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Report | 2024

States in Sync

The Western Win-Win Transmission Opportunity

By Tyler FarrellCharles Teplin
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Today, Western states have the chance to make transformative investments that will unlock incredible economic opportunities enabled by new energy. However, to seize this opportunity, states will need to collaborate to expand the region’s electricity transmission system. Unfortunately, status quo planning has been ineffective — over the past 40 years, the region has built almost no regional transmission.

In this report, we show that Western regional transmission expansion is a win-win economic opportunity for all Western states — Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming — and that the most expansive planning leads to the greatest benefits.

The West’s Next Energy Opportunity

We first focus on the immense economic opportunity for the West’s traditional energy export states, including Colorado, Montana, New Mexico, and Wyoming. We find that the coming Western electricity market, based on legislated public policy goals and reasonable estimates for load growth, will grow to $40 billion per year in 2050. But to fully access this market, energy export states will need increased interstate transmission capacity. Without increased transmission capacity, these states will be able to access only 7 percent of the market (or $3 billion per year).

Transmission’s Role in Reducing Costs for an Emissions-Free Western Grid

Second, we find that states with clean energy standards, including California, Colorado, Nevada, New Mexico, Oregon, and Washington, can significantly reduce their energy costs by collaborating with their neighbors. Our analysis reveals a direct correlation between a state’s potential cost savings in meeting its clean energy goals and the distance beyond its borders that it includes in its planning. The most expansive planning could lead to cost savings over 30 percent compared with building out generation only within a state.

Governors, state energy staff, legislators, and others in state leadership must seize this economic opportunity and champion West-wide collaboration to plan and build regional transmission.

Download the Appendix here.