Case study: grid modernization & storage -- transmission buildout

The modern power grid is facing a once-in-a-century redesign. Electrification of transport, heating and industry; the proliferation of wind and solar farms; and the arrival of energy-intensive technologies such as data centres and artificialintelligence clusters are driving an unprecedented rise in electricity demand. At the same time, much of the existing network was built for centralised, fossil fuel-based generation and one-way power flows. To keep pace with this transformation and meet decarbonisation goals, governments and utilities must embark on a historic transmission buildout. The International Energy Agency (IEA) warns that more than 80 million kilometres of power lines -- roughly the length of the entire existing network -- will need to be added or replaced by 2040. Investment in grids will need to double to over USD 600 billion per year by 2030. Meanwhile, at least 3 000 GW of renewable energy projects, including about 1 500 GW at advanced stages, are waiting in interconnection queues because there is not enough transmission capacity.

This case study examines the drivers behind transmission expansion, clarifies key concepts, and compares the progress of several flagship projects. It also highlights bottlenecks -- from long permitting delays to interconnection backlogs -- and offers a practical checklist for stakeholders. Together, these insights illustrate how transmission buildout underpins the entire clean-energy transition and why urgent action is required.

Why It Matters

Grid bottlenecks jeopardise climate goals. Without sufficient high-voltage lines, renewable projects cannot connect to the grid, causing a backlog of thousands of gigawatts. Delayed grid investments could add nearly 60 billion tonnes of carbon emissions between 2030 and 2050, making it difficult to achieve the Paris Agreement target. Highvoltage lines also help smooth regional imbalances by carrying wind and solar generation from resource-rich areas to demand centres. Studies by Americans for a Clean Energy Grid show that high-capacity transmission can deliver power at up to 75% lower cost per megawatt than lower-voltage alternatives, reducing consumer bills and improving reliability.

Aging infrastructure and new demand. Many existing lines are well past their expected service life. In Europe, around 40% of distribution networks are over four decades old, and similar patterns exist in the United States and Asia. Meanwhile, electrification of vehicles and heating; industrial reshoring; and a surge in AI-driven data centres are increasing electricity demand at rates not seen in decades. In the United States, the Department of Energys 2024 National Transmission Planning Study indicates that roughly 5 000 miles of new high-capacity transmission must be built annually to maintain grid reliability and support economic growth. In 2024, however, only about 322 miles of high-voltage lines were completed -- less than a tenth of what is required.

Backlogs slow renewable deployment. According to the Lawrence Berkeley National Laboratorys Queued Up: 2025 Edition, by the end of 2024 around 10 300 projects were seeking interconnection in the United States, representing 1 400 GW of generation and approximately 890 GW of storage. The median time from interconnection request to commercial operation has doubled since the early 2000s to more than four years. Only 13% of projects that sought interconnection between 2000 and 2019 have reached commercial operation. These delays increase costs, deter investors and risk leaving thousands of megawatts stranded.

Key Concepts

Transmission buildout. Transmission buildout refers to the planning, permitting and construction of high-voltage lines and associated infrastructure (substations, converters and transformers) needed to transport electricity from generation sites to load centres. It includes reinforcement of existing lines, addition of new corridors and deployment of advanced technologies that increase capacity and efficiency. Transmission buildout is distinct from distribution upgrades, which occur at the lower-voltage levels closer to end users.

HVAC vs. HVDC. Highvoltage alternating current (HVAC) lines dominate most transmission systems, but high-voltage direct current (HVDC) is increasingly used for longdistance and underwater links. HVDC can transmit more power over longer distances with lower losses and provides precise control of power flows. Modern HVDC projects, such as Germanys SuedLink and the United States SunZia and CHPE lines, are crucial to moving renewable energy from remote regions to urban centres. HVDC equipment is more capitalintensive but often cheaper on a lifecycle basis when transmission distances exceed several hundred kilometres.

Interconnection queues. Before a new generator can connect to the grid, it must undergo studies to determine whether the network can absorb the power and what upgrades are required. The resulting list of projects awaiting grid connection is called the interconnection queue. As renewable deployment accelerates, these queues have grown rapidly. In the United States, they now contain more than 2 300 GW of total capacity proposals. High withdrawal rates reflect the difficulty of getting projects through the queue.

Gridenhancing technologies (GETs). GETs encompass hardware and software solutions that unlock capacity on existing lines. Examples include dynamic line rating (DLR), which uses realtime weather data to update a lines permissible current and can boost capacity by about 50% on cold or windy days; powerflow control devices, which reroute power to underutilised corridors; and advanced sensors that give operators better situational awareness. GETs offer a faster, lowercost complement to new construction but require regulatory support and operational changes.

What's Working and What Isn't

What's Working

• Major projects secured financing. Several flagship transmission projects have secured funding and advanced to construction. Pattern Energy closed an $11 billion financing deal in December 2023 for the SunZia Transmission and Wind project, the largest clean-energy infrastructure project in U.S. history. The SunZia transmission line is a 550-mile 525 kV HVDC link capable of carrying 3 000 MW of power from central New Mexico to south-central Arizona. Together with the associated 3 515 MW wind farm, SunZia will deliver clean power to about 3 million Americans and provide more than $20 billion in economic impact.

• Progress on Europes energy highways. Germanys SuedLink project -- a 700kilometre underground HVDC line connecting windy northern states with industrial centres in the south -- has finally moved into construction after years of delays. Estimated to cost about EUR 10 billion, the line will deliver up to 4 GW of power and could supply around ten million households when complete in 2028. Officials describe SuedLink as one of the most important energy transition projects in Germany. Planning is also underway for the West Coast Line to connect Denmarks wind resources with Germany, highlighting regional cooperation.

• Crossborder links expand markets. The Champlain Hudson Power Express (CHPE) is a 600 kilometre (372 mile) HVDC Light link that will carry 1 250 MW of hydropower from Quebec to New York City using underground and underwater cables. Scheduled for commissioning in 2026, CHPE is expected to reduce CO2 emissions by 3.9 million metric tonnes per year -- equivalent to removing 44% of passenger vehicles from New York City -- and supply electricity to roughly one million households. The project will create more than 1 400 jobs during construction and is projected to deliver $50 billion in economic benefits over 30 years.

• Investment commitments and alliances. International alliances such as the Utilities for Net Zero Alliance (UNEZA) are mobilising capital for grid expansion. UNEZA members and partners have pledged more than USD 117 billion in annual investment, with roughly 48% earmarked for grid infrastructure. The IEA and IRENA both emphasise that around USD 670 billion per year must be invested in grids between 2025 and 2030. These commitments show that industry actors recognise the urgency and are beginning to act.

• Technological innovation. Gridenhancing technologies are making headway. The U.S. Department of Energy selected four demonstration projects in 2023 to deploy dynamic line rating and advanced powerflow control devices, providing nearly USD 8.4 million in funding. Dynamic line rating can allow existing lines to deliver up to 50% more power when weather conditions are favourable. Powerflow controllers help balance overloaded and underused lines. These innovations extend the life of existing assets and defer costly construction.

What Isn't Working

• Buildout pace falls short. Americans for a Clean Energy Grid reports that the United States added only 322 miles of new high-voltage transmission in 2024, marking the third slowest year in the past 15 years. Even when including revisions to Federal Energy Regulatory Commission data that count 888 miles of 345 kV and 500 kV lines built in 2024, the total still falls far short of the roughly 5 000 miles needed annually to ensure reliability and support economic growth. In 2013, the U.S. built nearly 4 000 miles of high-voltage lines, demonstrating that a faster buildout is possible.

• Permitting and public opposition. New transmission corridors often face years of permitting, environmental review and community opposition. Residents may oppose overhead lines for aesthetic, environmental or landuse reasons. Germanys SuedLink was delayed for years due to local protests, leading planners to bury most of the line underground. In the United States, some states require multiple agencies to issue permits, and legal challenges can stall projects even after approvals. Streamlining permitting while ensuring meaningful consultation is essential.

• Interconnection bottlenecks. The backlog of projects waiting to connect is perhaps the most visible sign that transmission is inadequate. As of late 2024, about 10 300 projects totalling 1 400 GW of generation and 890 GW of storage were in U.S. interconnection queues. The median time to reach commercial operation now exceeds four years, more than double the time observed two decades ago. Only 13% of projects submitted between 2000 and 2019 have reached operation. High withdrawal rates create uncertainty and waste resources.

• Investment gaps persist. Although investment pledges are rising, actual spending has not yet reached required levels. Global grid investment has remained roughly flat at around USD 300 billion per year. The IEA calls for doubling this amount to over USD 600 billion annually by 2030. Without sustained funding, supply chain expansion and workforce training, projects will not progress at the speed needed.

• Technical complexity and supply chains. HVDC technology and advanced grid controls require specialised equipment and skilled labour. Supply chain constraints for cables, transformers and power electronics can delay projects and increase costs. For example, HVDC converter stations involve large power semiconductor modules and transformers that may take many months to manufacture. The global supply chain for such components is concentrated, leaving projects vulnerable to bottlenecks.

Case Study Projects

SuedLink (Germany)

Length and capacity. SuedLink is an underground high-voltage direct current line running about 700 kilometres from the windy north of Germany to industrial regions in the south. It will have a transmission capacity of 4 GW, enough to supply roughly ten million households. By moving wind power from the North Sea to manufacturing centres, the project helps balance regional supply and demand.

Timeline and cost. Construction began in 2023 after years of planning and public consultation. The project is scheduled to enter service in 2028 and is expected to cost around EUR 10 billion. Most of the line will be buried underground following public opposition to overhead pylons, adding complexity but improving acceptance.

Why it matters. SuedLink demonstrates how large crosscountry projects can enable high renewable penetration. It also illustrates the challenges of permitting and the tradeoffs between overhead and underground construction.

SunZia (United States)

Project overview. The SunZia Transmission line is a 550-mile 525 kV HVDC intertie linking wind-rich central New Mexico with south-central Arizona. It will transport up to 3 000 MW of power from Pattern Energys 3 515 MW SunZia Wind project.

Investment and impact. Pattern Energy closed an $11 billion financing package in December 2023 to build both the transmission line and the wind farm. The project is expected to provide clean electricity for about 3 million Americans and to generate more than $20 billion in economic benefits. Construction is underway, with operations targeted for the mid2020s.

Challenges and lessons. SunZia shows how large private developers can aggregate generation and transmission assets into a single project. It also highlights the importance of innovative financing structures (including green loans and tax equity) to mobilise capital at unprecedented scale.

Champlain Hudson Power Express (CanadaUnited States)

Project overview. The CHPE project will deliver 1 250 MW of hydropower from Quebec to New York City via a 372mile (600 kilometre) HVDC Light link that runs underground and underwater.

Environmental and economic benefits. The link is expected to reduce CO2 emissions by about 3.9 million metric tonnes per year -- equivalent to removing 44% of passenger vehicles from New York City. The project will create over 1 400 jobs during construction and deliver nearly $50 billion in economic benefits to New York over 30 years. Commissioning is scheduled for 2026.

Why it matters. CHPE demonstrates how underground HVDC can deliver large quantities of renewable energy to dense urban centres without competing for overhead rightsofway. It also exemplifies the crossborder cooperation needed to build transnational infrastructure.

Interconnection queue backlog (United States)

Scope of the issue. By the end of 2024, about 10 300 projects were actively seeking grid connection in the U.S. interconnection queues, representing 1 400 GW of generation capacity and 890 GW of storage. More than 400 GW of capacity had already executed interconnection agreements but had not yet reached commercial operation.

Impact on projects. The median time to move from interconnection request to commercial operation has more than doubled to over four years. Only 13% of the capacity proposed between 2000 and 2019 has come online. As a result, many renewable developers withdraw their projects due to uncertainty and escalating costs.

Key insight. The backlog underscores the mismatch between generation ambitions and transmission expansion. Clearing interconnection queues will require both new lines and reforms to study processes and cost allocation.

Action Checklist

• Plan proactively. Transmission planning must anticipate longterm demand and align with renewable buildouts. Use scenariobased models to identify highvalue corridors and consider HVDC options for longdistance links.
• Streamline permitting and siting. Governments should modernise permitting processes to provide predictable timelines while ensuring environmental and social safeguards. Early engagement with communities can reduce opposition and identify routing alternatives (underground, underwater) that balance impacts.
• Adopt gridenhancing technologies. Deploy dynamic line rating, powerflow control devices and advanced sensors to unlock latent capacity on existing lines. FERC Order 881 in the United States requires regional transmission operators to incorporate ambientadjusted ratings by 2025, encouraging wider adoption. Utilities can begin pilots now to gain experience.
• Coordinate interconnection reforms. Standardise interconnection studies across regions, improve data transparency and allow generator clusters to share network upgrades. Consider proactive upgrades funded by multiple beneficiaries rather than requiring each project to pay for major reinforcements alone.
• Invest in workforce and supply chains. Expand training programmes for engineers, project managers, and trades to build HVDC lines and implement new technologies. Support manufacturing of cables, transformers and power electronics in multiple regions to mitigate supply bottlenecks.
• Promote crossborder cooperation. Regional transmission organisations, national regulators and neighbouring countries should collaborate on planning and financing. Shared projects, like CHPE and the West Coast Line, show that crossborder links can unlock significant mutual benefits.
• Finance at scale. Use innovative financing structures, such as green bonds, publicprivate partnerships, and blended finance, to mobilise the hundreds of billions required annually. Consider combining generation and transmission assets (as in SunZia) to reduce risk and align incentives.

FAQ

Q: Why are high-voltage direct current (HVDC) lines becoming more common?

A: HVDC lines transmit electricity over long distances with lower losses and greater control than traditional HVAC lines. They are particularly effective for connecting remote renewable resources to demand centres, crossing underwater or underground routes, and interconnecting different grid regions. HVDC projects are capitalintensive but often provide better value over their lifetime, especially when distances exceed a few hundred kilometres.

Q: Why cant we just upgrade existing lines instead of building new ones?

A: Upgrading existing lines with gridenhancing technologies can unlock significant capacity. For example, dynamic line rating may increase a lines capacity by around 50% on cold or windy days. However, upgrades alone cannot accommodate the projected doubling or tripling of electricity demand and the connection of thousands of gigawatts of new renewables. Many regions will still need new corridors to handle power flows and improve resilience.

Q: What causes the interconnection queue backlog?

A: The backlog stems from a combination of factors: surging demand for renewable connections, a firstcome, firstserved study process that examines each project individually, limited transmission capacity, and a cost allocation system that places upgrade costs on the first mover. Reforming study procedures, allowing projects to be studied in clusters, and proactively funding network upgrades can help clear the backlog.

Q: How do transmission buildout and energy storage interact?

A: Transmission and storage complement each other. Expanded transmission allows renewable energy to be delivered to where it is needed, while storage provides flexibility by absorbing surplus generation and supplying power during peaks. Largescale battery projects can defer some transmission upgrades by smoothing peaks, but they cannot replace longdistance lines required to move bulk power from resource-rich areas to load centres.

Q: Are underground lines always better than overhead lines?

A: Underground cables minimise visual and landuse impacts and can reduce public opposition. However, they are more expensive to install and maintain and may be more challenging to repair. Decisions on undergrounding should consider cost, environmental impact, technical feasibility and community preferences. SuedLink chose underground construction for most of its route due to public opposition, but this added complexity and cost.

Sources

• Mark Segal, 80 Million Kilometers of Grid Investment Needed by 2040 to Meet Global Climate Goals, ESG Today, 17 October 2023.
• Americans for a Clean Energy Grid and Grid Strategies, New Report Reveals U.S. Transmission Buildout Lagging Far Behind National Needs, 21 July 2025.
• Joseph Rand et al., Queued Up: 2025 Edition: Characteristics of Power Plants Seeking Transmission Interconnection as of the End of 2024, Lawrence Berkeley National Laboratory, 2025.
• Benjamin Wehrmann, Germany Starts Construction of NorthSouth Power Line Pivotal for Energy Transition, Clean Energy Wire, 12 September 2023.
• Pattern Energy Group, Pattern Energy Closes $11 Billion Financing of Largest Clean Energy Infrastructure Project in U.S. History, press release, 27 December 2023.
• Hitachi Energy, Champlain Hudson Power Express (CHPE), customer story, 2025.
• U.S. Department of Energy, GridEnhancing Technologies Improve Existing Power Lines, Office of Electricity, 2023.
• International Renewable Energy Agency (IRENA), Leading Power Sector Companies Reveal Blueprint for Infrastructure Upgrade, 23 September 2025.