President Biden signed the $1.2 bill into law on November 15, 2021.
Trillion Infrastructure Investment and Jobs Act (IIJA).1
Among the IIJA’s funding and changes is a
FERC has the authority to override state siting provisions
Decisions for electric transmission projects. The Energy
First authorized Federal funding was through the Policy Act of 2005 (EPAct of 2005).
Energy Regulatory Commission to approve, if a country withheld
Approval of interstate transmission projects in “national” states.
“Interest electric transmission corridors” were identified by the
Department of Energy. The new statute clarifies the law and expands it.
FERC’s authority.
This alert examines first whether such superseding is possible
Approval by FERC would have to be subject to the National Environmental
Policy Act (NEPA) requires an environmental impact report
(EIS). Second, we examine how such backstop sitting authority works
It is likely that this will affect state Public Utility Commissionss (PUCs).
permitting decisions. It is unlikely that the new regulations will be implemented.
IIJA will result in a sudden acceleration in the sitting of
transmission lines.
Existing Siting Authority – Section 216 Federal
Power Act
The sufficiency, and capabilities of interstate transmission
Grid has posed barriers to wholesale power market competition
Since FERC mandated open-access transmission in the ’80s,
mid-1990s. The reason is simple: The power grid was constructed by
Local utilities will move power from generators into customers’ hands
Load centers are located nearby. The grid was not intended to facilitate.
Generators scattered all over the country are in wholesale competition for each other.
country. Shifting from local usage patterns to regional ones
exposed weaknesses in the ability of the transmission network to
To meet these new requirements, we need to be able to deliver on time and economically. Billions
New transmission projects have attracted millions of dollars.
These conditions can be alleviated. The recent explosion of
Investment in remote renewable energy projects has been a boon
New strains are added to the grid. These projects must move energy
across ever-greater distances.
The main obstacle to the construction of new transmission projects is
Of late, the need to obtain certificates proving public convenience has been a constant.
These can be obtained from state regulatory agencies. These
“CPCNs” can be subject to up to ten years worth of contentious
proceedings. These proceedings often involve litigation before the
State agencies and the courts. Projects to move
electricity All states can fare even worse. The
Benefits flow to remote consumers in markets other than the United States. Proposals
For major interstate tielines like the Palo verde-Devers No. 2
Line to serve California (opposed Arizona).
Trans-Allegheny Line to Service the Mid-Atlantic (opposed
Pennsylvania, Virginia, West Virginia and West Virginia failed to achieve significant results
Partly because of local opposition
Congress and FERC have made many efforts to address these issues.
An attempt to stimulate new transmission investment. For more information, see FERC.
For example, he has issued numerous major rulemaking orders. These are
Change the way public utilities plan to meet future transmission needs.
Include the obligation of planning for “public policy”
These projects are those required to accommodate state renewable energy.
mandates). Congress passed landmark legislation in EPAct
2005. This incentivizes new transmission investments
by a more favorable rate treatment Section 1241 (the)
EPAct 2005 (Section 216 Federal Power Act), also gave FERC
“Backstop” is a construction authority
Modification of electric transmission units located within
“National Interest Electric Transmission Corridors”
(NIETCs). NIETCs are areas that experience electricity.
Congestion and limitations in energy transmission capacity adversely impact on energy consumption
Impact on consumers NIETCs can be identified by the
Congestion Studies conducted and issued by the Department of
Energy (DOE). Criteria the DOE was to consider
Designating NIETCs included economic aspects in the corridor.
Whether designation would be in national energy’s best interests
policy and enhancing homeland security and national defense.2
Section 216 was issued.
NIETCs were created to limit federal intrusion into the sitting
Authority is usually reserved for states.
FERC’s State “Backstop” Authority
FERC summarized legislative changes made by the EPAct 2005
They are also the means of administering them in a 2006 rulemaking. This
Explained that DOE will make a NIETC determination after DOE has made a DOE determination:
If it finds: (1) A State in need of electric transmission facilities
Which such facilities are located, does not have the authority.
Approve the location of the facilities or to look at the interstate
Construction or renovation is expected to bring about many benefits
Modification of the facilities; (2) The applicant is a transmitting
Utility is not required to apply for sitting approval in the
Declare that the applicant is not serving end-use customers in the
(3) The State, or (3) the State commission/entity with siting authority
Withholds approval of the facilities for a period of more than one year.
An application is filed one year after the designation.
Important national interest electric transmission route
Whichever is later, or if the State conditions construction or demolition
Modifications to the facilities that are consistent with the proposal
Transmission congestion in interstate commerce will not be significantly reduced
commerce, or is not economically feasible.3
Section 216 was challenged in court. In 2009,
The Piedmont Environmental Councilin this case, the Fourth
Circuit ruled (1) Section 216 doesn’t give FERC authority when a
State timely denies the siting of a transmission project
(2) FERC’s procedural rules on the content
Section 216 permits were not required
(3) FERC violated White’s law by preparing an EIS under NEPA
House Council on Environmental Quality’s CEQ regulations
It failed to consult the CEQ prior to amending the NEPA
Section 216 permit implementing regulations
applications.4These are the following Piedmont
Environmental CouncilFERC’s backstop siting authority
This was reduced to situations in which a state agency failed on a task
Permitting application for more than one calendar year after the filing.
Section 216 permit application. FERC could not approve Section 216 permit application.
Sitting application denied by a state agency
it.
Two years later in the Ninth, Section 216 was again hit.
Circuit. In California Wilderness CoalitionThe
Ninth Circuit overturned DOE’s Mid-Atlantic designation and
Southwest National Interest Electric Transmission Corridors
NIETCs.5The Ninth Circuit ruled that
DOE did not consult the affected states when it prepared its report.
Congestion Study, and designated the NIETCs. Additionally, the
The court found that DOE did not conduct an environmental study.
its NIETC designations. The Ninth Circuit was formed as a result.
Remanded to DOE for a Congestion Study.
The result? Piedmont Environmental Council
California Wilderness CoalitionIn all cases, FERC has not yet issued
a single permit under Section 216.
The IIJA Revival of FERC Siting Authority
Section 40105 of IIJA addresses interstate siting
electric transmission facilities It amends Section 216
The Federal Power Act clarifies the role of DOE in designing
NIETCs. It also reforms FERC’s backstop sitting authority.
First, the IIJA directs DOE a Congestion Study to be published
Minimum once every three years. This could be the following
Geographic areas as a NIETC
- An area that is experiencing electric power transmission
Congestion and capacity constraints can adversely impact your ability to do business.
Consumers; or - An area that is likely to experience such energy transmission
Congestion can restrict capacity6
The IIJA also adjusts factors DOE can consider in determining the
NIETCs are designated. It included the following:
Section 216 (a)(4) now has new criteria
- This designation would increase the facility’s ability to be designated.
To connect to the internet, generate or transmit intermittent energy.
electric grid - The designation maximizes existing rights and avoids
Limits, minimizes, as much as possible, and offsets
As far as practicable, sensitive environmental issues are addressed.
Areas and cultural heritage sites - The designation would reduce the cost of
Electricity can be purchased for consumers.7
The IIJA gives FERC authority over a state PUC.
Three scenarios for a transmission sitting permit decision:
- If the state authority is unable to make a determination on a
Transmission permit application for more that one year after the
later than the date that the DOE was notified.
Designated the NIETC relevant; or - If the state authority has conditionally approved a
Allowing application in such a way that the proposed
Construction and modification will not reduce the value of your home.
Transmission capacity limitations or congestion in interstate
commerce, or it is not economically possible; - The state authority refused to issue a siting permit.8
Will NIETIC Designation be Accepted?
NEPA is triggered by Siting Authority
Section 216 is intended and the amendments thereto from the IIJA.
To expand FERC’s backstop siting authority. They do however.
It is not exempt from the application of this authority from environmental
reviews. As described in the Piedmont
California Wilderness CoalitionIn some cases, FERC’s failure
In the past, environmental review has been a problem.
It is probable that it will again.
NEPA requires federal agencies incorporate environmental information.
These factors should be considered when making plans and making decisions.
Federal law is subject to certain exceptions and exclusions.
FERC and other agencies must assess the environmental impacts of.
Alternatives to, major federal actions that significantly affect the
environment.9This could mean that you need to develop an
EIS. CEQ regulations implementing NEPA define “major
Federal action” to include actions with effects that might
be major and could be subject to [f]ederal control and
responsibility.”10According to the
Federal actions, regulations are generally: (1)adoption
(2) Official policy (rules regulations and interpretations).
Adoption of formal plans, (3)adoptions of programs and (4)
Approval of specific projects, and actions approved by
Permit or any other regulatory decision.11
A FERC ruling to replace a state decision in withhold or
Deny sitting approval is almost certainly a federal act
NEPA review. DOE is likely to designate NIETC.
triggering, too. The Piedmont California
Wilderness CoalitionThis is supported by the cases. In
PiedmontFERC stated that it would complete the task.
Every transmission project should be subject to an environmental assessment.
The Fourth Circuit also stated that, “Once FERC has a
Permit application is required by NEPA to evaluate the permit
The project will have an impact on the environment. The assessment will
likely to prompt the preparation of an EIS (or an [environmental
assessment]. Any deficiencies in project-specific
At the appropriate time, environmental assessments can be challenged
time.”12While Piedmont
FERC promulgated procedural regulations
It was not possible to specify the content of Section 216 permit applications.
Require a complete NEPA review and actual use of the backstop sitting
Authority would.
In the same way, California Wilderness CoalitionThe court
NEPA triggering was based on the NIETCs being designated. The
Court ruled that the DOE’s unsupported conclusion was unacceptable
Its final agency action, which covers ten States and more than a hundred
One million acres does NOT, as a matter law, have any environmental requirements
impact.”13This is how new NIETCs are designated
Backstop sitting authority will be exercised by DOE and FERC
It is likely that environmental review will continue.
How will this affect the political dynamic between state and country?
PUCs?
The IIJA has now clarified the siting authority of FERC.
It is also possible to have an impact on the political dynamics with state PUCs.
Some suggest that PUCs of the state and other regulatory authorities should be considered.
It is less likely that they will make tough regional siting decisions now
Knowing that the FERC is there for them. However, FERC may not
Do not rush to accept its clarified authority. Stepping in
To approve a project that will help a transmission developer but
Condemn private property and create a NIMBY issue for constituents
or result in local consumers paying the costs (who may not be eligible for the)
Even for those who are already familiar with the benefits of the new transmission lines, it will not be an easy task to reap these benefits.
FERC.
The IIJA sought clarity from DOE regarding its role in naming NIETCs.
FERC’s backstop sitting authority. There are still some.
There are areas of confusion that could lead to litigation. For
For instance, subsection (a), (2) refers to areas “experiencing electricity.”
Congestion or limitations in energy transmission capacity That
Consumers are negatively affected“E” or that are “expected
These energy transmission capacity restrictions can be experienced or
congestion” leave a lot of space for
interpretation.14
Cost allocation is another source of courtroom drama.
disputes. The Federal Power Act’s “just” clause allows for disputes.
“Reasonable” ratemaking standard has been the rule for a long time
Customers can only be charged for the cost of services that are not provided.
“Used and useful” in public utilities service and from
Which customers enjoy tangible benefits.15 Meanwhile,
The IIJA does not provide a standard for determining what is “adversely”.
How one determines whether congestion affects consumers or what it means for them
Such effects are “expected”. Thus,
Subsection (a)(2) refers to “congestion that
“Affects consumers adversely” or “any other geographic area that could be affected by it
. . . Such energy transmission capacity is expected to be realized
“Constrained or congested” opens the door for a replay of the past
cost allocation litigation.
The IIJA doesn’t address the problem of change.
models. A number transmission projects have been cancelled.
When regional transmission organizations have been reorganized
studies. The new studies revealed that previously approved studies had been rejected.
Transmission congestion was no longer a problem and projects were no longer necessary
or to address reliability issues. The Regional
Transmission Authorities have removed the projects from their portfolios
The states then revoke the siting and allocate regional costs.
Construction permits. This results in stranded expenses.
Get allocated to consumers for projects which will never serve
them.
The relevant provisions of the new statute are also included in the context.
DOE conducts studies. What happens if DOE finds that a project is unacceptable?
No longer required in a NIETC What happens if DOE reverses a prior
NIETC determination? Presumably, the predicate finding for
Consumer impacts from congestion (actual and expected) would not have any effect on consumers
longer hold. This is why cost allocation is so important.
Justification would be invalid. This is still to be.
seen.
These are the Key Takeaways
- The IIJA aims to clarify DOE designations of NIETCs.
FERC’s authority overstates state objections to interstate
Transmission projects The clarified authority of FERC is, in theory,
It is expected that the country will be able to build new transmission lines in order to serve its customers.
Renewable energy projects - However, the IIJA is unlikely to result in a rush for new ideas.
Transmission lines are used for many reasons including:- There are currently no DOE-designated non-infrastructure electronic technology centers (NIETCs), and DOE has not yet.
2023 is the deadline for FERC to issue a new Congestion Study.
Permits under Section 216 are available today.16 - It is almost certain that the backstop sitting authority will be exercised
NEPA can be invoked, and an EIS may need to be completed. This may take several years.
- There are currently no DOE-designated non-infrastructure electronic technology centers (NIETCs), and DOE has not yet.
- FERC is subject to sensitive political dynamics.
The authority is exercised in a space normally reserved for it
states. - Even after approval is granted for construction, there are still
There are many obstacles to building a new transmission line.
Funding and connecting them with the grid
Please note that the government can issue orders to the federal, state, and local governments.
Local and national levels are constantly changing, and the information is constantly evolving.
This information is current as of the above date.
Footnotes
1.
https://www.congress.gov/bill/117th-congress/house-bill/3684/text.
2.
16 U.S.C. 824p(a).
3.
No. 689, 71 Fed. Reg. 69,440 (2006).
4.
Piedmont Env’t Council v. FERC, 558 F.3d 304 (4th Cir.
2009).
5.
Cal. Wilderness Coalition v. U.S. Dept’t of
Energy, 631 F.3d 1072 (9th Cir. 2011).
6.
H.R. 3684, 117th Cong. 40105(a)(2) (2021).
7.
Id. 40105(a)(3).
8.
Id. 40105(b)(1)(C).
9.
42 U.S.C. 4332(2)(C).
10. 40 C.F.R.
1508.18.
11. Id.
1508.18(b).
12. Piedmont Env’t Council, 558
F.3d at 314.
13. Cal. Wilderness Coalition, 631
F.3d at 1105.
14. H.R. 3684, 117th Cong.
40105(a)(2)(B) (emphasis added).
15. See, e.g., Ill. Commerce
Comm’n v. FERC, 576 F.3d 470 (7th Cir.
2009).
16. https://www.energy.gov/oe/services/electricity-policy-coordination-and-implementation/transmission-planning/national-2.
This article is meant to be a guide.
guide to the subject matter It is a good idea to seek specialist advice
Learn more about your particular circumstances.
