PublicDisclosureAuthorized PublicDisclosureAuthorized PolicyResearchWorkingPaper10517 GreenTransmission Context,Rationale,andPlanningMethodology DebabrataChattopadhyayDurrehTabassum EnergyandExtractivesGlobalPracticeJuly2023 PolicyResearchWorkingPaper10517 Abstract Transmissionisakeyenablerofcleangenerationasthelinesandsubstationsneedtobebuiltfirsttoencourageinvestmentsingeneration.However,therehasbeenlimitedattentiontoreadyingthegridthroughupgradesofexistingtransmissionlines/substationsandexpansionofthegrid.Asaresult,transmissionhasbecomeamajorbottleneck,notonlyindevelopingcountries,butalsointheirdevel-opedcounterparts,includingtheUnitedStates,whichhasseenaccumulationof930gigawattsofcleangeneration“queuedup”waitingfortransmissiontobebuilt.Topriori-tizeupgradingandexpansionofthetransmissiongrid,thereisaneedtoadoptamoreholisticsystemwideviewfromalong-termperspectiveanddevelopamethodologythatrecognizestransmissionasanenablerofcleangeneration.Suchamethodologycanbedevisedaroundacompositegeneration-transmissionco-optimizationmodel.Thispapersetsthecontextwithinwhich“greentransmission”needstobeviewedandfurtherproposesamodelingframework thatbringstogetherthecriticalelementsingenerationandtransmissionplanning,includingsystemsecuritycon-straintsasamixed-integerlinearprogrammingproblem.Themodelformulationattemptstostrikeareasonablebalancebetweenthetechnicalrigorofanetworkmodelandcomputationaltractability.Therearealsoimportantimplementationdetailssuchasmakingtheplanningperiodsufficientlylongtoelicitthevalueoftransmission.Theshadowpricesofkeyconstraintsextractedfromthemodelcanbeusefulinprioritizingtransmissionprojects,especiallyifthedualsoftransmissioncapacityandcarbondioxidelimitsarecombined.Theseissuesarediscussedaroundasetofillustrativeexamples.Itisexpectedthatthemodelandassociateddiscussionwouldprovideastartingpointtorefinethemodelfurtherandapplyittopracticalcasestudiestodevelopaholisticdefinitionofgreentransmissionandsustainablegeneration-transmissionplans. ThispaperisaproductoftheEnergyandExtractivesGlobalPractice.ItispartofalargereffortbytheWorldBanktoprovideopenaccesstoitsresearchandmakeacontributiontodevelopmentpolicydiscussionsaroundtheworld.PolicyResearchWorkingPapersarealsopostedontheWebathttp://www.worldbank.org/prwp.Theauthorsmaybecontactedatdchattopadhyay@worldbank.organddtabassum@ifc.org. ThePolicyResearchWorkingPaperSeriesdisseminatesthefindingsofworkinprogresstoencouragetheexchangeofideasaboutdevelopmentissues.Anobjectiveoftheseriesistogetthefindingsoutquickly,evenifthepresentationsarelessthanfullypolished.Thepaperscarrythenamesoftheauthorsandshouldbecitedaccordingly.Thefindings,interpretations,andconclusionsexpressedinthispaperareentirelythoseoftheauthors.TheydonotnecessarilyrepresenttheviewsoftheInternationalBankforReconstructionandDevelopment/WorldBankanditsaffiliatedorganizations,orthoseoftheExecutiveDirectorsoftheWorldBankorthegovernmentstheyrepresent. ProducedbytheResearchSupportTeam GreenTransmission:Context,Rationale,andPlanningMethodology DebabrataChattopadhyayandDurrehTabassum1 Keywords:Transmissioninvestment,Greenfinance,Optimizationmodel,Powersystemplanning,Decarbonization. JELClassification:L94 1DebChattopadhyayisaSeniorEnergySpecialist(WorldBank)andDurrehTabassumisanAssociateInvestmentOfficer(IFC).TheauthorswouldliketothankourWorldBankcolleaguesClaudiaVasquezSuarez(LeadEnergySpecialist),MelaniaLotti(InfrastructureFinanceSpecialist),StephaneHallegatte(SeniorClimateChangeAdvisor)andSandhyaSrinivasan(SeniorClimateChangeSpecialist)forusefuldiscussionsonthetopic.ClaudiainparticularhasprovidedanextensivereviewofthepaperthatledtotheinclusionofimplementationchallengesandMelaniaprovidedinputsonthegreentransmissioncriteriausedbyEUandIDB.Theviewsandopinionsexpressedinthisarticlearehowevertheauthors’ownanddonotnecessarilyrepresentthoseoftheircolleaguesorthatoftheWorldBankGroup. 1.INTRODUCTION 1.1PRIORITIZATIONOFTRANSMISSIONTHROUGHBETTERPLANNINGISNEEDED Whenitcomestodecarbonizationofthepowersector,itiseminentlyclearthattheprimaryfocusoughttobeoncleaningupthegenerationside,whichincludesscalinguprenewableenergy(RE)aswellasphasingdownofcoal/gasplants.WorldBank(2022)madethispointemphaticallyduringtheCOP27.TherehasbeenthedesiredfocusinitiallyontheREscaleupforatleastadecadeandincreasinglyonphasingdownofcoaloverthesecondhalfofit–mostprominentlyinsomeoftheEUcountriesandtheUK.TheWorldBank’sinternalworksondecarbonizationpathways,acceleratingcoaltransition(ACT:Huangetal,2021),CountryClimateandDevelopmentReports(CCDR;WorldBank,2021-2023)andmostrecentlytheScalingUpwork(WorldBank,2023)havealsodoneacomprehensivearrayofanalyticalworkcoveringtheseaspects.Thispaperhighlightstheimportanceofthetransmissioninvestmentsinupgradingandexpandingthegridastheyobviouslyplayacriticalroleinreorientingthenetworktoaccommodatecleangeneration.Inadecarbonizedstate,thetransmissioninfrastructureoftenneedstoconnecttoremoteREhubsandhasasignificantroletomanageitsvariabilityamidotherchallenges.Transmissionanddistribution(T&D)networksyste