Executive summary

Global energy grids have proven to be a dynamic entity, while facing several critical problems hindering its improvement. Specifically, this brief covers outdated infrastructure, insufficient government investment, and the difficulty of integrating renewable energy sources.

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Overview

The development of energy grid infrastructure has encountered challenges with the growing pressure to produce more energy in order to meet increasing demand. In addition, there has been difficulty in connecting renewable energy sources with the grid, raising questions about decarbonization of the electricity supply, grid reliability, and energy efficiency.

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Pointed Summary

• Outdated Infrastructure: Many power grids cannot handle current and future energy demands, becoming prone to outages, inefficiencies, and high maintenance costs.
• Integration of Renewables: The intermittent nature of renewable energy requires more advanced power grid storages and management systems to accommodate and maintain increased energy supply.
• Lack of Investment: While investment in energy sources have almost doubled since 2010, global investment in energy grids has hardly changed, staying stagnant at about USD 300 billion annually¹.

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Relevance

The growing backlog of renewable energy projects awaiting grid connections highlight the importance of developing energy grid infrastructure. More than 3,000 gigawatts (GW) of renewable energy projects, where more than 1,500 GW are in advanced stages, queue globally and constitute a substantial barrier in the transition to net-zero emissions. Furthermore, extreme weather events exacerbated by climate change add an additional strain on aging grids. As a result, debate continues on how to improve energy grid infrastructure to ensure energy security and achieve climate targets.

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History

Current Stances

The American energy grid has experienced several failures nationwide, which demonstrates the need for a more developed, stable energy grid. illions of Texans, for example, have been left without electricity due to weather issues multiple times this year, with outages centered around the largest city in the state: Houston.² While all involved parties have agreed for an urgent need of a large scale reformation to the energy grid along with massive development, many have very differing viewpoints on the pathways to development.

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Federal Government Stance on Infrastructure Development in Vulnerable Areas:

The Senate Joint Economic Committee Democrats memo cited a study conducted by Energy Innovation, a non-partisan energy and climate policy think tank, that specifically used the Texas disasters as a case of what not to do in the event of energy grid failures.² The committee endorsed a shift to renewable energy to combat weather-related energy grid obstructions. A memo released in January 2024 cited catastrophic events in Texas as key drivers of a proposed shift to renewable energy resources and congratulated the work of the Biden Administration and Congress to move towards a more sustainable power grid.³ 

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An accelerated shift to renewable energy, especially in areas with vulnerable energy infrastructure, aligns with recommendations and projections of the US Department of Energy and the Oak Ridge National Laboratory Climate Change Science Institute.⁴ This study found that the fossil fuel-based energy grid in Texas caused the failure, stating: “fossil-intensive grids cannot provide consistent resilience against climate risks they are simultaneously exacerbating.”⁵

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State Government Stance on Infrastructure Development in Vulnerable Areas:

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Continuing to use the example of the energy grid failures in Texas, the response of Greg Abbott’s Texas State Government is in high contrast with that of the Biden Administration and Senate Democrats. ERCOT, or the Electric Reliability Council of Texas, a nonprofit organization and the main energy provider governed by the Public Utilities Commission of Texas, has attributed many of the problems associated with the widespread systematic failures of the Texas energy grid to poor integration from clean energy sources and providers.⁶ Specifically, ERCOT warned of flaws in solar, wind and battery storage resources that decreased their reliability to the grid. Governor Abbott also blamed the repeat failures of the grid on increased usage of clean energy.⁷

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Tried Policy

The Biden Administration has focused on investments that align with the stated policy stances of Senate Democrats and the Department of Energy. In August, $2.2 billion in infrastructure investments had been announced, with a focus on preparing for extreme weather.⁸ The guidelines of this funding project strongly endorsed renewable energy goals, with one of the stated goals reading: “Selected projects will leverage: Innovative transmission infrastructure to improve grid resilience and reliability and integrate more clean energy to the grid.”⁸ This infrastructure funding bill appears to coincide with other goals of the federal government in energy grid development. This policy solution, enacted by the Biden administration, has come under criticism from Congressional Republicans on the House Oversight Committee, with the Republican led Subcommittee on Economic Growth, Energy Policy, and Regulatory Affairs holding hearings regarding the efficacy of the Biden Administration’s Department of Energy’s “rampant spending sprees”.⁹

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The disparity in stances show evident in funding announcements following the outages. Governor Abbott unveiled large scale investments in the Texas energy grid, with a ten billion dollar increase in the Texas Energy fund laying at the forefront of these investments.¹⁰ Half of this investment had been set aside for the construction of new gas-fueled power plants in Texas, which highlights the Abbott administration's focus on use of traditional, non-renewable energy sources to reinforce the grid.

The Abbott Administration’s focus on blaming clean energy and funding greater fossil fuel use has also drawn criticism. The opposition has mainly focused on the outages that had mainly caused by failures in fossil fuel and coal powered electricity sources, in contrast to ERCOT and Governor Abbott’s claims.¹¹

There has not been any immediate success following the public investment from either of the aforementioned policy and investment approaches, mostly due to the nature of building and improving such large scale infrastructure.¹² Time will tell if these policies have any meaningful impact on the pressing issue of energy grid failures.

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Policy Problem

New transmission lines take time to complete,¹³ and it is imperative to speed up this process to achieve the nation’s climate goals. However, at the current rate, progress faces challenges due to many challenges that have yet to be fixed. Infrastructural and technological concerns take priority, however, public actors and opinions are the most significant factor in slowing down this process and stalling the completion of transmission projects. The stakeholders discussed in this section include voters and communities, environmentalist groups, politicians, oil firms, and investors. These organizations and individuals become largely affected by the construction of new transmission lines, thus playing a large part in stalling their completion.

As new lines are constructed, all private property owners in areas where the energy is used or the lines are built must approve the projects. Often, they are built throughout family neighborhoods, and approval must come from all residents. A singular opposition from one household may prevent the entire project from completion. Therefore, many complications arise with voters located in those regions.¹³ 

Firstly, construction can be loud, busy, and noisy. As construction prolongs as a result of delay, it may disrupt peaceful suburban or rural communities and create difficulty to relax or work. Secondly, Transmission lines are incredibly large - standing between  380 m tall and 45 m tall.¹⁴ The large disruption to the normal atmosphere may ruin aesthetics, which most communities enjoy and look forward to. Aesthetics contribute to an extremely important part of creating valuable land, and thus the housing market may go down as the landscape filled with bombarding infrastructures might drive individuals out. Lastly, with the rise of climate change and larger disasters, concerns about the possibility of big transmission lines collapsing grows. This makes it difficult for communities to grant approval since individuals must consider many factors when living near a transmission line, regardless of the positive intent for the families in the area.

Researchers at Princeton University ²⁷ have concluded that transmission wires must become thicker and larger to transport energy over great distances. Environmentalist groups and concerned citizens have vocalized that the large, potentially exposed wires contribute to wildfires across the United States. Large amounts of land must be cleared to avoid the thick wires from touching tree branches. However, in return, this would also: further destroy aesthetics, require more private and public land leases, utilize more material and expenses to be built, and thus take an immense amount of time to be approved and therefore invested in.²⁷ 

Similar case scenarios such as the New England Clean Energy Connect (NECEC) aimed to build a high-voltage transmission line using hydropower in Canada through western Maine to Massachusetts. The project started in 2017 and was expected to be completed by 2022. However, a referendum in Maine halted the project on November 2, 2021. 59% of voters supported banning the construction of the power line. This vote, known as Maine Question 1²⁸, reflected widespread opposition to the project; concerns about environmental impacts and dissatisfaction with Central Maine Power played significant roles in the referendum's outcome. Despite the referendum vote, construction began in January 2021, leading to further constitutional battles. To this day, the line has still not been completed as paperwork continues to move slowly, facing legal problems and failing to gather approval from all the communities it may affect. 

Years before deciding on the Maine route for the NECEC, project developers initially proposed running the transmission line through New Hampshire. This route also aimed to bring Hydro-Québec's power to Massachusetts. However, the New Hampshire plan faced strong opposition from local communities and environmental groups concerned about its impact on scenic areas and natural landscapes. In 2018, New Hampshire’s Site Evaluation Committee rejected the “Northern Pass” project, leading the developers to shift their focus to the Maine route which seems to be ultimately failing as well.

Lines such as the NECEC aim to reach global net zero by increasing reliance on clean energy instead of fossil fuels. Therefore, petroleum, one of the world’s biggest industries, serves as the largest and most powerful opponent to the expansion of clean energy. Petroleum monetarily dominates entire governments and countries, not just private companies themselves. Incumbent oil firms have the ability to pour immense amounts of money into political action groups and politicians who will pass legislation to stop building transmission lines. This way, clean energy companies would not have the ability to steal oil firms’ customers and revenue, as well as destroy their long-term business overall. 

Lastly, investors actively fund research and resources to launch transmission line projects and ensure their implementation. Without an incentive for investors to trust future constructions, limitations grow for  future transmission lines for the  population to follow. Thus learning and adapting  ways to accelerate the lengthy process of building transmission lines to allow companies to move towards clean energy, as well as driving a future a healthy climate is prolonged. 

Policy Options

Several policy options prove as potential solutions to address the challenges of energy grid development in order  to improve current infrastructure. From strengthening regulatory frameworks to establishing comprehensive national standards and promoting public-private partnerships, innovation and growth continue.

Firstly, existing regulations that determine how energy infrastructure projects succeed can be improved. This approach requires minimal financial investments from a government or individuals and can easily be curtailed to meet the specific needs of various regions. For example, if states streamline permitting processes and update safety standards, they eliminate any bottlenecks that delay the start of projects.¹⁵ As a result, more opportunities for programs to implement such regulations have better chances of  achieving energy goals. Similarly, current mechanisms of regulation in many states could improve for quicker approvals, ensuring that essential infrastructure develops over shorter timeframes.

Through legislature, states could adopt standardized timelines for these very approvals. Mandating a state agency’s response within a specific time not only improves accountability, but reduces uncertainty for developers.¹⁶ At the same time, states may allow local governments the flexibility to adapt regulations based on their unique energy grid needs, fostering a more streamlined, equitable approach toward deploying energy infrastructure.

Socioeconomic and geographical factors include different regions having varying energy demands and environmental needs, making this adaptability additionally beneficial. Perhaps, rural regions might prioritize renewable energy installations, while urban centers may instead focus on upgrading existing grids to handle increased energy demand.¹⁷ However, the potential inconsistency of infrastructure quality , depending on where one may live, poses a significant disadvantage to the installations. If regulations are not enforced uniformly, safety standards or energy reliability will lack in some areas, causing a cascading negative effect on consumers and businesses.

Establishing comprehensive standards nationwide for energy grid development provides for a second alternative. This means creating unified guidelines explaining how states incorporate renewable energy sources and smart grid technologies into climate resilience. Such a program could be established at the federal level, in a similar manner to how the EPA creates national standards for power plant pollution, to ensure that all states adhere to a consistent set of regulations.¹⁸ Specific enforcement decisions would vary by standard but generally entail a combination of categorical grants and federal mandates.

Such a national framework would make for a more reliable energy grid, as it would create consistency from state to state in how they manage their energy resources. By requiring all states to adopt improved grid technologies, the federal government can facilitate better energy management and distribution, ultimately reducing waste and improving efficiency.

While the establishment of national standards may provide these benefits, it also comes with unique challenges as a result of inherent differences in existing energy systems. The inflexibility of a standardized approach might not accommodate the unique circumstances of different states. States with abundant renewable resources, such as wind or solar, likely have different needs compared to those reliant on traditional fossil fuels.¹⁹ Historical, environmental, and political factors combine to determine how energy use and sourcing are distributed across the country. At the same time, political division in the U.S. would make changes at this level challenging. Implementing such comprehensive regulations requires substantial resources and time, leading to pushback from states that prefer maintaining their autonomy.

The third strategy involves promoting public-private partnerships to utilize private-sector investment for energy infrastructure projects, encouraging collaboration between the government and private firms, which allows more efficient resource allocation. Creating economic incentives for private companies to invest in grid enhancements helps states expedite project timelines and incorporate innovative technologies into their energy systems.

In a similar manner, financial incentives such as tax credits or grants could be offered to private firms that develop technologies to improve energy efficiency or integrate renewable energy sources.²⁰ These partnerships may also encourage more research and development, as private companies often have the agility and resources to innovate rapidly compared to public agencies.

However, the use of public-private partnerships also can produce negative consequences. If not carefully managed by the government, these partnerships could lead to underfunded public infrastructure or poor maintenance due to the pursuit of private monetary gain. People primarily focus on the potential for corporate profits to be prioritized over the public good through problematic partnership agreements.²¹ Structuring these partnerships will inevitably be complex and time-consuming, which can potentially delay the implementation of critical infrastructure projects.²² Furthermore, marginalized communities could be overlooked as the grid develops in this way. Thus, companies might find projects in wealthier regions more attractive even if they are not as necessary.

While there are several policy options to improve energy grid infrastructure, each comes with its own set of benefits and drawbacks. Ultimately, combining specific aspects from each individual strategy may be the most effective way to create a resilient and sustainable energy grid that meets the needs of all communities. By thoughtfully considering such options, policymakers can make decisions that pave the way for an improved energy future.

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Conclusions

Energy infrastructure in the United States depends on several intermingling entities including the federal government, state-specific legislation, and of course geographical hurdles.²³ This often confusing intermingling of entities results in large delays in innovative energy infrastructure developments. 

While many solutions point to comprehensive standards for energy grid development, there are instances in which certain states or regions have adopted their own entrenched grid systems. Yet, these individual grid systems have proven to be fallible as shown by Texas’s power grid failure in 2021.²⁴ 

In addition to navigating government regulations and systems, companies must also contend with private entities. Thus private-public partnerships have been proposed to deal with differing interests compounded with economic incentives provided by the government. It is important for these institutions to strike a balance between private interests and public interests, otherwise, these partnerships may result in poorly funded infrastructure projects.

The country’s goal of improving existing energy infrastructure projects and developing advanced energy systems must also contend with differing stances on clean energy. While some states have taken proactive steps to improve clean energy efforts, many states aim to rely on fossil fuels and have been slower to adopt clean energy efforts because of concerns about unemployment. Thus, a balance must be struck between employment and the environment.

Acknowledgment

The Institute for Youth in Policy wishes to acknowledge Anagha Nagesh, Anoushka Swaminathan, Nolan Ezzet and other contributors for developing and maintaining the Policy Department within the Institute.

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