Solving the Challenges to Building New Transmission

As the region prepares to meet its growing electricity loads, the need for new transmission is a critical question. At its September meeting, Spencer Gray, executive director of the Northwest and Intermountain Power Producers Coalition, briefed the Council on its recent whitepaper. The paper explores the need for new transmission in the region and the Bonneville Power Administration’s ability to provide transmission to customers.

Increasing transmission capability within the region could increase the kinds of resources the Council considers in its power plan. Under the Northwest Power Act, a cost-effective resource must meet or reduce load at a cost less than other resources and be reliable and available when it’s needed. One of the key requirements of an available resource is access to transmission. Resources in past plans have been limited not by their technical potential, but by transmission and siting issues.

“We’ve been increasingly focused on how to build more transmission in the Northwest,” said Gray. “Not that Bonneville is the builder first resort, but it is a key part of the solution.”

“The report is for general readers and policymakers, to give people a roadmap for how we transition the mature grid to accommodate the changing generation fleet.”

Gray noted that transmission is a unique asset, calling it the “analog” part of the grid. “The wires can be used for different resources if plans change…it can be used in ways we didn’t expect.”

Describing the different challenges for both Bonneville and investor-owned utilities in building new transmission, especially in terms of how much risk to take on, Gray noted merchant transmission developers as an emerging model.

“These are the three models to building transmission, and none is better than the other,” he said. “We’ll need all three of them to get the transmission we need.”

Gray, noting the need for a more inclusive process, described the coalition’s recommended changes to Bonneville’s transmission planning process:

• Be transparent
• Be more proactive and think long term
• Consider multiple values to society
• Use scenario-based planning, include a range of impacts from extreme weather, etc.
• Use portfolio analysis with a stack of different options

Finally, Gray highlighted the importance of tackling the issue of risk as a critical obstacle to expanding transmission.

“You may have the best plan, but how do you execute it? Addressing the risk calculation is important,” said Gray.

One step forward, according to Gray, was when Congress passed the Infrastructure Investment and Jobs Act two years ago, which included $10 billion in borrowing authority for the Bonneville Power Administration.

“This single act alleviates Bonneville’s access to capital; this is a big benefit to the region for the next 20 years. This gives the region’s dominant transmission owner a bigger credit card.”

Other key takeaways:

• The need to make the business case for new transmission will need to include thinking about what 100 percent clean energy mandates means for risk; the stranded asset analysis has to change
• Risks to the grid are different now; there is a need for greater resilience because of extreme weather due to climate change
• The current planning process must shift from being reactive to being proactive; explore innovative contracting agreements on the load side
• Address the need for competitive pay authority. “The disincentive at Bonneville is getting painful, and we’re suffering because of it,” said Gray. “Other federal agencies have competitive pay authority, but the power marketing administrations do not. We’ll be asking the congressional delegation for help in solving this problem.”