Understanding FERC’s New Regulatory Framework
Today, the Federal Energy Regulatory Commission (FERC) issued a new rule, Order 1920, that makes significant changes to the way America’s interstate power lines are planned and developed. This is one of the most substantial updates in decades – since the transformative Order 888 from 1996, which increased access to the power grid.
Here’s a straightforward breakdown of what the new rule entails:
- Proactive Planning: Transmission providers are now required to conduct forward-looking regional planning every five years. This aims to ensure that the power grid evolves in anticipation of future needs rather than in reaction to past issues.
- Advanced Technologies: The rule places new emphasis on considering advanced transmission technologies. This includes exploring the potential of grid-enhancing technologies (GETs) and new high-capacity wires, known as high-performance conductors.
- Cost Allocation: The rule attempts to refine the process of how costs are determined. It promotes a method that aims to distribute benefits and costs more equitably across different regions and stakeholders.
- State Involvement: It sets guidelines for states to have a say in the decision-making process, potentially increasing local input into national energy planning.
In summary, FERC’s new rule is designed to modernize and streamline the planning and development of the U.S. power grid. Its impact will unfold as stakeholders begin to implement these new regulatory requirements.