Optimal transmission expansion modestly reduces decarbonization costs of U.S. electricity

Rangrang Zheng, Greg Schivley, Matthias Fripp and Michael Roberts

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Abstract: Expanding interregional transmission is widely viewed as essential for integrating clean energy into decarbonized power systems. Using the open-source Switch capacity expansion model with detailed representation of existing U.S. generation and transmission infrastructure, solar, wind, and storage resources, and hourly operations, we evaluate the role of transmission across least-cost, socially optimal, and zero-emissions scenarios for 2050. An optimal nationwide plan would more than triple interregional transmission capacity, yet this reduces the cost of a zero-emissions system by only 7% relative to relying on existing transmission, as storage, solar and wind siting, and nuclear generation serve as close substitutes. Regional cost and rent effects vary, with transmission generally favoring wind and hydrogen resources over solar and batteries. Sensitivity analysis shows diminishing returns: one-fifth of the benefits of full expansion can be achieved with one-twelfth of the added capacity, while cost reductions for batteries and hydrogen provide comparable or greater system savings than transmission. Reconductoring -- quadrupling line capacity at half the cost of new builds achieves nearly all the benefits of unconstrained expansion. These results suggest that while substantial transmission expansion is economically justified, a diverse set of flexibility resources can substitute for large-scale grid build-out, and the relative value of transmission is highly contingent on technological and cost developments.

Date: 2024-02, Revised 2025-09
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