BUILDING THE GREATER GRID WILL ACHIEVE AFFORDABLE, RESILIENT DECARBONIZATION
By Linda Apsey
As states, utilities, and companies large and small pursue increasingly ambitious clean energy objectives, those of us in the energy sector are compelled to consider what policies and approaches are necessary to ensure that the road to a better energy future leads to cleaner, cheaper, more reliable power.
As an independent owner and operator of electric transmission infrastructure, our company has seen first-hand how smart, careful, and timely investment in the transmission system can help bring about fundamental changes in the power system.
A truly regional transmission grid supports the ability of new generation resources to interconnect where these resources are cheapest. By building the right infrastructure today, we can access our abundant wind and solar resources and reduce emissions dramatically, while also ensuring and enhancing the resilience of the power system. Most important to most people, we can actually reduce electricity costs to customers as we achieve these goals.
Supporting Renewables, Enhancing Resilience
As we strive to reduce emissions from the power sector, expansion of electric grid infrastructure must be an essential consideration. New regional and inter-regional grid infrastructure is necessary to accelerate the deployment of cost-effective wind and solar generation resources.
Just as important, regional transmission is needed to ensure the future grid will be resilient to rising threats and can meet the need for power balancing within and across regions. If new regional and inter-regional transmission lines are not constructed in a proactive manner, the wide-scale adoption of renewables could be substantially delayed.
Even today, new generation resources, much of them wind and solar, are getting stuck in analysis paralysis in our regional markets due to the lack of needed infrastructure to interconnect them reliably. Had policymakers adopted a more aggressive approach to regional transmission investment over the past several years, many of these resources would be generating today, leading to reduced emissions and lower power prices.
Missed opportunities aside, there is still time to take action. Fortunately, rapid expansion of the transmission grid to support renewable development can be achieved at little or no cost to the treasury, as private capital is ready to better connect our balkanized electric markets and unleash our nation’s substantial cost-effective renewable energy resources.
Indeed, we have seen the success of policies that promote private sector grid investment as a means of accelerating renewable adoption in the past. For example, in 2005, Texas implemented a program of grid development known as CREZ. The CREZ program has helped make Texas the national leader in grid-scale wind energy adoption.
Similarly, Iowa has become a national leader in renewable adoption largely due to concurrent development of the regional transmission grid facilitated through MISO. However, replicating these successes across the country will require leadership from the federal government. It won’t take major new federal programs or taxpayer dollars, just a subtle shift in the way policymakers oversee how we plan and share the costs of new investments in transmission.
Untangling Regional Planning
To date, FERC, which oversees transmission development, has not required the type of large-scale regional and inter-regional transmission planning that would enable a nationally integrated transmission network. Due to different planning approaches and methodologies among regions, current transmission planning processes have failed to advance large transmission projects that would jumpstart the transition to renewable electricity.
To remedy this situation, FERC should bolster its regional and inter-regional transmission planning requirements to facilitate grid expansion, lower power prices, and achieve state and federal public policy goals.
FERC should implement the following policy changes: Inter-regional transmission planning should be conducted on regular triennial cycles and require the use of joint or coordinated models, assumptions, benefit metrics and approval criteria; and Planning regions should remove additional regional reviews once inter-regional criteria are agreed upon. This creates a single standard for approval of inter-regional projects, which is needed for effective planning.
FERC should also develop cost allocation methodologies that account for broad and varied benefits offered by regional and inter-regional transmission solutions, including the ability to bring about reduced emissions; and FERC should eliminate requirements that regional transmission lines must be subject to open solicitations for the right-to-construct.
These processes raise development costs, cause delays in constructing crucial new infrastructure, and risk creating a balkanized system subject to enhanced security risks.
The platform on which all vital infrastructure and new energy technologies rest is the transmission system. We need a new collective mindset about how the bulk power system is planned, built and managed to address our current and future needs.
It is imperative that policymakers help — or at least not hinder — construction of the core transmission infrastructure that is necessary to integrate low-cost renewables into the grid. Upgrading our electric infrastructure will allow us to reduce emissions, enhance resilience, keep energy affordable, and ensure that the transition to new sources of power will create quality, high paying jobs in areas that need it most. This is a win-win proposition for the environment and the economy. Let’s get started today.
Published in Fortnightly Magazine – December 2019