Renewable Energy Zone (REZ) Toolkit

Achieving renewable energy goals may require investments in new electricity transmission, especially if planners anticipate economic growth and increased electricity demand. The Renewable Energy Zone (REZ) Toolkit provides policymakers and practitioners with the information and tools needed to successfully apply the REZ transmission planning process—connecting areas of cost-effective renewable energy generation to the grid.

What is a Renewable Energy Zone (REZ)?
REZs are geographic areas with high-quality variable renewable energy resources (such as wind and solar), suitable topography and land use designations for development, and demonstrated interest from project developers. These areas can be used to identify new transmission lines that enable the development of cost-effective, grid-connected renewable energy.

What is the REZ Transmission Planning Process?
The REZ transmission planning process is an approach to connect areas with concentrated renewable energy resources (REZs) to the power grid. The process helps to plan, approve, and build transmission infrastructure to access areas with high-quality resources, suitable topography and land-use designations, and demonstrated developer interest—supporting reliable and economic integration of renewable energy. The REZ process can be adapted to any country's normal transmission approval processes.

Start here:

Renewable Energy Zone (REZ) Transmission Planning Process Guidebook

The Guidebook provides a complete overview of each step of the REZ process to help power system planners, decision makers, and other stakeholders understand and deploy this proactive transmission planning approach.

Deeper dive:

REZ Quick Reads includes short articles focused on building technical knowledge of specific activities within the REZ process.

REZ Topics dive deeper into REZ process topics to build knowledge and expertise in the technical areas associated with each step of the process. These pages also include expertly curated external resources—including technical reports, case studies, policy and regulatory examples, among others—on transmission expansion planning and renewable energy deployment topics.

REZ Tools and Templates is a central collection of tools and document templates that can support practitioners in deploying the REZ process.

REZ Trainings provides access to webinars and exercises that help practitioners adapt the REZ process to their specific context.

Is the REZ transmission planning process the right fit?

The REZ process is a proactive transmission expansion planning approach that helps to connect REZs to the power grid. The process is unnecessary if a country’s best sites for wind and solar development are already near available transmission. If they are not—or if nearby transmission has no room for new renewables—the REZ process might be an ideal fit.

Understanding the REZ process and its applicability to each specific context is vital to achieving renewable energy development goals. Actors should consider the following questions when deciding if the REZ process is the right fit.

1. Why consider the REZ process?

The REZ process is a proactive transmission expansion planning approach. It is not an isolated activity of cataloging and mapping potential renewable resources for electricity generation. Additionally, it is not intended to support the isolated procurement of renewable resources by individual utilities.

The ultimate goal of the REZ process is the construction and upgrade of transmission system infrastructure that connects REZs to the grid. The process to achieve this goal may vary depending on the context; however, the outputs of any REZ process should include the knowledge and tools necessary to implement transmission development plans and include:

Identification of REZs that have high-quality renewable energy resources, suitable topography and land use designations, and demonstrated interest from developers
An estimate of the maximum generating capacity (MWh) of each REZ and corresponding supply curves that quantify the renewable energy resources that can be developed for a certain levelized cost of energy (such as US $/MWh)
Identification of the major transmission enhancements needed to deliver the electricity generated in REZs to load in the most beneficial and cost-effective way
A final transmission order from the system operator or regulator with a map of the selected REZs and the transmission extensions and improvements to be implemented

2. What are the barriers to scaling up renewables?

The REZ process applies to renewable energy expansion that is constrained by a lack of existing transmission. Traditional transmission planning may be ill-suited to the characteristics of renewable energy development because transmission planning decisions need to be made well in advance of renewable energy development. For example, windy and sunny areas, which are often far from load centers but attractive for wind and solar power development, may require 5–10 years for planning and construction of new transmission infrastructure. This results in a timescale misalignment as wind and solar projects only require 1–3 years to construct.

Figure. Timescale misalignment

This timescale misalignment leads to a common circular dilemma in transmission planning. Financing for remote generation projects is not available without transmission access, but transmission lines cannot be built without a demonstrated need for service and certainty for cost recovery. Siting for conventional generation (such as coal) is seldom as constrained. Renewable energy planning that does not consider transmission expansion may limit power systems to renewable energy development that is less economically attractive.

attempt to blow up circular dilemma image

Figure. Circular dilemma

3. When is the REZ process beneficial?

The REZ process is beneficial where a lack of transmission infrastructure limits renewable energy expansion. But, it may not apply in cases where other factors constrain renewable energy development, or if the existing transmission system already has capacity to accommodate new renewable energy development. Other constraints, such as congestion on existing lines that leads to curtailment of renewable energy generation, could be addressed through traditional transmission planning activities and may not require the REZ process.

4. What resources does the REZ process consider?

The REZ process focuses on large-scale wind and solar development because other renewable energy resources (such as geothermal or mini-hydropower) are seldom found in sufficient concentration to warrant consideration as a REZ. As with large hydropower projects, transmission systems must be physically brought to these wind and solar resources to connect them to the grid. However, when located within a designated REZ with wind and/or solar resources, supplemental resources such as geothermal or mini-hydropower may provide additional value to a designated REZ.

5. How does the REZ process consider the private sector?

The REZ process does not focus solely on zones with the highest-quality resource alone but on the zones with the highest probability of commercial development and the highest-quality resources. The REZ process is an effective tool to encourage private sector investment in renewable energy generation by demonstrating commitment to the construction of efficient transmission to promote an increasing share of renewable energy resources in the power system.

6. How does the REZ process support power development planning?

The scope and time horizon of the REZ process varies depending on the local context. And, it can be aligned with power system planning activities such as integrated resource planning (IRP), power development plans (PDPs), and transmission development plans (TDPs).

As a proactive approach to transmission planning, the REZ process offers opportunities for reducing costs and amplifying benefits by evaluating the transmission needs of the system as a whole, as opposed to upgrading the system incrementally based on the needs of specific projects. The REZ process is also an effective tool to avoid transmission congestion in the longer term, as penetration of renewable generation on the grid and demand increase.