The Department of Energy (DOE) last week said it was considering transferring to the Federal Energy Regulatory Commission (FERC) its authority to conduct congestion studies and establish a process for designating “National Interest Electric Transmission Corridors” (NIETCs). But the move, which has been touted as a means to remove transmission-development barriers, could inhibit new power lines by creating uncertainty, the National Association of Regulatory Utility Commissioners (NARUC) has countered.

In two documents prepared by FERC staff, Transmission Siting Narrative, and Transmission Siting Narrative Outline, FERC said that the backstop transmission procedure established by Congress "has not yet been effective." No construction permits for projects in NIETCs—specific areas that have been designated for transmission lines—have been issued, and the only applicant that proposed to site a project within a NIETC withdrew from the process, the commission said.

The DOE’s delegation to FERC of its authority to both conduct the required congestion studies and to designate NIETCs would address this ineffectiveness, FERC said.

"This approach would consolidate National Environmental Policy Act (NEPA) review at FERC, instead of requiring redundant, sequential NEPA review by DOE and then FERC," FERC said. "Unifying federal authority with respect to siting interstate transmission projects would allow a more efficient, directed process," it added.

The delegation would not expand federal authority, established and limited by the Energy Policy Act of 2005, but rather would simplify and consolidate in a single form federal actions mandated by Congress, FERC said.

But in a letter submitted to the DOE on Thursday, NARUC said these proposals, “seemingly offered as a means to remove transmission-development barriers, actually inhibit new power lines by creating uncertainty, harming State and federal relations, and provoking litigation.”

“To the extent that this proposal is motivated by a desire to reduce barriers to transmission, it fails,” NARUC Executive Director Charles Gray wrote. “It relies on a tortured reading of the statute that would cause uncertainty, litigation, damage to State and federal relations, and delays in transmission development.”

Right now, the law states that FERC can only exercise this authority if a state does not act on a power-line project in one of these zones within one year after having been proposed, NARUC explained. The U.S. Court of Appeals for the 4th Circuit in Richmond already has ruled specifically that FERC does not have authority under EPACT to overrule decisions by state regulators to reject the siting of new power lines in their states.

“Despite the conditions in the law and interpretations by the court, FERC and DOE are considering an electric-power industry developed proposal that greatly expands the commission’s authority,” NARUC claimed. Under the proposal, DOE would cede its authority to designate transmission corridors to FERC, with the commission then proposing to reinterpret the law by determining corridors on a project-by-project basis. “If Congress had intended this, they would have simply given this authority to FERC in the first place,” Gray wrote.

Rather than reinterpreting the law, DOE and FERC should focus on existing regional planning efforts paid for by taxpayers in the American Recovery and Reinvestment Act, he added “The DOE-supported interconnection-wide planning efforts are a perfect example of constructive transmission study and planning,” Gray said. “This proposed delegation threatens to elevate backstop siting over planning and analysis, and does so in a time when federal resources should be dedicated to coordinating efforts funded by taxpayers that are already underway.”

Sources: POWERnews, DOE, FERC, NARUC