NYT: Grid Limitations Increase Prices for Electricity

[RedEarth]

CHAMBERSBURG, Pa. — It is a tiny, flickering signal of an expensive problem looming for tens of millions of Americans: The cost of electricity for households in this southern Pennsylvania town soared this year by 31 percent, or an average of $24 a month.

Like the nation’s highways and bridges, the network of transmission lines has not been maintained and expanded enough to meet growing demand, the United States Department of Energy says. In areas where there are not enough lines to transmit electricity from the most efficient generating stations, utilities must find other sources. Sometimes they have to buy from costlier power plants nearby, like drivers forced by highway bottlenecks onto slower side roads.

The problem already affects about 40 million people from metropolitan New York to Virginia as well as 18 million in Southern California. Similar but smaller price increases will hit New England, the San Francisco Bay Area and the Seattle-Portland and Phoenix-Tucson corridors until new transmission lines are built.

These higher costs, known as congestion charges, added $5.7 million to the cost of electricity in Chambersburg this year, which the borough has paid from a reserve fund rather than apply them directly to utility bills.

Over all, the Energy Department estimates, congestion charges in 2008 will add $8 billion or so — about $40 a person — to electricity costs on the Eastern grid, which serves almost 200 million people east of the Rockies except for Texas. The department did not make an estimate for the Western grids.

http://www.nytimes.com/2006/12/13/business/13power.html?pagewanted=print