The U.S. Department of Energy (DOE) has started a much-needed dialogue over the future of our nation’s power grid with the release of its National Transmission Needs Study. The study was released as a draft early in 2023 and offered an opportunity for interested parties to submit comments before it is reissued in final form.
As a high-level overview of the state of the transmission industry, the Needs Study assesses the outlook for future electric transmission reliability and resource adequacy within the context of the dramatic changes impacting the power sector overall. The report is based on existing data compiled from reports issued by the power industry over the past several years.
Pressing Transmission Needs
Though the report does not offer specific recommendations, it does lay out an urgent case for massive new investment in transmission infrastructure, with a particular focus on more interregional connections.
The Needs Study is the first of two planned for release by the DOE Grid Deployment Office in 2023. The second is the National Transmission Planning Study identifying the portfolio of potential transmission solutions required to meet new demands on the grid over the coming decades.
Even prior to release of the Needs Study, the entire power industry was well aware that the job of meeting forecasted power demand is growing much tougher than ever before, due partly to the introduction of many gigawatts (GW) of intermittent renewable generation resources and concurrent retirement of many older fossil-based units. With the reliability of thermal units that could be easily dispatched now being replaced by generation resources that can be impacted by weather and other factors, the engineering necessary for preserving historical grid reliability standards must evolve dramatically.
What’s Driving All This?
The Needs Study addresses future resource adequacy and reliability, the two core objectives set by the North American Electric Reliability Corporation (NERC). Since the early 2000s, NERC has set reliability and resource adequacy standards that utilities must follow.
NERC conducts its own resource adequacy assessments each year that are based on the resource assessments prepared individually by each region. NERC has recently flagged areas of concern and among those issues is a view that existing metrics are likely no longer sufficient to accurately assess the new demands on the power grid resulting from the changing generation resource mix.
The Needs Study recognizes that as transmission systems become more dependent on intermittent generation resources, the overall power delivery capacity must be able to counter risks posed by weather events. For example, should cold weather knock out generation assets in Georgia, the system should be robust enough to draw on alternate generation sources in Northern Florida that were unaffected. Building this grid resiliency will require much greater transmission capacity, with multiple new interconnections between regions.
The study helps illustrate the three primary justifications for expanding transmission infrastructure:
What Will Be Needed?
According to the Needs Study, the U.S. will need more than 47,300 additional gigawatt-miles of new transmission capacity by 2035, a 57% increase over today’s transmission capacity. Though the Needs Study does not advocate a specific course of action, it does point out that regions with the highest power costs currently — the Plains, Midwest, Mid-Atlantic, New York and California — would all benefit from more interconnected transmission that could deliver more cost-effective power.
The study points out that the largest reliability benefits will accrue from new interregional transfer capacity across regions that have historically experienced constraints, such as between Texas and all of its neighbors in the Southwest, Plains and Delta regions. Other interregional interconnections between the Plains and neighbors to the East and the Delta would also boost reliability while mitigating cost increases.
The study also notes that needs will almost certainly shift over time as regional load grows or declines and extreme weather events continue to cause stress on the grid.
With this much-needed transmission capacity, it is clear that it will be difficult to construct it all in just over a decade. This level of need should prompt renewed discussion on innovative solutions aimed at building better generation power density on sites closer to existing transmission corridors. Due to the long-term development cycles of such projects, progress is urgently needed if 57% more capacity is to be available by 2035.
Transmission planning studies are a critical part of the due diligence needed for these long-term capital investments.