Major Midwest transmission line gets a big but uncertain federal boost

The Grain Belt Express, a $7 billion transmission line project that’s been more than a decade in development, has won conditional approval for a $4.9 billion federal loan guarantee.

The Grain Belt Express could enable 5 gigawatts’ worth of affordable, clean power to be developed on the windswept and sun-soaked Kansas plains and then delivered to customers in Missouri, Illinois, and broader eastern U.S. power markets. If finalized, the federal backing would help push the sorely needed transmission project over the finish line.

The proposed loan guarantee is the latest in a string of Biden administration actions aimed at bolstering the U.S. power grid. The country needs to rapidly build high-voltage transmission lines in order to accommodate new solar and wind power, reduce grid congestion that’s driving up electricity rates, and improve power system reliability in the face of extreme weather events.

Whether the Grain Belt Express will be able to make use of this financial support is unclear, however. Last week’s conditional commitment from the Department of Energy’s Loan Programs Office (LPO) may ultimately depend on whether the Trump administration decides to follow through with it.

The LPO has played a major role in the Biden administration’s clean energy agenda, announcing about $37 billion in loans and loan guarantees over the past four years. Recipients include electric vehicle and battery factories; battery mineral mining, processing, and recycling facilities; distributed solar and battery deployments; EV charging projects; makers of alternative aviation fuels; clean-hydrogen production plants;and the owner of a shuttered nuclear power plant in Michigan that hopes to restart it.

Roughly $25 billion of those commitments have yet to be finalized and contracted by the DOE, according to a late November tally from Politico. The LPO has been sprinting to complete these contracts in case the incoming Trump administration opts to freeze any in-progress loan agreements.

Many of the projects backed by the LPO are in Republican congressional districts, Politico reported. That includes the Grain Belt Express, which plans to use its conditional loan guarantee to finance the first phase of its 5-gigawatt high-voltage direct current (HVDC) transmission line — a 578-mile stretch from southwestern Kansas to Missouri. 

Invenergy, a Chicago-based energy developer that bought the transmission project from its original developers in 2018, estimates that the Grain Belt Express will provide $11.3 billion in energy cost savings over 15 years for buyers of the power it will deliver. Invenergy also estimates that it will enable roughly $20 billion in wind and solar projects to be built — projects that will create jobs and tax revenue for Kansas and Missouri residents.

The Grain Belt Express has won approval from utility regulators in both of these Republican-led states, indicating that they have ​“affirmed our project is key to improving grid affordability and reliability across the Heartland,” Shashank Sane, Invenergy’s executive vice president of transmission, said in a statement.

The project has also secured some prospective buyers for its power, including a consortium of 39 municipal utilities represented by the Missouri Public Utility Alliance. Those utilities plan to rely on the transmission line to ​“receive clean, homegrown energy that will save millions in lower electricity costs each year,” John Twitty, CEO of the alliance, said last year after the Grain Belt Express won state regulatory approval.

Invenergy is also negotiating with corporations interested in buying the low-cost and low-carbon power it will deliver. That has helped the project win support from the Electricity Consumers Resource Council (ELCON), a group representing large industrial and commercial companies.

ELCON CEO Karen Onaran noted in a Tuesday statement that the group doesn’t see the LPO’s grid-related loans as ​“partisan” in nature. ELCON members are ​“very supportive of many planned Trump administration energy affordability and reliability reforms,” she wrote. At the same time, ​“there are some important LPO projects that will be key drivers in meeting the Trump administration’s goals to strengthen grid reliability and control energy cost inflation.”

Broad support for building more power lines 

Transmission lines are notoriously hard to build. Projects can take up to a decade or more to move from conception to completion. They must secure siting rights and permits from scores or even hundreds of public jurisdictions and private landholders. Relentless legal challenges can complicate or stymie their financing and construction.

But the U.S. desperately needs to build more transmission infrastructure to provide affordable and reliable electricity, much of it to come from low-cost wind and solar farms in remote areas. Studies from groups ranging from the Department of Energy and the North American Electric Reliability Corporation to the Massachusetts Institute of Technology and Princeton University have reiterated the central role of cross-country, high-voltage power lines in reducing the cost and improving the resilience of the grid.

The Grain Belt Express is one of roughly three dozen major transmission projects now either in the process of being built or in the advanced stages of planning across the country, according to a 2023 report from consultancy Grid Strategies commissioned by trade group Americans for a Clean Energy Grid (ACEG). Those projects represent $64 billion in investment and could enable 187 gigawatts of new renewable energy. But they would only expand U.S. transmission capacity by roughly 15 percent, compared with the doubling to tripling of capacity many studies say is needed.

The pressure to build more transmission has only grown more acute in recent years. After more than a decade of relatively flat growth, demand for electricity is surging in many parts of the country, driven by new data centers and factories in the short term and electric vehicles and building heating in the longer term.

At the same time, increasingly extreme weather events exacerbated by climate change, such as the winter storms that caused massive blackouts in Texas in 2021 and across much of the southeastern U.S. in 2023, are raising the risk of regional grid disruptions. Building more interregional grid capacity can reduce those risks by allowing power to flow from less-affected areas to those experiencing extreme weather.

“This country needs to build all kinds of infrastructure, when we think about the challenges facing the system — load growth from all sorts of reasons, increasing extreme weather and weather patterns that move quickly over broad areas, national security,” Allison Clements, a former member of the Federal Energy Regulatory Commission, which regulates interstate electricity transmission, said during a late November webinar on grid issues.

Clements, a Democrat, supported a series of grid policy reforms at FERC in recent years, including a major order passed in May that instructs the country’s utilities and regional grid operators to engage in long-term comprehensive planning to expand transmission capacity. While that order was opposed by FERC’s sole Republican member at the time, the agency last month approved a revised version of the order that won support from both Republican and Democratic members.

Bipartisan support for building more transmission has manifested in a number of other ways during the past four years. Most notably, the 2021 Bipartisan Infrastructure Law created a Department of Energy program that has directed billions of dollars to utilities and grid operators to expand grid capacity.

The Biden administration has also taken steps to streamline permitting among federal agencies and expand federal authority to accelerate transmission projects deemed to be in the national interest. The Grain Belt Express is one of many projects that fall under the purview of these actions.

Despite the federal support, Invenergy still faces legal challenges to completing the second phase of the Grain Belt Express line, which would stretch from Missouri to the Illinois-Indiana border. Earlier this year, an Illinois court upheld a challenge from the Illinois Farm Bureau and landowner groups that overturned state regulatory approval for the project. The state regulator is appealing that decision to the Illinois Supreme Court.

Pro-transmission groups have long supported efforts in Congress to pass comprehensive permitting reform that could reduce the many barriers grid projects face. Those efforts have faltered in the face of disputes between Republicans and Democrats over the role they could play in expanding fossil fuel development.

A permitting reform bill introduced this year by retiring senator Joe Manchin, a West Virginia Democrat, and Senator John Barrasso, a Wyoming Republican, is unlikely to pass in the lame-duck session ahead of Republicans taking a majority in both houses of Congress next year.

Even so, backing for the bill from groups including major tech companies and commercial and industrial power users indicates broad support for federal transmission reform.

“By reducing permitting bottlenecks, the United States is poised to re-energize domestic manufacturing, lead the energy transition, and create economic opportunities in the energy and manufacturing sectors,” ELCON’s Onaran said in a statement marking the Manchin–Barrasso bill’s passage in a Senate committee in August.