Staff Presentation
Docket No.: RM21-17-000
Item: E-1 | News Release
This is an Advance Notice of Proposed Rulemaking in which the Commission seeks comment on, pursuant to section 206 of the Federal Power Act, the potential need for reforms or revisions to existing regulations to improve the electric regional transmission planning and cost allocation and generator interconnection processes.
At a high level, the potential reforms in this Advance Notice of Proposed Rulemaking consider the need for more holistic transmission planning and cost allocation and generator interconnection processes, to plan the grid for the future, and to do so in a way that results in rates that are just and reasonable.
The electric generation fleet is shifting from resources located close to population centers toward resources, including renewables, that may often be located far from load centers. The growth of new resources seeking to interconnect to the transmission system and the differing characteristics of those resources are creating new demands on the transmission system.
In light of these evolving conditions, the document seeks comment on whether there should be changes in regional transmission planning and cost allocation and generator interconnection processes and, if so, which changes are necessary to ensure that transmission rates remain just and reasonable and not unduly discriminatory or preferential and that reliability is maintained.
The Advance Notice of Proposed Rulemaking would seek public comment on potential reforms in three specific areas: reforms for longer-term regional transmission planning and cost-allocation processes that take into account more holistic planning, including planning for anticipated future generation, rethinking cost responsibility for regional transmission facilities and interconnection-related network upgrades, and enhanced transmission oversight over how new transmission facilities are identified and paid for.
Examples of questions raised in this Advance Notice of Proposed Rulemaking include, among others:
how to plan for future scenarios, including planning for the needs of anticipated future generation, as part of the regional transmission planning and cost allocation processes;
- whether the Commission should require transmission providers in each transmission planning region to establish a process to identify geographic zones that have the potential for the development of large amounts of renewable generation and plan transmission to facilitate the integration of renewable resources in those zones;
- whether reforms are needed to improve the coordination between the regional transmission planning and cost allocation and generator interconnection processes;
- how to appropriately identify and allocate the costs of new transmission facilities in a manner that satisfies the Commission’s cost causation principle that costs are allocated to beneficiaries in a manner that is at least roughly commensurate with estimated benefits; and
- whether participant funding of interconnection-related network upgrades may be proven to be unjust and unreasonable and whether the Commission should eliminate the independent entity variations that allow RTOs/ISOs to use participant funding for interconnection-related network upgrades.
This Advance Notice of Proposed Rulemaking also seeks comment regarding whether the current approach to oversight of transmission investment adequately protects customers, and, if customers are not adequately protected from excessive costs, which potential reforms may be required and are legally permissible to ensure just and reasonable rates.
Finally, it seeks comment on several other important related topics including whether action in these areas would be consistent with our legal authority, consideration of consumer protection, coordination between individual transmission provider planning processes and regional transmission planning processes, and interregional planning.
Comments and reply comments, identified by Docket No. RM21-17, are due 75 days and 105 days, respectively, after publication in the Federal Register.