DOE: Failing to invest in grid-enhancing tech will be a 'massive miss'

The Department of Energy is poised to release another report in its Pathways to Commercial Liftoff series that tackles one of the utility sector’s most major challenges: how to prepare the grid for rapid load growth, at a moment when grid capacity is more constrained than ever. 

While the full report on the state of innovative grid deployment won’t be released until later in the spring, the department shared an interim report on its findings in a webinar. As the report’s release date draws closer, here are five reasons DOE believes we need a dramatic overhaul of grid planning.

New projects alone can’t meet the coming demand — the existing grid needs to step up.

Load growth is expected to increase by 35-70% by 2035, the report found. While renewables deployment — and especially solar deployment — is reliably trending up, supply chain delays and high grid interconnection wait times hinder the industry’s ability to scale quickly enough to keep pace with expanding demand. 

That demand comes from a range of sources, including data centers, new manufacturing hubs, and the grid-wide move toward electrification.

“Rapid load growth in many parts of the country is impacting utilities’ ability to meet demands today,” said Lucia Tian, the senior advisor to the DOE’s chief commercialization officer, in the webinar. “In these areas, there’s urgency to expand system capacity and investment…The industry will increasingly need to get more out of the existing grid infrastructure to be able to deliver reliable and affordable power.”

Even though 100 to 175 gigawatts of additional distributed generation capacity is expected to be added to the grid by 2030, this new build still falls short of what’s required to support demand surges while still ensuring reliability.

DOE emphasizes the need to rely on the existing grid — which can be improved upon with the use of grid-enhancing technology, or GETs. But today, investment in GETs is still too low for the grid to fully realize the technology’s benefits.

Failing to modernize the grid in the near-term will cost us in the long-term.

A combination of congested power lines that result in higher costs and imperil reliability, aging infrastructure, and a balkanized and ineffective grid interconnection landscape is causing the grid to struggle.

Grid modernization, DOE found, lessens the congestion that is projected to grow. Neglecting to modernize, though, could inhibit economic growth opportunities and risk both reliability and affordability. From 2020 to 2022, estimated congestion costs tripled, with the highest wallet-squeezes being found in non-ISO/RTO areas. 

Already, an estimated 60% of transmission and distribution (T&D) lines are operating near or past the end of their useful life. These aging assets are threatened by worsening extreme weather conditions — according to the report, there were over 78% more weather-related power outages between 2011 and 2021 than in the ten years prior. 

And, as grid capacity continues to stretch from new build and load growth, so does the amount of congestion and the associated ratepayer costs and risks of rolling blackouts. 

Innovative grid deployment — including through the use of GETs — can significantly expand capacity, but it has to happen judiciously.

An electricity cooperative quoted in the interim report worried that integrating new technologies while maintaining the system is difficult. And an investor-owner utility added that because “there isn’t a standard process for how to quantify the long-term value for these grid mod technologies,” scaling GETs is particularly challenging.

Grid modernization technologies are already readily available and commercially viable.

GETs and other forms of grid modernization technologies like advanced distribution management systems are already on the market and ready to help “future-proof” the grid, the interim report stressed. 

Though over 20 types of GETs exist, they generally fall under one of four strategic priorities:

• Retrofitting the current system with advanced transmission technologies to expand capacity and improve efficiency, which can be done with advanced conductors and high voltage direct current lines;
• Building situational awareness and system automation to improve visibility and decision-making with ADMS and DERMs; 
• Deploying grid enhancing solutions to better optimize and adaptively control a dynamic grid using dynamic line rating and VPPs;
• Integrating foundational communication, computational, and data management systems.

The over $3.4 billion in public sector funding specifically focused on grid modernization can help reduce upfront costs and de-risk investments into these technologies while stimulating supply chain development, DOE added. While it’s still early days when it comes to GET deployment, the department expects best practices to emerge, and make future deployments easier.

Insufficient and misaligned incentives are hampering deployment.

Although solutions are both technically proven and commercially available, utilities don’t have the right incentives to integrate them. 

“Traditional utility and regulatory incentive structures do not align with the needs of a modern grid,” said the interim report, especially when those structures don’t include monetization for avoided costs and improved performance, or when they disincentivize cutting-edge tech.

“We need to overcome key deployment barriers inherent in the market structure…and ramp up the momentum,” said Vanessa Chan, the chief commercialization officer for the DOE and director of the Office of Technology Transitions. “It will be a massive, massive miss if we don't work together to break these barriers down today; we need fast action to pursue a proactive investment strategy in available advanced grid technologies that are here right now that you can deploy today.” 

HVDC, DLR, advanced conductors, and ADMS technologies are considered high-priority for rapid scaling.

Though the final report will discuss over 20 different GETs, DOE already highlighted several as the cornerstones of a successful GET ecosystem: HVDC, DLR, advanced conductors, and ADMS technologies. This is largely due to their deployment readiness and scalability.

HVDC lines efficiently connect current transmission lines with converter stations that link to the grid’s alternating current system. By increasing the overall transmission capacity with very limited energy losses, HVDC improves grid reliability and resiliency. However, the domestic HVDC supply chain is currently limited because of low historical demand. 

“Accelerating HVDC projects can create a strong demand signal to drive domestic manufacturing build out, with public funding…available to support HVDC projects and component manufacturing,” the report noted. 

Meanwhile, DLR provides real-time calculations of the thermal capacity of a power line based on the current environmental and weather conditions. Rather than relying on static ratings that don’t take real-time conditions into account, grid operators can use DLR to better manage power flows and reduce congestion by 60-100%, the report found. 

“Think of static line ratings like setting a highway speed limit based on the most treacherous winter conditions,” said Eshaan Agrawal, a science, technology, and policy fellow at the OTT. “DLR sets a safe speed limit based on weather conditions in the moment.”

And advanced conductors are simply T&D lines that are made from stronger, more temperature-resistant materials. Though more expensive than traditional lines, advanced conductors can reduce energy losses by 20-40% and improve overall efficiency due to their low resistivity. Reduced power line sag also boosts resilience during extreme weather events. 

Lastly, the report touts ADMS technologies as the distribution network’s “cornerstone operational technology system for efficiency, reliability and resilience” because of how they can improve both the grid’s capacity and manage clean, distributed resources. ADMS software platforms integrate subsystems to provide the data granularity that’s essential for advanced applications like large-scale DERMs. 

These technologies alone won’t solve the problem. The U.S. may need to double the size of the grid to support new renewables. But these grid solutions are critical for driving down costs and expanding grid capacity quickly. 

Listen to a recent Carbon Copy episode featuring Brian Janous of Cloverleaf Infrastructure on creative approaches to unlocking grid capacity: