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Transmission Congestion Costs in the U.S. RTOs

Transmission Congestion Costs in the U.S. RTOs

Full Title: Transmission Congestion Costs in the U.S. RTOs
Author(s): Abby Sherman
Publisher(s): Grid Strategies
Publication Date: March 20, 2023
Full Text: Download Resource
Description (excerpt):

Yearly internal market congestion costs doubled from 2020 to 2021 across the Regional Transmission Organizations/ Independent System Operators (RTOs/ISOs) that serve around 58% of U.S. electricity load. Costs in RTO regions, apart from CAISO, were about $7.7 billion. Extrapolated to the rest of the U.S., including CAISO, congestion costs totalled around $13.4 billion. Of the seven operators of wholesale electricity markets in the country, all except California Independent System Operator (CAISO) publicly post congestion data.

Total reported congestion costs increased year-over-year by approximately 5% from 2019 to 2020, and by about 100% from 2020 to 2021. Reduced electricity demand in business and industry as a result of the COVID-19 pandemic, only partially offset by increased residential demand, contributed to lower congestion costs throughout 2020. This trend reversed from 2020 to 2021, and many other factors contributed to unprecedented congestion costs.

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