US Must Socialize Grid to Add Renewable Energy, Study Finds
Antiquated infrastructure
Due to years of underinvestment, most of the technology is between 25 and 60 years old. Antiquated transmission infrastructure is not only limiting the utilization of renewable energy resources, but it is also hindering means of mitigating their intermittency.
Our grid was designed to deliver local power from small coal-fired utilities to the consumers near by. Even without adding stranded renewable power, transmission bottlenecks impact daily power delivery.
Like herding cats
All these convoluted sociopolitical and institutional obstacles have historically prevented the modernization of transmission infrastructure. Not just NIMBYism, but balkanized ownership, fragmented regulatory authorities, and institutional disincentives are in the way.
Unlike most other countries, the United States cannot easily restructure its electricity sector by divesting state‐owned generation assets and consolidating transmission assets into a national monopoly. FERC can only attempt to cajole this multitude of owners and interests to a common cause.
Two thirds of the population (in the Northeast, Mid‐Atlantic, and much of the Midwest, Texas, and California) have competitive power markets operated under an ISO or a RTO; the rest of the country has traditional vertically integrated utilities.
Currently all the counties, townships, and communities along the transmission line can require local approval. And if the line crosses any federal lands or waterways, it will require additional approvals from relevant federal agencies.
A major risk to a transmission project is the possible failure in obtaining site approval from multiple jurisdictions. There have been cases where transmission projects were canceled due to continued local opposition even after site approval. Many states now have renewable energy contracts stuck in this limbo.
Our generation well outpaces transmission abilities – hindering renewable adoption
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September 14th, 2009 at 10:20 am
Well written article. Thank you.
Poor Obama is already being labeled as a socialist, this could be tough sell for him.
September 14th, 2009 at 5:10 pm
So, I suppose the rights of property owners should be trampled in the interest of the common good? I suppose small regional electrical co-ops should be smothered and absorbed into the national super-grid if they don’t play ball? I suppose the ‘rugged individualism’ that built this nation should be cast aside now that we’re so much more enlightened than our predecessors?
If you’re so hungry for socialism, why not pick up stakes and move to Europe … they’re well on the way. Personally, I prefer a nation where the rights of the individual are equally as important as the rights of the crowd. The protections that you see as limiting progress, I see as preventing government abuse. It’s easy for you to sit back and say that we should socialize the transmission grid for the common good because you don’t stand to lose anything. Someday, though, when it’s your own rights or property that are being threatened, perhaps you’ll feel differently about government intrusion.
September 14th, 2009 at 7:11 pm
National pipelines for oil and gas and national highways already “trampled the right of individuals,” when they were laid. Property was bought out. Yet you now benefit, as I do, from being able to drive across country, Mr Sinister.
Ben – you nailed it. So this is a huge problem.
September 15th, 2009 at 7:55 pm
Thanks Susan,
an interesting article. Links to further reading on how the UK and China accomplished their changes would be most useful.
Also, I wonder whether — as an interim step before nationalization, and in a bow to property rights and profit motives — the Government might change its accounting rules to re-allow Pooling-of-Interest accounting treatments for mergers in the energy transmission sector? This change (and some others) would likely go a long way toward promoting mergers among transmission providers. In this way, the government could end up with a much reduced number of players, making any future regulation/cooperation/nationalization easier. It might eliminate a source of tax revenue for the government on the mergers, but so what — what it really wants is the creation of fewer, merged entities, not more tax revenue.
Just a thought
September 15th, 2009 at 11:36 pm
Inquisitive – incredibly long pdf source for this story is the link at end of story – should have some more detail on China, UK.
Hope we do find a solution here.
September 17th, 2009 at 6:39 am
Aren’t we supposed to be social animals? What’s wrong with Socialism anyway, as long as it doesn’t become abusive and turn into Communism? As a matter of fact it can and shall coexist in harmony with Capitalism, as the inevitable two sides of the same coin.
September 17th, 2009 at 2:58 pm
Nicholas. I was kidding in my title, riffing off the current national furor over any kind of national Common Good right now as some kind of “socialist plot”.
A national grid infrastructure is no more socialist than national highways, railroads, pipelines, water supply infrastructure, etc.
As a nation we will grind to a halt without them.
October 19th, 2009 at 5:23 am
I live in India. It is a semi socialist state with flourishing free market. The market there is so big that it allows fair competition (infinite buyers and near infinite sellers). Infinite buyers allow economies of scale too. To top it there is strong regulation. Our banks did not collapse. Our telephone companies offer the cheapest calls on earth. The public sector companies are used as tools to bring down price still nurturing competition. Airlines compete with Indian Railways. Telecom companies compete with state owned BSNL which makes profit. There is no subsidy. There is only one place on earth where there is perfect free market economy (wrongly called capitalism). It is the city fish markets around the world. Random thoughts but point we state players and regulators are necessary environment for market.