The energy sector is alive these days with lots of change, opportunities, and yes, challenges. As we add energy generation from solar, wind, geothermal, hydro, nuclear, and natural gas, the industry must ultimately deliver this new energy to its end user customers who depend upon the grid to complete the transaction.
Energy Demand Is Growing:
Demand for electricity in the U.S. is growing as data centers require immense amounts of energy, states mandate replacing gas heating with electricity, the “electrify everything” movement, and finally, the impact of battery electric vehicles.
Currently, data centers consume 2.5% of the U.S. electricity. Globally, data centers consume 1-2% of overall energy, and this share will rise to 3-4% by 2030.
Goldman Sachs Research estimates that U.S. data center power demand will grow 160% by 2030. The U.S. electricity demand without AI by 2030 is estimated at 304 terawatt-hours, or TWh (304 million MWh), while the AI/data center incremental component is 93 TWh (93 million MWh), or 23% of the total of 397 TWh.
The energy transition to convert America’s 287 million cars and 14 million trucks from the internal combustion engine to electricity will alone increase demand for energy generation, transmission, and distribution by 25.3%, or 1 billion MWh per year.
U.S. electricity demand grew from 4,108 TWh in 2021 to 4,243 TWh in 2022, a 3.3% growth rate.
Electricity demand in the U.S. is clearly growing with the source of generation as a combination of the sources cited above. It is not enough to generate electricity at a power station: to satisfy residential, commercial, and industrial demand that same electricity must be delivered to its end use. That brings up the obvious siting, permitting, economic, political, and regulatory questions of how to transmit that incremental energy with the existing stressed U.S. grid.
Transmission pain points:
There are a number of current pain points/challenges for the transmission of electricity that are discussed below, however, there may be additional problems that I trust this article’s readers will communicate to me directly with my contact information provided at the end of this article.
- Timing of permits for overhead transmission:
Depending upon jurisdiction, i.e. urban or rural, securing the necessary easements and landowner permissions can be a burdensome, costly, and time consuming process. The current NIMBY attitude of property owners everywhere can be a huge impediment to allowing needed transmission lines to be built. For some projects, the permitting time can extend up to 10 years, an important consideration as new generation is needed and may be built, but new connections to the grid or increased grid capacity is not available in a timely fashion. These delays have dramatic impacts on the NPV of the project, with potential for large cost overruns.
- Change in the landscape view for landowners:
With the construction of large, high voltage transmission towers at a height of 110 feet (equivalent of an eleven-story building), the view for locals in the project area is eternally changed. This in turn can alter the willingness of landowners to grant a transmission line easement for a leasing payment, and cause them to delay making this life-altering decision for their land.
- Total cost of overhead transmission lines:
The MISO Transmission Expansion Plan’s report on the Transmission Cost Estimation Guide for MTEP22 provides some key transmission cost information as follows for a 345 kV duel-circuit line, including both material and installation: 1) up to $635,000 per tower, and 2) up to $17,879 per 1,000 feet for the conductor. Towers are assumed to be spaced at 850 feet.
Additionally, the average acquisition cost per acre for weighted-average land uses of pasture, crop, and suburban and urban is $12,923. The estimate for regulatory & permitting cost per acre is $2,693. These cost totals are $15,616 per acre.
For a 345 kV transmission line, American Electric Power recommends an easement of 150 feet.
Assuming a 50 mile, 150 foot right of way, 345 kV transmission line project, the rough-estimate capital cost is ~$217 million, or ~$4.34 million per mile as follows:
- Right-of-way acquisition in acres: 909
- Cost of ROW in $ million: 14.19
- Number of towers: 312
- Cost of material and construction for tower in $ million: 198
- Cost of material and construction for conductor in $ million: 4.72
Of the total cost for a 50-mile, 345 kV transmission line, the cost of the towers is ~91.2%, a high cost for a permanent object that impacts the local landscape.
- Tight urban areas with limited, if any, capacity increase potential:
Growing urbanization is a huge driver, causing a corresponding surge in electricity demand, often in areas that are spatially-constrained. Urban regions typically experience higher population densities, leading to increased electricity consumption per square kilometer.
- Connection of existing grid transmission systems to improve overall grid reliability, while connecting new solar and wind farms to the grid:
The U.S. Department of Energy highlights the need for expanded regional transmission line development and interregional transfer capacity of 47,000 GW-miles by 2035, a 57% growth from today’s system. Using the estimate in 3) above of $4.34 million per mile for a 345 kV line, and 345kV line carrying 735 MW, this transmission addition would cost ~$278 billion.
According to NREL’s 100% clean electricity study, these high load growth and high clean electricity futures would require building 91,000 miles of new high voltage interregional transmission lines by 2035. This appears unattainable when it takes 10 years on average to move a transmission line from conception to operation, and only 386 miles of high voltage transmission were built in 2021.
As clean energy demand increases due to improved energy production economics, transmission’s importance has grown considerably. Transmission must expand to move renewables to population centers.
Problem resolution:
There has to be a better method of transmitting large volumes of electricity within the U.S. that could offer these advantages:
- Lower cost
- Faster permitting, project startup
- Improved project NPV due to faster permitting
- Less public scrutiny for permitting
- Less environmental impact
- Easier access to new markets with tighter transmission corridors
- Improved public relations
Do you agree with the key problems described above with overhead transmission in the U.S. that provide both timing and cost obstacles to satisfying electricity demand?
What are the potential transmission problems that you are encountering in your business that need to be solved by a newer technology, a newer approach, and the possible re-purposing of existing assets?
I am working with my associates to address the pain points mentioned above to modify an existing transmission technology with a developed project estimation application to reduce the commercial cost, while speeding up the transmission project market potential identification from months or years, to weeks.
If you are experiencing these pain points in the transmission, electric utility, or renewable energy industries that are impacted by U.S. electricity transmission constraints, I request your comments, questions, and inquiries to this new approach. I can be reached directly at [email protected] or cell at +1 720-381-9452.
I welcome your comments and questions, and the opportunity to assist you with your energy questions and concerns. I am the principal at Reliant Energy Solutions LLC, a Professional Engineer, Certified Energy Manager, Renewable Energy Professional, and can be reached at [email protected] or cell at +1 720-381-9452.
“It is better to debate a question without settling it, than to settle a question without debating it.” Joseph Joubert
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