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Power Grid – Upgrade and Expansion

IntroductionHigh Voltage Transmission Lines

In the past few decades, the power sector has emerged as one of the largest and most capital-intensive sectors of the US economy. Every year, over 131 million consumers in North America foot an aggregate electricity bill of about $247 billion.

In 1940, generation of electricity accounted for only 10% of the total energy consumed in the US. The percentage grew to 25% by 1970. Today, over 40% of the total energy consumed in the US is used to generate electricity.

North America has over 17,000 power plants, with a combined nameplate power generation capacity of around 1,088 gigawatts, supplying power to consumers over 200,000 miles of high-voltage transmission lines with carrying capacities of over 230 kilovolts (kV). The immense network includes over 10,000 transmission substations, which step up the voltage of electricity to 155–765 kV to minimize losses in power transmission over long distances, and about 2,100 distribution substations that step down the voltage for supplying power to the consumer.  Also visit US Power Grid - Status and Updates for additional information regarding the energy supply system in North America.

The power generation facilities are owned and operated by over 6,000 utilities, public power systems and cooperatives, and there are about 500 owners in the transmission sector. The total asset value of the power sector is estimated to be in excess of $800 billion, of which about 60% is invested in power generation, 30% in distribution, and 10% in transmission infrastructure.

Built nearly a century ago, the US power grid is the world’s largest interconnected machine and is considered to be one of the most significant engineering achievements of the 20th century. Over the years, several patches of the grid’s components have been upgraded. Obsolete electro-mechanical technology has been overlaid in patches with information technology (IT) infrastructure and Internet-based technologies, which have increased the grid’s operational capacities. However, the grid, in its present state, is not capable of accommodating the growing and diverse electricity requirements of the country.
According to the Energy Information Administration, about 281 GW of new power generation capacity would be required by 2025 to meet the US’ growing demand for electricity. As North America goes ”green”, power generation from solar, wind, geothermal, and other clean and renewable sources of energy will likely continue to increase, and all these facilities will need to be connected to the grid efficiently.

The power grid would also be required to accommodate the growing number of hybrid and all-electric vehicles, which will be plugged into the grid for charging. Over the past five years, the aging grid has also lead to an annual increase of 3% in the duration of outages, and an increase of 4% in the frequency of outages. Businesses in the US incur annual losses to the tune of $100 billion on account of power outages and disruptions in the quality of power supply.

In the coming years, electricity is very likely to dislodge oil as the primary source of energy in the US. This alone clearly demonstrates the importance of upgrading the existing power generation, transmission and distribution infrastructure with advanced technologies.

The Need for Modernization of the Power Grid

The North American power grid is a massive network of power generation, transmission and distribution infrastructure. It consists of four 'interconnections', which are physically and administratively distinct.

Three of these interconnections serve the US. These are:

(a) The Eastern Interconnection, which stretches from Halifax to New Orleans

(b) The Western Interconnection, which covers the regions to the west of the Rockies, from British Columbia to San Diego, and also covers a part of Mexico

(c) The Electric Reliability Council of Texas (ERCOT), which covers most of Texas.


Each of these interconnections has several substations, which step down the high-voltage electricity, greater than 230 kV, to a lower voltage that can be distributed locally through lines of lower capacities. The interconnections themselves are linked to each other through short, high-voltage direct current lines.

Grid Congestion

Transmission capacity, both between and within the interconnections, is not adequate to accommodate new power generation capacity from diverse sources. As the demand for power increases, more power generation facilities are integrated with the grid, putting an excessive strain on it and making it more prone to blackouts.

For example, the transmission system of the Tennessee Valley Authority recorded less than 20,000 transactions in 1996. The number of transactions taking place on the grid has now increased ten-fold to over 250,000, a volume that the system was not originally designed to handle.

Over the last three decades, demand for electricity in the US increased by about 25%. Unfortunately, construction of transmission facilities failed to keep pace with the soaring demand and instead decreased by about 30%. This has led to grid congestion or bottlenecks, which result in heavy loading of transmission lines and a strained system.

Grid congestion has two major implications. First, it reduces the amount of low-cost electricity that can flow through the grid and consumers end up paying more as they use the high-cost electricity that flows through the transmission lines. Second, the increasing load on the grid results in high transmission and distribution (T&D) losses. T&D losses in the US increased from about 5% in 1990 to 9.5% in 2001 due to heavy utilization of the grid and more frequent congestion. Power outages and poor quality of transmission cost the US economy about $25–180 billion every year.

In the event of a bottleneck, transmission operators are required to curtail transactions in order to prevent a breakdown. In the case of the transmission system of the Tennessee Valley Authority, the number of such curtailments increased from 300 to over 1,000 within a period of only two years, from 1998 to 2000.

There are several impediments in solving these T&D issues. These include opposition and litigation against development of new transmission facilities, especially in urban areas, uncertainty over cost recovery mechanisms for investors, lack of clarity on whose responsibility it is to set up new transmission facilities, and an overlap in jurisdiction and government agencies when it comes to granting permits for developing new infrastructure.

Electricity Distribution

The distribution system starts at the substation and ends at the consumer’s electricity meter. It consists of a dense network of low-voltage distribution lines that carry electricity to residential, industrial, and commercial establishments.

The electricity distribution system is the segment of the grid that is closest to the consumer. Its toughest challenge lies in responding effectively to the consumer’s rapidly changing needs for electricity. The 'information economy' has led to a rampant usage of computers, information technologies, and state of the art electronic appliances, all of which require consistent, reliable and affordable supply of power. Individual consumers are now equipped with distribution power generation and storage devices, which in turn emphasizes the need for reliable interconnection with the grid and safe distribution of electricity.

Power Generation from Renewable Sources of Energy

With abundant natural resources and access to technology expertise and capital, the US is well poised to make a massive shift to renewable energy. However, renewable sources of energy are mostly available in regions far away from the consumer. As solar panels and wind turbines are being erected in remote places, it becomes crucial to set up a robust high-voltage transmission backbone to carry electricity to the consumer.

Also, such facilities do not generate a consistent and constant output dependent as they are on adequate sunshine and minimum wind speeds. The power grid needs to be capable of assimilating the intermittent energy generated without recourse to additional fossil fuel-based power plants as a backup.

Take the case of Xcel Energy Incorporated, a Minneapolis-based holding company with utility subsidiaries serving electric and natural gas customers in eight states. In Colorado, the firm is developing 1 megawatt (MW) of natural gas-fired power generation capacity for every MW of wind power capacity being developed, in order to serve as a backup generation facility when the wind tails off. 

The US inevitably requires a new transmission infrastructure that integrates all the various solar-energy fields, wind farms, hydroelectric power generation units, geothermal pools and other alternative sources of energy being set up across the country.

Grid 2030 – Vision For The Future

Electrical Substation Components

The US is now looking to convert its century-old patchwork electricity infrastructure into a 21st century ‘smart grid’ – an interoperable distributed network that would be capable of interacting with consumers, enable real-time monitoring, detect and solve issues on its own, and seamlessly integrate with renewable sources of power generation. The transformation would require a phase-wise restructuring of the country’s entire power structure and would take up to 20–25 years for completion.

A report titled Grid 2030 – A National Vision for Electricity’s Second 100 Years published in July 2003 by the US Department of Energy’s Office of Electric Transmission and Distribution, highlights the radical changes in the electricity infrastructure envisaged by the US government. The plan for the future involves building on the existing infrastructure with new tools, techniques and technologies such as distributed intelligence and energy resources in order to increase the quality, efficiency and security of existing systems while enabling the development of a modern robust architecture for the power grid.

Grid 2030 would consist of three key elements:

(a) A nationwide electricity backbone -
Electric supply and demand would be balanced on a national basis by setting up high-capacity transmission corridors to link the east and west coasts of the US, as well as Mexico and Canada. This would provide consumers with ‘continental’ access to supply of power, connecting them to suppliers located anywhere on the continent.

(b) Regional interconnections, including Mexico and Canada -
While the national backbone would be connected with the Eastern and Western Interconnections, power from the backbone would be distributed over regional networks through upgraded, controllable AC facilities, high-capacity DC links, and electricity storage devices.
(c) Local distribution -
Micro and mini-grids to tap into generation resources and supply power to consumers located anywhere on the continent.

The regional networks would in turn be connected to local distribution systems and enable two-way flow of power between the regional network and consumers. Consumers would be able to tailor electricity supplies to suit individual needs, costs, quality, reliability, and environmental impacts.

The aim of Grid 2030 is to revolutionize the existing system to attain real-time flow of electricity and information, near-zero economic losses resulting from power outages and disturbances in the quality of power supply, a wider range of personalized energy choices, and suppliers competing in an open market to provide the best services. This requires a robust infrastructure built on advanced technologies such as superconductivity, clean power, distributed intelligence and resources, and the hydrogen economy.

Wide Area Measurement System (WAMS)

Information technologies have already revolutionized the banking and telecommunication sectors and have also made inroads in certain manufacturing industries. There is a vast scope for IT to be effectively applied in the power sector.

The WAMS is a smart, automatic network that enables real-time monitoring of the grid infrastructure. This can automate several functions such as transmission and distribution operations, restoration of power supply in the event of an outage, pricing, meter reading, billing, access and management of data, and status reporting.

New Materials

Advances in material sciences and semiconductor-based electronics are leading to the development of new electricity conducting materials with desirable properties such as lower electrical resistance, higher current-carrying capacity, greater control, lighter weight, and lower costs. High-temperature superconductors are capable of high-capacity power transmission over long distances with minimal T&D losses, leading to greater efficiency and reliability of the electric system.

Electricity Storage

Grid energy storage is used to level out the load on a large-scale interconnected system. This is achieved by transmitting low-cost off-peak surplus power to temporary storage sites; from where the low-cost power can be recovered when demand for power increases such as during peak hours. This eliminates the need for excess power generation capacities and also allows the grid to assimilate intermittent sources of energy such as solar and wind power.

Modern storage systems can be fitted at various transmission and distribution sections of the power grid, specific appliances, and also on the consumer’s meter equipment. These systems can significantly reduce peak load problems, eliminate disturbances in the quality of power supply, and enhance the stability of the grid.

Power Electronics

High-voltage power electronics form the crucial link between energy storage systems and the power grid. They function as the key power conversion interface, enabling rapid and precise switching of electric power to integrate asynchronous sources and direct current with the alternating current grid.

Power electronics are also the vital element in power flow controllers or Flexible Alternating Current Transmission Systems (FACTS), which increase the levels of power transfer and improve control of the power system. Advances in power electronics are aimed at reducing the costs of these vital components of the power grid.

Distributed Energy Technologies

Distributed generation refers to the use of small-scale power generation facilities located close to the region of consumption. An example of distributed power generation would be a small-scale solar power system set up on the rooftop by the homeowner.
Breakthroughs in combined heat and power generation systems and distributed energy generation help in increasing the number of electricity installations for residential, industrial and commercial users. Consumers can install modern devices such as micro-turbines, distributed gas turbines, reciprocating engines, and fuel cells in order to increase the quality and reliability of power supply, while controlling energy costs. In addition to addressing individual power requirements, surplus power generated from these units can also be fed into the grid.  

Advanced Metering Infrastructure (AMI)

AMI is a consumer-friendly concept in which homes and appliances are fitted with ‘smart’ controllers. Price signals from the grid are relayed to these controllers, which process the information and tune the power consumption accordingly. This prevents unnecessary consumption of electricity.

Google has developed Google PowerMeter, a Web application that uses smart meters to monitor energy consumption of households, broken down by appliance, and relay the information to electric utilities every few minutes. This enables a consumer to view his/her energy consumption on a real-time basis, leading to behavioral changes that would prod the consumer to reduce consumption of electricity by about 5–15% on an average.

Demand-Side Management

Electricity usage varies as customers’ activities and requirements vary by the time of the day and the season of the year. These patterns usually result in ‘peak periods’ i.e. periods of high electricity usage. Demand-side management refers to diligent steps taken by users to reduce consumption of electricity during peak periods. This can improve the overall efficiency of the system and reduce costs.

Reduction of peak demand can be achieved by using energy storage systems for load shifting, ‘smart’ thermostats for load management, and peak-elimination techniques such as distributed generation and thermally activated cooling, heating and humidity control devices. Demand-side management is estimated to result in annual economic benefits to the tune of $80–800 million

Implementation Schedule of Grid 2030

The table below highlights the implementation schedule of Grid 2030:



Demand-Side Management

Phase I – By 2010

-      Establish feasibility of the superconducting backbone concept

-      Coordinated regional planning and operations

-      Real-time information transparency for all grid operators

-      Deploy superconducting cables

-      Initial deployment of superconducting "power hubs" in congested regions

-      Develop prototype of "smart grid"

-      Use composite conductors for majority of new transmission lines

-      Establish feasibility of distributed intelligence

-      Set up remote outage detection capabilities

-      Plug & play protocols for distributed generation and resources

-      Define architecture for intelligent automated systems

-      Improve utilization and reduce costs

-      Establish feasibility of smart appliances

-      Greater use of distributed generation and combined heat and power

Phase II – By 2020

-      Smart grid in place for transmission of 50% of power in the US

-      Superconducting power hubs in operation in metropolitan areas

-      Average grid losses reduced by 50%

-      Fully integrated distribution operations

-      Deployment of intelligent automated architecture

-      Real-time, two-way communication for power and information

-      All appliances made "smart"'

-      Customers provided with access to power markets, real-time information and controls

Phase III – By 2030

-      Installation of superconducting backbone with fault timers and transformers

-      Smart grid transmits 100% power in the US

-      Two regional networks

-      Affordable electricity storage

-      Deployment of superconducting cables and equipment

-      Fully automated demand response

-      Deployment of low-cost onsite storage

-      Absolute interconnection between customers and electric networks

Funding for Upgrade and Expansion of the Power Grid

On February 17, 2009, the American Recovery and Reinvestment Act of 2009 came into force, as President Barack Obama approved a stimulus of $787 billion to be pumped into the economy, which is currently caught in a severe downturn. The US Department of Energy has been allotted $40 billion of the total stimulus package. About $4.5 billion of this package has been allotted to the Office of Electricity Delivery and Energy Reliability to undertake the upgrade and modernization of the country’s electric grid.

The funds will support the Smart Grid initiative authorized by the Energy Independence and Security Act of 2007. About $100 million would be invested in training workforce, $80 million in conducting assessment of resources and estimating future demand for power and transmission requirements, and $10 million in developing interoperability standards and protocols for devices of the smart grid.

In April 2009, the US Department of Energy announced plans to distribute over $3.3 billion to encourage development of smart-grid technologies. The DoE also said that it would disburse an additional amount of $615 million to promote studies pertaining to smart-grid storage, monitoring, and viability of technology.  For more information visit the US Department of Energy Smart Grid website.  

Under the DoE Smart Investment Grant Program, smart-grid technology deployments would be eligible for grants in the range of $500,000 to $20 million. About $100,000 to $5 million would be handed out as grants for deployment of grid monitoring devices.

The focus on smart-grid technologies is so high that a trade association has been set up for product developers and service providers in the areas of smart meters, smart grid technologies and demand response. The Demand Response and Smart Grid Coalition (DRSG), based in Washington, DC, seeks to educate and provide information to consumers, utilities and policymakers on how smart grid technologies can be used to modernize the US’ electricity infrastructure.


The US already has the world’s top electricity generation, transmission and distribution system. However, the existing system will not be able to cope up with the soaring demand for power and the increasing dependence on electricity for day-to-day activities unless it is upgraded in response to the changes in the power generation and consumption patterns. There is an urgent requirement for advanced, robust, and reliable technologies that can not only improve the existing infrastructure for generation, transmission and distribution but also revolutionize the country’s power grid for generations to come.

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