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Thousands Get Energy Active
Nearly 27,000 visitors have come to the Get Energy Active Web site since its launch one month ago on May 29, 2007. Thank you for visiting the site and signing up to receive our monthly newsletters. Don’t forget to bookmark the site and check back frequently for updates. And tell your friends to Get Energy Active too.
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Electricity Powers Our Economy, Our Future
The U.S. economy is highly dependent on affordable and reliable electricity. In fact, growth in our nation’s gross domestic product—“GDP” or the measure used to gauge economic activity—has coincided with growth in electricity use since the end of World War II. That’s a long time!
Going forward, the government’s energy forecasting agency—the Energy Information Administration (EIA)—forecasts that strong economic growth will continue for at least the next 25 years. Likewise, EIA anticipates continued growth in electricity use in all sectors—a 40-percent increase over today’s levels.
Electricity powers nearly all of the new products, gadgets and technologies that we buy and use. And our demands for electricity will only increase in the future. That’s why it’s smart to start planning today for our tomorrow.
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Energy Legislation Advances in Congress
Last week, the Senate approved an energy bill (H.R. 6, the Clean Energy Act) that would boost the use of renewable fuels for transportation, set aggressive energy efficiency standards for appliances and buildings, and raise the fuel economy standards for cars, SUVs, vans, and pickups to an average of 35 miles per gallon by 2020. The bill also promotes production of plug-in hybrid electric vehicles and creates new programs to get advanced electric and hybrid vehicles to market.
On June 28, Speaker of the House Nancy Pelosi unveiled a package of energy bills that she intends to take to the House floor next month, fulfilling a promise that she made when she became speaker in January to produce “energy independence” bills by July 4. If the House passes its version of an energy bill, the House and the Senate would then meet in conference to reconcile the differences between the two versions of legislation. Following conference, a final bill would be brought back to the House and Senate floors for a vote.
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Strong Upward Trend in T&D Investment
Preliminary survey data indicate that the strong upward trend in both transmission and distribution investment that began in 2000 continued into 2006. Here are some highlights:
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In 2006, both shareholder-owned electric companies and stand-alone transmission companies invested an historic $6.9 billion in the nation’s transmission grid. This represents a 9.7-percent increase over the inflation-adjusted $6.3 billion ($5.8 billion prior to inflation adjustment) invested in 2005. Industry transmission investment in 2006 represents a 51-percent increase over 2000 levels. Since the beginning of 2000, the industry has invested more than $37.8 billion in the nation’s transmission system.
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Shareholder-owned electric utility investment in the distribution system surpassed $17 billion in 2006, the first time this has happened. This level of investment ($17.3 billion) represents a 6.5-percent increase over the inflation-adjusted $16.2 billion ($14.5 billion prior to inflation adjustment) invested in 2005. Industry distribution investment in 2006 represents an 18-percent increase over 2000 levels. Since the beginning of 2000, the industry has invested almost $109 billion in the nation’s distribution system.
It is becoming more evident that rising construction material costs are an important driver contributing to the higher actual and planned industry infrastructure investments. According to the latest Handy-Whitman Index of Public Utility Construction Costs, construction costs have increased by an average rate of 4.8 percent per year (32 percent since 2000) for transmission and 5.4 percent per year (37 percent since 2000) for distribution since 2006.
Enhancing the transmission and delivery systems used to get electricity where it’s needed is a smart way to ensure that we have reliable, affordable and increasingly clean supplies of electricity in the future.
* The investment data above is provided in real terms (2006$) and was adjusted for inflation using the Handy-Whitman Index®.
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