Consumers are paying billions of dollars a year due to transmission constraints between the Mid-Atlantic and Midwestern grid regions, and those costs are expected to increase with decarbonization and electrification efforts, according to a new report released today from the American Council on Renewable Energy (ACORE) and Grid Strategies.
The analysis, Billions in Benefits: A Path for Expanding Transmission between MISO and PJM, argues increased interregional transmission between the PJM Interconnection (PJM) and the Midcontinent Independent System Operator (MISO) can save consumers more than $15 billion by reducing the need for power plant capacity, as well as ongoing savings that can exceed $1 billion per year by allowing more affordable power to flow across a broader geographical area.
The report says the congested seam between the regions also harms reliability by limiting the ability to import power, particularly during events like Winter Storms Elliott and Uri that disrupted electricity supply and demand in one region but not the other.
The report outlines various steps the grid operators, states, the Federal Energy Regulatory Commission, and other stakeholders can take to develop more workable mechanisms for planning and paying for interregional transmission.
“Interregional transmission lines have helped save American lives during extreme weather events, yet today’s transmission planning processes do not value the added reliability they provide our grid,” said ACORE President and CEO Gregory Wetstone. “Consumers should not be forced to endure outages when study after study shows additional line capacity would help keep the lights on and reduce power costs.”
The report identifies proactive multi-value planning as the gold standard for regional planning that should also serve as the model for interregional transmission. Absent that process, MISO and PJM should improve their coordination on transmission planning, the analysis said.
“The U.S. Department of Energy has found that the MISO-PJM seam has the greatest need for expanded interregional transmission ties,” said American Clean Power Association (ACP) Vice President of Markets and Transmission Carrie Zalewski. “In fact, the intertie with MISO accounts for around 80% of PJM’s total need for interregional transmission. These grid operators must collaborate on the transmission planning necessary to bridge this gap, preserve reliability, and benefit millions of customers.”
The DOE recently announced a $1.3 billion commitment in three transmission lines crossing six states. The commitment is meant to advance transformative projects aimed at adding 3.5 GW of additional grid capacity throughout the United States.
DOE also released the final National Transmission Needs Study to provide insight into where the grid—and American communities—would benefit from increased transmission.
The Needs Study estimates that by 2035 the U.S. must more than double the existing regional transmission capacity and expand existing interregional transmission capacity by more than fivefold on its way to economy-wide decarbonization.
DOE’s study found that increasing interregional transmission — that is, the ability to move power across regions of the country — is needed to move electricity from where it is available to where it is needed, and results in the largest benefits to customers in reducing congestion and constraints. Historically, the data assessed show a need for transmission to alleviate transmission constraints that prevent moving electricity across the interconnection seams — between the Mountain and Plains regions and between Texas and all its neighbors.
To download a copy of the new analysis, click here.
