Understanding the Cost of Transmission Infrastructure | Insights from World Bank Group-Financed Projects

This report presents a new, comprehensive analysis of transmission infrastructure costs in developing economies, built on a unique dataset of 74 World Bank–financed projects from 2000 to 2024 totaling US$ 21 billion. It addresses a long-standing gap in transparent and standardized cost data, which is critical for planning future grid investments. As global electricity demand is expected to double by 2050, transmission systems will play a central role in expanding energy access, integrating renewable energy, and ensuring reliable, secure, and efficient power systems.

The analysis shows that while transmission costs in developing countries are generally lower than in developed markets, they vary significantly depending on region, voltage level, and project design. This variability highlights the importance of using cost ranges rather than averages when planning investments. To improve cost assessment, the report introduces the Levelized Cost of Transmission (LCOT), a new metric that captures the full economic value of transmission by combining capital and operating costs with energy delivered over time. Used alongside traditional metrics, LCOT strengthens cost-benefit analysis and supports more accurate, data-driven decision-making.

The findings emphasize the need for better data, improved planning tools, and more strategic investment approaches to scale transmission infrastructure effectively and support global decarbonization goals.

Key points:

• Introduces a first-of-its-kind transmission cost database for developing economies
• Confirms high variability in project costs and the need for better benchmarking
• Finds transmission costs are significantly lower than in developed markets
• Launches the LCOT metric to improve economic evaluation of projects
• Highlights opportunities to reduce costs through better planning and system integration
• Underscores the importance of transmission for renewable energy and energy transition goals