Thousands of miles of new power lines are needed to send clean electricity across the U.S. to meet ambitious climate goals. The looming question for the Biden administration is how to get them built.
That could involve a previously constrained authority to site new long-distance power lines in the most neglected and congested parts of the country — and speed up development, which often takes a decade or more.
A long-awaited study released by the Department of Energy last month laid out the areas of the country with the biggest transmission needs. DOE could soon spell out its plan to use the siting authority — which was strengthened by the 2021 bipartisan infrastructure law — to pave the way for national transmission corridors. Some energy experts argue that program could alter the course of electricity development as the Biden administration seeks a carbon-free U.S. grid by 2035.
“It’s very possible a 700-mile-long line has support all along the route, and there’s just no way to avoid one landowner somewhere objecting,” said Rob Gramlich, president of the electric power consulting firm Grid Strategies. “Even if the authority is never ultimately used, it can change the negotiation on the ground, and often there’s a negotiation and the landowner gets some compensation.”
Despite inaction so far on the National Interest Electric Transmission Corridors, DOE is moving ahead with big plans for big wires, which it views as key to both fighting climate change and cutting electricity prices. Last month, the department put $1.3 billion behind three transmission projects after funding dozens of grid projects earlier in October. Now, pressure is rising on DOE to tap new corridors, although uncertainty reigns over how the department can use that tool and what it can accomplish.
Jeff Dennis, deputy director for transmission at DOE’s Grid Deployment Office, told a conference of the Wires Group this month that the new study was “an opportunity for us at DOE to really set forth a vision” of where transmission investments are needed most across the U.S.
In six months, “we’ll be talking a lot more about how states are collaborating with each other” to meet clean energy goals, he predicted.
The White House didn’t respond to a request for comment on the study’s role in reaching the Biden administration’s clean energy goals.
In the meantime, private developers and government planners are turning to the new “needs study” for direction. The Clean Energy Buyers Association, a consortium of large companies committed to purchasing zero-carbon energy, said the study laid the groundwork for new wind and solar resources to reach demand centers around the country — especially with billions of dollars in incentives for generation from last year’s Inflation Reduction Act.
In addition to emphasizing a need to build transmission infrastructure, the study underscored the importance of speeding up the connection of resources to the grid, said Bryn Baker, the group’s senior director of market and policy innovation.
“Right now, it feels like on the heels of the IRA we’re trying to hit the accelerator, but we have the hand brake on at the same time,” Baker said in an interview.
For now, DOE is tight-lipped on its plans for corridor designations.
“DOE is currently working on next steps. When we have more information to provide on the process for the designation of [corridors] we will release it publicly,” the department said in a statement.
DOE has said it will soon invite developers to propose specific projects for corridor designation.
Attention is also turning to funding and policy tools at DOE’s disposal, congressional efforts to speed up permitting and a looming Federal Energy Regulatory Commission rule on regional transmission planning.
Larry Gasteiger, executive director of the Wires Group, which advocates for large-scale grid expansion, said this month that a consensus of expert studies concludes that the U.S. high-voltage grid would have to grow to twice or three times its current size by 2050 to meet President Joe Biden’s goals for a virtually carbon-free U.S. economy.
Below are three takeaways from the Biden administration’s recent moves on big wire transmission:
Uncertainty over DOE plans
In a notice issued earlier this year, DOE explained its likely approach to developing national transmission corridors where new long-distance power lines may be needed.
While the approach could change significantly in response to input from companies, states and other interested parties, the department described the transmission needs study as “a key input into the designation” of the corridors. These are areas where “urgent transmission investments” will be needed to reduce consumer costs and improve grid reliability, according to the department.
The corridors would open up billions of dollars in financing opportunities for eligible transmission projects. More controversially, projects located in the corridors would be eligible for backstop siting. That means FERC could approve projects in those routes if states, which normally permit transmission lines, either deny permits or don’t act on applications.
Congress created the backstop siting authority in 2005, but it hasn’t been exercised because of successful legal challenges in past years.
Still, questions remain about how quickly the process will proceed and the extent to which transmission developers look to the federal government for siting help.
The needs study provided 84 pages of reactions from across the grid industry and outside interest groups. The Center for Biological Diversity, an environmental group that has pressured the administration to cut back much harder on fossil fuel emissions, said it recognized the administration’s rush to build out transmission infrastructure. But it added that “meaningful community engagement and trust are crucial to effective implementation” of this effort, according to the needs study’s summary.
“The study itself has lots of good information in it,” Cullen Howe, a senior advocate for the Natural Resources Defense Council’s Sustainable FERC Project, said in an interview. “As to exactly how it will be used by developers in the [transmission corridors] process, we’ll have to see.”
Howe said the use of federal backstop authority still requires FERC to complete a rulemaking process. Even then, there may be reluctance to use the power because of likely political backlash. The mere potential for federal siting of transmission lines in the absence of state action will be a more useful tool for developers than actually seeking federal approval, said Howe.
“I think that’s where the real power comes from,” he said. “It’s not so much that the feds would overrule what the state does. But it says to a state: ‘You just can’t do nothing on this.’”
One question the transmission study raises is how consumers will pay for the miles of new lines that could be necessary to bolster the grid, FERC Commissioner Allison Clements, a Democrat, said this month.
Speaking at an event hosted by the Wires Group, Clements said the independent commission is exploring ways to ensure consumers are getting the most transmission investments for their buck.
FERC began an inquiry on cost management issues associated with transmission last year, although it’s unclear when or if new policies will be proposed.
“The DOE numbers tell you how much is going to be built, so there has to be some give on the other side,” Clements said. “There has to be protection of customers while those significant investments get made.”
Spencer Gray, executive director of the Northwest & Intermountain Power Producers Coalition, a trade group for transmission developers, power producers and other companies, said he’s not banking on DOE’s use of the authority.
“We’re not as focused at the moment on trying to make that work,” he said. “I’m not counting on that to unlock new transmission that, but for that corridor authority, we’re not going to get otherwise.”
Conrad La Joie, a government affairs and law fellow at the Niskanen Center, a libertarian-leaning nonprofit, likewise said he was unsure about how DOE’s “clunky” expediting tools might play out in action. But the needs study puts the government’s heft behind new proposed lines and might help bolster the cost-benefit analysis for those lines, he said.
“This says, ‘Yes, there is a need, those actions are justified and it’s for the good of the nation,’” La Joie said. “It’s the kind of thing advocates and policymakers can lean on to show that these lines will be used.”
Mind the gaps
The $1.3 billion transmission project funding announced in late October, as well as $3.5 billion in projects unveiled earlier in the month, is a step in the right direction, grid experts say.
The Southline project will ship power produced by wind in New Mexico to cities in Arizona. The Cross-Tie project will connect Utah and Nevada, which will enable delivery of more renewable energy among additional Western states. DOE expects both projects to start construction in 2025. A third project, New England’s Twin States Clean Energy Link project, is slated to begin construction in 2026, DOE said.
The federal money is going to pay tolls to transmission operators, which experts say provides assurance to private developers that the shipped power will ultimately be purchased by parties known as offtakers.
“These are really complex, deep power markets, and you’ve got dozens of buyers and sellers of power on their respective sides of the market,” said Gray of the Northwest & Intermountain Power Producers Coalition. “That’s kind of the point of this program: to address that real challenge to get enough offtakers lined up at the same time for the same project.”
But the study outlines a need for new transmission in wide swaths of the country.
One of the biggest areas of need is in Texas. The Electricity Reliability Council of Texas (ERCOT) grid, which handles about 90 percent of the state’s power demand, will need a 140 percent median increase in transmission deployment between 2020 and 2035, the study found.
That’s in large part because the state’s best sources of renewable energy generation — the solar-rich western plains and offshore wind along the coasts — aren’t close to Texas’ large city centers. The market has had to curtail some renewable generation and even came close to rolling blackouts one evening in September when transmission constraints contributed to a drop in frequency.
Even greater could be the need for transmission out of Texas. DOE estimated that under a high load and high clean energy growth scenario, the Lone Star State would need to boost transmission to the plains region by more than 3,500 percent.
That whopping number reflects the almost nonexistent number of connections between ERCOT and the two other national grids — the Eastern Interconnection and Western Interconnection, said Joshua Rhodes, an energy systems researcher at the University of Texas, Austin, who has studied transmission.
“It’s easy to get a number so big when you start with a number so small,” Rhodes said. “But this reflects what we’ve seen, which is that Texas would benefit from connecting to” the nation’s other grids.
ERCOT has long resisted big connections to other grids, in part because it would open the state up to more federal oversight. There are increasing calls for ERCOT to do so — including proposed legislation from Rep. Greg Casar (D-Texas) — but many state officials have not been persuaded.
Another region where transmission development lags behind the national average is the South. According to the study, Delta states like Louisiana and Mississippi, as well as the rest of the Southeast and Florida, installed the least miles of transmission relative to how much power was on the grid throughout the 2010s.
Those findings were “shocking” to Simon Mahan, executive director of the Southern Renewable Energy Association, a clean energy trade group.
Electric utilities in many Southern states operate outside of organized regional transmission organizations, meaning they answer only to regulators within their state and FERC. That means no overarching entity is collecting data on regionwide trends, Mahan said.
“We’ve known for a long time that we are falling behind our neighbors, but because we have such a lack of data transparency in the Southeast, it’s been difficult to quantify how far behind our neighbors we’re running,” Mahan said. “To see that we’re basically dead last in the Southeast, in the Delta, in Florida compared to all other regions, including Alaska, is rather shocking and disturbing.”
Noel Black, senior vice president of federal regulatory affairs at Southern Co., said one of the report’s key takeaways was that demand for electric resources — and not just transmission — is growing in the South. Southern Co. provides electricity to customers in parts of Alabama, Georgia and Mississippi.
Black also said that Southeastern states already have “produced a robust electric transmission system.”
“Indeed, it will take infrastructure investment and the buildout of generation, transmission, and natural gas infrastructure to deliver the capacity needs anticipated in the DOE’s report,” Black said in an email.
Gramlich with Grid Strategies said the report isn’t going to get any specific projects over the finish line.
“The report certainly could be used to strengthen evidence of need in a permitting proceeding,” he said. “It’s not likely to be dispositive or the only source of information, so this report by itself is unlikely to directly change an outcome somewhere.”
Role for islanding?
DOE’s needs study also highlights policy changes that could help address potential transmission deficits, according to former FERC Chair Richard Glick.
In particular, the way transmission projects are planned at the regional level is not working as well as it could, and permitting barriers “need to be removed,” said Glick, a Democrat who served at FERC from 2017 to January of this year.
Under Glick’s watch last year, the independent agency proposed broad changes to how transmission projects are planned and paid for. Acting Chair Willie Phillips, also a Democrat, aims to finalize those changes in the coming months.
The commission could also promote the use of technologies that make the existing transmission grid more efficient. One example is dynamic line ratings, a technology that enables more power to flow across transmission lines and helps integrate renewable energy on the grid.
Because there is “no incentive” for transmission owners to invest in dynamic line ratings, FERC is trying to find a way to encourage those investments, FERC’s Clements said during the Wires Group meeting this month.
The commission opened an inquiry last year examining whether the technology — which can reduce electric system costs overall — should be required and, if so, how those requirements should work.
Still, not all of FERC’s transmission initiatives have unanimous support on the commission.
Republican Commissioner James Danly, for example, strongly opposes efforts by FERC to dictate how transmission lines are planned and paid for on a nationwide basis. Danly has also said that FERC should be more concerned about the retirement of power plants than about transmission lines if it wants to promote grid reliability.
Some experts say there’s another option to relieve electricity congestion: smaller, self-sustaining “island” grids that are now eligible for a 30 percent investment tax credit in the Inflation Reduction Act.
These “microgrids” aggregate, manage and generate energy resources without a connection to the grid. They’re often just 10 megawatts or less — enough to power thousands of homes but insufficient to alleviate national grid challenges. And they often rely on diesel generation.
“Microgrids are not a clean energy initiative; they’re a reliability initiative,” said Gramlich. “There’s just not the clean power on site in almost all cases, so it’s going to be usually dirty energy.”
Developers are also grappling with persistent import lags for distribution transformers and other “switchgear” equipment, which control electricity flow in energy systems. But decreasing costs for solar and battery technology have the potential to make microgrids green.
Astrid Atkinson, a former Google executive who now runs California-based Camus Energy, which produces software to better manage loads, says advancements in battery storage are a major opportunity for microgrids. She said island systems are a “really important part of the solution,” particularly for utilities grappling with dramatic load growth.
“Siting the generation near the load that is being added kind of helps to tackle part of the problem of not being able to get enough new power into the area where stuff is getting built,” Atkinson said. “That takes pressure off the need for more transmission. It doesn’t totally alleviate that need.”
Reporter Peter Behr contributed.
