The Northwest’s energy system, long among the region's greatest strengths, has become one of its greatest security vulnerabilities. A lone terrorist could bring the Northwest’s economy to its knees for days; an organized band could make it weeks or months.

That’s one finding of a new report by Northwest Environment Watch — the Cascadia Scorecard — that documents striking vulnerabilities in the Pacific Northwest’s energy system and the potential of clean-energy solutions to tighten security and cut costs.

In the case of electricity, for example, the region’s power is transmitted across mountains and deserts on power lines that are virtually impossible to defend. Transmission lines are vulnerable to attacks with weapons: rifle fire knocked out transmission systems three times between December 2003 and July 2004 in Oregon and Washington alone.

They are also vulnerable to hand tools. In November 2004, an attacker loosened bolts and let gravity fell a transmission tower in Wisconsin, interrupting electricity to the Milwaukee airport and 17,000 other utility customers. And in 2003, Michael Devlyn Poulin of Spokane, Wash., was finally apprehended by the FBI. Over a period of weeks, Poulin, who described himself as “62 years old, overweight, arthritic, diabetic, half-blind and a cancer patient,” had unscrewed bolts from about 20 transmission towers across the Northwest and California. Poulin’s avowed purpose was not to crash the grid but to illustrate its vulnerability. He succeeded.

How to make the region’s energy system more secure and resilient over the long term? The reflexive strategies — “hardening” the existing infrastructure with guards, guns, and gates; or creating a thicker web of power lines — is probably justified to some extent. But both hardening the system and constructing more lines can make only marginal improvements while also raising the cost of energy. Security through efficiency, on the other hand, saves money and reduces the environmental impact of energy consumption. In fact, in its new 20-year plan, the Northwest Power and Conservation Council (NPCC) has identified efficiency as the biggest and cheapest source of new energy.

Fortunately, the Northwest is home to pioneering efforts that can boost energy efficiency and strengthen the region’s security. “Smart-grid” and “demand response” provide instantaneous rebalancing of power and gas demand. And “decoupling” unhitches utilities’ profits from their gross sales.

Already the NPCC is encouraging utility investment in “demand response” systems, which allow utilities to temporarily turn off certain power-using devices on the consumers’ side of the meter. Demand-response programs, such as the experimental Non-Wires Solutions project of the Bonneville Power Administration (BPA), recruit consumers (usually businesses) who agree to such cutbacks in exchange for cheaper rates.

Demand response allows the Northwest to avoid the construction of expensive “peaking” power plants or the purchase of expensive peak power on the spot market. If large transmission lines are attacked, demand response can keep vital functions operating. It would even help in the event of the loss of natural gas pipelines, since some 22 percent of the region’s natural gas goes into power plants.

The Pacific Northwest National Laboratory in Richland, Wash., is taking demand response to an even higher level of sophistication. The smart-grid electronic tools it and others are developing will allow millions of electricity-using and -generating devices to adjust their operation to real-time grid conditions.

If demand and prices soar, for example, pre-programmed smart grid thermostats would ease up. If attackers disabled a transmission line, decentralized energy sources such as co-generators in factories would feed power into the grid. The result: a smart grid would largely heal itself.

The second approach, decoupling, could put the profit motive to work for efficiency. Utilities’ profits are dictated by state regulators, based on complicated formulas. At present, profits rise in direct proportion to sales, so utility investments in improving efficiency can drain away profits.

In the case of PacifiCorp, an investor-owned utility that serves parts of the Northwest states, every investment that allows its 121,000 Washington state customers to save 1 percent of their power through better efficiency subtracts well over $1 million from shareholders’ earnings in the first year. Such a move subtracts an equal amount in each subsequent year, often for a decade or more. Not surprisingly, many utilities are half-hearted about efficiency, even if they are legally obligated to encourage it.

But by decoupling sales from earnings, utility regulators can write security into utilities’ bottom lines and turn utilities into vanguards of the clean-energy revolution. At present, only one Northwest utility has decoupled rates: NW Natural, a Portland-based gas company. An assessment in 2005 will tabulate the benefits, but earlier experience is encouraging. For example, Puget Sound Power and Light (now Puget Sound Energy) operated under a decoupling rule from 1991 to 1996 before a tangentially related lawsuit — and more importantly, the ill-fated electric deregulation movement — put decoupling on hold.

Decoupling helped convert Puget Sound Power and Light from a laggard to a leader in energy efficiency. In its first decoupled year, the company’s efficiency programs saved almost as much electricity as they had saved during the three previous years combined. In its second year, it boosted savings another 60 percent and single-handedly accounted for 40 percent of all electricity savings in the Northwest states — outdoing even the BPA — at half the cost. Decoupling is returning to the fore of regional policy debates just in time to turbo-charge implementation of NPCC’s efficiency-centered plans.

The transition to a cleaner, stronger, and more resilient system can be profitable to investors and advantageous to customers. The Northwest’s current weakness in energy security actually creates significant opportunities because smarter systems can enhance our natural heritage precisely by boosting our region’s energy security.

Alan Durning directs the Seattle-based research center Northwest Environment Watch and is lead author of "Cascadia Scorecard 2005: Focus on Energy," from which this commentary is adapted.