We also need planning, financing, and political leadership
Transmission siting came up on #EnergyTwitter this week. In these conversations, siting is shorthand for how project developers and the states establish a proposed transmission line’s route and right-of-way. Though the process is different in every state, that approval typically conveys the authority to condemn land through eminent domain, making it a politically thorny endeavour.
For many transportation experts and observers, siting is a principal challenge for building more electricity transmission. Russell Gold’s book, Superpower, documents the story of Clean Line Energy’s failed efforts to build a high voltage direct current (HVDC) line to bring low cost wind power from the plains to Tennessee–including the long siting battles faced by the company’s Plains and Eastern line. Before Superpower, there was Powerline by Paul Wellstone, which detailed the challenges of building a transmission line across Minnesota in the 1970s. Both projects were successfully, if arduously, sited. But only the latter was built.
Resolving siting challenges will be critical for decarbonizing the economy. To meet ambitious climate goals at low-cost, many studies conclude that we need a macrogrid: that is, a large-scale network of transmission infrastructure connecting consumers with regions that can produce a lot of renewable power. The Net-Zero America study released by Princeton on Tuesday found that to achieve net-zero emission by 2050, we will need fast growth in wind and solar generation and a 60 percent increase in transmission capacity in the next decade. Siting shouldn’t take ten years, especially when we don’t have ten years to wait for more transmission.
The solutions to siting issues are pretty clear.
DOE, FERC and DOT could study how and where lines can be built on existing rights-of-way, without new eminent domain claims: converting existing lines to high capacity HVDC, building along highways, and even building along railways. These approaches have the additional upside potential for expedited NEPA reviews.
Where new lines will need to be built, there are tools. For example, establishing National Interest Electricity Transmission Corridors that DOE and FERC can use to assert federal eminent domain authority as a backstop. An excellent report on barriers and possible workarounds to siting was released Monday by the Center for Global Energy Policy. And proposals to expedite federal siting authority through legislation have been around for years.
Of course, Congress could simply move principal siting authority for interstate electricity transmission to FERC, with similar authority as the commission has for siting natural gas pipelines. Hopefully, they would match that authority with better protections of landowner rights.
But siting isn’t the only problem a macrogrid faces. Like all transmission expansion, a macrogrid will be built line-by-line. So we need solutions to the planning barriers that keep individual projects from even making it to the siting process and the financing barriers that cancel projects that have already been sited.
Projects often fail to find financing. Non-merchant lines (i.e., those planned and built within the planning authority) are paid for by participating utilities according to FERC principles on cost allocation. While a macrogrid will provide nationwide benefits, the universal benefits for a single line are not always as clear, and sorting out who will pay for infrastructure depends on who is planning, building, and benefiting from it. FERC, DOE, and state leaders could bring more certainty to cost-allocation, which currently prevents interregional transmission lines from getting off the ground. To accomplish that, cost allocation discussions will have to recognize the benefits to the public good. Transmission is typically the least cost solution to increasing demand and incorporating renewables and, therefore, better for consumers than just building more local power plants.
We also need state and federal leadership to make purchasing clean power and securing constituents’ access to clean power a priority, to prevent an otherwise economically viable project from being torpedoed by incumbent utilities’ refusal to purchase the power in the future. In the end, local opposition from incumbents buried Clean Line Energy. External investors financed their merchant transmission lines, but Clean Line could not secure power purchase agreements, and the company ran out of investment.
The last issue is planning. There is no federal planning authority. So what is there to be done? Unless and until there is a federal planning authority responsible for interregional transmission, existing planners will need to think ahead. FERC, NERC, RTOs, ISOs, and governors, and public utility commissions can act on climate change imperatives to create change. Aggressive renewables expansion will impact the grid’s reliability and resilience, and climate change has already had impacts on grid functionality. Exercising their respective authorities as they pertain to climate change can get transmission built, which is nearly universally agreed upon as the best and least-costly way to decarbonize.
As FERC envisioned in Order 1000, interregional planning could and should open up competitive opportunities for transmission developers. Progress on this is limited by how the various electricity transmission regulatory bodies are narrowly interpreting their role in planning. We don’t need to wait for a new regulatory body or act of Congress to make this happen. Rather we need our existing regulators to exercise their authority to develop this public good.