BACKGROUND

The Current Transmission and Distribution System

T&D involves two distinct but connected systems (as shown in Figure 9.1):

  • The high-voltage transmission system (or grid) transmits electric power from generation plants through 163,000 miles of high-voltage (230 kilovolts [kV] up to 765 kV) electrical conductors and more than 15,000 transmission substations. The transmission system is configured as a network, meaning that power has multiple paths to follow from the generator to the distribution substation.1

  • The distribution system contains millions of miles of lower-voltage electrical conductors that receive power from the grid at distribution substations. The power is then delivered to 131 million customers via the distribution system. In contrast to the transmission system, the distribution system usually is radial, meaning that there is only one path from the distribution substation to a given consumer.

The U.S. T&D system includes a wide variety of organizational structures, technologies, economic drivers, and forms of regulatory oversight. Federal, state, and municipal governments and customer-owned cooperatives all own parts of these systems, but approximately 80 percent of power transactions occur on lines owned by investor-owned regulated utilities (IOUs). These fully integrated utilities own generating plants as well as the T&D systems that deliver the power to their customers. In the past, this was the dominant model, but deregulation in some states has transformed the industry. In deregulated areas, generation, transmission, and distribution may be handled by different entities. For example, independent power producers (IPPs) may sell power to distribution utilities, or even directly to end users, using the transmission system as a common carrier (as shown in Figure 9.2).

The Federal Energy Regulatory Commission (FERC) has long had the authority to regulate financial aspects of the transmission of electricity in inter-

1

“Distribution substations” connect the high-voltage transmission system to the lower-voltage distribution system via transformers. The system includes 60,000 distribution substations. “Transmission substations” connect two or more transmission lines.



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