The improvements needed in the T&D system could be completed over the next 20 years, with significant progress by 2020. Modifying the EPRI results as detailed in Annex 9.A suggests that a total investment of $225 billion will be required for transmission systems, and modern distribution systems are likely to require a total of $640 billion.37 If the T&D system is not modernized but simply expanded to meet growing loads, transmission would require $175 billion and distribution $470 billion. Thus the incremental costs of modernization are $50 billion for transmission and $170 billion for distribution spread over the next 20 years.38 Modernization would actually cost about twice this amount, but less expansion would be needed to meet projected loads, and the savings from these synergies would account for the difference. For example, existing lines could carry greater loads if improved control systems prevented overloading, so some new lines would not be needed.

A more recent analysis was performed by the Brattle Group, which built on the EPRI analysis (Brattle, 2008). Estimated costs in the two studies are very similar.39 The Brattle study does not distinguish between investments to meet increased load demands and investments in modernizing the system, but it estimates that $233 billion will be needed for the transmission system (compared to EPRI’s $225 billion).40 Brattle estimates that $675 billion will be needed for distribution versus EPRI’s $640 billion.

Neither report explicitly accounted for the construction of new transmission lines to bring power from remote wind or other renewable energy sources to load centers. These lines could be longer than those from conventional power sources and carry power at a lower capacity factor, thus increasing costs. According to a DOE report on achieving 20 percent of U.S. electricity from wind power, an estimated 12,000 miles could be constructed for $20 billion (DOE, 2008). Actual expenditures will be highly dependent on the routes chosen and the capacities of the lines, but additional costs on the order of tens of billions of dollars seem plausible. Large-scale power generation from photovoltaics or solar thermal technology is a longer-term possibility if cost reductions are achieved. Much of this power


These estimates are in 2007 dollars.


The cost of implementing a T&D system is less than the cost of meeting load growth plus the cost of adding intelligence to the systems because of synergies, which are discussed in Annex 9.A.


A comparison between these two studies is made in more detail in Annex 9.A.


Again, these estimates are in 2007 dollars.

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