Biden Administration Releases Electricity Grid Rule, But More Permitting Reform Is Needed

The Federal Energy Regulatory Commission (FERC) has approved a new regulation intended to bolster U.S. electric grid reliability. The rule is the first major update to electric transmission policy in more than a decade and it “aims to speed up new interregional lines to move more clean energy to meet growing demand amid the [growth] of electric vehicles, data centers, and artificial intelligence,” Reuters reported.

The rule requires transmission providers to look ahead at least 20 years when developing plans, such as state energy goals, corporate energy procurement commitments, and interconnection queues. It also requires operators to:

• Submit plans for splitting project costs between states and the private sector;
• Weigh seven economic and reliability advantages when considering possible transmission projects, including production cost savings; and
• Consider alternative transmission technologies, such as advanced power flow control devices, transmission switching, and advanced conductors, in place of the building of new lines.

On Capitol Hill, FERC’s announcement spurred new calls for broader federal permitting reforms.

A bipartisan group of lawmakers has been working for nearly two years to agree on a set of reforms that would speed up the process through which energy and other infrastructure projects are approved. In an interview with Politico’s E&E News, Sen. Joe Manchin (D-W.Va.), the author of a bipartisan permitting overhaul bill, said, “Everybody we’ve been working with understands you’ve got to have permitting reform.”

Unfortunately, Senate Majority Leader Charles Schumer (D-N.Y.) said he did not think a permitting reform bill could get done in 2024. “I’m happy to listen, but I’ve told Joe Manchin it’s going to be virtually impossible to get something done,” he told The Hill. The Metals Service Center Institute supports broad permitting reforms so that industries can get important infrastructure projects approved and online more quickly.

In related news: the same day that it released its electricity grid rule, FERC also approved an order that would give the commission backstop siting authority to approve permits for interstate transmission projects that have been rejected or not acted upon by states.