US transmission 'in desperate need of an upgrade,' Vice President Harris says

Achieving lofty US climate goals will require "thousands of miles of new high-voltage transmission lines all across our country," US Vice President Kamala Harris said Jan. 19.

Harris' comments, delivered at the groundbreaking for a new high-voltage line in Arizona, highlight the Biden administration's push to promote transmission development as it seeks to decarbonize the electric power sector.

"Every time you turn on a light or charge your laptop or plug in your air conditioner or put leftovers in the fridge, you rely on the power delivered by our nation's network of transmission lines," Harris said. "And that network is in desperate need of an upgrade."

The US is "at the start of an historic transition away from fossil fuel plants" toward cleaner energy, including wind and solar generation, she said.

But "in many cases, the infrastructure we need to move clean electricity from where it is created to where it is most needed has not yet been built," the vice president said. "To create our clean energy future, we must construct thousands of miles of new high-voltage transmission lines all across our country."

Harris joined Energy Secretary Jennifer Granholm and Interior Secretary Deb Haaland at the groundbreaking for the 125-mile, 500-kV Ten West Link transmission project in Tonopah, Arizona. The 3,200-MW capacity line will run from Pinnacle West Capital subsidiary Arizona Public Service's Delaney substation, west of Phoenix, to the Colorado River substation in Blythe, California, and help facilitate development of new renewable power and energy storage resources in both states.

In July 2022, the US Interior Department authorized a project company, Delaney Colorado River Transmission, also called DCR Transmission, to start construction of the line. It has already received approvals from utility regulators in Arizona and California. The Ten West transmission line is expected to enter operation by the end of 2023.

The Ten West Link is backed by Starwood Energy Group Global, which as of Jan. 1 rebranded itself as Lotus Infrastructure Partners.

Interior has described the project as "another significant milestone" in reaching a congressional mandate to permit at least 25 GW of renewable energy projects on federal lands by 2025. The department's Bureau of Land Management is currently processing 64 utility-scale onshore clean energy projects proposed on public lands in the western US that have a combined potential capacity of over 41,000 MW. The BLM is also conducting preliminary reviews of 90 applications for solar and wind projects.

Broader administration efforts

Expanding and modernizing the electric grid has been a key focus for the Biden administration, which has set a goal to decarbonize the US power sector by 2035.

Reaching that goal will require a substantial amount of new transmission. A US Department of Energy study released in August 2022 estimated that the country's total transmission capacity would need to as much as triple by 2035 to achieve a carbon-free power sector by that year.

The administration has worked with Congress to support new transmission development. The recently signed Inflation Reduction Act contained $2 billion for DOE loans that support transmission lines determined to be in the national interest. It also provided $760 million for a transmission siting and economic development grants program.

In addition to that funding, the bipartisan infrastructure law of 2021 provided more than $65 billion for power infrastructure, of which nearly $29 billion is devoted to the electric grid, including transmission. The infrastructure law also allows the Federal Energy Regulatory Commission to approve certain high-priority transmission projects if a state utilities regulator denies approval or has not acted on an application.

But transmission advocates hope to see more support from Congress and the Biden administration, both to lower permitting barriers and cut costs. Among other things, Congress could reconsider a proposal to create an investment tax credit for large projects and take up permitting reforms that stalled in 2022.

FERC is also moving ahead on a slate of major transmission rulemakings. The commission's acting chairman, Willie Phillips, said that FERC will forge on in 2023 with proceedings launched under former chairman Richard Glick, including proposed rules to address long-range transmission planning and cost allocation, generator interconnection delays and extreme weather events.

S&P Global Commodity Insights reporter Molly Christian produces content for distribution on Capital IQ Pro.