phase of financing.

7. Conclusion

When thinking of resiliency as adaptation measures then, one can easily see how resilience is important for meeting the goals of long-term sustainability. The decisions that we choose to apply to existing tech- nologies, or to make for new energy build, are likely to contribute to- wards or detract from the long-term goals of the energy transition. The types of technologies that are put in place can either increase or de- crease carbon emissions reductions. Either way, these technologies must contribute to the reliability of the existing grid; designing these technologies in a manner that helps to achieve social and environ- mental goals is a critical part of ensuring the security of our energy grid in the future.

It’s critical for policymakers to begin to identify how the actions that are taken today can also help to address goals needed for tomorrow. Taking a more dynamic approach to resilience will help engineers, economists, and broader technical experts to design their systems in a manner that supports the broader development goals of a community. Doing so will help to ensure that the microgrids themselves are able to act as part of a system within a system. By setting out a framework that prioritizes the development of microgrids as part of a resilience strategy, city planners can help to protect their own communities without having to use their own financial means to do so. Microgrids as part of a resilience strategy provides systemic value to a variety of stakeholders within an urban setting.

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Katrina M. Kelly-Pitou’s background is a mix between economics and engineering. She is currently a postdoctoral student in Electrical Engineering at the University of Pittsburgh, but also holds a Ph.D. from the University of Nottingham in Energy Studies, a Masters from Hult International Business School, and a B.A. from Duquesne University in Economics and International Relations.

Anais Ostroski obtained her B.S. degree with a focus on environmental and sanitary engineering at the Federal University of Parana. She participated in a research-intensive study with the University of Pittsburgh in 2017. She has conducted research since March 2015 in the Laboratory of Computation and Technology in Environmental Engineering at her home university, interned for Copel in Singapore, and now serves as an incoming global talent team leader at AIESEC, based in Singapore.

Brandon Contino graduated last spring with a B.S. in Electrical Engineering and a minor in Economics.

Brandon Grainger is a Research Professor in the Department of Electrical and Computer Engineering at the University of Pittsburgh, Swanson School of Engineering, and also serves as Associate Director of the Electric Power Systems Laboratory. He obtained his M.S. and Ph.D. degrees in Electrical Engineering and B.S. degree in Mechanical Engineering (with a minor in Electrical Engineering) all from Pitt. Dr. Grainger has either worked or interned for ABB Corporate Research in Raleigh, North Carolina; ANSYS Inc. in Southpointe, Pennsylvania; Mitsubishi Electric in Warrendale, Pennsylvania; Siemens Industry in New Kensington, Pennsylvania, and has regularly volunteered at Eaton’s Power Systems Experience Center in Warrendale, Pennsylvania, designing electrical de- monstrations.

Alexis Kwasinski is an Associate Professor and R.K. Mellon Faculty Fellow in Energy at the University of Pittsburgh, Pittsburgh. His current research interests include power electronic systems, distributed generation (microgrids), renewable and alternative en- ergy, smart grids, and the analysis of the impact of natural disasters on critical power infrastructure, which included site damage assessments after several natural disasters in Japan, New Zealand, the U.S., and Chile. He received a B.S. in Electrical Engineering from the Buenos Aires Institute of Technology (ITBA), Buenos Aires, Argentina, in 1993, a graduate specialization degree in Telecommunications from the University of Buenos Aires, Buenos Aires, in 1997, and M.S. and Ph.D. degrees in Electrical Engineering from the University of Illinois at Urbana-Champaign, Illinois, in 2005 and 2007, respectively. From 2007 to 2014, he was a faculty member at the University of Texas at Austin, where he reached the rank of tenured Associate Professor.

Gregory F. Reed is Director of the Electric Power Systems Laboratory within the Swanson School of Engineering, University of Pittsburgh; the University Center for Energy, Pittsburgh; and Energy GRID Institute, Pittsburgh, and a Professor of Electric Power Engineering with the Department of Electrical and Computer Engineering, Pittsburgh. His current research interests include advanced electric power and energy generation, transmission, and distribution system technologies; power electronics and control tech- nologies such as flexible AC transmission systems, high-voltage DC, and medium-voltage

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DC systems, renewable energy systems and integration, smart grid technologies and ap- plications, and energy storage. He has over 30 years of combined industry and academic experience in the electric power and energy arena, including engineering, research and development, and executive management positions throughout his career with the Consolidated Edison of New York, New York; ABB Corporate Research Center, Raleigh,

North Carolina; Mitsubishi Electric Power Products, Inc., Warrendale, Pennsylvania, and DNV-KEMA, Arnhem, Netherlands. He holds a B.S. in Electrical Engineering from Gannon University, Erie, Pennsylvania; an M.S. in Electric Power Engineering from Rensselaer Polytechnic Institute, Troy, New York, and a Ph.D. in Electrical Engineering from the University of Pittsburgh.

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