The Cost of Transmission

Tom Konrad, Ph.D.

I’ve been reading a report out of the Colorado Governor’s Energy Office called The REDI Report: Connecting Colorado’s Renewable Resources to the Markets in a Carbon-Constrained Electricity Sector.  I summarized the REDI report’s main conclusions and drew some conclusions for stock market investors here.

I found the report’s discussion of transmission costs particularly interesting, because I’ve had trouble finding numbers for the cost of transmission in the past.  I once resorted to Wikipedia in order to find costs for transmission when comparing them to the costs of large scale electricity storage.  If you don’t think that the two are comparable, consider that long distance transmission can reduce the net variability of wind and solar, making it possible to integrate these renewable forms of generation without the cost of expensive storage.  That’s why even net-zero electricity homes are connected to the grid: it’s prohibitively expensive to buy enough batteries to keep the lights on 24/7.

Here are a couple cost charts from the report:

I took the data from the above table, and plugged it into my spreadsheet comparing the costs of electricity storage.  Below are the updated graphs (click for enlarged versions.)  The notation "2-500 kV AC" means a Double-circuit 500 kV AC line.  As in the storage comparison, I computed the costs and round-trip electricity losses for a 1000 mile line, since that was the example I used in my original Transmission/Storage comparison.

 

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15 Comments

  1. [...] the transmission we need for wind and other renewable resources ahead of time. I wrote about a report that came out of this process and the cost of transmission a couple months ago, and some new projects are alredy well into the planning [...]

  2. Jamie Bull said

    Interesting stuff, Tom. Another important point is that the HVDC line also has the one-off loss at the DC/AC transformer. I assume these are accounted for somewhere in there? This means that there is a cut-off distance at which HVAC becomes less efficient than HVDC. Somewhere around 100km at European prices according to this report http://tinyurl.com/34va65d

    In my storage / balancing post which I should be putting up tomorrow I’ve assumed a 4,000 km HVDC line from North Africa into Europe following the German thesis I got the figures from. I’d love to find the time to put some work into a more detailed bit of analysis – perhaps following on from your post here http://tinyurl.com/62fzkq

    As an aside, the low cost of transmission (and high EROEI / life cycle efficiency) really does bring home why even in an almost fully renewable grid, one of the most efficient ways of balancing will probably be to maintain stocks of fossil fuels and plenty of dispatchable generation capacity.

    • Tom said

      Jamie,
      Regarding your aside, I actually think the most efficient balancing method will be smart grid/demand response. As my chart shows, Transmission is the best energy resource, and smart grid is the best power resource by far. In the future, we can even take advantage of demand planning.

      Biogas, hydro, and geothermal could also probably be useful for balancing. Even though geothermal is normally thought of as baseload, geothermal reservoirs have limited capacity, and so if the turbine is oversized compared to the resource, geothermal could also be used for intermediate dispatchable generation.

    • Tom said

      Regarding the HVDC conversion losses, I accounted for that in the round trip efficiency, although I don’t recall the assumptions I used.

  3. Joy Hughes said

    There are a few other factors to consider here:

    1. Do the demand figures here take into account conservation and efficiency? It seems a 50% drop in demand would lead to a greater than 50% drop in the need for transmission. The same applies to demand response.

    2. It appears that storage technologies are rapidly improving, e.g. nanowire and Sodium-Sulfur. A factor of 10 reduction in battery costs is quite arguable, wheras the cost of transmission is likely to increase.

    3. Just as freeways lead to urban sprawl, transmission can lead to energy sprawl. Adding transmission would favor investment in large facilities rather than rooftop solar. For instance, in Colorado, additional transmission to the San Luis Valley would lead to a decrease in the geographic diversity of solar generation and unacceptable impacts. A “tragedy of the commons” would result, where it would be most profitable to build any given solar plant in the SLV, but all would be shut down during long winter periods of valley fog when the front range may remain sunny.

  4. Tom said

    Joy,
    1. Efficiency should of course come first, but how much a decrease in demand leads to a decrease in transmission (unlikely because our transmission system is already needs upgrades for current needs) depends on the timing of the reductions. Reductions in peak demand may lead to reductions in transmission needs, but reductions in off-peak demand (CFLs, for instance, which are not on during the day) will lead to no decrease in the need for transmission. A 50% drop in consumption is nice to think about, but it would probably take 30+ years and be offset by population growth.

    2. It appears that there is potential for improvements in battery technology, but a factor of 10 reduction is the stuff of fantasy. Nanowire batteries are not commercial, and so not included in the graph. Sodium-sulphur is already here (the NaS circle)

    3. I agree that energy sprawl is a problem, and rooftop PV is one of the few electricity sources that does not contribute. However, at this point the geographic diversity of solar is not an issue since it’s less than !% of generation… nor do I believe that such a decrease is inevitable… we might get 200MW of solar in the SLV, but most of it is likely to be CSP with storage, since that is what is in Xcel’s Resource Plan. Since CSP with storage will be dispatchable power, geographic diversity is not an issue. Geographic diversity is only important for non-dispatchable variable resources such as wind and solar PV, because it smooths out the variations.

  5. Joy Hughes said

    Hmmm… CSP with storage is still energy sprawl. And the best CSP heat storage I have heard of is only 12-14 hours. Last winter the SLV was clouded over for a week, while the front range was sunny. Much better to find geographically dispersed sites along existing transmission, rather than the “eggs in one basket” scenario proposed by REDI.

    It had better not take 30 years for us to get 50% efficiency! Within a lot less than 30 years we will see PV drop in price dramatically compared to CSP. Within a lot less than 30 years we will see the benefit of nanotech batteries.

    I live off the grid. I use batteries. This means shifting from the idea that “electricity is unlimited but has a price” to “electricity is (marginally) free, but limited”. Sort of like having a water tank instead of municipal water.

    • Tom said

      The reason they only build thermal storage for 8-12 hours is economic, not due to the limits of engineering. Just add a few more tanks, or build larger tanks.

      Your predictions about the future of PV and nanotechnology batteries are just that: predictions. commercializing new technology always takes longer than the boosters expect, even when it does not strain the laws of physics. 50% eff PV is within the laws of physics with multijunction cells, but I doubt they’ll ever be cheaper per watt than 20% efficient cells.

      Changing our attitudes towards electricity is important, but the hardest part of living off the grid is not changing our attitudes, it’s affording it. Consider what your off grid system cost (before subsidies): $50,000? And PV prices are dropping rapidly, but battery prices are not. How much would it cost for everyone to live off the grid?

      Transmission reduces the need for batteries: if it’s cloudy in the SLV, it may be sunny in Denver, and vice versa, and that’s why it’s a good idea.

  6. [...] electricity storage is effective for smoothing short term volatility in electric supply and loads, long distance transmission, especially High Voltage DC transmission is the most cost-effective techn….  Prospective wind investors should also be considering companies involved in building, [...]

  7. [...] electricity storage is effective for smoothing short term volatility in electric supply and loads, long distance transmission, especially High Voltage DC transmission is the most cost-effective techn….  Prospective wind investors should also be considering companies involved in building, [...]

  8. [...] electricity storage is effective for smoothing short term volatility in electric supply and loads, long distance transmission, especially High Voltage DC transmission is the most cost-effective techn….  Prospective wind investors should also be considering companies involved in building, [...]

  9. [...] electricity storage is effective for smoothing short term volatility in electric supply and loads, long distance transmission, especially High Voltage DC transmission is the most cost-effective techn….  Prospective wind investors should also be considering companies involved in building, [...]

  10. Cedric said

    Dear Tom,

    This is really interesting!

    I just finished my PhD on the integration of wind power using demand response. In my further research, I would like to compare demand response opportunities with transmission interconnection and other sources of storage/flexibility. Could I get access to the presentation/publication behind as well as the excel file you refer to (I found a link on the internet, but it does not work)?

    Thanks in advance for your reply!

  11. [...] UPDATE 12/29/09- I came across better numbers for the cost of transmission, and updated the graphs here. [...]

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