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CEIC-03-06

"Transmission Line Siting: A Quantitative Analysis of Transmission Demand and Siting Difficulty "

Shalini Vajjhala

Abstract:
Recent events, such as the California energy crisis, have focused national attention on the growing demand for electricity in the United States and the simultaneously lagging development of electricity transmission infrastructure. Although the nation’s transmission grid began as a series of local connections for regional reliability, expanding interconnects and state deregulation have gradually transformed the system into a competitive superhighway for electricity trading. In spite of recent extreme examples of the nation’s ailing grid and the widespread call for new transmission construction, transmission line siting is a difficult and time-consuming process often resulting in construction delays or cancellations of new lines. Problems with individual siting projects have been attributed primarily to public opposition, regulatory inconsistencies, geographic or topographical constraints, and lack of investment incentive; however, most of the information about siting difficulty is anecdotal and project-specific, and there is little comprehensive empirical analysis on the factors affecting transmission line siting.

This paper develops four unique measures of transmission line siting difficulty and based on these measures, presents a regression model for quantitatively evaluating the factors affecting siting at the state-level. The four measures of the dependent variable, siting difficulty, are 1) an economic measure based on variations in the marginal cost of electricity production, 2) a physical measure of the difference between proposed and actual transmission construction, 3) a geographic measure of the co-location of generation capacity and demand load centers within a state, and 4) a subjective measure from a survey of industry experts’ perceptions. Using these four measures of siting difficulty, this paper also evaluates perceived and actual siting constraints using a series of regression analyses. The results from these measures and analyses parallel documented perceptions of siting constraints and serve as quantitative counterpart to existing anecdotal information on siting. Overall, the framework that this research provides for characterizing siting difficulty and siting constraints has the potential to serve as a tool for communication between siting agencies, foster a common understanding of the siting problem, and address existing issues with inter-agency coordination. In a field dominated by uncertainty and anecdote, this paper provides a guide for characterizing the demand for transmission construction, evaluating specific siting problems, and coordinating siting solutions.

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