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Another Year of Cost and Loss?

image credit: Alliance for Innovation and Infrastructure
Benjamin Dierker's picture
Executive Director, Alliance for Innovation and Infrastructure

Benjamin Dierker is the Executive Director of Aii, specializing in economic, administrative, and legal aspects of American energy, transportation, infrastructure, and innovation. His goal is to...

  • Member since 2021
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  • Feb 14, 2023

This item is part of the 2023 Predictions and Anticipated Trends for the Power Industry - January/February, click here for more

As executives and managers are putting together and disseminating goals for 2023, there is reason to be optimistic. Many innovative technologies will make worksites safer and more efficient. Some may be looking forward to coalition-building and partnerships on the horizon that will improve their work and expand access to resources. But for the utility industry, there is damage and deadweight loss likely already baked in this year. 

Everyone in the utility sector has some familiarity with damage prevention. Buried facilities are vulnerable to accidents and recklessness when excavators break ground without first notifying utilities and identifying the pipes, cables, and wires below. And while eyes are focused downward for the underground utility workers, a sword of Damocles hangs above this powerful and otherwise successful industry. But the dangers, damages, and dollars at risk are not merely abstract looming concerns, they have been tallied up annually on a trend that will likely extend into the future – unless something changes. 

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In 2019, the Common Ground Alliance estimated that the U.S. experienced approximately 532,000 damage events to underground facilities. That was the highest year on record and coincided with an estimated $30 billion in annual economic harm. Subsequently, the Infrastructure Protection Coalition studied the 811 one-call system and found that the processes set up to facilitate damage prevention contribute to an additional $60 billion in economic waste and inefficiency. All told, somewhere on the order of $100 billion is needlessly forfeit in the U.S. every year. 

Heading into 2023, that story is destined to repeat – unless or until systemic reforms are adopted. Every individual utility owner/operator, every locate business, every excavator, and the peripheral network of damage prevention stakeholders broadly must begin to take action to deploy known and proven technology, adhere to best practices, and report the highest quality data available when incidents do occur. The starting point would be two of the technologies most heralded by CGA itself all the way up to the Pipeline and Hazardous Materials Safety Administration (PHMSA). 

In 2017, following a request from Congress, PHMSA completed a study on improving damage prevention technology. It returned with recommendations that chiefly included electronic white-lining and enhanced positive response. Perhaps not coincidentally, by 2021, CGA issued its then-latest Technology Report stating that the ideal dig of the future would start with electronic white-lining and enhanced positive response as the very first steps. These technologies, when utilized together, all but guarantee over a two-thirds reduction in excavation damage incidents. 

When we set our eyes ahead once more, we can only assess 2023 in light of what we know of the recent past. Just this past fall, CGA issued its annual Damage Information Reporting Tool (DIRT) report, in which it concludes that damages in 2021 slightly increased from 2019 levels. In other words, for the last year that data is available, damages were at a new all-time high. With it must logically include new heights in damage costs and system inefficiencies. 

The grim – but not yet foregone – conclusion then, is that 2023 will see over $100 billion in economic harm, waste, loss, and inefficiency from the damage prevention sector. The trend from recent years does not have to predict the future. In fact, it will be years before we know definitively what happened in the utility sector in 2023 when the next available data is released. In that time, stakeholders and policymakers can all work together to prevent damage, implement technologies and best practices, and avoid becoming another data point in a stubborn trend of rising excavation damage. 

Paul Korzeniowski's picture
Paul Korzeniowski on Mar 5, 2023

Very big numbers. The world has changed a great deal since the time when much of this infrastructure was laid. We do have tools today to help prevent some of the problems. With so much in losses, it would seem that a business case to invest in them could be made. 

Benjamin Dierker's picture
Benjamin Dierker on Mar 9, 2023

I agree, there is a business case for investments, but much of the problem seems to be with who will spend and on what investments. Currently the system works to the favor of some but not without drawbacks. As a for instance, excavators use the 811 (Call Before You Dig) system for free. But much of the investment and technology that would most greatly help excavators would be paid for by utilities and others. Absent regulatory requirements or a shift in cost burdens, change may be slow. 

Benjamin Dierker's picture
Thank Benjamin for the Post!
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