Presenting an option to solving electric transmission congestion.
Don L. Sytsma is a vice president with R. J. Rudden Associates. He is directly involved in the restructuring, reformation and introduction of customer choice in many markets, and has performed consulting engagements all over the world. Ron Hrehor also is a vice president with R.J. Rudden Associates. His background includes consulting in the energy industry throughout the world, focusing on natural gas market reformation, infrastructure and energy trading issues.
A recent FERC study of transmission constraints concluded that there are a number of significant electric transmission constraints in the contiguous United States that have the effect of increasing costs of power to consumers.1 If alleviated, the study concludes that the "benefits in overall energy bills are potentially quite large."
The foundation of existing natural gas pipeline and local distribution company (LDC) systems in the U.S., together with associated expansion investments, can hold a key that provides a viable option to address existing transmission constraints in the power industry. This foundation includes not only the physical assets of the gas pipeline and LDC systems, but also the regulatory, commercial, and operational aspects of those systems. Gas systems can be used to support the development of new generation in power-constrained areas, placing the gas industry in an advantageous position. Gas companies can capitalize on electric restructuring by developing a deeper understanding of the electric grid in their markets and more proactively monitoring the planning process of regional transmission organizations (RTOs).