When we think of business continuity planning, we often think of natural disasters and security related disasters. But no business can continue operations without access to energy; primarily electricity and gasoline.
And in this climate where the energy paradigm is changing, and in many instances uncertain, thinking about energy continuity planning is essential to the long term survival of your business.
Let’s look at some of the risks …
1. Blackouts and Rolling Brownouts
Concerns have heightened since the rolling brownouts in California in 2000 and 2001, and the Northeast blackout in 2003. These kinds of events are the worry of every major city now as they battle to find more electricity to deliver to more customers on a continually deteriorating power infrastructure.
Power regulators are trying to do more and more with less and less. And sudden demand events such as heat waves or freezing storms can push electrical grids to their limits very quickly. In many countries, blackouts and rolling brownouts are common.
2. Supply and Demand Dynamics
The cost of fuel and electricity rises due to the simple market dynamics of supply and demand. The rising cost of gasoline and diesel alone have put many businesses out of business, and hurt many more.
Conventional energy sources are fast becoming expensive enough to make many sources of alternative energy viable. But in the interim, significant supply disruptions could send prices skyrocketing as the only way to erode demand and create balance in the energy marketplace.
3. Regulated Conservation and Rationing
Along with supply and demand dynamics and the threat of blackouts or brownouts comes the threat of regulation. Many industrial countries such as China have used regulation to curtail their energy woes; for example, by only allowing manufacturing during the night, they allow the general service economy to run during the day.
Many ideas have also been proposed for rationing fuel as well; such as allowing vehicles with odd numbered license plates to run on odd numbered calendar days, and even numbered plates on even days.
Creating rolling brownouts is a quick, emergency solution to overtaxed electrical grids. But longer term solutions for energy shortages could involve regulated or forced conservation and rationing.
Building Your Energy Continuity Plan
As part of your overall business continuity plan, look at energy shortages, inflation, and loss as potential hazards. Then build a plan to mitigate and respond to these hazards. Some of the things to look at are …
- Reducing your energy consumption and requirements. The less energy you need to run your business, the less risk you face.
- Look at alternative energy sources; primarily renewables such as solar, wind, and biodiesel. The supply of alternative sources is growing, and being ready and capable of using those sources in a crisis situation can keep you up and running when others are scrambling.
- Build safety and backup sources of energy. These include UPS (uninterruptible power supplies), backup generators, and regular data backups in diverse locations. This can also include diversifying the regional locations of your business units.
A business continuity plan is a vital part of your business’s long term survival. And energy continuity is a vital part of that plan. And it becomes more so every day.