Electricity Lost in Transmission: Offsetting the Cost of Wasted Energy

Traveling leisurely down the rural highway, my eyes track the waves of the power lines just outside my window. They stretch for miles into the horizon, tracing over hills and crisscrossing farm fields; transporting the resource that our modern American life depends on, even out here in the middle of nowhere. What most of us don’t realize though, is that the very transmission lines that power our lives are currently leaking electricity– and we’re paying for it.

Daily losses in transmission and distribution are a key problem in energy management today, and consumers end up paying for the extra electricity that never makes its way to our homes. When the majority of our global electricity comes from major power plants burning fossil fuels, daily losses eat into an already severely limited resource. By understanding how electricity is lost and the economics that keep this faulty system in place, we as consumers can learn how to minimize our own costs accordingly.

Electricity’s Long Journey to Your Doorstep

Electricity starts at the power plant, or at the wind turbine or solar panels, but that is only the beginning of its long journey to you. High voltage lines (the massive ones that look like robot sentries standing at attention across the plains) carry the energy to a substation near your neighborhood, where the energy is converted into a lower voltage that we can actually use. Smaller distribution lines (on wooden poles or underground) then carry this low voltage electricity to your home.

The tricky part is that every stage of the process is owned by a different company. The supplier purchases the energy at wholesale from a power plant. The transmitter pays to move the energy through the high voltage lines. And the distributing utility delivers the energy to your home. It’s a complicated grid and unfortunately, there are many places along the way where losses can occur.

Why We Are Losing Our Electricity

As far as electricity is concerned, we are living in a perpetual state of loss. From the power plant to the outlets in our living rooms, we could be losing anywhere from 5-10% of the electricity that was originally generated simply due to the physics involved in transmission.

In the United States, electricity losses due to transmission and distribution have averaged about 5% each year since 2010, but this number varies from state to state. In places like Wyoming and North Dakota, only about 2% of electricity is lost, while New Jersey and Delaware are losing upwards of 10%. On a global scale, the numbers are even more disheartening. According to the World Bank, countries like Namibia and Venezuela are losing upwards of 35% of their electricity in transmission alone.

Assuming that no electricity theft (a major component of India’s nearly 20% loss rate) is taking place in your area, electricity gets lost due to sheer physics. There’s a majorly important reason that power lines require huge right-of-ways in the air that require local utilities to keep trees trimmed: these lines are pure metal, insulated only by the air surrounding them, and they give off a tremendous amount of heat. This makes the lines sag, especially on hot days, and creates the otherworldly rustling sound you may hear when you stand under a power line.

What Transmission Companies Can Change

Let’s take a field trip back to our days studying physics. Ohm’s law dictates that the higher the voltage, the less electricity is lost as heat– which means that the bigger high voltage lines that carry energy across vast distances are actually the most efficient. Extra high voltage lines (rated around 765-kilovolts or higher) would reduce existing losses many times over. The lower voltage lines running through your neighborhood are actually losing a lot more electricity, which makes rural states like Wyoming more electrically efficient than densely populated states like New Jersey.

In addition to building more of the massive robot towers, companies can invest in grid technologies that prevent losses– which include the newly touted high-temperature superconductors that could potentially eliminate transmission loss altogether. Seasons of higher demand can also cause major losses due to power surges that could be lessened with the addition of demand response technologies.

Unfortunately, these solutions are expensive for transmission and distribution companies to implement — and the consumer is currently paying for the cost of electricity loss. You and I see this embedded within our electric bill as “transmission fees” (if it’s delineated at all). As such, the companies in charge of the grid currently have no incentive to pursue these changes, much like traditional utility companies have no incentive to lower prices in the absence of retail choice competition.

What We Can Do To Reduce Costs

While updated technologies may one day reduce daily electric losses, they could be a long way off. For now, we as consumers are receiving the short end of the stick, footing the bill for losses caused by thermodynamics and a resistance to advancing technology.

However, there are still ways for us to reduce our own electric costs and personal losses. We can manage our household “grid” so that our electric use is spread throughout the day instead of running all our electronics at once. Smart metering can be a potential solution to discuss with your utility company, and a fixed rate energy plan can help you stabilize your energy bill beyond the influence of surges. In addition, because the baseload that a grid carries is usually covered by fossil fuel power plants, any surge in demand needs to be covered elsewhere. Investing in renewable energy can minimize the losses that are felt, if not reduce the losses themselves. The extra energy produced by renewable sources bumps the grid above baseload and helps keep the lights on when demand is high.

This is a system that’s in need of advancement, but until transmission and distribution companies have an incentive to change regional grid infrastructure, we will be paying for our 5% electric losses with every electric bill. In the meantime, shifting our behaviors and partnering with companies who support new technology can help reduce our own costs.

Looking for an energy supplier to partner with that recognizes where our industry needs to improve? Liberty Power is dedicated to advocating for improved power systems and offers plans to help you take control of your electric bill and reduce costs. Reach out to us today to learn how switching your energy supplier can help you reduce your own household costs and help offset the electric losses inherent in the system.


Photo Credit: Jeff Moss /  CC BY

Liberty Power Editorial Team
The Editorial Team at Liberty Power is a swashbuckling group of passionate and creative Energy experts bringing you the hottest topics on exciting market trends, booming products and services, and the latest news in the industry.