By OBBM Network Editorial Staff

Derived from an episode of American Energy Works.

When a massive transmission line stretches across the Lone Star State, the cost doesn’t stay on the map—it ends up on every household’s electric bill.

The STEP Plan’s Scope and the $100 Billion Estimate

The Public Utility Commission of Texas recently gave the green light to the Longshore‑to‑Drill Hole and Dinosaur‑to‑Longshore segments of the 765‑kV Strategic Transmission Expansion Plan (STEP). While the vote cleared a technical hurdle, it left Texans wondering how much the project will actually cost them. According to research cited by Dr. Brent Bennett of the Texas Public Policy Foundation, the lifetime cost of the transmission build‑out could approach $100 billion and would affect roughly 70,000 acres of private property.

Dr. Bennett explained the math behind the figure: “Because of the way we socialize transmission costs in Texas, everybody pays for transmission. Doesn’t matter where it’s built. Those costs get uplifted to the entire system.” He likened the financing to a 30‑year home mortgage, noting that equity returns, debt interest, maintenance and taxes all inflate the capital cost. “On an annual basis, it works out to about $3 billion a year,” he said, adding that Texas currently spends about $6 billion a year on transmission. “This plant alone would add 50 % to what’s currently being paid for transmission.”

Why Transmission Alone Won’t Solve Reliability

The STEP lines are essentially giant extension cords—they move electricity but do not create it. As Molly Vogt pointed out, “These proposed 765 transmission lines won’t create a single new watt of electricity. They simply move electricity from one place to another.” Texas still needs additional dispatchable generation, especially near the Permian Basin, because transmission cannot replace the need for reliable, on‑demand power plants.

Critics argue that building both new generation and expensive transmission is redundant. “If we’re still going to need new power plants, why spend tens of billions of dollars building the extension cords first?” asked Vogt. The concern echoes the state’s experience with the CREZ system built two decades ago, which moved power from West Texas to the rest of the state but did not eliminate the need for new generation.

Who Pays and Who Benefits?

Transmission costs are spread across all ratepayers, but the split varies. Residential consumers cover about half of all transmission expenses, while industrial users—large oil and gas companies and other big loads—pay a smaller share, roughly less than 30 %. “Residential consumers pay about half of all transmission costs. Industrial consumers pay a lower share,” Dr. Bennett clarified.

Landowners directly in the path of the new lines also face tangible impacts. Vogt highlighted stories from ranchers and farmers who worry about losing multi‑generational land and seeing no direct benefit in reliability or lower rates. “They’re paying more for the rates and they’re not actually getting any more electricity from it,” she said.

Alternative Paths: Building Generation Near the Load

Dr. Bennett and other analysts suggest a different approach: locate reliable, dispatchable generation close to where power is needed, rather than relying on massive transmission corridors. This could involve expanding natural‑gas‑fired plants, leveraging existing infrastructure in the Permian Basin, or investing in emerging storage technologies.

“If we could convince our state to right the ship and do that, what would that look like and how much would we really need?” Bennett asked. He argued that a focused generation strategy could reduce the need for half of the projected transmission spending, potentially saving billions for ratepayers.

Policy Implications and the Road Ahead

The Texas Public Utility Commission is already reviewing cost‑allocation rules, which could affect how the $100 billion is distributed among consumers. Even with reforms, the projected annual increase—well over $100 per household—remains a significant burden.

For lawmakers, the challenge is balancing the desire for a resilient grid with the fiscal reality of ratepayer impacts. The STEP plan illustrates a broader tension in Texas energy policy: how to harness the state’s abundant resources without imposing unsustainable costs on families, farmers, and businesses.

Ultimately, the conversation underscores a simple truth: every dollar spent on the grid shows up on a bill. Whether Texas chooses to invest heavily in transmission or pivot toward localized generation will shape the state’s energy future and the wallets of its citizens for decades to come.

The full episode of American Energy Works is available on OBBM Network TV.