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Thursday, October 29, 2009

A Really Smart Grid Supports Local Energy Production over Long-Distance Transmission

I'm all about President Obama's plan to pump $3.4 billion into the smart grid, technology that will lower your electric bill, make our energy distribution system more resilient, and take a big chunk out of the $150 billion annual negative impact of power outages. I even appreciate the President's shout-out to South Dakota, as he noted smart-grid tech is essential to promoting renewable energy and supporting the longer-distance transmission lines that would let Chicago utilities plug in to South Dakota wind power (and solar power! Don't forget our big solar potential!).

But hold your horses, Mr. President: who says we should build our energy policy around long-distance transmission? Not John Farrell, who's coming to Brookings Saturday to talk about why we should say no to transmission and focus on local energy independence:

Transmission legislation moving through Congress would preempt longstanding state regulatory authority over transmission line approval and siting. The goal is to speed the construction of a $100 to 200 billion interstate transmission superhighway, bringing solar power from the Southwest and wind from the Great Plains to the coasts.

Why is this problematic? Let’s ignore for a moment that most people wouldn’t care to live by a 150 foot tower running through a 200 foot swath of denuded landscape. Or to have their land seized for this purpose by eminent domain.

Many states oppose the new transmission superhighway for two reasons. One, it’s expensive. Two, it undermines efforts to reap the economic rewards of renewable energy self-reliance [John Farrell, "Say No to Transmission," Marc Gunther's blog, 2009.10.24].

Farrell says we would do more to promote clean energy and local economic development by producing our own alternative energy and using that power locally. Forget the tree-hugging: on the purely economic side, Farrell says one locally owned wind turbine can produce a million dollars of economic activity. Plus, "Locally owned wind projects can create twice the jobs and 3 to 4 times the economic impact of absentee owned projects."

Thanks for your forward thinking on energy and technology, Mr. President, but let's aim more of that $3.4 billion in smart grid money toward supporting the efforts of states and communities to produce their own energy.


  1. Hrm, I don't understand his argument about the ugliness of power distribution networks. They are silent and not moving. Conversely wind turbines at substantially taller, moving, and make noise.

    Also, I don't understand his reasoning that distribution networks limit the benefit to the local economy. If the turbines are only connected locally, then the power will be sold at the very low south dakota market rate. (perhaps his argument is that it leads to more business? But industry in SD only uses ~19% of the power, we are not an industrial state) If they were connected to the grid at large, the power could be sold at the highest market rate, increasing the profitability of the power generation. I would argue that by not connecting them to the larger grid, we would be artificially suppressing the price by limiting which markets it can be sold in!

    Am I missing something!?!

  2. I wonder, Tony, if there is an element here of the phenomenon we see in oil-producing countries and in Africa with other extractive industries: countries that lock themselves into exporting their resources seem to end up worse off than countries that make use of those resources domestically. I imagine we could make money wiring our wind power to rich folks elsewhere... but Farrell argues that we get even more economic benefit by finding ways to use what we make ourselves. Anyone have more perspective on that?


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