15 Dec
This piece was originally posted on Morning Consult on 12/15/14, part of a monthly column authored by our own Bill White.
Saying that “much has been said and written” about EPA’s Clean Power Plan is an epic understatement. More than 1.6 million individuals, organizations, and businesses weighed in before the public comment period ended last Monday. Unfortunately, this avalanche of input – like the proposed rule itself – paid almost no attention to arguably the most well-established and cost-effective approach to reducing electric sector carbon emissions: expanding and upgrading high voltage transmission.
Scientists agree that avoiding catastrophic impacts from climate change will require slashing greenhouse gas emissions by 80 percent or more by 2050, far beyond the 30 percent by 2030 goal in the proposed rule. EPA wisely recognizes that a problem of this magnitude will require states to use multiple strategies, collected under four “building blocks”: (1) making power plants more efficient; (2) using cleaner power plants more than dirty ones; (3) substituting zero-carbon generation (e.g. wind and solar) for fossil fuel plants; and (4) using energy more efficiently. All of these actions – from power plant to customer – help reduce carbon emissions because the electricity system is “highly interconnected” and supply and demand are “fungible” over large regions. Without this flexibility and efficiency, achieving carbon emissions goals in a timely manner would likely be prohibitively expensive and/or technically infeasible.
America’s transmission network is remarkable – the National Academy of Engineering recently ranked it as the 20th century’s greatest engineering achievement[1] – but it’s far from perfect, and improving it would certainly make meeting carbon goals much easier. America has enough wind and solar to accomplish this many times over, but the best resources are concentrated in very sunny and very windy places far from where most people prefer to live. Our transmission network, built piecemeal over decades around cities and towns and the power plants that serve them, is ill-suited for the renewable-powered system we need for the future. It doesn’t reach the best resources, and it’s too fragmented to share and balance variable and diverse renewables over large regions.
What renewable and conventional generation do have in common is economies of scale. Utility-scale solar photovoltaic (PV) systems cost $1.69 per watt – less than half the $3.74 per watt for residential systems.[2] Small scale wind turbines (100 kW or less) cost more than four times as much per unit of installed capacity as larger ones.[3]
The enormous economic advantage of large scale renewable facilities in prime locations is a primary reason why states are using “transmission first” strategies to achieve renewable energy goals. States also know that transmission projects take much longer to design, permit, and build than wind and solar plants: ten years or more versus about two years. Speeding up transmission expansions and upgrades is usually the best way to deploy inexpensive renewable resources quickly and at scale. Texas identified Competitive Renewable Energy Zones (CREZ), the best areas for wind generation, and built 3,600 circuit miles of new and upgraded transmission lines to deliver the energy to consumers.[4] The CREZ lines catapulted Texas to number one in installed wind capacity with 12,976 MW – more than twice as much as California (5,832 MW) in second place, and more than one fifth of the U.S. total (62,300).[5] California, home to about half of the nation’s solar PV capacity, established its Renewable Energy Transmission Initiative to identify more than $15.7 billion in transmission projects needed to meet the state’s ambitious renewable portfolio standard (33 percent by 2020).
The billion-dollar price tags of high-voltage projects are only one side of the transmission story. At just 11%, transmission is the smallest part of the average consumer’s bill, far less than the 58% for generation and 31% for distribution.[6] Transmission investments consistently save money for customers by relieving congestion, fostering competition, and increasing access for renewable resources immune to fuel price volatility. The Midcontinent Independent System Operator (MISO) is developing seventeen 345 kV transmission lines across nine states over the next five years at a cost of $5.2 billion, largely to relieve congestion and help states meet renewable energy goals. MISO estimates that the lines will generate net economic benefits of $13.1 to $49.6 billion over the next 20 to 40 years, enable 43 million MWh of wind generation, and reduce annual carbon emissions by 9 to 15 million in 2028.[7]
America has the resources and technology to achieve even the most ambitious climate goals at reasonable cost – perhaps even with net economic benefits – the only thing missing is the infrastructure to unlock them. Our best and most abundant zero carbon resources cannot be developed or delivered to customers without a more robust and better integrated transmission system. By requiring states to work with transmission planners, giving states credit for expansions and upgrades, and providing states with incentives and technical guidance, EPA would help states to develop more holistic, cost-effective, and equitable approaches to reducing carbon emissions, and more importantly, place us on the path toward a truly workable climate solution.
Bill White is a Senior Advisor at Americans for a Clean Energy Grid and the President of Norton White Energy
[1] National Academy of Engineering, Greatest Engineering Achievements of the 20th Century, 2000.
[2] Modeled turnkey pricing for installed solar photovoltaic systems, by sector, Q2, 2014. U.S. Solar Market Insight: Q2, 2014, Solar Energy Industries Association, September, 2014.
[3] Ibid.
[4] CREZ Transmission Program Information Center, Public Utility Commission of Texas, 2014.
[5] U.S. Wind Industry Third Quarter 2014 Market Report: AWEA Public Version, American Wind Energy Association, October, 2014.
[6] U.S. Energy Information Administration, Annual Energy Outlook 2012, Reference Case, Table 8: Electrical Supply, Disposition, Prices, and Emissions.
[7] MTEP14 MVP Triennial Review: A review of the public policy, economic, and qualitative benefits of the Multi-Value Project Portfolio, Midcontinent Independent System Operator, September, 2014.
