Workers had to sign confidentiality pacts

Wednesday, September 24, 2003

The outspoken chief of southeast Michigan's power grid says the national inquiry into last month's blackout has been too secretive and may not provide the public a full answer to what caused the largest power outage in U.S. history.

Joseph Welch, CEO of Scio Township-based International Transmission Co. - the firm that manages electricity for 2.3 million customers who lost power in this region - said he's pushing for a more open process looking into causes of the blackout. But after more than a month of questioning, federal investigators seem more prone to conceal information than reveal it, he said.

At least six ITC technicians who provided data for the federal investigation had to sign non-disclosure agreements. Federal regulators initially wanted to bar local grid operators from revealing any contents of the still-pending investigation as well discussing any aspects of the blackout, Welch said. While he sees a need to control sensitive data about the probe while it's in process, the initial agreements would have kept most information under permanent seal, Welch said.

"I think the general public has a right and a need to know," he said of the investigation into the 2003 blackout, which left millions of people in eight states and parts of Canada without power on Aug. 14.

State regulators with the Michigan Public Service Commission are investigating whether ITC may have played a part in the blackout's spread. From offices on Wagner Road, ITC manages power flows through transmission lines previously owned by Detroit-based DTE Energy Corp.

ITC eventually negotiated for its workers to sign only one-year non-disclosure agreements with investigators, according to Jim Frankowski, the firm's in-house attorney. But Frankowski said federal investigators had first pushed for blanket silence on the blackout.

"Their initial intent was to keep all information related to the outage confidential forever," Frankowski said.

The U.S. Department of Energy and the North American Electric Reliability Council, an energy oversight organization, are coordinating the federal investigation into the power loss through a joint U.S.-Canadian task force. A spokeswoman for NERC did not return a phone call, but DOE spokesman Joe Davis said critical energy infrastructure and other data protected under the Federal Trade Secrets Act has to be kept private.

"It requires task force members to use protected information only for work in support of the task force," Davis said.

DTE Energy spokeswoman Lorie Kessler said certain information needs to stay private for competitive and national security reasons, as well as to ensure that regulators find a "bigger picture" cause to the power crash.

"You don't want an investigation going on and having a bunch of entities leaking out individual pieces of information," Kessler said. To her knowledge, no DTE workers have signed the agreements, she said.

Since the blackout, regulators have stepped up oversight of power grid managers, such as ITC. Ensuring the grids' reliability is the task of the Midwest Independent Service Operator, known as MISO, which is based in Carmel, Ind. The nonprofit covers 15 states, including parts of Ohio and all of Michigan.

Spokesman Gary Rasp said the organization has tripled the number of key facilities it monitors on a "minute-to-minute basis" in Ohio. The group also performs daily voltage stability analysis for the area. He said MISO believes the confidentiality requirements are appropriate.

But Welch said there are still significant flaws among regional energy traffickers and individual grids like ITC. He stands by his earlier statements that ITC was never warned by MISO or other utilities about conditions that led to the blackout.

"This is like two air-traffic controllers not talking," he said. "I just believe the process is set up to never get to the core fundamental issues of how we correct this thing.

"You need enforceable national reliability standards - right now there aren't any. They're voluntary," he said.

It's not the first time Welch's comments have caused controversy. In congressional hearings into the blackout this month, Welch's testimony was criticized by Congress members who said a full investigation had to be concluded before any blame was assigned. Welch claims he was only providing specifics and not pointing fingers.

Nevertheless, Welch said ITC officials still don't understand why 2,300 megawatts from Ohio flooded the Michigan grid that August afternoon, knocking out power lines and sending power plants off line. As many as 10 transmission lines - owned by American Electric Power of Columbus, Ohio, and Akron-based FirstEnergy Corp. - failed on the day of the blackout, he said.

ITC was spun off from DTE in March as a for-profit entity. For 30 years before that, the DTE and Consumers Power grids were both managed from the Wagner Road facility. But under deregulation of the electric industry, power providers like DTE and Consumers sold off their transmission lines.

Consumers' power is controlled by grid managers at Michigan Electric Transmission Co., which is in the same building as ITC. Consumers' grid did not fail during the blackout.

Scott Anderson can be reached at sanderson@annarbornews.com or at (734) 994-6843.