A battle is brewing in Congress over a climate and energy issue that is pitting the U.S. Senate and states west of the Mississippi against the U.S. House and states east of the mighty river.
It’s a fight over expansion of the electric grid – the building of a new "transmission superhighway" – with boosters claiming you can’t have a clean energy future without it, and more cautious skeptics saying it could be a huge waste of money that would hurt both the economy and the climate.
A scene from this unfolding political drama was performed before Rep. Ed Markey of Massachusetts last week, who held a hearing on the future of the grid in his House Subcommittee on Energy and Environment and set the stage with his opening comments.
The landmark climate bill he has co-sponsored with Rep. Henry Waxman of California calls for the Federal Energy Regulatory Commission (FERC) to report back to Congress within three years with recommendations for grid development. Markey said:
Some believe we should go further, by substantially expanding federal authority to plan and site new transmission lines. That includes overriding state decisions to reject proposed lines and using federal eminent domain authority if necessary. I think we need to look closely and skeptically whether such a step is warranted at this juncture.
Markey urged caution (see complete statement, attached below) as did many others who testified, including Christopher Miller, president of the Piedmont Environmental Council:
"Current and proposed transmission policies may produce a transmission grid that is over-built, overly complex and subject to reliability problems, and encourages increased reliance on fossil-fuel generation rather than distributed renewable generation, energy efficiency, conservation, and load management."
Nevertheless, action on federal transmission policy is picking up steam, with various proposals under consideration in both the House and the Senate, driven more by politics than policy wisdom.
Leading the charge on the Senate side is Majority Leader Harry Reid, who is facing a tough re-election battle in 2010 in Nevada. Powerful interests behind solar energy expansion want to see the federal government bankroll new transmission lines to get the power Nevada can generate from its sun-drenched deserts to energy-hungry cities in California, Rep. Waxman’s home state.
At the same time, the potential of a massive transmission grid build-out worth tens or hundreds of billions of dollars is attracting political support for its stimulative effect on an ailing economy. It promises to create shovel-ready jobs across the entire country and give a big role to large-scale manufacturing in clean energy development.
That translates into votes in the 2010 interim elections and beyond from labor unions and rust belt industries looking for economic revival, and in key races like Reid’s re-election challenge in Nevada.
Washington insiders are expecting Rep. Waxman to introduce a floor amendment to his own bill to beef up its transmission provisions in order to align with Sen. Reid’s more bullish position, even while the bill’s co-sponsor, Rep. Markey, pulls in the opposite direction, as his hearing last week showed.
"Transmission is among the most complex and controversial aspects of energy policy," Markey said. "Today’s hearing is literally the first in this committee, in this Congress or the last, on transmission. We cannot afford to take a ‘ready, fire, aim’ approach in this area."
Chris Miller also advised lawmakers to adopt a more cautious approach and to look at the bigger energy equation with transmission policy as an important part of energy solutions rather than as a stand-alone measure:
"Before we set federal policy that permits a $100-200 billion grid build out, we should make every effort to better utilize existing transmission infrastructure, reduce the need for new supply, and encourage clean distributed generation."
Other utility energy experts provided more detail on why and how an alternative approach would create more long-term jobs at lower cost, reduce emissions more effectively, and have a more benign impact upon the land than a new transmission superhighway.
Paul Hibbard, chairman of the Department of Public Utilities of Massachusetts – Markey’s home state – provided strong testimony against a federal electric superhighway from an East coast perspective.
In our view, the expansion of FERC authority into centralized resource planning and associated siting jurisdiction violates fundamental free market principles, is unwarranted from energy or environmental policy perspectives, would diminish or eliminate the proven benefits of competition in electricity markets, including the fostering of local renewable and energy efficiency resources, and would strip states and indeed whole regions of critical policy authority over energy resource planning.
Hibbard was particularly concerned that opening up markets in the East to wind power from Western states thousands of miles away would disrupt local energy market development.
The very best wind resource in our country – from the perspectives of resource size, distribution, capacity factor, reliability, proximity to population centers and minimization of environmental impact – is located a short distance off the major load centers of the East Coast.
If the FERC steps in as proposed, Hibbard warned, the move would undermine the ability to tap offshore wind in the Atlantic Ocean.
"If FERC, with its new resource planning authority, moves quickly on a major transmission build out as conceived in the Joint Coordinated System Plan, this would, as a result of a single, non-market planning decision, dump [about] several thousand MW of resources into New England along new high-voltage lines. This would wipe out the need for new resources in our region for decades."
To the text of his official testimony, Hibbard appended a letter sent by 11 governors of Eastern Seaboard states. It was addressed to the Senate and House leaders of both parties urging a regional approach to transmission policy and support for offshore wind development. The governors wrote:
"While we support the development of wind resources for the United States wherever they exist, this ratepayer funded revenue-guarantee for land-based wind and other generation sources in the Great Plains would have significant, negative consequences for our region."
The East-West divide over transmission policy is not the only flashpoint in the upcoming debate. There’s great concern – and good evidence – that new transmission would serve to transport more coal-fired power, not less – instead of the wind and solar energy the public expects, particularly in the East. Indeed, speaking in support of a new Appalachian transmission line, the president of the West Virginia Coal Association recently said:
"Enhanced transmission capacity helps increase the amount of low-cost, coal fired generation dispatched into the regional grid. This helps preserve the future of existing power plants already on line, justifies additional investment in these plants and increases the likelihood that new, clean-coal electric fired generation will be constructed in the state."
And even on the question of national security, a transmission superhighway would make the power system less secure. Long inter-regional transmission lines, one commentator observed, are like extension cords that connect your toaster to a neighbor’s house a block or two away. The chances of a power outage due to unforeseen circumstances are magnified rather than diminished.
Miller of PEC concluded his testimony by calling for an integrated planning process so that transmission is not considered in isolation but together with the need for new capacity and the potential to reduce power demand.
"If we plan for transmission, transmission will be all that we build. And in the end many of your constituents will be left living beneath an aluminum sky."
He echoed the cautious approach that Markey sounded when he opened the hearings and that is currently in the Waxman-Markey bill. But observers don’t expect the current language to survive.
They are waiting to see if Waxman will amend it to reflect a more West-centric approach before the bill gets sent to the Senate and Sen. Reid, and whether the White House, which already sent billions of dollars in stimulus funds for new transmission lines, will weigh in publicly with a preferred position of its own.
Speaking before the Western Governor’s Association yesterday, Interior Secretary Ken Salazar — a former Senator from Colorado — promised to provide federal support for new transmission, and announced the creation of new federal renewable energy planning offices in four Western states —
Arizona, California, Nevada and Wyoming — to help make sure projects don’t get stalled.
Transmission Superhighway On Track to Carry Cheap, Dirty Coal Power to Northeast
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