Back to basics: Ramping up renewable energy in the U.S. won’t require new technology so much as basic infrastructure—such as this substation near Santa Clarita, CA—to help bring that energy to market.
The challenge facing the United States is particularly striking. Whereas Germany already gets 14 percent of its electricity from renewable sources, the United States gets only about 1 percent of its electricity from wind, solar, and geothermal power combined. But more than half the states have set ambitious goals for increasing the use of renewables, and president-elect Barack Obama wants 10 percent of the nation’s electricity to come from renewable sources by the end of his first term, rising to 25 percent by 2025. Yet unlike Germany, which has begun planning for new transmission lines and passing new laws meant to accelerate their construction, the United States has no national effort under way to modernize its system. “A failure to improve our grid will be a significant burden for the development of new renewable technologies,” says Vinod Khosla, founder of Khosla Ventures, a venture capital firm in Menlo Park, CA, that has invested heavily in energy technologies.
When its construction began in the late 19th century, the U.S. electrical grid was meant to bring the cheapest power to the most people. Over the past century, regional monopolies and government agencies have built power plants–mostly fossil-fueled–as close to population centers as possible. They’ve also built transmission and distribution networks designed to serve each region’s electricity consumers. A patchwork system has developed, and what connections exist between local networks are meant mainly as backstops against power outages. Today, the United States’ grid encompasses 164,000 miles of high-voltage transmission lines–those familiar rows of steel towers that carry electricity from power plants to substations–and more than 5,000 local distribution networks. But while its size and complexity have grown immensely, the grid’s basic structure has changed little since Thomas Edison switched on a distribution system serving 59 customers in lower Manhattan in 1882. “If Edison would wake up today, and he looked at the grid, he would say, ‘That is where I left it,’” says Guido Bartels, general manager of the IBM Global Energy and Utilities Industry group.
While this structure has served remarkably well to deliver cheap power to a broad population, it’s not particularly well suited to fluctuating power sources like solar and wind. First of all, the transmission lines aren’t in the right places. The gusty plains of the Midwest and the sun-baked deserts of the Southwest–areas that could theoretically provide the entire nation with wind and solar power–are at tail ends of the grid, isolated from the fat arteries that supply power to, say, Chicago or Los Angeles. Second, the grid lacks the storage capacity to handle variability–to turn a source like solar power, which generates no energy at night and little during cloudy days, into a consistent source of electricity. And finally, the grid is, for the most part, a “dumb” one-way system. Consider that when power goes out on your street, the utility probably won’t know about it unless you or one of your neighbors picks up the phone. That’s not the kind of system that could monitor and manage the fluctuating output of rooftop solar panels or distributed wind turbines.
The U.S. grid’s regulatory structure is just as antiquated. While the Federal Energy Regulatory Commission (FERC) can approve utilities’ requests for electricity rates and license transmission across state lines, individual states retain control over whether and where major transmission lines actually get built. In the 1990s, many states revised their regulations in an attempt to introduce competition into the energy marketplace. Utilities had to open up their transmission lines to other power producers. One effect of these regulatory moves was that companies had less incentive to invest in the grid than in new power plants, and no one had a clear responsibility for expanding the transmission infrastructure. At the same time, the more open market meant that producers began trying to sell power to regions farther away, placing new burdens on existing connections between networks. The result has been a national transmission shortage.