Regulators Overhaul U.S. Transmission Planning

by Christian Roselund

On 21 April the Federal Energy Regulatory Commission (FERC) approved significant changes to the nation’s transmission planning process which advocates say will assist in adding more clean energy. FERC’s Notice of Proposed Rulemaking (NOPR) will require grid operators and utilities to plan over a 20-year timeline and to take into account state policies and changing resource mixes.

The proposal will also set guidance for allocating costs, including requiring transmission providers to seek the agreement of relevant state entities within its planning region on cost allocation for transmission projects. Finally, it gives utilities “right of first refusal” for projects they jointly develop with other transmission owners, removing a requirement for competitive bidding of transmission projects that was opposed by major utilities.

FERC’s NOPR was cheered by clean energy trade groups including American Clean Power Association and Americans for a Clean Energy Grid, and utility trade group Edison Electric Institute also expressed its approval. An analysis by Canary Media notes that the wider set of criteria that the new process would look at translates to more proposed transmission projects going forward. Additionally, both advocates and FERC members have stated that the enlarged role for state regulators can reduce the kinds of conflicts that have caused other regional transmission projects to fail.

The approval of the NOPR follows the completion of a study by the Midcontinent Independent System Operator (MISO) and Southwest Power Pool (SPP) that identifies seven transmission projects to interconnect their grids. MISO and SPP say that this will allow them to maintain reliability and reduce costs to their customers.

Read more:

News coverage: FERC’s transmission planning, cost allocation proposal elevates state regulators (S&P Global)

News/analysis: The US needs to build a bigger, stronger grid. FERC has a plan for that (Canary Media)

Source: FERC Issues Transmission NOPR Addressing Planning, Cost Allocation (FERC press release)