America faces many important energy challenges, but one not discussed often enough is the problem of how best to transmit electricity over long distances. The U.S. electricity grid, as tremendous an engineering feat as it is, was not built for the type of energy economy we’re becoming.
The grid was built to deliver power short distances to customers located near the sources. Today, however, conventional energy sources, such as natural-gas and nuclear-energy plants, cannot deliver excess power to faraway consumers over the current system of largely unconnected regional grids.
In addition, our nation’s best locations for renewable-energy generation are not located near big cities, where the bulk of electricity is consumed.
To match supply and demand more efficiently and maximize the benefits of both traditional and emerging energy sources, we need a modernized, extra-high-voltage, interstate electricity grid. The bad news is that we don’t have one; the good news is that there’s no reason we can’t.
We have all the engineering capabilities to build the lines we need. The key is to eliminate the regulatory barriers standing in the way.
For years, investment in electric transmission has not kept pace with investment in power generation. Partly, this is due to the federal tax code’s unfavorable treatment of transmission investment, but the chief reason for inadequate transmission funding is the myriad levels of regulatory hurdles that must be cleared in order to win approval and siting of transmission lines.
Currently, the authority to approve electricity lines is vested almost entirely with the states, each employing its own system of review. In addition to obtaining site approval from regulators, a transmission developer often must win the approval of localities, a regional grid operator and federal agencies whose interests are affected by the proposed line.
As we increase the depth and breadth of our energy resources, lawmakers would be wise to strengthen Washington, D.C.’s authority to site extra-high-voltage interstate lines that are in the national interest, while leaving in place the current system of state approval for lower-voltage interstate lines and all intrastate transmission.
Far from being an unconstitutional power grab by the feds, such federal authority is justified by the U.S. Constitution’s Interstate Commerce Clause, and a range of procedural safeguards could — and should — be implemented to protect the legitimate parochial interests of states.
Drew Thornley is the author of the new report “Regulatory Barriers to a National Electricity Grid,” published by the Manhattan Institute.