US energy subcommittee hears mixed views on FERC grid permitting authority

Former US energy regulators, utility executives and grid experts offered mixed views on whether Congress should clarify and strengthen the federal government's role in siting and permitting long-distance high-voltage electric transmission lines.

However, witnesses testifying at a US House Energy and Commerce subcommittee hearing were generally supportive of new federal guidelines for interregional transmission planning and cost allocation.

The panel's Subcommittee on Energy convened the May 13 hearing as Senate negotiators work to reach a bipartisan deal on a comprehensive permitting reform package.

Lawmakers from both parties have acknowledged that bipartisan legislation, expected by early summer, would need to include technology-neutral reforms to the National Environmental Policy Act, restrictions on states' ability to block natural gas pipelines and measures to boost US transmission capacity.

"We should focus on targeted policy reforms such as streamlining backstop authority for interstate transmission lines, while providing guardrails that protect customers, benefit local communities, and respect state authority," Representative Kathy Castor, Democrat-Florida, the subcommittee's ranking member, said May 13.

Representative Brett Guthrie, Republican-Kentucky, chairman of the full committee, agreed that the US will need to build more generation to accommodate new sources of demand, such as artificial intelligence data centers. But he cautioned against disturbing the long-standing integrated resource planning processes currently used in many states with vertically integrated utilities.

"Most decisions about physical electric infrastructure have been states' responsibility under federal law," Guthrie said.

FERC backstop authority

In March, Democrats on the Senate Energy and Natural Resources Committee unveiled a sweeping draft discussion bill that would strengthen the Federal Energy Regulatory Commission's siting, permitting and cost-allocation authority for national-interest transmission lines.

The bill would remove an existing requirement under the Energy Policy Act of 2005 for those lines to be sited in a national-interest electric transmission corridor designated by the US Department of Energy.

Rob Gramlich, president of consulting firm Grid Strategies, told lawmakers the existing framework -- which has yet to produce any DOE corridor designations -- inherently involves duplicative NEPA reviews.

"As DOE goes through the whole process with NEPA, that's one agency, and then for the same line, FERC goes through the same thing," Gramlich said. "What's the point? Just streamline it."

He later estimated that clarifying FERC's backstop siting authority would likely affect less than 10% of proposed transmission projects.

Tony Clark, a former FERC commissioner who is now executive director of the National Association of Regulatory Utility Commissioners, contended that state regulators are approving the "vast majority" of projects nationwide. Transmission projects are generally denied state permits when they rely too heavily on eminent domain or fail a needs analysis that considers lower-cost alternatives, he said.

The SunZia transmission line took over 17 years to permit and build, and was originally denied a state permit because its application was deemed deficient, Clark said.

At the direction of Congress, the North American Electric Reliability Corp. completed a 2024 study that found the US could prudently add roughly 35 gigawatts of interregional transfer capacity.

However, former FERC Chairman Mark Christie, who also served as a Virginia state utility regulator, said individual projects should still be subject to formal fact-finding proceedings.

"FERC can't be an expert in all 50 states," he said during the hearing.

Integrated resource planning, merchant development

Clay Rikard, senior vice president of system planning for Southern Co., said the utility's integrated resource planning process helps deliver least-cost solutions for ratepayers.

"We enjoy the benefits of all our planners sitting around the same table -- generation, transmission, distribution, and fuel -- working off the same concepts, assumptions, and inputs to design the fully integrated operating solution," he said.

In contrast, Grid United CEO and co-founder Michael Skelley said the independent transmission developer typically attracts utility partners by demonstrating cost savings, which are ultimately passed on to end-use customers.

Grid United's 420-mile North Plains Connector project, for example, is being jointly developed with Allete and supported with nonbinding deals to acquire capacity from 10 different utilities. The high-voltage, direct-current line will run from near Bismarck, North Dakota, to Colstrip, Montana, with an estimated in-service date in 2032.

Once complete, the North Plains Connector will establish the nation's first HVDC transmission connection among the Western Interconnection and the 15-state Midcontinent Independent System Operator and 17-state Southwest Power Pool wholesale power markets.

"We have a bunch of vertical silos all around the country, and there are many affordable options that tend to be outside of those siloes," Gramlich said.