RMI urges faster transmission expansion as U.S. electricity demand rises

U.S. Grid Expansion needs faster transmission planning, interconnection reform, advanced grid technologies, and demand flexibility as utilities confront rapid load growth, reliability pressures, capacity constraints, and rising electricity costs.

U.S. electricity demand is rising faster than the power system can add generation and transmission, creating a pressing need to expand and modernize the grid. A new industry brief argues that reliable, affordable and abundant electricity has become central to economic growth, national security and technological leadership, placing transmission development and faster interconnection at the center of grid policy.

Utilities are forecasting 166 GW of peak-demand growth over the next five years, compared with 24 GW in 2022. Much of the increase is concentrated in Texas and the Mid-Atlantic, where capacity constraints and high prices are already concerns. At the same time, major transmission projects can take more than seven years to progress from planning to operation. The pressures behind Transmission Upgrade Delays PJM Network Queues illustrate why process improvements are increasingly important.

The brief identifies five broad areas for action: building regional and interregional transmission more quickly; streamlining permitting and interconnection; using demand-side and distributed energy resources; deploying advanced transmission technologies; and attracting private capital for grid investment. It says broader transmission networks can connect customers with lower-cost resources over a wider area while improving resilience against localized disruptions, including wildfires and severe weather.

Planning and cost allocation remain major barriers. The analysis says regional plans are still insufficient for surging load growth, while interregional planning lacks an adequate process and does not fully value reliability benefits. Federal action on cost allocation, permitting and a venue for interregional planning could accelerate construction and reduce generation costs. Policy discussions such as Wires Senate Testimony remain relevant as lawmakers consider grid reforms.

Interconnection reform is another priority. Stronger project-readiness requirements, tighter study practices and improved analytical tools can shorten timelines for new generation and large loads. The brief points to new pathways intended to reduce waits for interconnection study results while protecting system reliability. As Booming US Clean Energy continues to shape system needs, connecting resources efficiently will be essential.

The brief also calls for wider use of load flexibility, virtual power plants, co-located generation and storage, and bring-your-own-resources arrangements. Large electricity customers could help support reliability by adjusting consumption during peak events or by contributing generation and storage resources. Clear rules and standardized processes would help utilities, grid operators and customers implement these options at greater scale.

Advanced transmission technologies could provide near-term relief while new lines, substations and generation are developed. Dynamic line ratings, high-performance conductors, topology optimization and power-flow control can increase the usable capacity of existing and new facilities. The potential addressed in Dynamic Line Rating Rollout Grid Capacity aligns with the need to improve grid utilization as well as build new infrastructure.

Finally, the brief says private capital and new funding structures could help accelerate investment while protecting existing ratepayers. Large new customers have expressed interest in contributing to grid investments that enable faster connections. Building public understanding and engaging communities early will also be necessary, a challenge with relevance beyond the United States as shown by UK Transmission Investment NAO Grid Upgrades in the broader transmission debate.

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