Transmission Expansion for Renewable Energy Scale-Up: Emerging Lessons and Recommendations

Scaling up renewable energy, such as wind and solar, goes hand in hand with the expansion of transmission infrastructure. Investment needs for transmission expansion to accommodate renewable energy are significant and growing in both developed and developing countries, and they are challenging existing planning and cost-recovery practices.

The objective of this report is to present emerging lessons and recommendations on approaches to efficiently and effectively expand transmission networks for renewable energy scale-up. The report focuses on the planning and regulatory aspects of transmission expansion that are relevant to transmission utilities and electricity regulators. Recognizing that policy goals, sector structures, existing regulations, and capabilities to implement new tools vary across countries, we offer some general principles to help guide the design of transmission planning and pricing regulations aiming at effectively and efficiently developing transmission for renewable energy

» Download the Report (PDF, 3.1MB) 

FOREWORD |

In their efforts to move toward a lower-carbon power sector, developed and developing countries are facing the need to considerably expand their transmission networks to serve the needs of renewable energy. The most cost effective renewable energy resources needed to decarbonize the electricity supply are usually located far from the existing transmission networks and consumption centers. Thus, transmission networks need be expanded and upgraded in order to reliably and cost-effectively connect and transport renewable energy supplies. Policy makers need be aware that renewable energy scale-up goes hand in hand with the expansion of transmission networks and that proper planning and regulatory actions are therefore necessary.

This report reviews emerging approaches being undertaken by transmission utilities and regulators to cope with the challenge of expanding transmission for renewable energy scale-up. The challenge becomes surmountable if the conducive planning and regulatory approaches are implemented. Proactively planning and regulating transmission networks have been identified as key to ensure that transmission networks are expanded efficiently and effectively. Linking planning with clear and stable cost recovery regulations can also help bringing the private sector to complement the considerable investment needs in transmission.

Based on the evolving experience and on established theory and practice, the report also proposes some principles to develop country-specific approaches to planning and regulation of transmission networks. We hope transmission utilities and regulators will find this report useful in their continued efforts to support a transition to lower-carbon power networks.

General Principles for Transmission Planning and Pricing to Effectively and Efficiently Develop Transmission for Renewable Energy Principle 1: Extra transmission is often worth the cost Principle 2: Develop transmission proactively Principle 3: Maximize the net benefit of renewable transmission Principle 4: Transmission tariffs for generation should use efficient pricing Principle 5: Broadly allocate uncovered transmission costs

» Download the Report (PDF, 3.1MB)