Fossil Fuels

Published on May 13th, 2016 | by Joshua S Hill

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Investment Gap In US Electricity Infrastructure Could Wreak Havoc

May 13th, 2016 by  

Failure to increase investment in America’s electricity infrastructure could have massive consequences down the line, according to a new report.

A new report, published this week by the American Society of Civil Engineers investigating the infrastructure investment gap in a number of the country’s infrastructure sectors, has found that underinvestment in the electricity sector could have massive consequences down the line.

sun and transmission lines - flickr Dennis WilkinsonAccording to the report (PDF), the average annual investment gap for America’s electric generation, transmission, and distribution sector through 2025 is expected to decrease from $21 billion to $18 billion. The average annual investment gap through to 2040 is expected to show an overall average annual decrease from $30 billion to $23 billion (in 2015 dollars), with the total investment gap through 2040 now expected to be $565 billion, a cumulative investment gap of $177 billion through 2025, and $388 billion from 2026 through 2040.

“If we want our economy to thrive then we need to invest in its backbone,” said Greg DiLoreto, past president & current chair of the Committee for America’s Infrastructure, American Society of Civil Engineers, referring to the country’s entire infrastructure network. “Instead we’ve allowed it to live on borrowed time, and are paying the price of its inefficiencies every day.”

“The continued underinvestment into our transportation, energy, and water systems is hurting families and businesses. While there has been some recent legislative success, it unfortunately has not been nearly enough to modernize our ageing infrastructure.”

The report highlights the three distinct elements that make up the entire sector: generation facilities, high-voltage transmission lines, and local distribution systems. Built over the course of a century, the first two elements — America’s bulk power system — are today, “a complex, patchwork system of regional and local power plants, lines, and transformers that have widely varying ages, conditions, and capacities.” Furthermore, as the report continues:

“Regulations and policy are complicated and inefficient, leading to uncertainty from infrastructure owners in where and when to invest. As electricity is a subset of the broader reaching energy systems of the U.S., investment in the larger energy network is more significant than reported here but vitally needed.”

Based on current trends, the investment gap through 2025 is expected to be 22% due to generation, 24% due to transmission, and 54% due to distribution infrastructure. By 2040, the cumulative gap will reach $565 billion, with an annual gap in that year set to exceed $25 billion, which will mostly be due to projected shortfalls in generating capacity.

If such repeated underinvestment is allowed to continue, the costs on the country’s economy will be drastic, ranging from higher cost of electricity, costs due to power unreliability — as the “projected investment gap will lead to a greater incidence of electricity interruptions” — or costs associated with having to adopt more expensive industrial processes. Specifically, as costs to businesses and households increase, national GDP will fall by a total of $819 billion by 2025, and $1.9 trillion by 2040. The US economy will see 102,000 fewer jobs by 2025, and 242,000 fewer jobs by 2040.

“Because of the compounding effects of inefficient infrastructure, the economic effects are extraordinary,” said Steven Landau, Vice-President, Economic Development Research Group, Inc.





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About the Author

I'm a Christian, a nerd, a geek, and I believe that we're pretty quickly directing planet-Earth into hell in a handbasket! I also write for Fantasy Book Review (.co.uk), and can be found writing articles for a variety of other sites. Check me out at about.me for more.



  • JamesWimberley

    A plea for investment in a 21st-century electricity grid – illustrated with photos of ugly and obsolete 1930s lattice pylons. Where are the stylish monopoles?

    • Roger Lambert

      Yeah – where are the buried HVDC lines? OK, those are kinda hard to photograph….

  • Roger Lambert

    Ironic that the tenets of today’s non distributed renewable energy frenzy – rooftop and small-scale energy owned or leased by individuals or corporations as being patriotic and “empowering” – has moved us away from public ownership of the electric sector and is supportive, if not downright hostile, to building the distributive infrastructure we need.

    Our future is not on our rooftops as much as it is in building energy farms where they are most efficient, and then moving that resulting electricity over distance to where it is needed. It is all about the grid.

    Good article.

    • jeffhre

      Funny. Everyone sees the future in their own way.

      • Roger Lambert

        You must be a homeowner with PV panels who thinks he has just done his part to solve the energy crisis? You think the balkanization of the publicly-owned electrical sector into little corporate or privately-owned fiefdoms is a happy future? You think rooftop solar can produce a significant portion of our future energy needs?

        What is so “funny”?

        • jeffhre

          …perhaps you can use your crystal ball to discover the truth.

          • Roger Lambert

            You don’t need a crystal ball to look at the change in the energy sector over the past ten years – it’s called “history”.

            And you don’t need a crystal ball to to pay attention to the mathematics of rooftop PV potential vs total projected energy needs to see that rooftop PV can not come close to providing enough energy. And that, therefore, the majority of energy will need to be distributed along transmission lines. On that smart grid that so many people, for some strange reason, keep talking about.

            On the other hand, you CAN just sit around making detached insults about how the future will just play itself out in whatever fashion it will, as if it is all just fated to be, and we have no say in it.

          • jeffhre

            Wow. That crystal ball is way ahead of my thinking!

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