The US Department of Energy (DoE) has launched its Building a Better Grid initiative to “catalyse” nationwide development of new and upgraded high-capacity electric transmission lines, seen as a critical step in reaching President Joe Biden’s targets of 100% clean electricity by 2035 and a net-zero economy by mid-century.
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“Multiple pathways exist for the US to meet these clean energy goals, but all require upgrading and expanding the nation’s transmission infrastructure,” said DoE in an 18-page document detailing how it will lead federal government support of private efforts to modernise, strengthen and expand the country-wide power system.
Achieving this, said the DoE, would require a particular emphasis on laying interstate high-voltage lines that connect remote geographic areas with significant low-cost solar and wind resource and the US major power demand centres, and linking together independently operated grid regions.
“The foundation of our climate and clean energy goals is a safe, reliable, and resilient electric grid that is planned hand-in-hand with community partners and industry stakeholders,” said US energy secretary Jennifer Granholm
DoE cited unidentified independent estimates that indicate the US needs to expand electric transmission lines 60% by 2030 – Biden’s interim target date for the grid to be 80% carbon-free – noting: “More than 70% of those lines and power transformers are over 25 years old, creating vulnerability.”
States, tribes and stakeholders
To spur development of “nationally significant” transmission projects and grid upgrades, Building a Better Grid will emphasise early collaboration with states, tribal nations, and stakeholders, and also draw upon authorities and available funding in the new bipartisan Infrastructure Investment and Jobs Law (IIJL).
Other core objectives of the initiative are to enhance transmission planning to identify areas of greatest national needs and conduct longer-term planning analysis and facilitate an efficient transmission permitting process.
Finding solutions for the permitting challenge eluded the previous administrations of former Presidents Donald Trump, Barack Obama, and George W Bush.
This time around, DoE will attempt to get results by coordinating with federal agencies to streamline permitting, using public-private partnerships, and designating so-called national interest transmission corridors every three years in consultation with states.
The new infrastructure law amends the Federal Power Act to clarify that the Federal Energy Regulatory Commission (FERC) has “backstop authority” to use federal eminent domain in such corridors even in cases where a state formally rejects a proposed new line, as well as merely fails to act within one year on a certificate from a developer to construct a new line, according to Robert Shapiro, an attorney at Norton Rose Fulbright in Washington, DC.
It remains unclear whether DoE will designate corridors based on projected paths where there may be no present lines but where there is potential for substantial renewables capacity development and likely demand in faraway load centres, he added.
In any case, while this change to allow FERC’s backstop siting and eminent domain authority is an improvement from the existing law, “the path to permitting and eminent domain will still be a long and complicated process”, he wrote in the law firm’s project finance newswire.
Until now, denial by one state last decade thwarted several high-profile interstate and inter-regional transmission projects by independent developers, who normally cannot recover development costs from ratepayers and instead, do so through fees from private users.
Building a Better Grid also seeks to deploy more than $20bn in federal financing tools in the new law. These include $2.5bn Transmission Facilitation Programme (TFP), a $3bn expansion of the Smart Grid Investment Grant Programme, and more than $10bn in grants for states, tribes, and utilities to enhance grid resilience and prevent power outages.
The TFP covers new high-voltage interstate transmission lines with at least 1GW of carrying capacity, or upgrades to existing ones with at least 500MW capacity. The law authorizes the US Treasury to lend up to $10bn to DoE for financing eligible projects, with a maximum of $2.5bn in outstanding repayable balances at any one time.
Offshore wind transmission
For offshore wind, DoE will partner with the Department of the Interior’s Bureau of Ocean Energy Management (BOEM) to bring together key stakeholders, government partners, and ocean users, to identify the central transmission challenges associated with meeting Biden’s 30GW by 2030 ‘national goal’ for the sector.
Later this year, DoE and BOEM, in consultation with FERC and other federal agencies, will lead a series of “convening workshops” to develop a set of recommendations and association action plans for addressing offshore wind transmission challenges in the medium- and long-term.