According to EIA data, national, annual electricity transmission and distribution losses average about 7% of the electricity that is

transmitted in the United States.

EIA has estimates for total annual losses related to electricity transmission and distribution (T&D) and other losses in the State

Electricity Profiles.

National level data are in the U.S. Total Profile (see link a bottom left of the Profiles page). The data are in "Table 10: Supply and

Disposition of Electricity" of each Profile; scroll down each Profile page to find Table 10 and see the row for Estimated Losses in the

Table.

To calculate T&D losses as a percentage, divide Estimated Losses by the result of Total Disposition minus Direct Use. Direct Use

electricity is electricity that is generated at facilities that is not put onto the electricity transmission and distribution grid, and therefore

does not contribute to T&D losses.

Last updated: June 15, 2011

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2 of 2 6/27/2012 10:01 AM
U.S. Climate Change Technology Program – Technology Options for the Near and Long Term 

November 2003 – Page 34 

1.3.2 TRANSMISSION AND DISTRIBUTION TECHNOLOGIES

Technology Description

The electric utility industry is 

restructuring itself from a regulated 

environment to operation under 

competitive wholesale electricity 

markets. However, the electric 

transmission and distribution (T&D) 

systems remain regulated entities that 

connect deregulated generation to the 

end-use customer. Construction of U.S. 

transmission above 230 kV is expected to 

increase by only 6% (in line-miles) 

during the next 10 years, while demand is 

expected to increase more than 20%. The 

resulting increase in the intensity of use 

of existing facilities will increase energy 

losses and transmission congestion, and 

is likely to cause grid reliability problems and threaten the continued growth of wholesale electricity trade. 

Energy losses in the U.S. T&D system were 7.2% in 1995, accounting for 2.5 quads of primary energy and 

36.5 MtC. Losses are divided such that about 60% are from lines and 40% are from transformers (most of 

which are for distribution). Technologies that can improve efficiency and reduce carbon emissions are highvoltage DC (HVDC) transmission, high-strength composite overhead conductors, and power transformers and 

underground cables that use high-temperature superconductors (see related technology profile). High-efficiency 

conventional transformers also could have significant impacts on distribution system losses. In addition, energy 

storage and real-time system monitoring and control systems could improve system reliability and customer 

access to competitive generation, including renewable power producers. There is no active U.S. program for 

HVDC development or improved distribution transformer technologies. 

System Concepts 

• Composite-core, low-sag transmission conductors can transport two to three times as much power as 

conventional conductors over the same rights-of-way and with no tower modifications. 

• Energy storage will facilitate more optimal use of existing infrastructure and increase the dispatchability of 

renewable resources. 

• Real-time grid operations using measured data and automatic, intelligent controllers can improve T&D 

reliability – and lead to a smart, switchable future network that can anticipate and respond automatically to 

system contingencies. 

System Components

• One advanced composite overhead conductor consists of an aluminum metal matrix composite core 

(replacing the steel core of a conventional cable) surrounded by temperature-resistant aluminum alloy 

wires. 

• Several large- and medium-scale energy-storage systems, using different electrochemistries, have been 

developed. 

• Real-time control uses wide-area measurement systems, synchronized by global positioning system (GPS) 

satellite clocks that feed system information to artificial neural net controllers. The controllers reconfigure 

the system in real time, preventing outages and allowing maximum use of available transmission capacity. 

Technology Status/Applications

• Aluminum composite-core conductors, terminations, and suspensions have been developed by 3M 

Company and demonstrated in the field by leading U.S. and European utilities. Additional field trials in the 

United States and accelerated thermal cycling tests are planned in 2003-2005. This extensive mechanical 
U.S. Climate Change Technology Program – Technology Options for the Near and Long Term 

November 2003 – Page 35 

and electrical testing is required to predict the 40-year life responses of this new conductor technology. 

Niche applications including long-span river crossings and short lead-time reconductoring over congested 

existing rights-of-way are now cost-effective. In addition, the conductor’s core has 25% lower electrical 

resistances than steel, enabling higher transmission efficiencies. 

• Large-scale energy-storage systems are entering field demonstrations. 

• Wide-area measurement systems used for monitoring, event analysis, and system model studies have been 

deployed in the Western United States power grid to help analyze system disturbances.

Current Research, Development, and Demonstration 

RD&D Goals 

• Accelerated thermal-cycle testing for 3M’s composite conductor in 2003-2005. Field-testing of this 

conductor began in 2002 on a 230kV transmission line on DOE’s Western Area Power Administration 

grid. Other advanced conductors are expected to undergo similar high-current and field tests in 2003-2006. 

• Demonstration of the reliability of energy-storage systems, and reduction of the cost of such systems by 

30%. 

• Operation of a prototype smart, switchable grid on a region on the U.S. transmission grid by 2010. The 

market for conventional utility-control systems approaches $300 M/year. 

RD&D Challenges

• Development of large-diameter composite conductors for high-voltage transmission lines that are both lowcost and high capacity, so as to yield the highest payoffs in grid reliability and competitive market 

efficiency. 

• Energy-storage systems with reduced costs that can meet several applications while using a single system. 

• Neural net networks that can be trained in parallel to perform control functions in real-time control 

systems. 

• A regulatory framework that will allow investors to make credible projections of the return on investment 

in new transmission capacity. 

RD&D Activities

• For composite conductors, 3M Company cost-shared on a DOE effort in FY2002 and FY2003 to perform 

field tests and accelerated, controlled thermal tests on several conductor sizes. 

• DOE is cost-sharing an energy-storage effort with industry. EPRI has a newly reformed energy storage 

target. 

Recent Successes 

• DOE’s National Transmission Grid Study, released in May 2002, examined issues surrounding U.S. 

transmission system upgrades and expansion, and contains 51 recommendations for actions to remove 

constraints on the U.S. transmission grid. 

• Real-time monitoring tools have been developed by DOE and installed in California with funding by the 

California Energy Commission, and at the North American Electric Reliability Council (NERC) to monitor 

and display voltage and frequency over wide areas. 

• Demand response (DR) projects are assisting independent transmission system operators (ISOs) with DR 

program design, and identifying DR capabilities to respond to markets for energy and contingency 

reserves. 

Commercialization and Deployment Activities 

• Commercial deployment of high-current composite conductors awaits U.S. field trial results, and 

manufacturing cost reductions for all but high-value niche applications. 
GridWorks: Overview of the Electric Grid http://www.energetics.com/gridworks/grid.html

1 of 2 11/15/2007 12:28 PM

Overview of the Electric Grid

Electric power is essential to modern society. Economic prosperity, national security, and public health and safety cannot be 

achieved without it. Communities that lack electric power, even for short periods, have trouble meeting basic needs for food, 

shelter, water, law, and order.

In 1940, 10% of energy consumption in America was used to produce electricity. In 1970, that fraction was 25%. Today it is 

40%, showing electricity's growing importance as a source of energy supply. Electricity has the unique ability to convey both 

energy and information, thus yielding an increasing array of products, services, and applications in factories, offices, homes,

campuses, complexes, and communities.

The economic significance of electricity is staggering. It is one of the largest and most capital-intensive sectors of the 

economy. Total asset value is estimated to exceed $800 billion, with approximately 60% invested in power plants, 30% in 

distribution facilities, and 10% in transmission facilities.

Annual electric revenues - the Nation's "electric bill" - are about $247 billion, paid by America's 131 million electricity 

customers, which includes nearly every business and household. The average price paid is about 7 cents per kilowatt-hour, 

although prices vary from state to state depending on local regulations, generation costs, and customer mix.

There are more than 3,100 electric utilities:

213 stockholder-owned utilities provide power to about 73% of the customers

2,000 public utilities run by state and local government agencies provide power to about 15% of the customers

930 electric cooperatives provide power to about 12% of the customers

Additionally, there are nearly 2,100 non-utility power producers, including both independent power companies and 

customer-owned distributed energy facilities.

The bulk power system consists of three independent networks: Eastern Interconnection, Western Interconnection, and the 

Texas Interconnection. These networks incorporate international connections with Canada and Mexico. Overall reliability

planning and coordination is provided by the North American Electric Reliability Council, a voluntary organization formed in 

1968 in response to the Northeast blackout of 1965.

Electric Generation

America operates a fleet of about 10,000 power plants. The average thermal efficiency is around 33%. Efficiency has not 

changed much since 1960 because of slow turnover of the capital stock and the inherent inefficiency of central power 

generation that cannot recycle heat. Power plants are generally long-lived investments; the majority of the existing capacity 

is 30 or more years old.

The roughly 5,600 distributed energy facilities typically combine heat and power generation and achieve efficiencies of 65% 

to 90%. Distributed energy facilities accounted for about 6% of U.S. power capacity in 2001.

The profile of the electric power generation industry is changing rapidly, however. A shift in ownership is occurring from 

regulated utilities to competitive suppliers. The share of installed capacity provided by competitive suppliers has increased 

from about 10 percent in 1997 to about 35 percent today. Recent data suggest this trend is slowing.

Also, cleaner and more fuel-efficient power generation technologies are becoming available. These include combined cycle 

combustion turbines, wind energy systems, advanced nuclear power plant designs, clean coal power systems, and 

distributed energy technologies such as photovoltaics and combined heat and power systems.

Because of the expected near-term retirement of many aging plants in the existing fleet, growth of the information 

economy, economic growth, and the forecasted growth in electricity demand, America faces a significant need for new 

electric power generation. In this transition, local market conditions will dictate fuel and technology choices for investment 

decisions, capital markets will provide the financing, and Federal and state policies will affect siting and permitting. It is an 

enormous challenge that will require a large commitment of technological, financial, and human resources in the years 

ahead.

Electric Transmission

Even with adequate electric generation, bottlenecks in the transmission system interfere with the reliable, efficient, and 

affordable delivery of electric power.

America operates about 157,000 miles of high voltage (>230kV) electric transmission lines. While electricity demand 

increased by about 25% since 1990, construction of transmission facilities decreased about 30%. In fact, annual investment 

in new transmission facilities has declined over the last 25 years. The result is grid congestion, which can mean higher 

electricity costs because customers cannot get access to lower-cost electricity supplies, and because of higher line losses. 

Transmission and distribution losses are related to how heavily the system is loaded. U.S.-wide transmission and distribution 

losses were about 5% in 1970, and grew to 9.5% in 2001, due to heavier utilization and more frequent congestion. 

Congested transmission paths, or "bottlenecks," now affect many parts of the grid across the country. In addition, it is 

estimated that power outages and power quality disturbances cost the economy from $25 to $180 billion annually. These 

costs could soar if outages or disturbances become more frequent or longer in duration. There are also operational problems 

in maintaining voltage levels.

America's electric transmission problems are also affected by the new structure of the increasingly competitive bulk power 

market. Based on a sample of the nation's transmission grid, the number of transactions have been increasing substantially 

recently. For example, annual transactions on the Tennessee Valley Authority's transmission system numbered less than 

20,000 in 1996. They exceed 250,000 today, a volume the system was not originally designed to handle. Actions by 
GridWorks: Overview of the Electric Grid http://www.energetics.com/gridworks/grid.html

2 of 2 11/15/2007 12:28 PM

transmission operators to curtail transactions for economic reasons and to maintain reliability (according to procedures 

developed by the North American Electric Reliability Council) grew from about 300 in 1998 to over 1,000 in 2000.

Additionally, significant impediments interfere with solving the country's electric transmission problems. These include: 

opposition and litigation against the construction of new facilities, uncertainty about cost recovery for investors, confusion 

over whose responsibility it is to build, and jurisdiction and government agency overlap for siting and permitting. Competing 

land uses, especially in urban areas, leads to opposition and litigation against new construction facilities.

Electric Distribution

The "handoff" from electric transmission to electric distribution usually occurs at the substation. America's fleet of 

substations takes power from transmission-level voltages and distributes it to hundreds of thousands of miles of lower 

voltage distribution lines. The distribution system is generally considered to begin at the substation and end at the 

customer's meter. Beyond the meter lies the customer's electric system, which consists of wires, equipment, and appliances 

- an increased number of which involve computerized controls and electronics which ultimately operate on direct current.

The distribution system supports retail electricity markets. State or local government agencies are heavily involved in the 

electric distribution business, regulating prices and rates-of-return for shareholder-owned distribution utilities. Also, in 2,000 

localities across the country, state and local government agencies operate their own distribution utilities, as do over 900 

rural electric cooperative utilities. Virtually all of the distribution systems operate as franchise monopolies as established by 

state law.

The greatest challenge facing electric distribution is responding to rapidly changing customer needs for electricity. Increased

use of information technologies, computers, and consumer electronics has lowered the tolerance for outages, fluctuations in 

voltages and frequency levels, and other power quality disturbances. In addition, rising interest in distributed generation and

electric storage devices is adding new requirements for interconnection and safe operation of electric distribution systems.

Finally, a wide array of information technology is entering the market that could revolutionize the electric distribution 

business. For example, having the ability to monitor and influence each customer's usage, in real time, could enable 

distribution operators to better match supply with demand, thus boosting asset utilization, improving service quality, and 

lowering costs. More complete integration of distributed energy and demand-side management resources into the 

distribution system could enable customers to implement their own tailored solutions, thus boosting profitability and quality 

of life.

Summary

North America's world-class electric system is facing several serious challenges. Major questions exist about its ability to 

continue providing citizens and businesses with relatively clean, reliable, and affordable energy services. The recent 

downturn in the economy masks areas of grid congestion in numerous locations across America. These bottlenecks could 

interfere with regional economic development. The "information economy" requires a reliable, secure, and affordable electric 

system to grow and prosper. Unless substantial amounts of capital are invested over the next several decades in new 

generation, transmission, and distribution facilities, service quality will degrade and costs will go up. These investments will 

involve new technologies that improve the existing electric system and possibly advanced technologies that could 

revolutionize the electric grid.

For additional information, please refer to the Electricity Delivery System fact sheet (PDF 897 KB). Download Adobe Reader

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