Electric generating capacity in North America is expected to be adequate in the near term, although instances of problems could occur in specific regions, the North American Electric Reliability Council said in its newly released assessment.

“NERC’s latest 10-year reliability assessment projects that electricity generating capacity margins across North America will increase markedly over the next 5 years as new merchant generating plants come on line,” said NERC CEO Michael Ghent.

The transmission outlook isn’t as rosy. With few new transmission projects on the books during the next decade, NERC predicted transmission congestion will likely increase, resulting in higher use of transmission loading relief procedures.

Between now and 2005, NERC-wide capacity margins are expected to keep rising and peak at 20% in 2004. Electricity demand is projected to increase 63,800 Mw in the same period, while new capacity additions could total 138,000-245,000 Mw. Last year was the first time in which capacity margins increased for several years.

“The market has begun to respond in areas of capacity deficiencies, and merchant generation will continue to play a major role in the future power supply of North America,” NERC said.

NERC’s regional reliability councils supplied their individual assessments, including:

— Midcontinent Area Power Pool. When demand forecast uncertainty is taken into account, the region may be capacity short by summer 2004 and nearly 5,442 Mw short by 2010. The summer reserve margin is expected to decline to 15% in 2005 and 1% in 2010 from a high of 20% in 2001 when committed and proposed generation is considered. MAPP-US utilities have committed to provide an additional 5,018 Mw of capacity during the period. MAPP’s transmission system is expected to be adequate to meet internal demand. But because of the increase in power marketing activity, the system is expected to operate near its secure limits. Current studies have identified potential restrictions that may limit energy transfers from Minneapolis and St. Paul, Minn., to Iowa and Wisconsin.

— Electric Reliability Council of Texas. New generation planned or under construction will add 11,000 Mw between now and 2002. One utility is planning purchases and one forecasting sales outside ERCOT. Interconnections use appears to be increasing purchases from outside ERCOT for economic rather than capacity reasons. After transmission congestion occurred this summer, ERCOT said transmission facilities needed to connect new generating capacity may not be ready in time, due to possible regulatory and other delays.

— Florida Reliability Coordinating Council. Projected peak demand and energy growth rates for the next 10 years are 2.4% and 2.3%, respectively. The increase is attributed to increased telecommunications demand and a bigger population. FRCC members are projecting net additions of 17,604 Mw of new capacity in the next 10 years.

— Southeastern Electric Reliability Council. Nearly 39,616 Mw of new generating capacity are planned to be added in the region in the next 10 years. The reported SERC capacity margin for the next 10 years ranges between 10% and 13%. Energy consumption is projected to grow at a 2.1%/year rate, down from last year’s forecast of 2.4%/year. The historic rate for the past 10 years was 3.1%/year. Planned transmission additions include 2,800 miles of new 230 kv and 500 kv facilities.

— East Central Area Reliability Cooperation Agreement. The region’s criteria for resource adequacy will be satisfied through 2005 if at least 3,650 Mw of the announced capacity additions within ECAR go into service between now and 2010. This assumes capacity outside ECAR is available when needed, and average annual generating unit availability is maintained at or above levels experienced in recent years. ECAR’s net internal demand is projected to reach 114,512 Mw in 2010.

— Southwest Power Pool. Expected capacity margins are 14.4% in 2002 and 2003, and 13% in 2004. The capacity margin remains steady until 2008, when it is projected to decline to 9.5%. The margin rises about 1.7% for each 1,000 Mw of merchant generating capacity added. Should merchant power plant development continue, transmission will not be adequate to handle extensive exports required to deliver power outside SPP.

— Western Systems Coordinating Council. Reserve capacity is projected to be inadequate during the next decade and could require calls for public appeals to reduce electricity use. The assessment assumes 66,849 Mw of net new generation will be built when and where needed. The transmission system is considered adequate for firm and most economic energy transfers.

— Mid-Atlantic Area Council. Sufficient generating capacity is expected to be added to meet MAAC’s adequacy objective that the probability of demand exceeding available resources will be no greater, on average, than 1 day in 10 years. PJM Interconnection LLC is evaluating interconnection requests for more than 48,000 Mw of new capacity expected by 2005.

— Mid-America Interconnected Network Inc. MAIN’s projected reserve margins are expected to range between 17% and 20%. Energy demand is projected to grow 1.5%/year. The majority of planned capacity additions in MAIN are short lead-time combustion turbine peaking units owned by independent power producers. MAIN expects its transmission system to perform adequately if reinforcements are installed as planned.