You know electricity is generated by wind turbines or coal or nuclear plants. And you know that the light turns on when you flip the switch. But have you ever wondered how the electricity gets from the generation source to your light bulb?

The electricity system is made up of the following three major components:

• generation plants (such as coal plants, wind turbines or solar photovoltaic cells), which generate electricity
• transmission, which carries large, bulk amounts of power at a high voltage across long distances
• distribution powerlines, which are lower voltage and are the powerlines connected to homes and businesses

Image from North American Electric Reliability Council (NERC)

In the United States, transmission lines are interconnected to form a grid. This grid is broken up into three large, mostly self-contained areas, called interconnects. The Western Interconnect extends west of the Rocky Mountains. The Eastern Interconnect, which accounts for about 75 percent of the electricity consumed in the country, is largely the area east of the Rocky Mountains. Finally, the state of Texas has its own interconnect, called ERCOT (Electric Reliability Council of Texas.)

Image from North American Electric Reliability Council (NERC)

Within each interconnect, there are regional transmission organizations and independent service operators. These organizations are regulated by the Federal Energy Regulatory Commission (FERC) and primarily provide a marketplace to buy and sell bulk electricity to serve the electricity load within the region. They also serve a reliability function to ensure that the region’s electricity generation and transmission meet current demand. Minnesota is served by the Midwest Independent Service Operator (MISO). The MISO region includes North Dakota, South Dakota, Nebraska, Minnesota, Iowa, Wisconsin, Illinois, Indiana, Michigan, and the province of Manitoba, as well as parts of Montana, Missouri, Kentucky, and Ohio.

Image from the Energy Information Administration

Transmission is important to renewable energy development because currently there is very little room to add additional generation to the transmission grid. For that reason, new electricity generators must often pay a substantial portion of the costs to upgrade transmission to allow the generator to connect to the grid and sell electricity.

Currently in the Midwest, there are about 10,000 megawatts of wind generation (largely located within the purple MISO and green PJM regions in the map above)—enough to power over three million homes. However, existing state renewable energy standards within the MISO region will require about 25,000 megawatts of renewable energy. The Midwestern Governors Association clean energy goals of 30 percent renewable energy by 2030 would require the equivalent of 75,000 to 100,000 megawatts of wind generation. Moreover, there are a huge number of requests from wind projects to connect to the grid that can’t be met currently because of transmission constraints.

Transmission policy is broadly made up of three components: planning, paying, and permitting. The planning stage determines how much transmission is needed and where it must be located to stabilize the grid; these plans are usually conducted regionally—such as on the MISO level—and recently at the interconnect-wide level. Paying determines who will pay for new transmission: electricity generators, the utilities that purchase the electricity, or the region as a whole. Permitting is largely determined by state rules and laws governing where a transmission line is actually built.

There are several processes underway to address these issues. Within the MISO, there are studies to determine the transmission needed to meet renewable energy standards; separate processes are working to determine who should pay for new transmission. In the past, the MISO has asked electricity generators and the utility buying the power to split the cost of transmission upgrades. However, small rural utilities whose service area covers a large geographical area often have a large wind resource but a small customer base. They argue that they should not have to pay to allow wind producers to connect to the grid. At the same time, current temporary MISO rules that require wind generators to pay ninety percent of the cost of new transmission may render new wind projects uneconomic. Alternatively, some portion of these costs could be allocated regionally, since the region also reaps the increased reliability brought by new transmission as well as other benefits. The FERC will make a final cost allocation decision.

On a broader level, the Eastern Interconnect Planning Collaborative, working under a three-year Department of Energy stimulus grant, has brought together a broad group of stakeholders to determine what kind of grid investments are required to meet existing renewable energy standards and future carbon limitations.

Fresh Energy continues to work for a transmission system that facilitates broad deployment of renewables across the region to meet renewable energy standard goals, create jobs and new industry, and stop global warming pollution.

You know that the light turns on when you flip the switch. But have you ever wondered how the electricity gets from the generation source to your light bulb?