Two major Northeastern U.S. power grids, in New Jersey and New York City, are now talking to each other and dispatching energy more efficiently and reliably using GE smart grid technology and capital. Three massive “variable frequency transformers” are converting up to 315 MW of electricity – enough for up to 300,000 homes – from the power system in New Jersey and feeding it to New York City.

The technology kickoff was celebrated during a dedication ceremony yesterday at the 900-MW Linden cogeneration power plant owned by GE Energy Financial Services, just up the road from where Thomas Edison designed the first reliable electric light bulb 130 years ago. It follows three years of planning, design, construction and testing.

The rotary-type transformers – in their largest application – help control the intersection of two of the two largest electrical demand centers in the United States, the Pennsylvania-New Jersey-Maryland (PJM) transmission system and the New York City section of the NYISO grid, which are connected by an upgraded cable buried 60 feet below the Arthur Kill waterway.

These variable frequency transformers are stabilizing New York City’s power grid, increasing energy reliability and providing consumers with more diverse and lower-cost power sources. Because of capacity constraints, New York City pays among the highest electricity costs in North America, creating demand for PJM’s historically lower-cost power generation. The technology also reduces the need for new power plants within the city, where siting is difficult and construction costs are high.

The variable frequency transformers provide a precise control path between electrical grids, permitting power exchanges previously impossible because of technical constraints. They enable transmission system operators to control power flows with high reliability, speed and efficiency, while offering flexibility in how utilities meet growing energy demand.

Four power marketing and trading companies are buying 300 MW of the power, in the first truly merchant U.S. transmission project, and reselling it to wholesale and retail customers in New York City. GE Energy Financial Services plans to auction the balance of the transformers’ output, 15 MW.