Investing in electricity transmission is a win-win for American consumers, workers, and the environment. Most of America’s world-class renewable resources are currently stranded in remote areas where the power grid is weak to nonexistent. Policy barriers in how we plan, pay for, and permit transmission are blocking private investment in modernizing our power grid. This study finds breaking that logjam will unleash up to $7.8 trillion in investment in rural America, create more than 6 million net new domestic jobs, save consumers more than $100 billion, and provide all Americans with cleaner air.
This study examines varying levels of renewable energy deployment and carbon dioxide (CO2) emissions reductions in the Eastern Interconnect, the power grid that physically connects all of the Eastern United States and roughly ends at Montana, Wyoming, Colorado, and Texas, where the Western Interconnect and Electric Reliability Council Of Texas (ERCOT) power grids begin. Other studies have evaluated benefits of transmission between these Interconnections;1,2 but this study does not.
This analysis shows how by investing in transmission, the Eastern U.S. can access low-cost renewable energy to:
- Cost-effectively reduce electric sector CO2 emissions by 65% by 2035, and by more than 95% by 2050 and reduce other air pollutants across the region.
- Reliably obtain more than 80% of its electricity from wind and solar by 2050.
- Decrease the average electric bill rate by more than one-third, from more than 9 cents/kWh today to approximately 6 cents/kWh by 2050, saving a typical household more than $300 per year. These savings are broadly shared by all consumers across the region. The cost of transmission accounted for only 3.6% of total electricity costs on average in the strong carbon reduction cases. Transmission yielded savings many times greater than that by providing access to low-cost renewable resources and increasing the overall efficiency of the power system.
- Create more than 6 million net new jobs, increasing electric sector employment more than 5-fold from approximately 1.3 million to more than 7.5 million jobs by 2050. The new jobs are broadly spread across the Eastern U.S. Transmission investment alone drives more than 1.5 million new jobs.
- Deliver reliable power by meeting electricity demand in every 5-minute period of the year, even with wind and solar providing 82% of electricity in 2050 in the strong carbon policy cases.
The study also found that scenarios with greater emissions reductions were more cost-effective and created more jobs than scenarios which achieved fewer emissions reductions, as indicated in Table 1. The scenario with 95% CO2 emissions reductions and high solar deployment was also more cost-effective than the comparable scenario with around 70% emissions reductions, with cumulative savings of more than $105 billion through 2050. Moreover, 2.6 million more jobs were created in the scenarios with larger emissions reductions.
The study is one of the first to evaluate how wind, solar, storage, and transmission each play essential, unique, and complementary roles in providing consumers with reliable and affordable electricity. Wind and solar tend to produce at opposite times, so they complement each other. However, the best wind and solar resources are generally in different locations, so transmission is needed to aggregate them and deliver a reliable mix of power to customers at all times. Transmission also allows local weather-driven variation in wind and solar output to be canceled out by opposite variations in other regions, providing a more constant supply of power. Energy storage helps meet reliability needs and increases the utilization of transmission capacity by absorbing excess generation and filling in when wind and solar output is low. Together, along with some flexible capacity resources that fill in when needed, these resources provide a reliable, efficient, and clean portfolio.
This study evaluated four scenarios, with varying degrees of CO2 emissions reductions and relative shares of wind and solar deployment:
- Weak Carbon policy High Solar deployment (WCHS)
- Weak Carbon policy High Wind deployment (WCHW)
- Strong Carbon policy High Solar deployment (SCHS)
- Strong Carbon policy High Wind deployment (SCHW)
The weak carbon policy cases were developed by extrapolating forward the “business as usual” rate of CO2 emissions reductions from 2005-2017, while the strong carbon policy cases were benchmarked to meeting the Paris Agreement requirements, as explained in more detail in Appendix A.
Many of the same transmission upgrades were built across all four scenarios, indicating these investments will be needed regardless of future trends in renewable costs or carbon reductions. The model also used battery storage to increase the utilization of transmission lines, demonstrating that storage is a transmission complement, not a substitute. The analysis was conducted using Vibrant Clean Energy’s WIS:dom®-P model, which has been extensively used by states, utilities, and grid operators for generation and transmission planning.