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"Electric Gridlock: A National Solution"

Jay Apt and Lester B. Lave

Preventing future blackouts requires increasing the capacity and reliability of the transmission grid. This can be accomplished by building more lines as well as by increasing the capacity and controllability of existing lines, both requiring billions of dollars of investment. New technology, from Flexible AC Transmission System (FACTS) to improved data acquisition and control (SCADA) systems would do much to increase the operational capacity and reliability of existing lines. R&D promises still larger advances in the future, such as SMES (Superconducting magnetic energy storage), FCL (Fault-current limiter), and HTS (High-temperature superconductor) cable.

During and immediately after the blackout, political leaders stated that the blackout was unacceptable and should never happen again. This is political rhetoric that is unlikely to produce substantial government appropriations or approval of price hikes to pay for the investments. We propose a more realistic goal: The amount of loss and inconvenience from cascading failures should be no greater, averaged over a decade or so, than the loss and inconvenience due to natural hazards such as ice storms.

Present systems for paying transmission operators do not provide both proper incentives for new investment at the same time that they discourage use of the congested segments of the grid. We propose a two-part tariff. This two-part tariff would both encourage customers and generators to locate in places with low LMP, and would give investors in new transmission lines the incentive to build needed capacity.

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