High Voltage, High Reward Transmission

Investment Rating - The report does not explicitly provide an investment rating for the transmission industry but emphasizes the cost-effectiveness and long-term benefits of regional and interregional transmission projects for ratepayers [10][24]. Core Insights - The report highlights that large-scale transmission projects can deliver significant cost savings to American consumers, with benefit-to-cost ratios ranging from 1.1 to 3.9 for the evaluated projects, indicating that every dollar invested yields at least equivalent savings [17][48]. - It emphasizes the importance of well-planned regional and interregional transmission systems to maximize benefits and reduce costs amid rising electricity demand and the integration of new energy resources [10][24]. - The analysis is based on seven case studies of operational transmission projects across various regions, showcasing their economic benefits and contributions to grid reliability [11][36]. Summary by Sections Executive Summary - The report discusses the growing need for transmission investments to meet electricity demand and integrate lower-cost generation resources while maintaining grid reliability [10]. - It presents evidence from seven case studies demonstrating the savings that large-scale transmission can provide to ratepayers [11]. Case Studies on Regional and Interregional Transmission Savings - Seven transmission projects were selected for analysis, each providing at least 10 years of operational data and showcasing geographic diversity [36][39]. - The projects were evaluated based on their performance, focusing on realized benefits and costs, with findings indicating that all projects delivered savings exceeding their costs [16][48]. Key Findings - Finding 1: Ratepayer savings exceed costs, with all seven projects achieving benefit-to-cost ratios between 1.1 and 3.9, demonstrating the economic viability of large-scale transmission [17][48]. - Finding 2: Projects aimed at delivering economic benefits exceeded planners' expectations, with several projects outperforming their original benefit-cost analyses [18][53]. - Finding 3: Reliability-driven projects delivered unintended economic benefits, showcasing that addressing reliability can also yield significant economic returns [19][56]. - Finding 4: Transmission is a long-term investment, with benefits increasing over time as initial capital costs depreciate, leading to enduring savings for ratepayers [20][60]. Methodology - The report outlines a methodology that focuses on calculating the benefits and costs of transmission projects using observed performance data, emphasizing a conservative approach to estimating savings [68][74].