A HOLE IN THE U.S. GRID

US Grid Has $107B in Investment “Gaps” by 2020; The American Society of Civil Engineers finds that failing to spend on grid upgrades will end up costing U.S. homes and businesses nearly $200 billion by 2020.

Jeff St. John, April 26, 2012 (Greentech Media)

“…[Failure to Act from the American Society of Civil Engineers (ASCE)] finds a gap of $107 billion dollars between today’s trends on grid investment and what the country needs to invest between now and 2020…If U.S. utilities and regulators don’t work to increase spending trends to make up that gap, the result will be…aging equipment and capacity bottlenecks that lead to…electricity interruptions…Those may come as equipment failures, voltage surges and power quality irregularities, or blackouts and brownouts due to demand exceeding supply…

“ASCE’s estimates of current 2012 costs to such grid problems are about $6 billion for U.S. households and $10 billion for U.S. businesses. But by 2020, they add up to $71 billion for households and $126 billion for businesses…[T]hat $197 billion in costs is nearly twice as much as the $107 billion in investment needed to fix the problem…”

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“…The Electric Power Research Institute (EPRI) predicted last summer that smart grid investment of $338 billion to $476 billion could yield $2 trillion in benefits by 2030, but that failing to invest could cause power prices to quadruple …Without needed investment in the grid, U.S. GDP will fall by a total of $496 billion by 2020, the U.S. economy will end up with an average of 529,000 fewer jobs…and personal income will fall by a total of $656 billion…ASCE’s estimates are actually lower than many…from [older] studies…The massive Northeast blackout of 2005 led to a spurt of new investment in grid reliability, which has mitigated some of the most pressing grid reliability problems…

“…ASCE’s report breaks out a gap of $12.3 billion in power generation, $37.3 billion in transmission lines and $57.4 billion in distribution grid systems through 2020. In other words, the distribution grid -- the neighborhood power delivery system -- will require more investment than generation and transmission combined…[T]he Southeastern U.S. has the most catching up to do…followed by [t]he Western U.S…the Mid-Atlantic…and Texas…”