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Originally,
this grid was built, owned, operated and maintained by the large, state-run
utilities that had monopolies in every geographical area. The governments
decided that it would be cheaper to build one power line from point A
to point B, than have a number of competing companies all building power
lines between the two points. This is very similar to the way we build,
own and operate the road system in North America, and the way we used
to think of the telephone system. Recently, there has been a shift in
thinking on this issue.
‘The old school of thought that considered
electric utility power generation, transmission, and distribution a
“natural monopoly” has given way to a new school of thought.
Today, there is a widespread view among legislators, regulators, industry
analysts, and economists that the generation segment of power supply
in today’s environment would be more efficient and economical in
a competitive market. In contrast, transmission and distribution will
remain regulated and noncompetitive.
Major segments of the electricity industry are being restructured. The
industry is currently in the midst of a transition from a vertically
integrated and regulated monopoly to an entity in a competitive market
where retail customers choose the suppliers of their electricity. The
change began in 1978, when the Public Utility Regulatory Policies Act
(PURPA) made it possible for nonutility generators to enter the wholesale
power market. ’[1]
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Over the past few years, many of these regions have
been de-regulated (i.e. the government has turned over the system
to the free market), and independent companies have started to build,
own and operate power plants. In order to deliver the electricity
that they are creating, these independent companies have started using
the grid. It still makes sense to maintain a monopoly structure with
the actual wires. |
To accomplish this, the governments
have set up independent bodies to own, operate and administer the grid
in different areas.
The Grid can be broken down
into two main categories:
- High-voltage, long-distance
power lines (the highways or veins) that carry bulk or wholesale power,
and
- Lower-voltage, local distribution
lines (feeder roads or capillaries) that carry retail and commercial
power.
Let’s look at the high-voltage
lines first…
[1] The Restructuring of the Electric Power Industry –
A Capsule of Issues and Events, DOE/EIA-X037 January 2000,
http://www.eia.doe.gov/cneaf/electricity/chg_str/booklet/electbooklet.html
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