National Grid: New Transmission Policies Are Needed to Realize Renewable Generation's Potential in the U.S.

Sep 21, 2006 Business Wire

In a white paper published yesterday, National Grid (Westborough, Massachusetts) urged federal and state policymakers to address current inadequacies in U.S. transmission policies that create obstacles for wind and other renewable generators in accessing the country's electric grid.

In the paper, entitled "Transmission and Wind Energy: Capturing the Prevailing Winds for the Benefit of Customers," National Grid advocates for the development of a consistent and appropriate policy approach to support the transmission investment needed to harness wind power and integrate it into the U.S. electricity grid while continuing to maintain system reliability, and deliver its full benefits to electricity market users and customers.

Renewable power sources, including wind, have captured the attention of policymakers, customers, and others as an alternative to natural gas and other fossil fueled generation as their prices have become increasingly high and volatile. Improved technology, federal tax credits and public policies that encourage utilities to use renewable energy sources have helped spur the recent growth of wind power across the country.

"Transmission is the essential infrastructure needed to facilitate access to new generation sources such as wind power," said Masheed Saidi, National Grid senior vice president, U.S. Transmission. "If U.S. policymakers and customers want to tap the potential benefits of the nation's renewable resources, including wind, policies must be established to facilitate the integration of these resources into the electric grid reliably and cost effectively."

National Grid contends that in order to tap the vast potential of new generation sources, policies must support investment needed to deliver renewable energy to customers. National Grid calls for:

-- Comprehensive regional planning for reliability and economic needs, including access for new renewable and remote generation sources.

-- Cost allocation for transmission improvements that recognizes their broad benefits.

-- Policies that address interconnection scheduling issues, remote siting, generation interconnection, and the unique characteristics of renewable generation, such as the intermittency of wind.

-- Federal and state cooperation on siting and cost recovery.

"The New York renewable energy industry is pleased that National Grid is promoting transmission policies that will help clean energy sources reach the customers they are intended to benefit," said Carol E. Murphy, executive director of the Alliance for Clean Energy New York.

"This report from National Grid highlights the critical role that wind energy can play in building a more diverse and reliable power supply that generates significant economic and environmental benefits for electricity customers," said Renewable Energy Trust Director Warren Leon. "Harnessing wind energy is an important part of our strategy to build a cleaner, more secure energy future for the Commonwealth."

National Grid also proposes incentives to continue FERC's encouragement of independent transmission ownership, which can help wind development. Independently operated transmission can:

-- Provide the most effective method of ensuring non-discriminatory and adequate transmission access to new, less costly, and diverse sources of generation including clean coal, renewables, and wind;

-- Promote effective regional system planning processes that provide for new generation, including remote renewables, and demand-side participation in electricity markets;

-- Facilitate the closure of old, dirty, and uneconomic generating sources by allowing newer, cleaner regional generation sources to be delivered to load centers.