ARKANSAS, Oct 31 (Future Headlines)- The Biden administration has announced a significant commitment of up to $1.3 billion to support the development of three new power lines in the U.S. West and Northeast. These projects aim to modernize the aging power grid and extend the reach of renewable energy sources to a broader customer base.
The funding provided by the Department of Energy (DOE) will not directly finance the construction of these power lines. Instead, the DOE will employ capacity contracts, which are authorized by a $2.5 billion program established in the 2021 bipartisan infrastructure law, to reduce the financial risks associated with the construction of these critical transmission projects.
Energy Secretary Jennifer Granholm emphasized that the capacity contracts allow the DOE to act as an anchor tenant for these power lines. This role provides developers with the confidence they need to proceed with the construction, as it ensures there will be a guaranteed offtake of power from these lines.
The U.S. power grid has been under increasing pressure, as demonstrated by the widespread power outages resulting from 18 natural disasters that affected power lines last year. These disruptions cost American businesses an estimated $150 billion. To prevent such incidents and to align with President Joe Biden’s climate goals, which include achieving 100% clean electricity by 2035, the DOE asserts that the capacity of the power grid needs to more than double. Many parts of the existing grid are over a century old and are in dire need of upgrading and expansion.
The projects supported by the capacity contracts include:
Cross-Tie 1,500 MW Line: This proposed 1,500-megawatt line aims to connect existing transmission systems in Utah and Nevada. The project’s primary goal is to enhance grid reliability and resilience in the region.
Southline Transmission Project (748 MW Line): The Southline Transmission Project, a proposed 748-megawatt line, intends to facilitate the utilization of solar and other renewable power sources in New Mexico. It will deliver this clean energy to markets in Arizona, which currently rely on fossil fuel-generated power. Construction on these two projects is expected to commence in 2025.
Twin States Clean Energy Link (1,200 MW Line): The Twin States Clean Energy Link, another proposed project, is set to provide a significant boost to the capacity of the New England power grid (including hydropower from Quebec Canada). The construction of this line, projected to begin in late 2026, will also have the capability to transmit power to Canada as offshore wind power capacity expands in New England.
While the Biden administration is taking steps to reinforce the power grid, it is also essential to note that further actions are required. The Energy Department released a study that highlights the importance of expanding interregional transmission capacity. The ability to transfer power across different regions of the country is crucial for achieving a more resilient and efficient power grid. By 2030, the study recommends that significant interregional transfer capacity deployments are needed between various regions, including the Delta and Plains regions, the Midwest and Plains, and the Mid-Atlantic and Midwest. These initiatives are critical for ensuring the reliability of the U.S. power grid as the nation strives to transition to a cleaner and more sustainable energy future.
Writing by Kevin Wood; Editing by Sarah White