Improved Transmission Planning Is Key to the Transition to a Carbon‐Constrained Future

Prepared by Judy W. Chang and Johannes P. Pfeifenberger of the The Brattle Group

Preface

Changing The Way We Plan Major Transmission Expansions Can Save Customers Billions During The Coming Transition To New Forms of Electric Generation, New Modes of Managing The Grid, and New Uses of Electricity

WIRES offers this white paper as part of its ongoing mission to provide policymakers and practitioners in the electricity industry with insight into the policies and regulation governing the development of the integrated North American high voltage electric transmission system. As WIRES has indicated in past reports, the role of transmission and the benefits it provides have often been overlooked or prematurely dismissed. In addition, the prevailing regulatory processes and planning requirements that govern transmission development today, such as existing regional and inter-regional planning processes and cost allocation methodologies, that were put in place to comply with Order No. 1000, are not always in the long-term public interest of consumers or our economy.

As a result, the industry is facing a period of adaptation to new environmental regulations, technologies, and market conditions with a grid largely built to serve the analog economy of the mid-1900s. Left unaddressed, this situation could lead to costly outcomes for customers and constrained choices for policy makers and regulators. The time is now to undertake a proactive, scenario-based transmission planning effort to ensure the grid can meet the challenges of a rapidly evolving generation fleet while capturing significant cost savings for customers. If planned, constructed, and paid for with its near- and long-term benefits to consumers in mind, a 21st century grid will its near- and long-term benefits to consumers in mind, a 21st century grid will provide the flexibility, strength, and the quality of service our economy requires and electricity customers expect.

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