Abstract: The US electrical grid is experiencing a rapid transition as cheap renewable electricity transforms the energy mix. With these grid changes, new supply is not spatially matched to demand, and the transmission network has become more strained. Better market integration could thus lower US generation costs. This talk will present results from two projects, estimating (1) the excess generation costs associated with transmission congestion and other spatial constraints; and (2) how generator profitability would change if spatial constraints were eliminated. We document that eliminating interregional constraints could reduce generation costs by billions of dollars each year, but would create winners and losers among generation companies. The latter are especially of interest because generators have a large say in whether transmission projects are developed.
Biography: Dr. Catie Hausman is an Associate Professor in the School of Public Policy at the University of Michigan and a Research Associate at the National Bureau of Economic Research. Her work focuses on environmental and energy economics. Recent projects have looked at electricity transmission policy; the natural gas sector's role in methane leaks; the economic damages from climate change; and inequality in pollution exposure. Prior to her graduate studies, Dr. Hausman studied in Peru under a Fulbright grant. She has taught Statistics, a policy seminar on Energy and the Environment, and a course on Government Regulation of Industry and the Environment. She holds a BA from the University of Minnesota and a PhD in Agricultural and Resource Economics from the University of California, Berkeley.