US energy department announces $1.3bn transmission buildout

The US Department of Energy (DOE) announced up to a $1.3 billion commitment in three transmission lines crossing six states, advancing projects aimed at adding 3.5GW of additional grid capacity throughout the United States.

To ensure that transmission buildout is done in an informed manner, DOE also released the final National Transmission Needs Study to provide insight into where the grid – and US communities – would benefit from increased transmission.

“To realise the full benefit of the nation’s goal of 100% clean electricity by 2035, we need to more than double our grid capacity,” said US secretary of energy Jennifer M. Granholm.

The Needs Study released estimates that by 2035 the US 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 decarbonisation.

Transmission Facilitation Program

Funded by the Bipartisan Infrastructure Law, the Transmission Facilitation Program is a $2.5 billion revolving fund meant to help overcome the financial hurdles associated with building new, large-scale transmission lines, upgrading existing transmission lines, and connecting microgrids in Hawaii, Alaska, and US territories.

Under the program, DOE is authorised to borrow up to $2.5 billion to purchase a percentage of the total proposed capacity of the eligible transmission line. By offering capacity contracts, DOE hopes to increase the confidence of additional investors, encourage additional customers to purchase transmission line capacity and reduce the overall risk for project developers.

DOE announced that it is entering into capacity contract negotiations with three interregional transmission line projects that are intended to strengthen grid resilience and reliability, enable the addition of more clean energy resources to the grid and bring clean energy to more customers.

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The selected projects are:

Cross-Tie 500kV Transmission Line (Nevada, Utah)

Cross-Tie is a proposed 214 mile (344,4km), 1500MW transmission line connecting existing transmission systems in Utah and Nevada to increase transmission capacity, improve grid reliability and resilience, relieve congestion on other key transmission lines, and expand access to low-cost renewable energy across the region.

The bidirectional nature of Cross-Tie will increase transfer capabilities in the West, unlocking increased access to renewable energy resources in the region. Construction is expected to start in Q1 of calendar year 2025. The Needs Study estimates that by 2030 the Mountain region will need nearly 2,300GW-miles of new transmission to unlock the power sector emissions savings enabled by Inflation Reduction Act (IRA). Cross-Tie will contribute 14% to this regional need.

Southline Transmission Project (Arizona, New Mexico)

Southline is a proposed 175-mile (281.6km), 748MW transmission line from Hidalgo County, New Mexico to Pima County, Arizona, that is meant to help unlock renewable energy development in southern New Mexico and deliver clean energy to growing markets in Arizona that currently rely on fossil fuel generation.

The project, which is the first phase of a longer line, will make use of existing transmission rights of way along parts of its route, upgrading aging transmission facilities that are the source of congestion and constraints in the region. Construction is expected to start in Q1 of calendar year 2025. The Needs Study estimates that by 2030 the Southwest will need 935 GW-miles of new transmission to unlock the power sector emissions savings enabled by IRA. The Southline project will contribute 14% to this regional need.

Twin States Clean Energy Link (New Hampshire, Vermont)

Twin States is a proposed 1,200MW high-voltage direct current (HVDC) bidirectional line that is meant to expand the capacity of the New England electric grid and improve its resiliency, reliability, and efficiency by providing access to clean firm energy supplies in Quebec, Canada.

The bidirectional design of the Twin States line will also allow the New England grid to export power to Canada when New England is producing more energy than it needs to meet its own demand, which is expected to occur as the offshore wind industry in New England expands. Construction is expected to start in Q3 or Q4 of calendar year 2026.

The Needs Study predicts the North East region will need 1.5GW of new transfer capacity with its neighbors; Twin States will provide 79% to this interregional need. 

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DOE anticipates releasing a second round of TFP funding in the first half of 2024 through a request for proposals that may include a combination of public-private partnerships, loans, and capacity contracts, totaling up to $1 billion.

National Transmission Needs Study 

The National Transmission Needs Study serves as DOE’s triennial state of the grid report and is an assessment of current and near-term future transmission needs through 2040.

Key findings of the Needs Study include the following:

• There is a need for additional electric transmission infrastructure in nearly all regions of the country to improve reliability and resilience, address high energy costs and reduce congestion and constraints. Regions with historically high levels of within-region congestion — the Northwest, Mountain, Texas, and New York regions in particular — as well as regions with unscheduled flows that pose reliability risks — California, Northwest, Mountain, and Southwest regions — need additional, strategically placed transmission deployment to reduce this congestion.  
• 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.
• Needs will shift over time as the clean energy transition, evolving regional demand, and increasingly extreme weather events must all be accommodated by the future power grid. By 2030 large relative deployments of interregional transfer capacity are needed between the Delta and Plains, Midwest and Plains, and Mid-Atlantic and Midwest regions to meet future demands of the power grid. By 2040 there is a significant need for new interregional transmission between nearly all regions. 

Interconnection Roadmap

The DOE also recently released a draft roadmap to address interconnection challenges on the transmission grid, which is intended to serve as a practical guide for implementing near- and long-term solutions to interconnect clean energy sources and to clear the existing backlog of solar, wind, and battery projects seeking to get built.

The country will need to dramatically expand the deployment of solar and wind energy resources to meet the Biden-Harris Administration’s goal of a decarbonised electricity sector by 2035, DOE said.

However, increased incentives and growing demand for renewable energy have exacerbated long wait times for the clean energy projects seeking to connect to the grid.

The i2X draft roadmap provides decision makers with a set of pathways organised around four goals about deploying clean energy resources: increase data access and transparency; improve process and timing; promote economic efficiency; maintain a reliable grid. 

Originally published by Sean Wolfe for, and edited with permission from, Power Grid.