3Q 2022

Stakeholders Should Prepare for Significant Increases in Grid Infrastructure Spending

The North American electric grid is a vast network of transmission and distribution (T&D) infrastructure, spanning millions of line miles and intersecting thousands of local jurisdictions. Across the board, the system needs repair because of its age, hardening measures due to severe weather and external threats, modernization to increase efficiency, and a sizeable expansion to facilitate renewable generation growth. The age and condition of the existing T&D infrastructure is reflected in recent system performance metrics, which show a measurable decline in grid reliability. Recent trends show that spending on T&D infrastructure is increasing, but the rate of spending to date is significantly below what is required to build a resilient grid of the future. The exponential deployment of distributed energy resources and intermittent renewable generation that is expected over the next decade will require a more sophisticated response capability than exists today.

This Guidehouse Insights report examines the current and historical spending levels on T&D infrastructure in North America, and the rapidly changing drivers of grid investment that highlight the need for future spending increases. It also breaks down the 2021 Infrastructure Investment and Jobs Act, providing context for the many potential funding sources for T&D upgrades.
Pages 18
Tables | Charts | Figures 7
  • What is the level of capital spending on the T&D system?
  • How is the US’s T&D system performing?
  • Is capital investment on T&D infrastructure expected to increase?
  • What factors are influencing current and future grid investment?
  • How are federal subsidies for grid modernization being deployed?
  • Utilities
  • Energy developers
  • Hardware vendors
  • Software vendors
  • Government agencies




Despite Investment to Date, Achieving Grid Resilience Requires Immediate and Sustained Action

Concerns About Current Grid Infrastructure Grow in Latest Assessments

Regulators Call for Action on Grid Reliability

Case Study #1: California Summer Reliability Prompts Emergency Action

T&D Infrastructure Spending Has Experienced Slow but Consistent Growth

Driving Infrastructure Investment

Grid Planners Should Prepare for More Frequent Weather Events

Clean Energy Standards and Required Infrastructure Escalate Over the Next Two Decades

Transportation Electrification Will Likely Accelerate Distribution Investment

Appliance Electrification Requires Long-term and Continued Investment

Case Study #2: California Public Utility Commission’s 2021 Preferred System Plan Provides a Glimpse of the Future

CPUC 2021 Preferred System Plan

The 2021 US Infrastructure Investment and Jobs Act Offered a Boost to Grid Infrastructure Spending

Stakeholders Should Prepare for Robust Grid Infrastructure Spending Over the Next Decade

  • SAIDI: Average Outage Duration with and without Major Events
  • SAIFI: Average Number of Outages with and without Major Events
  • Utility T&D Infrastructure Spending
  • Billion Dollar Weather Events in the US
  • EV Charging Impacts to Ripple Through Distribution Grid
  • IIJA Funding
  • IIJA Energy Funding by Program
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