The Cambridge Dictionary (online) defines this idiom thusly:
"UK (US drunk as a skunk) INFORMAL› extremely drunk: Andy staggered in last night drunk as a lord."
Dictionary.com says this: "Extremely intoxicated, as in He came home drunk as a lord ...considered proverbial by the mid-1600s and presumably alludes to the fact that noblemen drank more than commoners (because they could afford to).
Now far be it from me to disparage the scholarship one finds on the internet, but this is crap. First of all, I was born and raised in the United States and have never stepped foot on British soil. "Drunk as a lord" is the only thing I say when I use this sort of simile and I turn my nose quite firmly up at any use of “drunk as a skunk.” It’s a horrible phrase. The only thing "drunk as a skunk” has to recommend it is that it rhymes, and that ain’t much. It’s otherwise vapid and meaningless. Skunks don’t drink (unlike monkeys—“drunk as a monkey” not only rhymes-- and more prettily too-- but it’s funnier and more accurate). Hell, skunks don’t even act drunk. You won’t see a skunk so much as wobble when it walks. Rather it proceeds in a straight line, its head held high, assuming, quite rightly that almost all other creatures will step deferentially out of its way.
“Drunk as a Lord” is highly evocative, specific and multivalenced. It has little to do with how wealthy a lord may be. Have these people at Dictionary.com never heard of aristocracy brought low? No, one is "drunk as a lord" not because one has more money to buy alcohol, but because of the quality of one’s drinking has led one to an expansive state of “lordliness” where one has little to fear but the hangover (and that’s in the morning and in the morning you could be dead.)
When you are drunk as a lord you laugh loud at everyone’s jokes but most especially your own, because, of course, you are a lord, and a lord’s jokes are funny even when they are not.
A drunk lord puts his hands up skirts where hands have not been invited. A drunk lord winks and leers at ladies of all ages and states of availability. A drunk lord will happily rise to a fight, but even more happily order some underling to fight it for him.
Lordly drunkenness is a blessed and dangerous state, fairly easily lofted into, rather difficult to climb down from, and generally best indulged at widely spaced intervals. What is lordly once can quickly becomes plebeian upon repetition.
This has been a nodeshell rescue—one of my own actually—in the larger service of the THE IRON NODER CHALLENGE 7.