New electricity bill could slow transmission projects

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Quick Take: For years, critics have complained that the costs of new transmission lines are unfairly allocated. They said the formula for deciding who got the benefits—and therefore who should pay—was much too narrow. Recently, the Federal Energy Regulatory Commission (FERC) proposed a new rule to allocate benefits more broadly. Now a coalition of senators from "pass-through" states—states where current or proposed transmission lines pass through without delivering much power within the state—is introducing legislation to ensure that new rule is not put in place.

The upshot will be months if not years of delay before transmission builders have the clarity they need to plan their future projects. – Jesse Berst

Five U.S. senators have introduced legislation to derail a proposed rule from the Federal Energy Regulatory Commission (FERC) that they say would give the agency the option of spreading transmission line costs to customers outside the areas that directly benefit from new services.

One of the bill's backers, Sen. Bob Corker (R-Tennessee), was quoted in The State Column as saying "We need federal policies that promote viable domestic energy production and innovation in the fairest, most cost-effective manner possible. Governors and utilities from across the country have spoken out against FERC's attempt to shift transmission costs from states that benefit to those that don't." Another sponsor, Sen. Ron Wyden (R-Oregon), commented "The principle that the costs ratepayers pay should be directly related to the benefits they receive from a transmission project needs to be absolutely clear in FERC's regulations and right now it isn't."

Current law mandates that those costs are assigned to the regions that directly benefit from the new services.

Sen. Lisa Murkowski (R-Alaska), Sen. Richard Burr (R-North Carolina) and Sen. Lindsey Graham (R-South Carolina also are backing the bill to block FERC's proposed rule.

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