Released October 11, 2021 | SUGAR LAND
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The North American Power Industry's transmission & distribution (T&D) buildout remains strong, with more than $40 billion worth of projects scheduled to kick off from January 2021 through December 2022. That level of spending is slightly below the level of planned T&D spending across North America from January 2019 through December 2020.
According to Industrial Info's Global Marketing Intelligence (GMI) database, there are 1,110 T&D projects scheduled to begin construction from January 2021 through December 2022. The total investment value (TIV) of these projects is approximately $41.29 billion. For comparison, from January 2019 through December 2020, Industrial Info was tracking 1,102 projects valued at $46.82 billion that were scheduled to begin construction.
The number of scheduled projects held relatively steady for the two-year periods, but planned spending for the January 2021-December 2022 period dropped about 12% compared with the January 2019-December 2020 period.
Many of the projects slated to begin construction over the prior two-year period have either been completed, cancelled or placed on hold. Only about 182 projects, valued at about $6.9 billion, remain active from that earlier period.
Looking forward, the regions with the greatest dollar value of T&D projects are the Rocky Mountains, Southwest, Quebec and the West Coast. For the 2019-2021 period, in contrast, the regions with the greatest dollar value of T&D projects were the Rocky Mountains, New England, Southeast and Northeast.
Click on the images at right to see the North American regions with the highest dollar value of scheduled T&D projects for the 2019-2020 period, and the 2021-2022 period.
"The continued high level of planned transmission spending is not particularly surprising, given the way utilities and developers have embraced renewable generation projects like solar and wind in recent years," said Britt Burt, Industrial Info's vice president of research for the Global Power Industry.
"We don't expect that all of the T&D projects that are announced will be built according to their original schedules," he continued. "Some may not be built at all. Transmission projects that cross state, regional or even national borders seem to have a harder time lining up regulatory approvals. In fact, several large transmission projects that are scheduled to begin construction from January 2021 through December 2022 were scheduled to kick off years earlier, but ran into regulatory roadblocks."
To illustrate how utilities and developers have set their sights on renewable energy, Burt noted that, over the next five years, roughly 88% of all planned utility-scale, new-build generation in the U.S. is scheduled to be renewable energy. Natural gas-fired generation projects, on the other hand, account for only 11% of all new-build generation scheduled to break ground between 2022 and 2026.
Click on the image at right to see the breakdown between renewable energy and gas-fired generation over the next five years in the U.S.
"At utility scale (greater than 1 megawatt), the 'dash to gas' that was such a prominent feature of new-build power generation a decade ago has become a 'rush to renewables'," Burt said. "Again, we're not saying all of that planned utility-scale generation will be built, or be built according to the original schedule, but the dominance of renewable energy in the new-build market is really striking."
"And, if you're going to site a renewable-energy project far away from load centers, you will need transmission projects to bring that energy to customers. As utilities and developers have gone increasingly green in their power-generation plans, transmission developers have been busy proposing new projects."
Burt said a combination of factors--including rising concerns about global warming, and state and federal support for renewable energy--continue to be a strong driver for planned transmission projects.
He also noted that as instances of extreme weather--such as this year's Texas deep freeze, Western wildfires, tornadoes and hurricanes--have proliferated, utilities have increased their planned spending to harden, or in some cases rebuild, their distribution networks.
And while the dominant model of scheduled T&D spending is expected to mirror past spending practices, at least for the next few years, Burt noted that the emergence of microgrids, distributed energy resources like rooftop solar, and battery energy storage systems (BESS) could challenge traditional T&D spending sometime in the next decade.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
According to Industrial Info's Global Marketing Intelligence (GMI) database, there are 1,110 T&D projects scheduled to begin construction from January 2021 through December 2022. The total investment value (TIV) of these projects is approximately $41.29 billion. For comparison, from January 2019 through December 2020, Industrial Info was tracking 1,102 projects valued at $46.82 billion that were scheduled to begin construction.
The number of scheduled projects held relatively steady for the two-year periods, but planned spending for the January 2021-December 2022 period dropped about 12% compared with the January 2019-December 2020 period.
Many of the projects slated to begin construction over the prior two-year period have either been completed, cancelled or placed on hold. Only about 182 projects, valued at about $6.9 billion, remain active from that earlier period.
Looking forward, the regions with the greatest dollar value of T&D projects are the Rocky Mountains, Southwest, Quebec and the West Coast. For the 2019-2021 period, in contrast, the regions with the greatest dollar value of T&D projects were the Rocky Mountains, New England, Southeast and Northeast.
"The continued high level of planned transmission spending is not particularly surprising, given the way utilities and developers have embraced renewable generation projects like solar and wind in recent years," said Britt Burt, Industrial Info's vice president of research for the Global Power Industry.
"We don't expect that all of the T&D projects that are announced will be built according to their original schedules," he continued. "Some may not be built at all. Transmission projects that cross state, regional or even national borders seem to have a harder time lining up regulatory approvals. In fact, several large transmission projects that are scheduled to begin construction from January 2021 through December 2022 were scheduled to kick off years earlier, but ran into regulatory roadblocks."
To illustrate how utilities and developers have set their sights on renewable energy, Burt noted that, over the next five years, roughly 88% of all planned utility-scale, new-build generation in the U.S. is scheduled to be renewable energy. Natural gas-fired generation projects, on the other hand, account for only 11% of all new-build generation scheduled to break ground between 2022 and 2026.
"At utility scale (greater than 1 megawatt), the 'dash to gas' that was such a prominent feature of new-build power generation a decade ago has become a 'rush to renewables'," Burt said. "Again, we're not saying all of that planned utility-scale generation will be built, or be built according to the original schedule, but the dominance of renewable energy in the new-build market is really striking."
"And, if you're going to site a renewable-energy project far away from load centers, you will need transmission projects to bring that energy to customers. As utilities and developers have gone increasingly green in their power-generation plans, transmission developers have been busy proposing new projects."
Burt said a combination of factors--including rising concerns about global warming, and state and federal support for renewable energy--continue to be a strong driver for planned transmission projects.
He also noted that as instances of extreme weather--such as this year's Texas deep freeze, Western wildfires, tornadoes and hurricanes--have proliferated, utilities have increased their planned spending to harden, or in some cases rebuild, their distribution networks.
And while the dominant model of scheduled T&D spending is expected to mirror past spending practices, at least for the next few years, Burt noted that the emergence of microgrids, distributed energy resources like rooftop solar, and battery energy storage systems (BESS) could challenge traditional T&D spending sometime in the next decade.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
