There's a new paper out of MIT's Center for Energy and Environmental Policy Research that reads like something CCL would have commissioned 🤓 It looks at what passing the BIG WIRES Act would accomplish from four different angles.
1) Where and how much new inter-regional transmission would be built?
On the map below, the red bars illustrate the already existing inter-regional transmission capacity, and the gray bars illustrate the new transmission that would need to be built to meet BIG WIRES' requirements. Bigger bars mean more transmission capacity.
The authors estimate that about 32% of the total added capacity would be between the Midwest and Mid-Atlantic, 15% between the Southeast and Florida, 13% between the Mid-Atlantic and Carolinas, and 8% between the Midwest and Central states.
2) How much money would it save?
The paper considers a few different scenarios – no new inter-regional transmission vs. BIG WIRES-mandated transmission expansion, and a world in which the US doesn't try to reduce its emissions vs. one in which we try to reduce our emissions by 95% (the latter basically reflects our real-world net zero by 2050 Paris commitment, but the former evaluates the bill's effects even if we don't try to reduce emissions).
Even in the scenario where we're not trying to reduce our emissions, the paper estimates that BIG WIRES would save $330 million per year due to the lower energy costs associated with being able to deploy more solar and wind energy.
In the 95% emissions reduction scenario we implement other complementary policies to deploy clean energy faster, in which case inter-regional transmission is even more valuable so that we can get that energy from the most cost-effective locations (particularly the Central, Mid-Atlantic, and Northeast regions, which become big net clean energy exporters) and then move it around the country. And so in this more realistic scenario, the paper estimates that BIG WIRES would save even more – $2.5 billion per year.
These cost estimates account for investment in generation and storage, fixed and variable operating and maintenance costs, new transmission investment costs, fuel and start up costs, and tax credits/incentives, if any.
The paper also finds that the most optimal inter-regional transmission capacity in the scenario without an emissions target is 30% of the peak load (left frame in the figure below) – which coincidentally is basically the target set in BIG WIRES. In the 95% emissions reduction scenario though (right frame), it's most cost-effective for inter-regional transmission capacity to be 95% of the peak load (although once we get beyond ~50%, the savings gains after that aren't very large).
3) What would the climate benefits be?
The paper estimates that BIG WIRES would reduce US greenhouse gas emissions by 73 million metric tons of CO2 per year compared to the status quo. That's a 5.5% reduction in our emissions. And again, if our goal is to reach net zero emissions by 2050, BIG WIRES get us there at a cost of $2.5 billion less per year.
4) Would it make grids more resilient to extreme weather events?
One non-climate benefit of BIG WIRES is that allowing regions to exchange power makes them more resilient to extreme weather events, because if a big storm knocks out a bunch of power generation in one region, it could then import extra electricity from a neighboring region to make up for it and thus avoid some blackouts.
In this paper the authors did a bunch of model runs simulating a storm equivalent to Winter Storm Elliot in December 2022, which knocked out a bunch of power generation. They found that BIG WIRES would have reduced the number of homes that lost power in this storm from 4.7 million to 2.1 million – a 58% reduction in blackouts.
Summary
To sum up, the paper estimates that the. BIG WIRES Act would save us $2.5 billion per year (assuming we stick to our net zero commitment), reduce US climate pollution by 5.5%, and make the grid more resilient against blackouts caused by extreme weather events. And the roughly 30% peak load inter-regional transfer capacity requirement set in BIG WIRES is a good one – if anything it should be higher to be even more cost-effective.
That's an impressive win-win-win scenario from passing BIG WIRES! 🤓
Hey @Dana Nuccitelli. Thanks for sharing this great research. Some questions:
In the study, Table 2 shows that some regions have higher costs and some have higher savings. Can you explain the implications of that and how that might affect consumer costs in those regions?
I worry this could be politically challenging if some regions might see higher electricity rates than others but I'm not sure that's what is implied here.
Yes, good question @Tony Sirna. Here's that table:
In the ‘Difference’ columns, numbers in parentheses mean ‘savings’ while those without parentheses denote ‘costs.' But the authors are careful to clarify:
It is important to note that an increase in costs is not necessarily a negative impact on the region … we also see an increase in electricity exports to other regions, thereby increasing regional revenues.
A ‘cost’ reflects the fact that more power generation will be built in some regions – the regions where it's most cost-effective, like the Central part of the country where there are a lot of wind resources available. Here they point to Table 3, which shows regional energy imports and exports. In the ‘Difference columns’ here parentheses mean net imports and no parentheses denotes net exports.
And you can see all the regions that have net ‘costs’ in Table 2 also have net energy exports in Table 3. So they're paying to build more mostly solar and wind energy, which will create both jobs and revenue as they export some of that clean energy to other regions.
I think the Southeast is an example of a challenging region. I believe the issue is that this region has relatively high-carbon power generation and relatively low inter-regional transmission capacity right now, and so to both reach net zero and increase transmission capacity will require a lot of investment costs (Table 2). They'll have some net energy exports, but not a lot (Table 3). How those costs compare probably depends on a lot of factors like electricity rates, local tax revenue, how much you value the associated jobs created, etc.
Thank you @Dana Nuccitelli! And for those interested in finding out more about this study and how it can help out advocacy, be sure to tune into the upcoming CCL training on Thurs. Feb 29th (leap day!) at 8 pm ET / 5 pm PT on Zoom!
Join details and RSVP Here: https://community.citizensclimate.org/events/item/24/15092
@Dana Nuccitelli
Hi Dana!
Seeing some numbers and the various dimensions of the benefits of BIG WIRES in this MIT CEEPER working paper is very helpful. Getting information into the questions of how this policy would affect different regions of the US is also quie useful. It brought up a few additional questions for me that were not addressed directly and were clearly beyond the scope of this paper.
One was regarding the anticipated role of Grid Enhancing Technologies to satisfy the MITC. The extent of that utilization might be difficult to guess, though a general range of possibilities would be interesting to see.
Another was around the cost-benefit issue comment for the exporters of energy, most likely to be wind and solar energy. This would get into the complex details of how that would be priced including the role of any subsidies and production credits. I am primarily looking for additional insight as to the net costs of compliance for the ‘exporters’ both in general and also specifically for the region I live in (Southwest). This too I imagine would be difficult to predict.
Attention to grid resiliance is important, and the paper supports how BIG WIRES would help.
Looking forward to your presentation later this month. Thank you!
Thanks @Lois McLauchlan. BIG WIRES leaves it up to each transmission region to decide how best to meet its requirements. So, they can choose any combination of building new transmission lines and deploying grid enhancing technologies, as long as the end result meets the inter-regional transmission capacity requirements set in the bill. We'll have to wait to see what each region ultimately proposes in their plans.
The Southwest will have to increase its inter-regional transmission capacity by about 19% from what's already in place, according to the paper, which is a relatively small requirement. So, I think the net ‘costs’ to the Southwest will primarily come from installing more solar energy that can be exported to neighboring regions, as illustrated in Tables 2 and 3. Basically the region would already be installing a bunch of solar power, and BIG WIRES will allow it to install a bit more (about 10%), which can then be exported and sold. That's more ‘cost’ to build the extra solar in the Southwest, and also more revenue generated by selling the extra power to neighbors.
@Dana Nuccitelli In conjunction with passing the BIG WIRES act or with permitting in general, should CCL be pushing ‘reconductoring’, which appears to be a much cheaper and quicker solution to beefing up our electrical grid?
Hi @R Bruce Cooper. Reconductoring requirements are generally under the purview of FERC and public utility commissions, and it's not something CCL can have much influence over. See our discussions about the subject over on the Nerd Corner here and here.
Search Forums
Forum help
Select a question below
CCL Community Guidelines
- Discuss, ask and share
- Be respectful
- Respect confidentiality
- Protect privacy
CCL Blog Policy Area Categories
- Price on Carbon
- CBAM
- Clean Energy Permitting Reform
- Healthy Forests
- Building Electrification and Efficiency