The Grid: Aging Power Lines Need Upgrading

It's tough to get a new power plant built in the United States. It's even tougher to get regulatory approval for utilities to raise rates to pay for upgrading the power lines that make up the transmission grid. Yet those lines may be the weakest point in the nation's power-delivery system.

The aging transmission grid is handling much more power than the system was originally designed for, says Gordon van Welie, president and CEO at ISO New England. "Hundreds of thousands of megawatts of generation have been added, and the transmission system hasn't kept up with generation," he says.

Part of the problem is the regulatory scheme that approves capital spending plans and sets rates for electricity. Regulators are reluctant to authorize new investments without a clear demand for more power. "We have generation both north and south of Atlanta, trying to keep generation close to the demand," says Becky Blalock, CIO and senior VP for information resources at utility Southern Co. "But we never build anything without contracts for power already in place."

Regulators also want to see revenue that will pay for investments without raising rates for consumers. As a result, more power is being transmitted longer distances as utilities in one part of the country sell their excess electricity to other regions. That can reduce the need to build more power plants, but it also can increase the risk of outages.

In the long run, the transmission grid needs to be able to accept power generated from a variety of sources--including by businesses--and ship it anywhere in the country that needs that power. "We should see distributed generation [coming from] off the grid on the part of end customers," Meta Group analyst Jill Flebowitz says. She predicts that the transmission grid of the future will look more like a computer network, with automated capabilities to resolve problems and reroute power around network blockages and downed power lines.

Photograph by Taxi

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