Southern California and the Atlantic coastal area from New York City to northern Virginia are the most severely congested areas in the country, the U.S. Department of Energy (DOE) said in a new national electric transmission congestion study released last Tuesday.

The study also identifies other parts of the country that merit either close monitoring due to congestion issues or face potential congestion difficulties if significant new power supplies are brought online without associated transmission capacity.

The congestion study identifies three types of congestion areas that merit further attention. The first are categorized as the most severely congested areas — “critical congestion areas,” of which the study identified two: Southern California and the Atlantic coastal area from metropolitan New York southward through northern Virginia.

Critical congestion areas are “where it is critically important to remedy existing or growing congestion problems because the current and/or projected effects of the congestion are severe.”

This part of the country cuts across the PJM Interconnection footprint, where a number of major new transmission line projects have already been announced. And in the Empire State, New York Regional Interconnect (NYRI) has proposed construction of a 190-mile high voltage direct current (HVDC) transmission line that would run from Oneida County to Orange County, NY.

The report said that the area from greater New York City south along the coast to northern Virginia “is one continuous congestion area, covering part or all of the states of New York, Pennsylvania, New Jersey, Delaware, Maryland, Virginia, and the District of Columbia.”

This area “requires billions of dollars of investment in new transmission, generation, and demand-side resources over the next decade to protect grid reliability and ensure the area’s economic vitality. Planning for the siting, financing, and construction of these facilities is urgent.”

Electricity supply and transmission planners in the Mid-Atlantic area are looking west, particularly to West Virginia, Kentucky, Ohio and Indiana, “where there are extensive coal resources and the willingness to host power plants as a means of fostering economic development.” West Virginia and western Pennsylvania “also have significant potential wind resources.” In addition, the Midwest has “comfortable reserves” of generation for the near term, particularly low-cost, baseload nuclear and coal generation.

Nonetheless, major transmission upgrades will be needed in parts of Delaware, Maryland, New Jersey, Pennsylvania, Virginia, West Virginia, and perhaps Ohio to enable delivery of enough Midwestern generation to the Mid-Atlantic area to meet that area’s growing reliability and economic needs, the DOE said.

Several new high-voltage transmission lines have been proposed to address these needs, “but to date no region-wide analysis has been published confirming that the proposed lines would provide the facilities the region needs to strengthen its overall system and facilitate greater imports. As the entity responsible under FERC oversight for transmission planning within its broad footprint, PJM is the appropriate entity to respond to this analytic challenge.”

New York City’s “electricity supply problems are especially complex and difficult,” the report said. “Building new generation capacity within the city is extremely challenging because of air quality restrictions, high real estate values, fuel supply problems, and local opposition to power plants. Some additional generation is being added north of the city to serve the city’s requirements.”

Adding major new transmission lines to the north and northwest would increase the options available to the city for power, the DOE noted. “During the summer the city could be served by excess, relatively inexpensive hydropower from Canada. The flexibility provided by new transmission could also enable the city to tap recently proposed in-state wind power and clean coal generating capacity, if they are developed.”

The study said that an alternative would be to supply a portion of the city’s needs by strengthening ties to PJM and using the PJM network to access coal-fired generation in western PJM, “but this would affect electricity supplies and costs within PJM.”

The organizations directly responsible (under FERC oversight) for transmission planning across this area are PJM and the New York Independent System Operator (NYISO).

“Additional efforts are needed, however, at the inter-regional level. The electric systems of the Mid-Atlantic states and New York have become so highly interdependent that it is not possible to address the Mid-Atlantic problems without affecting New York’s electric system, and vice versa.”

The DOE recommended that transmission planners, regulators and stakeholders from PJM, NYISO, ISO New England, the Midwest Independent Transmission System Operator, Quebec and Ontario work jointly to analyze the long-term inter-regional challenges and to identify and support solutions that will meet the needs of the wider area as a whole, as well as its components.

The DOE “does not intend that any of the RTO-level initiatives and analyses now under way should be put on hold or delayed while a new level of inter-regional analysis is conducted. The challenge is to find an appropriate balance between the upgrades and other actions that are needed urgently in the near term, and the need to develop realistic concepts for what this critical portion of the Eastern Interconnection should look like twenty and thirty years from now.”

This long-term effort “will be hampered by many uncertainties, and it will be important to ensure that near-term initiatives are robust ‘no regrets’ projects, suitable to a wide range of possible futures.”

The PJM region, which covers several Mid-Atlantic states and the District of Columbia, has witnessed a plethora of new transmission line proposals since the start of 2006, with projects brought forward by American Electric Power, Allegheny Power and Pepco Holdings.

At the other end of the country, the study said that Southern California needs new transmission capacity to reach generation sources outside the region for reliability, economics and compliance with the state’s renewable portfolio standard.

It noted that the California Energy Commission’s November 2005 strategic plan identified four major projects related to Southern California as needed in the near term: Palo Verde-Devers No. 2 500-kV project; Sunrise Powerlink 500-kV project; Tehachapi transmission plan phase I-Antelope transmission project; and Imperial Valley transmission upgrade.

“Although progress is being made in expanding California’s energy infrastructure, Southern California’s economic and strategic significance to the nation is so large that the Department [DOE] finds it to be a critical congestion area.”

The DOE urged “continued cooperative analysis and planning within the Western Interconnection, and a strong commitment to identify and implement sound solutions as quickly as possible.”

The second category, “congestion areas of concern,” acknowledges four areas that need close watching and further study to determine the magnitude of their congestion problems. They are: New England; the Phoenix-Tucson area; the Seattle-Portland area; and the San Francisco Bay Area.

Congestion areas of concern are “where a large-scale congestion problem exists or may be emerging, but more information and analysis appear to be needed to determine the magnitude of the problem and the likely relevance of transmission expansion and other solutions,” the study said.

The third type, “conditional congestion areas,” identifies areas where congestion is not presently acute, but could become so if considerable new electric generation were to be built without associated transmission capacity. These areas include Montana-Wyoming; Dakotas-Minnesota; Kansas-Oklahoma; Illinois, Indiana and Upper Appalachia; and the Southeast.

The DOE noted that “these areas are potential locations for large-scale development of wind, coal and nuclear generation capacity to serve distant load centers.”

Section 1221(a) of the Energy Policy Act of 2005 amended the Federal Power Act (FPA) by adding a new section 216 to the FPA. FPA section 216(a) directed the Secretary of Energy to conduct a nationwide study of electric transmission congestion by Aug. 8. Based on the research documented in this study, Secretary of Energy Samuel Bodman may select and designate geographic areas as national interest electric transmission corridors.

For the two areas of the U.S. identified as critical congestion areas, the DOE believes it may be appropriate to designate one or more national corridors to facilitate relief of transmission congestion in these areas.

The DOE will also consider designating national corridors to relieve constraints or congestion in congestion areas of concern and conditional congestion areas.

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