Blackouts in the US/Canada and continental Europe in 2003: Is liberalisation to blame?

The paper starts with an overview of 2003 blackouts in the US, Sweden/Denmark and Italy in order to analyse common threads and lessons to be learnt. The blackouts have exposed a number of challenges facing utilities worldwide. Increased liberalisation of electricity supply industry has resulted in a significant increase in inter-area (or cross-border) trades which often are not properly accounted for when assessing system security. The traditional decentralised way of operating systems by TSOs, with each TSO looking after its own control area and little information exchange, resulted in inadequate and slow response to contingencies. A new mode of coordinated operation for real-time security assessment and control is needed in order to maintain system security. This new mode of operation requires overcoming a number of organisational, psychological, legal and technical challenges but the alternative is either to risk another blackout or run the interconnected system very conservatively, maintaining large security margin at a high cost to everyone.