FERC Proposes New Transmission Rules

On June 17, the Federal Energy Regulatory Commission (FERC) announced its Notice of Proposed Rulemaking on electric transmission planning and cost allocation reforms. There will be a 60 day public comment period (Docket No. RM10-23-000).

The nation's electric grid will require major upgrades and expansion in the next few decades due to the projected increase in demand for electricity and to facilitate access to renewable energy resources, deploy new digital technologies, and strengthen grid security. Grid planning today is done at various levels – individual utilities, states, regions, or whole interconnections – and the parties responsible for coordinating the process and executing the plans vary widely.

FERC’s new policies will require transmission providers to establish cost allocation systems for energy consumers benefiting from new transmission facilities, take into account public policy requirements during transmission planning, and improve coordination in adjacent planning regions. Limits will be placed on policies that give advantage to incumbent developers.

“Our nation needs a transmission grid that can accommodate rising consumer demand for a more diverse mix of power generators and the sophisticated technology of the smart grid,” FERC Chairman Jon Wellinghoff said in a press release. “To do that, we must make sure FERC transmission policies are open and fair to all.”

Industry groups have responded positively to the proposals. “With the demand for power projected to increase across the country, and the emerging public policy favoring clean, renewable generation resources which often are far from load, it is essential that we modernize the nation's approach to enhancing this critical infrastructure network,” Working group for Investment in Reliable and Economic electric Systems (WIRES) President Paul McCoy said in a press release.

The Environmental and Energy Study Institute (EESI) and WIRES will bring experts to Capitol Hill on Monday, June 28 for a briefing about current and future methods of planning expansion of the high voltage electric transmission system. Speakers will include representatives of Southwest Pool Power, The Brattle Group, PJM Interconnection, Xcel Energy, CNA's Military Advisory Board, and the Energy Future Coalition.