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Balancing Grid Investments

North America's transmission system is already smart, and new investments in technology will make it even smarter. Most of these smart grid technology

North America's transmission system is already smart, and new investments in technology will make it even smarter. Most of these smart grid technology elements are well-tested, mature and cost-effective, and their use will make the North American bulk power system more reliable, secure, efficient, economic, diverse and environmentally sustainable.

But while communications, computer analytical tools, sensors and controls are critical smart grid elements, those technologies cannot themselves deliver electricity from a power plant to the consumer. That task requires a strong platform of wires, cables and substations, which requires investment in existing transmission infrastructure and additional investment in new wires in the air and transformers on the ground.

The combination of conventional transmission technologies with advanced smart grid elements will optimize the value of transmission investments and enhance transmission's value and service to the nation.

Economists who have studied various future scenarios predict that the nation will require as much as US$300 billion in transmission investment by 2030, only about one-third of which will be a direct response to public-policy directives that necessitate increased reliance on renewable energy resources. Much of this investment will be driven by the fact that most of the existing transmission system was built more than 30 years ago and many of those facilities have been over-utilized and insufficiently updated or maintained.

Consider that 70% of America's transmission lines are 25 years or older; 70% of the large power transformers are 25 years old or older; and 60% of the circuit breakers are more than 30 years old. Consider further that most of those facilities were built before digital technologies were available. Failed or degraded transformers have caused restricted thermal ratings or rerouting that caused hundreds of millions of dollars in congestion costs and reduced the region's grid reliability over the past few years. Such failures have resulted in local brownouts and outages and, on occasion, caused wide-area blackouts.

According to the Department of Energy, major power outages and power-quality problems cost the U.S. economy as much as $180 billion annually. With increased load on the bulk power system and with transmission traversing greater distances, utilities suffer increased line losses and more lost energy.

Computers, information technology and communications alone cannot deliver generation from location-constrained renewable power plants to customers if physical transmission capacity either does not exist or is very limited. Congested transmission lines cannot deliver high volume of power between regions without construction of new high-voltage AC or DC lines. Large metropolitan areas with growing loads will need new smart substations and other equipment to maintain even existing levels of reliability. Enhancing the physical backbone of the high-voltage transmission system may be needed to improve system redundancy and resilience in response to the potential for terrorism and the threat to cyber security.

The modern transmission system is information-rich and complex. Therefore, it must be complemented by sophisticated processes and a workforce trained to understand, support and exploit the capabilities of the system. Smart transmission, like the rest of the smart grid, is (or will be) characterized and built upon clear technical interoperability standards, open architectures that enable technological and process innovation, and extensive physical and cyber-security protections.

Section 1301 of the Energy Independence & Security Act of 2007 established a federal policy that the nation's electricity transmission and distribution system should be modernized to maintain a reliable and secure electricity infrastructure. The Act laid out the goals and characteristics of the smart grid. For purposes of the transmission system, those characteristics include:

  • Increased use of digital information and controls technology to improve the reliability, security and efficiency of the electric system

  • The dynamic optimization of grid operations and resources with full cyber security

  • The development of standards for communication and interoperability of devices and equipment connected to the grid, including the infrastructure serving the grid.

The act makes clear that the smart grid, including smart transmission, also should support the deployment and integration — actual or potential — of demand-side resources, distributed generation, renewable generation, energy storage and electric vehicles.

Heath Knakmuhs is the director of federal affairs for American Transmission Co. and vice president of WIRES (Working group for Investment in Reliable and Economic Electric Systems).

Editor's note: This column highlights the findings of the WIRES report: “Smart Transmission: Modernizing the Nation's High-Voltage Electric Transmission System,” available at

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