Provisions encouraging the development of electric transmission, renewable power, and the “smart grid” included in H.R. 1, the American Recovery and Reinvestment Act of 2009 are a critical first step to ensuring a clean and reliable energy future for North America, announced the North American Electric Reliability Corp.(NERC). The bill, which includes provisions for $8 billion for loan guarantees for transmission and renewable energy projects and additional funds to advance the “smart grid,” is the strongest support for electric infrastructure development to be considered by lawmakers in recent years.

“We applaud the Obama Administration and Congressional lawmakers for their leadership in working to resolve the national transmission crisis and support needed infrastructure development,” commented Rick Sergel, president and CEO of NERC. “We strongly support the smart grid and loan guarantee provisions in the proposed stimulus package and look forward to further discussion on addressing barriers to the development of this needed infrastructure, including siting and cost allocation for transmission projects.”

NERC flagged the escalating need for transmission as critical to a clean and reliable energy future in its 2008 Long-Term Reliability Assessment and Special Report on Reliability Impacts of Climate Change Initiatives, highlighting the integration of new renewable resources as a key driver for transmission development. Typically located outside the transmission grid’s present footprint, these remote resources will require more transmission to move power from where the wind blows, the sun shines, and the waves roll to where customers need it.

Transmission development has significantly lagged behind generation development for the last decade, leading to situations where the grid is operated closer to the edge than in the past. Operating performance statistics collected in recent years increasingly suggest the grid is in need of significant investment.