As states develop energy resources, a greater burden has been placed on the current electric transmission and distribution system. States are addressing these issues through the planning and construction of additional transmission capacity, development of cost allocation approaches, non-wires alternatives and hybrid approaches. A hybrid approach is the development of a 'smart grid' that has the potential to enable a modern, more resilient transmission infrastructure.

The smart grid is a two-way digital communication with the potential to help consumers and businesses manage energy more efficiently. It can also enable renewables on the grid.  However, much uncertainty exists about the costs and impacts of the smart grid.

State regulatory bodies and policymakers play an important role in advancing transmission and facilitating the growth of smart grid. The policy areas these topics influence are many and include increased use of renewable energy, net metering, interstate transmission issues, deployment of digital smart electricity meters, restructuring of utility rates, feed-in tariffs and demand response.