FERC’s rule hits a balance

Source: BY MATTHEW CHOI, Politico • Posted: Sunday, April 24, 2022

FERC’s much talked about proposed rule Thursday requiring future generation considerations in transmission planning and giving states more say in cost assignments garnered widespread praise from industry, clean energy and environmental groups alike. There was widespread agreement throughout the comment period that the status quo is not working with transmission reform, but utility transmission owners in particular feared upending the planning process could hurt their incumbent status allowing them to be first in line on the transmission investments that make up a significant portion of their bottom line.

But FERC seems to have struck a tentative balance with its proposal Thursday — not to mention securing bipartisan consensus that has eluded some of its other major rulemakings. The commission indicated it may revisit a 2011 rule that eliminated utilities’ ability to build transmission lines without a competitive bidding process, securing industry support. Clean energy advocates, meanwhile, were thrilled by the proposal’s broader efforts to reform cost allocation and long-term planning, two significant hurdles to getting necessary transmission built in the U.S.

“From both an economic and climate perspective, … all of the analysis that we’ve seen shows the need for a lot of transmission, but there’s barriers to building that transmission,” said Chaz Teplin, a principal at clean energy think-tank RMI’s Carbon-Free Electricity program. “And FERC today, we think, took two important steps towards overcoming some of the barriers that we see.”