EEI Report shows electric transmission investment growing

Washington, D.C., March 5, 2010 — According to a new report by Edison Electric Institute, electric utility companies invested nearly $58 billion (in 2008 dollars) in maintaining and expanding the nation’s electric transmission network between 2001 and 2008, and plan to invest at least another $56 billion (nominal dollars) from 2009 through 2020.

This year marks the fourth publication of EEI’s report, titled Transmission Projects: At A Glance includes a subset of future member company projects from 2009 through 2020, representative of various project investment category types, such as long-line, reliability, economic, and resource access (conventional and renewable) to present a broad perspective on the variety of transmission projects that EEI members currently have under construction or are planning.

Large, interstate projects in the report will account for about 10,000 circuit miles of transmission and represent $39 billion (nominal dollars) in investment.  

Highlighted projects that facilitate the integration of renewable resources will represent the addition or upgrade of nearly 12,900 circuit miles of transmission with an accompanying transmission investment cost of about $37 billion (nominal dollars). These types of transmission projects have the potential to address an array of purposes, including resource interconnection, reliability and congestion relief.

This trend in increased transmission investment is due, in part, to several landmark developments in federal and state policies affecting transmission infrastructure, notably, the Energy Policy Act of 2005 and federal transmission pricing policies being implemented by the Federal Energy Regulatory Commission. The adoption of these pricing policies is helping to sustain the continued level of investment growth.

Other drivers include state renewable portfolio standards (RPS), federal transmission pricing policy, and federal initiatives promoting transmission smart grid development under the American Recovery and Reinvestment Act (ARRA). From 2001 to 2008, EEI members invested nearly $57.55 billion in transmission infrastructure improvements to meet these various needs.

EEI members continue to actively plan transmission projects to address the need to integrate renewable resources where and as appropriate, which may include addressing local bottlenecks. However, integration of renewable resources such as wind power, solar energy, and geothermal generation presents special challenges.

While fossil-fuel generation resources have some flexibility to site in close proximity to the existing transmission grid, siting of renewable resources is largely dictated by nature, due to the location of the resource and the inability to transport the fuel source.

The transmission investments needed to meet these challenges are being addressed by EEI’s members through various processes across the U.S. These processes recognize renewable resource locational constraints and address the transmission needed to interconnect these renewable projects. They also must consider the availability of renewable resources and energy efficiency being deployed at the regional and local level.

On October 27, 2009, the DOE awarded $3.4 billion in ARRA Smart Grid Investment Grants (SGIGs) to 100 projects benefitting customers in 49 states. Ten of the 100 SGIGs fall under the “electric transmission systems” category and most of them include the installation of phasor measurement units (PMUs).

While some projects may in some respects look like conventional transmission capacity investments, they deliver, “added capabilities” that advance demand response or integrate advanced storage solutions. States are also taking proactive steps towards promoting grid modernization.

California has enacted state law requiring utility regulators and major utilities in the state to develop a smart grid deployment plan and the coordination of smart grid deployment plans at the state level is happening in New York and Ohio.

It is against this backdrop that EEI developed this report on member transmission projects that are intended to give a broad, but not comprehensive, perspective on the variety of transmission projects being built to support a number of goals including renewable resource integration and smart grid enhancements.

EEI’s Transmission Projects: At A Glance report includes a brief profile of each EEI member company surveyed for the report, along with information about the representative projects, including a project map, brief description, estimated cost, current status, potential partners and intended benefits.

EEI is the national the association of U.S. shareholder-owned electric companies. Our members serve 95 percent of the ultimate customers in the shareholder-owned segment of the industry, and represent about 70 percent of the U.S. electric power industry.

 

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