Transforming transmission: Building a flexible, resilient future grid


The grid moves electricity in ways never even imagined by its original designers, thanks to changing uses, large and small. Customers are adopting new technologies like rooftop solar and apps that allow them to better control when and how they use electricity. Large renewable power sources in disparate locations are creating the need for transmission lines from sites never before considered. All of this has transformed the wires business, and it's only the beginning.

Widespread use of energy storage, whether combined with transmission infrastructure or sited alongside generation, will further change the way the grid transports electricity. In the past decade, security and resilience have become a higher priority than ever, after incidents causing widespread blackouts reminded us just how fragile the most expansive piece of machinery in the country can be.

To be clear, said the American Public Power Association's Mike Hyland, the grid isn't failing, and the sky isn't falling. In fact, the transmission system has been doing its job well and for a long time. It's resilient, robust, and prepared for threats.

"Let's give ourselves credit for doing a good thing and doing it well," said Hyland, senior vice president of engineering services at the Association. "And for the commitment to making it better while remaining fair to taxpayers and the customers who pay the bills."

The Past
Transmission is not unlike other energy infrastructure in the U.S. - it was built a long time ago, and it's still being used. But it's being used in a very different time and a very different way than when it was originally built. Transmission lines, for example, were built simply to bring electricity to load centers, but today that electricity travels in many different directions, thanks to wholesale energy markets, renewables, and distributed generation.

"The world has changed dramatically since we first threw those lines up in the air," said Ed Tatum, vice president of transmission at American Municipal Power in Ohio. "Are these still the types of facilities we need? What role will distributed generation and other changes play in this arena?"

Much of the existing transmission system was built 30 to 50 years ago, said Lisa McAlister, senior vice president and general counsel for regulatory affairs at AMP. A tremendous amount of money was invested in transmission at that time, and an investment of that caliber has since not been made.

Instead, the country has been benefitting from the standard engineer's margin of error.

"You see this when we're building bridges," Tatum said. "You want to have an error factor of 2 or 3. If the bridge will take 10,000 tons, the engineers design it for 30,000. We've had adequate capacity on this transmission system for 50, 60, 70 years. That's a good amount of headroom, but since then, we've eaten a lot of it up."

That means it's time, or a little bit past time, for the next generation grid.

The Present
That's not to say no new transmission has been added in the U.S. in the past 50 years. Recently, much has been built to accommodate renewables. Many projects have come before regulators in states through ISO New England, the PJM Interconnection, and the California ISO. If renewables have driven the new projects, the Federal Energy Regulatory Commission's Order 1000 has paved the way for them; however, public power advocates in these territories agree that the order isn't always executed to its original intention.

FERC introduced Order 1000 in 2011. It's considered landmark energy regulation that affects regional and interregional transmission planning and cost allocation for new transmission. The order includes requirements that encourage collaboration and competition to ensure a transparent planning process and lower costs. This is the intention public power advocates worry isn't being fully executed.

"The American Public Power Association supports FERC's efforts to bring the benefits of competition to the transmission development business - and ultimately to the consumers who bear the costs of new transmission projects," said Delia Patterson, acting senior vice president, advocacy and communications and general counsel.

In New England, for example, transmission owners are lining up to make investments in new infrastructure. But Matthew Ide, executive director of energy and financial markets at the Massachusetts Municipal Wholesale Electric Company, called these projects somewhat self-serving.

"We have not seen the promise of FERC Order 1000 really hitting the ground up here in New England," Ide said. "There's a big gap in the order and the reality. Up here in New England, the majority of the transmission projects that have been proposed are really aligned with bringing renewables to load centers."

In addition, Ide said that as New England sees more if its capacity supplied by distributed generation and demand response resources, it will be necessary to re-examine the region's need for large, expensive transmission projects to carry power from remote areas to load centers.

While these projects are intended to bring new renewable power to New England customers, they're not necessarily doing so at the lowest cost. That's where agencies like AMP, MMWEC, and the Northern California Power Agency are stepping in to make sure public power has a voice.

"As a joint action agency, we are very much entrusted by our municipal light departments to represent their interests in the ISO New England stakeholder process," Ide said. "Through that stakeholder process, we're very vigilant on looking to see that the review and the promulgation of new transmission projects is as open as possible, which will promote competition and ensure that transmission needs are properly evaluated in light of changing grid dynamics. And that's where we are trying to make sure the actual process is as faithful as possible to the desire and vision of what FERC Order 1000 was trying to do - create a competitive environment for transmission and yield low costs to customers."

Similarly, in the California ISO territory, NCPA was one of several parties to file a complaint with FERC against PG&E Corp., about PG&E's transmission spending. Some public power utilities have incurred extremely high costs.

"For several of our large members, especially those like Santa Clara that have a very high load factor and sell a lot of energy relative to their peak use, all these transmission charges are based on energy, so they're hit really hard," said Dave Dockham, assistant general manager of power management at NCPA. "One of their highest priorities is to fix the rate of increase for transmission."

The cost of transmission in PG&E's territory has gone up 10 percent per year since 2003, Dockham said. "That is just not sustainable. We're hopeful that this review process and looking more critically at the noncapacity increase projects will yield an ability to start reorienting that cost curve."

It's a delicate balance in each region to achieve the necessary build-out without adversely impacting customers, but it can be done, Tatum said.

"We need the right stuff, and we need the right price," he said. "Active participation is really what I think is the key. FERC has given us the tools that we can use. We have to make sure that FERC makes the transmission operators play by the rules and takes on the transmission planning and operating role as intended for the independent planning process."

The Future
Jon Jipping, chief operating officer for ITC Holdings, has a rosy view of the transmission system that will serve customers through the utility of the future. ITC independently develops transmission projects throughout the U.S. Despite the challenges utilities are facing with transmission costs, ITC is hopeful about what the future grid will bring. Jipping said that the grid will be flexible and resilient to handle all the new technologies that are already being attached to it, as well as those that haven't yet caught on.

"We know we'll be able to make a great grid that works for everybody," Jipping said. "The grid is already improving and changing for these new future demands. It can do it, trust me; I work on it every day."

Aside from renewable power and cost pressure, there are a few other major factors shaping the grid of the future. Energy storage is definitely one of them, said Calvin Crowder, president of the south-central region for GridLiance. He just isn't sure when it will hit widespread use.

"Storage is one of those disruptive technologies that would change everything. I've been here for 25 years, and I always hear it's around the corner, and it's around the corner," Crowder said. "Nothing has broken the mold in how we do things yet."

But energy storage is starting to have an impact. During a transmission project on a line from Presidio to Marfa in Texas, a line taken out of commission was replaced by a battery. Now that the transmission is back online, the battery serves as reactive power. But the battery takes up an entire warehouse, Crowder said. So while the technology may be around the corner, he said, it's still not where it needs to be.

Meanwhile, one of the biggest focus areas for development in transmission is resilience. While technologies like batteries and other new developments will make a more resilient grid, there's still more to be done. Mark Davis, executive vice president and chief operating officer at American Transmission Co., said resiliency work is done in a spirit of collaboration.

"The failures, the unfortunate events of the past, have really shaped the way we sit today. From the blackout of 2003 to the assault on PG&E's Metcalf substation - all have introduced new facets of grid resiliency, stronger vegetation management programs, and a focus on continually improving reliability metrics," Davis said. "There's a spirit of collaboration that occurs in the industry, especially in the transmission space. We recognize that with most issues, if they affect one of us, there's a good chance they can affect all of us if the magnitude is big enough. We're very willing to help one another."