November 15, 2007

Can FERC deliver transmission?

By Steven F. Greenwald and Jeffrey P. Gray

A road to nowhere?

In designating the Southwest corridor, the DOE—noting growing demand for power—explained that, “now, more than ever, we must look at electricity generation from a regional and national perspective.” However, the designation by itself neither overturns the ACC’s ruling nor guarantees that any new transmission lines will be built in the corridor. Indeed, given the considerable time and cost needed to secure a FERC decision overruling a state decision, using the national corridor process to change jurisdiction may not prove to be a practical alternative to the state project approval processes that EPAct clearly intended to reform.

As the need for new generating capacity (particularly capacity powered by renewable resources) grows, states must work together to develop regional transmission solutions. Wind in Wyoming, solar in Arizona, and hydro and biomass in the Pacific Northwest all require a network of interstate facilities to bring power from remote areas to load centers.

Accordingly, transmission needs should increasingly be assessed through a regional lens. Whenever the political and parochial interests of a state impede the development of a needed project, a practical alternative must be available. National interest transmission corridors could be the answer, but at first blush, they may not offer one.

—Steven F. Greenwald (stevegreenwald@dwt.com) leads Davis Wright Tremaine’s Energy Practice Group. Jeffrey P. Gray (jeffgray@dwt.com) is a partner in the firm’s Energy Practice Group.