Constructing New Transmission Infrastructure Would Repower the US Economy
- May 19, 2021 12:11 pm GMT
A report from the international trade association WIRES shows that improving the transmission lines would create far-reaching employment and GDP benefits
WIRES, the international trade association that promotes investment in all aspects of the high voltage grid, has recently released an analysis prepared on its behalf by London Economics International LLC (LEI) that highlights the short- and long-term economic benefits and job creation that would be actualized by financing high voltage transmission projects.
The Repowering America: Transmission Investment for Economic Stimulus and Climate Change report identified $83 billion in planned transmission projects around the country that have been ISO/RTO Board-approved and/or recommended to regulators. LEI’s investigation found that this infrastructure investment would boost GDP by $42 billion, create approximately 442,000 well-paying jobs, and hike direct local spending by nearly $39 billion cumulatively during the construction phase of the projects.
This new analysis comes hot on the heels of a report by ACORE – the American Council on Renewable Energy, which makes a similar case for investing in the grid to spur innovation as well as boost the post-COVID economy.
The LEI report also determined that in the longer term over the transmission assets’ lifecycle, the operations and maintenance of these projects would provide an annual GDP increase of $1.6 billion and create around 9,000 permanent jobs. The co-benefits of the transmission projects were also highlighted as offering longer-term impact on GDP, including reduction in electricity prices, increasing renewable generation, and advancing decarbonization goals. Previous investments in transmission have helped the nation recover from economic shocks and it is likely that this would too.
“This report quantifies what WIRES and its members have long known — that investment in transmission infrastructure drives family-supporting jobs and can deliver a significant boost to the national and regional economies. That’s just what we need in our current economic climate,” said Larry Gasteiger, Executive Director of WIRES. “The Biden Administration clearly views grid infrastructure as a critical component of its Build Back Better agenda and a means to achieve its ambitious climate goals, and WIRES commends its focus on transmission. We encourage more attention on federal policies and incentives that will spur even more grid investment, and address planning, siting, permitting and cost allocation issues that delay transmission build out, so the country can more quickly reap the benefits of this mission-critical infrastructure.”
Of the $83 billion in approved and/or recommended planned projects, LEI found that the GDP during the construction impact (including the installation and domestic manufacturing stages) could generate an increase of nearly 14% of utilities current value-added GDP and more than double utilities’ current regional employment, based on 2019 levels.
“It is clear that transmission infrastructure is a powerful driver for unlocking GDP growth and job creation in the U.S.,” said Julia Frayer, managing director at LEI. “In our analysis we purposefully took a very conservative assessment of the figures, and anticipate that the multiplier effect and co-benefits of transmission projects would drive substantially greater economic impact.”
Taken overall, these two reports make a very strong case for investment in the country's aging infrastructure. The benefits in jobs, with their secondary effects, would help communities which have seen employment and businesses hit hard by the pandemic.
The full report is available for download here:
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