Blackout '03: Getting By Without the Grid

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Where economics lead, government policy often follows. The few consumers who do generate their own power--typically with green technologies like solar panels, windmills or hydroelectric turbines--usually use it only to supplement what they draw from the grid. Still, this can present a problem when the power they generate with their windmills or solar panels, combined with what they take from the local power plant, exceeds their needs. Historically, they would simply kick that extra juice back to the local power company, which would buy it back from them at far below market value. A new system has been enacted in 36 states to rectify that inequity. Under the plan, called net metering, a homeowner's electrical meter simply rolls backward whenever the house is feeding electricity to the grid instead of pulling it down, reducing the bill at the same price per kilowatt hour the power company charges.

Proponents of the policy hope that it will boost energy independence, but not everyone thinks that's a good idea. Because so much of the American gross domestic product is involved in the coal, petroleum and nuclear industries, walking away from them would set off severe economic shock waves. "The grid is a $360 billion asset," says Clark Gellings, a vice president of the nonprofit Electric Power Research Institute. "It's literally a national treasure." Gellings believes that decentralization will play some role in the energy industry of the future, but he thinks it will always be a minority player. "It may be 20% of the supply in maybe the next 20 years," he says, "but it's not going to replace what we have." That may be so. But after the fiasco of last week, plenty of consumers would be happy to see the whole system replaced--or at least dramatically improved. --By Jeffrey Kluger. Reported by David Bjerklie and Mitch Frank/New York, Rita Healy/Denver and Laura A. Locke/San Francisco