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Not-So-Green Superhighway

Unforeseen consequences of dedicated renewable energy transmission.

Fortnightly Magazine - February 2012

of the transmission lines needed to move RE power must be sized to at least the nameplate capacity of the RE technologies, if the maximum amount of RE power is to reach markets. However, the average capacity factor of, for example, wind in the Great Plains is less than 40 percent, which means that more than 60 percent of the transmission capacity would be unused, resulting in much higher transmission costs than if the lines were more fully loaded. Locating backup power generating capacity near RE sites can make greater use of transmission capacity and reduce cost penalties.

In principle, once the approximate number of miles of required new transmission is estimated, the total cost can be projected by multiplying by the average cost per mile. Unfortunately, transmission costs per mile vary greatly (see Figure 2) . Most of the new RE transmission will be through rural or semi-rural areas, but as transmission lines approach major load centers costs will escalate rapidly.

Using FERC estimates of required new transmission and independent figures for transmission costs, analysis yields an estimated cost of about $80 billion to construct the 14,500 miles of new transmission that FERC expects will be necessary by 2016. 5 With this estimate as a benchmark, the new transmission required by an RES could cost between about $50 and $100 billion.

However, even this estimate might be conservative, and transmission costs to enable an RES might be much higher. 6 Nevertheless, this estimate is generally comparable to others that have been developed. 7

Coal Plants and Green Transmission

If additional transmission is built to accommodate an RES, a key question involves whether these transmission lines will be restricted to carrying only RE-generated electricity. Green transmission bills have been introduced in Congress to restrict new transmission exclusively to RE-generated electricity. 8 Congress also has enhanced the power of the federal government to enable transmission projects with multi-state importance to be assessed on more broadly based national interests, and the Energy Policy Act of 2005 (EPAct) provided FERC “backstop” transmission siting authority. States retain primary siting responsibility, but under certain circumstances the applicant may seek siting authority from FERC. 9 However, it isn’t clear that EPAct provides a meaningful federal alternative if a state denies a transmission project.

For example, Arizona regulators rejected a transmission line to connect Arizona generation with California electric consumers. In 2005, Edison International proposed a power line that would stretch from a substation 50 miles west of Phoenix, Ariz., to Palm Springs, Calif. Edison contended that the line would ensure reliable supplies of electricity for Southern California and bring the region renewable energy. However, Arizona opposed Edison’s proposed power line. The dispute over the $774 million project initiated a struggle in Washington, D.C., over whether the federal government should seize more authority from states over the approval of transmission lines, since state regulators want to protect their authority. 10 Notably, after Arizona regulators rejected the proposal, Edison offered concessions to give Arizona utilities access to the line. This might indicate the ultimate fate of green transmission mandates.