Study Projects Pacific Northwest Job Loss if New Transmission is Not Built

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The Pacific Northwest Economic Region's Energy Horizons project today released a report by Idaho National Laboratory entitled The Cost of NOT Building Transmission. According to the study, if the top 5 projects are not built, it could lead to $55-85 billion in lost economic activity annually, and up to 60,000 jobs annually.

This is not a definitive study of every transmission issue in the Pacific Northwest. It is a conversation starting point on what issues we need to look at in more detail to make sure our that our region's energy gets to where it needs to be

The Pacific Northwest Economic Region's Energy Horizon project today released a report by Idaho National Laboratory entitled The Cost of NOT Building Transmission. According to the study, if the top 5 projects are not built, it could lead to $55-85 billion in lost economic activity annually, and up to 60,000 jobs annually.

"This report gives us, as policymakers, a better understanding of the cost of not meeting our energy needs as a region," said Rep. George Eskridge R-Idaho. "In addition to considering our energy resources, we also need to have the transmission infrastructure to get those resources to consumers. This report really underscores how transmission is vital to our collective future as a region."

The report was funded by a grant to PNWER's Energy Horizon project from the US Department of Energy as part of an effort to provide State and Provincial policymakers with tools for decision making on energy transmission issues. A full copy of the report can be downloaded at
http://www.pnwersenergyhorizon.com/files/PNWERReport_Rev2c_Final_16Jul08_ntwtm3.pdf.

The PNWER region experienced significant population and economic growth during recent years, and all jurisdictions except for the Yukon Territory are currently experiencing growth at a rate higher than that of the combined Canadian and U.S. population. Because of this rapid growth, critical infrastructures, such as in the energy sector are being overloaded.

Without new transmission lines, negative impacts occur to local economic/employment growth opportunities due to limited availability of additional power and increased costs.

Failing to deliver lower-cost wind, coal, hydro power and other resources to load centers can increase electricity cost 40-50% over the next few years as growth outstrips the increases in power generation and delivery. Furthermore, a recent groundbreaking report, entitled 20% Wind Energy by 2030: Increasing Wind Energy's Contribution to U.S. Electricity Supply, looks closely at one scenario and concludes that reaching 20% wind energy in the United States by 2030 will dramatically reduce greenhouse gas emissions and enhance our energy security and clean power generation.
Since PNWER has such rich wind resources, wind farms will be a critical part of the solution to regional environmental issues of climate change and ensuring energy security.
If we do not move forward with needed transmission a cascading series of events will unfold.
1) Inadequate competition will not be available to keep regional power costs down.
2) Lack of new transmission assets elevates the likelihood of rolling brown/black outs due to congestion of the existing grid and increase rates to rate payers.
And a new school is replacing old school thinking as part of regions new future:
1) Transmission planning is encountering more regional (i.e., PNWER) economic-based pressure as contrasted to historical state-specific planning based on reliability requirements.
2) Distributed generated sources (i.e., natural gas powered plants) are subject to large fuel price swings as compared to renewable or established lower cost coal and hydro generation, thus increasing uncertainty in future energy costs. Further, these plants are dependent on remote energy sources supplied by an aging and undersized pipeline infrastructure.

3) The California energy market is, and will remain, the driver of energy availability in the Northwest. Because Californians are willing to pay a higher premium for energy, a significant portion of any additional power capacity in the Northwest will try to make its way to California

"The goal of PNWER's Energy Horizon project is to give decision makers a look into the future, to avoid crises like the 2001 California/Enron price spikes, and provide a sound foundation in energy costs for our region's economic growth," said Jeff Morris Project Director.

The report also outlined new generation identified in over the horizon planning by utilities that look out to 2025 and predicts what the most affordable electricity generation will be bought to accommodate growth.

Most affordable resources in the Northwest identified include the following:
1.     Wind in the Columbia Valley, southern Alberta, much of Montana, central and
         southern Wyoming, and southern Idaho
2.     Coal in central Alberta, eastern Wyoming, and central and eastern Montana
3.     Cogeneration and nuclear in the oil sands of northern Alberta
4.     New hydro in western British Columbia and Alberta.

There is a growing customer demand, as well as political mandate, for access to clean, renewable energy sources. As a result, more and more states have passed measures to mandate greater use of these resources and to reduce greenhouse gases. Because renewable resources are widely distributed, this growing demand further emphasizes the need for additional transmission lines to supply load.

INL has also recommended that PNWER should explore the interrelationship of transmitted energy vs. distributed gas plants, study gas pipeline capacity to meet climate change policy goals and that PNWER should study how natural gas power plants increase the cost of natural gas to local/regional consumers and how the plants are only a stop-gap solution and do not build long-term infrastructure or redundancy.

The major deliverable from this study is that policy makers across the Pacific Northwest as well as Washington D.C. and Ottawa now know the 15 most important electric transmission projects in the Pacific Northwest and what it will cost the economy in jobs and dollars if they are not built.
This information is now known and these projects progress can be tracked and questions asked if they stall or do not go forward.

"This is not a definitive study of every transmission issue in the Pacific Northwest. It is a conversation starting point on what issues we need to look at in more detail to make sure our that our region's energy gets to where it needs to be," said Morris.

About PNWER
Pacific NorthWest Economic Region (PNWER) is the only regional planning and facilitation organization set up in statute by the border states and provinces to deal with transboundary policy and planning in the Pacific Northwest.
http://www.pnwer.org
Idaho National Laboratory
In operation since 1949, INL is a science-based, applied engineering national laboratory dedicated to supporting the U.S. Department of Energy's missions in nuclear and energy research, science, and national defense.
Mission
Ensure the nation's energy security with safe, competitive, and sustainable energy systems and unique national and homeland security capabilities. http://www.inl.gov .

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