Windpower Engineering & Development

  • Home
  • Articles
    • Most recent posts
    • News
    • Featured
  • Resources
    • Digital issues
    • Podcasts
    • Suppliers
    • Webinars
    • Events
  • Videos
  • 2025 Leadership
    • 2024 Winners
    • 2023 Winners
    • 2022 Winners
  • Magazine
  • Advertise
  • Subscribe

First look at the economic savings from deploying advanced transmission technology

By Paul Dvorak | November 9, 2017

Rob Gramlich, Grid Strategies LLC

Transmission congestion can increase electricity bills paid by American households and businesses. It results from limits on transmission flows from one location and “re-dispatch” of electricity generation such that higher cost generators must be turned on to supply electricity demand.

Congestion costs are likely to rise in the US. It had been on the decline after a significant build-out of transmission capacity from 2009 to 2015. But there is much less transmission expansion planned in coming years than in the past. Interconnection queues and generation deployment estimates suggest continuing development of generation resources in constrained areas. The retirement of some generation in certain areas may create some space on the grid. But the combination of reduced transmission investment and growing remote generation development will likely cause congestion to grow.

Determination of congestion costs and the savings possible from advanced transmission technologies requires detailed region-by-region study. The purpose of this short analysis is to provide an initial rough estimate.

The analysis below indicates that a combination of advanced power flow control, topology optimization, and dynamic line ratings would save American households and businesses around $20 billion over 10 years.

Congestion costs in the U.S.

Congestion costs are known in two-thirds of the country, and not well known in the other third. Where it is known is where there is a Regional Transmission Organization (RTO) or Independent System Operator (ISO) because they transparently price and post congestion. Other efforts to calculate annual transmission congestion cost such as the Congressionally mandated National Electric Transmission Congestion Study[1] by the Department of Energy faced the same challenge in calculating national transmission congestion cost.

If one assumes that congestion outside of RTOs is similar in magnitude to congestion inside, then one can extrapolate from the known half of the country to the full country. That method is employed here.

Congestion costs in the transparent markets in the country for the most recent year in which all the data are available (2016) are shown in Table 1 below. They total $3.91 billion.

To extrapolate from the transparent regions to the full country we need to know what portion of the country is covered by transparent markets. Sixty-six percent of the country is covered by RTOs, estimated by comparing the percent of peak loads, using the data below in the Market Size Comparison section. Dividing $3.911 billion by .66 yields $5,952 billion. Thus we estimate annual US transmission congestion cost to be approximately $6 billion per year.

Congestion cost reduction from transmission technologies

There are a few indicators of how much of the $6 billion could be reduced through advanced transmission technology. The market monitor for MISO estimated that “as much as $155 million in production costs savings could be achieved by fully adopting temperature-adjusted, short-term emergency ratings throughout MISO.”[2] MISO had $1.4 billion in congestion as shown above, so these savings are a little over 10 percent of total congestion.

An estimate of the capacity increase Dynamic Line Ratings make possible on the Oncor system found capacity could be increased by 30 to 70%[3] The New York Power Authority pilot project showed capacities increased 30-44 percent above static ratings.[4] Clearly, these pilots indicate significant economic savings though the amount would depend on how much out-of-merit dispatch occurs at the times when capacity increased, and that was not quantified.

One study of power flow control savings found 30-50 percent reduction in congestion.[5] Another study in the UK found 2 million pounds in savings though it doesn’t say what percentage of the system congestion cost that represents.[6]

A combination of the technologies that increase grid utilization would increase the total savings.

With savings of 10 percent from one technology and over 30% from another, and adding these technologies together along with others, it seems safe to estimate that savings from the suite of technologies could be on the order of 1/3 of congestion costs. With annual congestion costs around $6 billion/year, that would be $2 billion/year in savings. So over a 10 year period savings could be $20 billion.

Studies of this potential would be needed to provide a more robust estimate. The studies should be done for each region, and take into account the shape of the dispatch curve and grid configuration.

Market size comparison for use in extrapolating from transparent markets to the US

For the rest of the article: https://goo.gl/rtrGQw

Also, a detailed presentation introducing WATT is here: https://goo.gl/NuXfZG


Filed Under: Uncategorized
Tagged With: Grid Strategies llc
 

About The Author

Paul Dvorak

Related Articles Read More >

DTE Energy to buy three new Michigan wind farms
Connecticut seeking input on draft solicitation for offshore wind
Maine establishes three new renewable energy laws
US Wind applauds extension of offshore wind tax credit

Podcasts

Wind Spotlight: Looking back at a year of Thrive with ZF Wind Power
See More >

Windpower Engineering & Development Digital Edition Archive

Digital Edition

Explore the full archive of digital issues of Windpower Engineering & Development, presented in a high-quality, user-friendly format. Access current and past editions, clip, share, and download valuable content from the industry’s leading wind power engineering resource.

Windpower Engineering & Development
  • Wind Articles
  • Solar Power World
  • Subscribe to Windpower Engineering
  • About Us/Contact Us

Copyright © 2025 WTWH Media LLC. All Rights Reserved. The material on this site may not be reproduced, distributed, transmitted, cached or otherwise used, except with the prior written permission of WTWH Media
Privacy Policy | Advertising

Search Windpower Engineering & Development

  • Home
  • Articles
    • Most recent posts
    • News
    • Featured
  • Resources
    • Digital issues
    • Podcasts
    • Suppliers
    • Webinars
    • Events
  • Videos
  • 2025 Leadership
    • 2024 Winners
    • 2023 Winners
    • 2022 Winners
  • Magazine
  • Advertise
  • Subscribe