By Romany M. Webb
Picture Credit score: Oran Viriyincy (flickr)
Final Thursday, December 15, the Federal Power Regulatory Fee (FERC) issued a discover of proposed rulemaking (NOPR) in search of feedback on proposed adjustments to its laws governing the siting of interstate electrical transmission traces. FERC is proposing the adjustments to implement part 40105 of the 2021 Infrastructure Funding and Jobs Act (IIJA) which expanded the scope of federal authority over transmission siting. That was traditionally an space of unique state jurisdiction however, with frustrations mounting over the gradual tempo of transmission growth, FERC seems to be set to play an growing position within the approval of recent infrastructure. This might assist to speed up build-out of the transmission system—one thing that’s urgently wanted to facilitate elevated renewable technology. It’s, nevertheless, essential that the build-out happens in a method that doesn’t trigger undue hurt to the setting, native landowners, or different stakeholders. The regulatory adjustments proposed by FERC seem designed to attain these twin targets however challenges stay.
Transmission growth has lengthy been fraught with complexity and delay. That is significantly true of transmission traces that move by a number of states. Take into account, for instance, the Grain Belt Categorical Clear Line. First proposed in 2014, the 780-mile transmission line is meant to move electrical energy generated by wind generators in Kansas to clients in Indiana, passing by Missouri and Illinois alongside the best way. It required approval from all 4 states to maneuver ahead. Regulators in Kansas, Illinois, and Indiana signed-off on the undertaking, however the Missouri regulator denied approval for it, stopping it from shifting ahead. The developer challenged the denial in court docket and gained however, within the meantime, an Illinois court docket overturned that state’s approval of the road, once more blocking growth. Right now, eight-years after the road was first proposed, building nonetheless has not begun.
How may this occur? Within the Federal Energy Act of 1935, Congress licensed the previous Federal Energy Fee (now FERC) to manage “the transmission of electrical power in interstate commerce,” thereby giving it authority over interstate transmission charges and amenities. Importantly, although, Congress didn’t authorize FERC to supervise the siting of recent transmission. The siting of transmission thus remained inside the unique authority of the states. The impact is that, the place a proposed transmission line travels by a number of states, it have to be accredited by all of them. (There is just one restricted exception to this (mentioned under).)
A 2020 examine discovered that, in most states, regulators can solely approve a transmission line in the event that they decide it’s “within the public curiosity.” State legislation typically offers that, in assessing the general public curiosity, the regulator can think about “solely the pursuits of in-state residents and companies.” When a transmission line is proposed to maneuver electrical energy between two states and passes by others alongside the best way, there could also be little direct profit to residents and companies in these “pass-through” states. Development of the road could have short-term financial advantages for pass-through states (e.g., by way of job creation) but in addition presents dangers and challenges. In recent times, transmission initiatives have typically confronted opposition from native communities and landowners involved about their visible impacts, amongst different issues.
The necessity for a number of state approvals, along with the frequent native opposition, has made constructing new interstate transmission traces extraordinarily tough. That should change if the U.S. is to attain its local weather targets. The Biden Administration has set an formidable purpose of chopping U.S. greenhouse fuel emissions by 50 to 52 p.c under 2005 ranges by 2030. To get there, the U.S. might want to quickly decarbonize its electrical energy producing system, changing fossil gasoline energy crops with renewable power programs. It can additionally want to affect varied end-use sectors that at the moment depend on fossil fuels (e.g., transportation and buildings) which is able to additional improve the necessity for renewable technology.
Vital assist for these actions was supplied within the Inflation Discount Act (IRA), which President Biden signed into legislation in August. Modeling means that, by driving investments in renewable technology, electrical autos, and different clear applied sciences, the IRA may scale back U.S. greenhouse fuel emissions by 40 p.c under 2005 ranges by 2030. Emissions reductions of that magnitude will, nevertheless, solely be potential if transmission growth accelerates quickly. Based on evaluation by Princeton’s REPEAT Challenge, during the last decade, the U.S. transmission system grew at a median annual charge of only one p.c per 12 months. The evaluation exhibits that, if transmission growth continues at that charge by 2035, “[o]ver 80% of the potential emissions reductions delivered by [the] IRA in 2030 are misplaced . . . To unlock the complete emissions discount potential of the [IRA], the tempo of transmission enlargement should greater than double . . . to succeed in a median of two.3%” per 12 months.
Recognizing the necessity to velocity up transmission growth, in part 50152 of the IRA, Congress appropriated $760 million to the Division of Power (DOE) to assist state authorities packages designed to “enhance the probabilities of, and shorten the time required for, approval” of recent interstate transmission traces. DOE may use the funding to supply grants to state governments “for financial growth actions” in communities that “could also be affected by the development and operation of” accredited traces. That might assist to scale back native opposition to transmission growth in some areas, however securing state approval for interstate traces is prone to stay difficult in lots of instances. This has led some lawmakers and others to advocate for better federal management of transmission growth.
In a current episode of the Columbia Local weather Faculty’s “Maintain What?” podcast, Consultant Sean Casten stated that if he got a “magic wand” and will do something to assist transmission growth he would “give somebody . . . ideally FERC, single supply allowing authority” over new interstate transmission traces. Consultant Casten stated he would select FERC as a result of it already has unique authority to approve new interstate pure fuel pipelines. As beforehand reported on this weblog, FERC has accredited virtually each pipeline undertaking it has thought-about lately, typically in as little as three months. This has led to allegations that FERC operates as a “rubber stamp” and approves pipeline initiatives with out adequately contemplating landowner considerations or environmental impacts. With respect to the latter, the Sabin Middle and others have lengthy argued that FERC has a authorized obligation to think about the local weather impacts of pipeline growth, however typically fails to take action in a strong method. (For extra on that, see our 2020 report right here.)
Congress has, thus far, refused to offer FERC unique authority to approve all interstate transmission initiatives. Nonetheless, in part 1221 of the Power Coverage Act of 2005, Congress gave FERC restricted “backstop” authority to approve sure initiatives in areas designated as “nationwide curiosity electrical transmission corridors” by DOE. Particularly, the Act licensed FERC to approve initiatives in designated corridors if six standards have been met, particularly:
- The undertaking should “be used for the transmission of electrical power in interstate commerce.”
- The undertaking have to be “in keeping with the general public curiosity.”
- The undertaking should “considerably scale back transmission congestion” and “defend[] or profit[] shoppers.”
- The undertaking have to be “in keeping with sound nationwide power coverage and . . . improve power independence.”
- If the undertaking entails modification of an present transmission line, it should “maximize
. . . the transmission capacities of” that line. - The undertaking couldn’t transfer ahead with out federal approval as a result of:
- a state by which transmission amenities are to be situated lacks authority to approve the undertaking or to think about its interstate or interregional advantages;
- state legislation solely offers for approval of initiatives developed by utilities that serve in-state clients and the developer doesn’t; or
- a state with authority to approve the undertaking has “withheld approval for greater than 1 12 months” or “conditioned its approval in such a way that the proposed [project] won’t considerably scale back transmission congestion . . . or just isn’t economically possible.:
In 2007, FERC issued Order No. 689, by which it defined how it will train this new authority. Amongst different issues, Order No. 689 clarified FERC’s interpretation of standards 6(c), indicating that if a state thought-about however rejected an utility for approval of a transmission undertaking, that rejection would quantity to the state “withholding approval” for the undertaking and thus allow FERC to approve it (if the opposite standards have been met). This side of Order No. 689 was struck down in 2009 in Piedmont Environmental Council v. FERC, with the Fourth Circuit Courtroom of Appeals holding that FERC couldn’t approve a undertaking that had been expressly rejected by a state. Many commentators subsequently complained that the court docket’s resolution would severely restrict FERC’s skill to advance interstate initiatives. Within the phrases of one authorized knowledgeable, “a single state regulator could kill an interstate transmission undertaking and FERC has no authority to intervene, whatever the worth of the undertaking.”
Greater than a decade after the Piedmont resolution, Congress lastly stepped in in 2021. On account of amendments enacted through the IIJA, FERC can now approve a transmission undertaking in a chosen hall if a state “has denied an utility in search of approval” of the undertaking, and standards 1 by 5 above are additionally met. (The IIJA additionally made adjustments to the hall designation course of designed to deal with one other court docket resolution—California Wilderness Coalition v. DOE—by which the Ninth Circuit vacated the one two hall designations ever issued by DOE.)
Within the NOPR it issued final week, FERC proposed adjustments to its laws governing the approval of interstate transmission amenities to “guarantee consistency with the IIJA’s amendments,” and “incorporate different updates and clarifications to supply for the environment friendly and well timed assessment of” purposes. FERC’s proposed regulatory adjustments seem designed to speed up interstate transmission initiatives, whereas additionally making certain that landowners and others have enough alternatives to weigh in on initiatives.
To realize the previous purpose, FERC is proposing to permit transmission builders to start the pre-filing course of for federal approval of a undertaking similtaneously they apply for state approval. This represents a marked change from present FERC apply as, till now, builders have been unable to begin the federal pre-application course of till one 12 months after submitting a state utility. Eliminating the one 12 months delay signifies that builders can transfer by the federal pre-application course of whereas state authorities are contemplating their utility. Through the federal pre-application course of, FERC workers will work with the developer to make sure they’ve supplied all data required to guage the undertaking, and start gathering stakeholder enter. Frontloading that work signifies that, if the state authority denies approval for the undertaking, the federal course of can start instantly and FERC can rapidly full its assessment.
Whereas FERC is clearly eager to expedite initiatives, it has additionally proposed reforms designed to reinforce stakeholder participation in undertaking evaluations, seemingly in an effort to keep away from the issues which have plagued its fuel pipeline approval course of. Within the pipeline context, some landowners have accused builders of misrepresenting key info about initiatives, and in any other case pressuring them to comply with growth on their land. Searching for to pre-empt comparable points within the transmission context, FERC is proposing to require builders to adjust to an “Applicant Code of Conduct” when partaking with affected landowners. The Code of Conduct would require builders to supply sure data to affected landowners, be sure that communications with them are factually right, and keep away from different types of misconduct.
FERC can also be proposing necessities which, it says, will guarantee builders “meaningfully have interaction with probably affected environmental justice communities.” Beneath the proposal, builders can be required to establish any such communities, and put together an “Environmental Justice Public Engagement Plan” figuring out “outreach actions which might be focused to the recognized . . . communities.”
These and different reforms proposed by FERC ought to assist to advance accountable interstate transmission growth. They’re, nevertheless, solely a primary step. Even when the reforms are applied, interstate transmission initiatives are prone to proceed to face vital challenges, which have to be overcome if the U.S. is to attain its clear power ambitions.
