America’s Electric Power Transmission Crisis

Long-distance electric transmission lines are critical to the energy transition, yet construction of new lines has come to a near standstill in the U.S. Rob Gramlich of Grid Strategies discusses recent market and regulatory action to resurrect transmission development.

Electric transmission line mileage will need to triple by the middle of this century to make a net-zero carbon grid a reality, according to estimates cited by the U.S. Department of Energy. Yet new transmission development has plummeted over the past decade, while efforts to spur new construction of long-distance powerlines have largely come up short.

Rob Gramlich, president of power sector consultancy Grid Strategies and a frequent expert witness on grid issues before Congress, discusses transmission’s critical role in making the grid of the future clean and reliable, and the reasons behind the development slowdown.  He reviews the results of a recent report card analysis of transmission development activity across the country, and highlights efforts among grid operators and regulators to incentivize new development.

Andy Stone: Welcome to the Energy Policy Now podcast from the Kleinman Center for Energy Policy at the University of Pennsylvania. I’m Andy Stone. The U.S. electric grid is transforming at an accelerating pace. In recent years, a truly unprecedented number of clean energy projects have lined up to connect to the grid, a fact that has caught grid operators and their government regulators off-guard and serves to highlight the fact that our transmission system is ill prepared for the fundamental changes that are taking place. The challenge that the electricity system faces is hard to overstate. According to estimates cited by the U.S. Department of Energy, transmission line mileage must increase by 60% by the end of this decade and triple by the middle of this century to accommodate so much new clean power.

Yet the fact is that the construction of long-distance transmission lines has all but come to a standstill. On today’s podcast, we’re going to dive into the reasons behind lagging transmission development and look at efforts that are taking place inside the nation’s electricity markets and in Washington, to jumpstart the construction of regional and interregional transmission projects.

My guest is Rob Gramlich, President of Power Sector Consultancy Grid Strategies and a frequent expert witness on grid issues before the U.S. Congress. Rob recently co-authored a report card on the state of grid development in this country. Spoiler alert: Few regions earned a passing grade. Rob, welcome back to the podcast.

Rob Gramlich: It’s great to be here, Andy. I appreciate it.

Stone: So recent reports from the DOE and others have highlighted the fact that more electric transmission is needed in this country to enable the energy transition. Start us out. Why is transmission critical to the energy transition?

Gramlich: Well, there are a few technical reasons. Most people understand that the really good wind and solar sites tend to be far from population centers. That is true. I’m not sure everybody appreciates the volumes of power, just the magnitude that we need, and the limited ability to get that power in cities or right close to load. So we just need a lot of power. The land is cheap, and the resources are plentiful far away, so that’s one issue. But also, when we get beyond the current, say roughly 20% renewables, you start to really need to focus on the time and place of the energy production. And what tends to be the case is a regionally diversified set of renewable energy projects leads to a steadier overall supply. The wind is always blowing somewhere, as they say. And so that ends up being really important as we go from 20 to 30 to 50 or more percent renewable energy. And the only way to integrate all those projects around large regions is with transmission.

Stone: So despite this need for transmission, the fact is that the development of the long-distance regional power lines that are going to be needed to transport all this energy has actually declined over the past decade. How steep has the decline been, and why is it happening?

Gramlich: The positive spin on that is that we did this 10 or 13 or so years ago, a few regions built quite a lot of transmission and were able to integrate most of the renewables we have today — especially the wind, but also a lot of the solar. So we know we can do it, and we know the barriers are not insurmountable. But you’re right. We had this building spell period from 2010 to 2013-ish, and then it stopped. It just dropped like a rock. And for ten years, almost no long-haul, large-capacity transmission has been built.

There are a few reasons. At that time, solar and gas prices dropped, and you can do a fair amount of solar closer to load, and gas units, you can do closer to load. The high hopes in the 2008, 2009 era of the climate bill and the carbon tax or cap and trade or all those things, they didn’t happen, and I think the energy around the national plans for a big transmission grid kind of went out with them. There are also some complexities around Order 1000 from FERC, in terms of who gets to build and own the projects, and a lot of utilities lost interest in supporting ambitious regional transmission plans, so they pretty much dried up to a trickle, and that’s where we’ve been stuck for about a decade.

Stone: It’s interesting that the Order 1000 was intended to introduce competition into these transmission line projects. It seems to actually, instead of introducing competition, which it theoretically, I guess, has done, as you said, it’s disincentivized these transmission companies from going out proactively looking at needs and building transmission to meet those needs, right?

Gramlich: I think that’s right. It’s a controversial point, and competition really works well in generation, and it has worked well in transmission in certain areas, like in the U.K. and in Texas, where they did the competitive renewable energy zones, and the Public Utility Commission of Texas oversaw the procurement and a competitive process. But it’s just a very diverse country, and there are areas where it hasn’t worked. Those areas where it hasn’t worked happen to be some of the places where the transmission was most important, like much of the center of the country and the MISO and SPP regions. For those who know the regional transmission organizations right in the center of the Great Lakes states and then the Plains states, it really hasn’t worked well there. So I think there is an argument for maybe taking a new look at how transmission competition is done. If it can work in a given region, great — keep it. But I don’t think we should assume it works well everywhere.

Stone: And one of the key issues here is that there’s nobody really planning the overall grid in this country, right? So before we go further, I just wanted to define a little bit more clearly who or what organization is responsible for the overall grid development? And what are their powers and limitations in terms of pushing new projects forward?

Gramlich: Historically, the Department of Energy had very little role. They got this limited role of backstop siting in the 2005 Energy Policy Act, but it, of course, never worked, and they didn’t really do anything with it. The current Biden administration Department of Energy is doing a lot, and they got some funds — in my opinion, very little funds for transmission — but they’re doing very well, I think, with what they have. So they’re getting a little bit more of a role, but it’s a far cry from any national planning authority.

And then FERC has the most actual jurisdiction over transmission policy, but you know FERC’s history is not really aligned with any kind of national planning role, either. The agency was created to just fill a gap in state jurisdiction, and that kind of implies sort of the backseat and gap-filling role that FERC had historically. Now that role has been increasing gradually over the years. The ’92 Act, and then FERC Order 888 and three or four other major, nationwide FERC rules that the courts have affirmed have given FERC a much greater role. But it’s still kind of set up as a quasi-judicial agency. It mostly acts in response to contested tariff filings that come in, and then they adjudicate those controversies. So it’s still a little bit unnatural for FERC to proactively plan or do the planning, and there’s no real prospect of FERC actually doing the planning, but they can require planning. They can require the Jurisdiction of Utilities participate in a process and produce a regional plan, and they could do the same in the interregional context between RTOs. So that’s what FERC has been talking about doing of late, and I hope they follow through on that.

Stone: So the regions have, for quite some time, been required at least to come up with plans for how they’re going to move forward with developing their grids. But you’ve co-authored a report that grades transmission development efforts. The title of the report is “Transmission Planning & Development Regional Report Card.” It looks at ten major transmission grid regions in the U.S. and how well they’ve done in planning their grid. And for the most part, the grades are astonishingly low — mostly Ds, and even an F. Can you introduce us to these regions and overall, why have they fallen short?

Gramlich: We’re in a little bit of a period of a lull in FERC activity. Under previous Chairman Glick, they had this proposal for regional planning, and it had a lot of the same requirements that we used in this report, in terms of all regions should do proactive planning, meaning take a look 10 or 20 years out to see the generation additions and retirements, and do the plan accordingly. Use scenarios to look at severe weather and other uncertain but important grid factors. And look at multiple values of transmission, reliability, congestion reduction, et cetera.

So there are now, I think, just from FERC’s proposed rule, a set of widely accepted best practices that all regions should do. And so we used those as kind of a benchmark, and again, with this lull between the proposed rule and a final rule, we thought it a good time to see how well we’re doing because regents don’t have to wait for a FERC final rule. They can go ahead and get busy now.

So we used those best practice planning methods as a benchmark, and we also looked at actual performance, like have they been building long-haul, high-voltage transmission, and are their interconnection queues good or bad, as an indication of whether they’re alleviating grid capacity constraints? And then also just congestion, like the hour-to-hour, day-to-day costs of delivering from point A to point B, each region reports its congestion.

So we took all of those, and of course high congestion means high grid capacity constraints, and those don’t exist if they’re doing their job building transmission, but they do if they’re not. So those were most of the metrics of good performance, where you get an A if things are going well on each of those counts. And what we found — we weren’t totally surprised, and we had a big committee, lots of people helping. This was done for the Americans for a Clean Energy Grid, and that has a very large list of participants and stakeholders who are all reviewing and contributing, and we had an advisory committee. But we found a couple of reasons we’re doing pretty well.

MISO sticks out as usually the kind of poster child for doing a pretty good job on proactive regional planning. They get a little extra credit because it’s a multi-state RTO. It’s harder there than, say, in California and New York to get alignment.

Stone: Just to jump in for listeners, MISO is the midcontinent ISO, that’s the RTO, the electricity market and system in the center of this country.

Gramlich: That’s right. And it’s the Great Lake states mostly, the Upper Midwest, but then it also gets down to Louisiana now with the energy system. Anyway, they’ve been doing what they call “long range transmission planning,” and that’s going pretty well. They’re doing all those practices that — again, they’re not rocket science, and everybody should be doing it — but it does take a lot of work to get the parties together and do the studies and to figure out who’s going to pay how much for transmission.

Anyway, MISO is doing that. California ISO is also doing quite a lot of that now. They scored pretty high. New York ISO is doing some after years and years of congestion between Upstate and Downstate New York. There’s some activity now with lines going from Upstate to Downstate. But those are sort of the exceptions. The rule is mostly the grades were C down to F. A couple of the regions were F, and there were a couple of Ds. We’re trying to just be as objective as possible. Are you actually doing a generation forecast? How much generation is coming on and going off the system, and are you planning for that future resource mix? In most cases, no, that’s not happening.

So yes, that seems like a real problem, and we’re seeing the downsides of this incremental approach right now, where we’re not really planning. In most regions, nobody is really doing proactive, forward-looking planning, and so all we’re doing is sort of connecting the next generation that comes in, which turns out to be — you know, that’s the most expensive way to do things. You don’t get the economies of scale, of higher voltage power, the power lines that can deliver more for lower costs, or the network interactions that you get from a regional plan, looking at a whole bunch of lines and technologies all together, to find the optimal mix. We’re not doing any of that in most regions. So we try to just be honest about what’s going on.

We also tried to communicate to the world that we’re not trying to judge or find fault, we’re trying to show the positive things that every region can do. And hopefully each region has something to learn from every other region, and also kind of see, “Oh, look, it’s not rocket science.” At least one region is doing everything that needs to be done. Some of these practices are being done somewhere. You know, the semester is not over. These may be interim grades. I don’t know if the Kleinman Center or UPenn operates this way, but we’re going to keep the final grades open and hope everybody improves, and we can adjust them upward in the future.

Stone: Let’s definitely be optimistic about this. Just to review what you’ve just said here, basically, what we’ve got right now is kind of a reactive, rather than a forward-looking approach to transmission, right? So you’ve got new generators, new wind and solar plants that want to connect. When they connect, they may actually have to upgrade the grid to accommodate the electricity that they’re going to provide to the system, but there’s nobody looking at this — at least in most areas, is what I’m getting from this conversation — who are realizing, “Okay, where is this system going? What are the transmission needs going to be in a decade? How much renewable energy are we going to have to interconnect? How much new load are we going to have? And are we going to proactively create a grid that’s going to accommodate all those new interconnections?” As you said, that would be much better, to take the holistic approach than the piecemeal, “Let’s do this little project, this little, project, this little project,” and the costs add up that way. Is that right?

Gramlich: Exactly right. Perfectly stated. Yes, it seems intuitive. Most people think that transmission planners are out there, and they do their job. But the reality is we’re not actually planning transmission. We’re not actually doing what any normal person would think of as a transmission planner’s job, which is to look at the future resource mix and the future load and connect the dots, literally draw lines to connect the generation to the load.

Stone: So fill in one more blank here, if you don’t mind. So again, these regional transmission organizations — PJM is the one here in Philadelphia. They have an annual transmission plan called their “Regional Expansion Transmission Plan. That should encompass this, but it’s not. Explain to me a little bit more why it’s not.

Gramlich: It’s very short-term focused, and just on reliability requirements. So the thing that gets transmission built right now is just if you violate a NERC criterion, NERC being the reliability authority, which is just a very narrow and limited way to look at transmission. It’s just like if your car is literally going to fall apart when you drive down the street, that’s the only time you’d do anything to fix it. And that’s pretty common. That’s basically what PJM is doing. That’s what most regions are doing now. Since you asked about PJM, I’ll note that they just very recently announced a new program to develop a long-range transmission planning effort, so we don’t know if that’s going to succeed or actually result in a long-range transmission plan. We’re hopeful, but they actually, literally, two days from now they have, I think, their first meeting on that. So they’re getting started with something, to their credit.

Stone: Going off on this PJM situation is something you said a few minutes ago, about FERC and its NOPR. FERC issued a “Notice of Proposed Rulemaking,” I believe it was in May of 2022, to address its shortfall of new transmission planning projects. One of the key proposed features of this — and you’ve also hinted at this, as well — is that it would require transmission operators to take a longer view of transmission needs, 20 years or more into the future. Give us a little bit more of what that might look like, and again, why it’s important.

Gramlich: Yes, that’s exactly right. I think it’s an excellent proposed rule. I think Chairman Glick and the other commissioners and staff did a really good job. There are a few places in it where it gets weak-kneed, that I think need to be corrected before the final rule is issued. But the basic gist of it is just not any more complicated than just saying, “Each region, each utility that’s jurisdictional to FERC, needs to be part of a regional planning process that does certain things, the main thing being look out 20 years at the generation mix, expected additions and retirements, and load growth, and plan based on that. And that fundamental change, planning for the future or proactive planning, that’s just a very basic thing, and it’s a big change from the status quo.

Stone: One of the issues here, as well, is all of these public policy goals of the individual states. That has to be included in this conversation, as well.

Gramlich: Yes, that’s right. And “public policy” as a term gets a little bit touchy because now we’re getting into where some states don’t have climate or clean energy policies, and others do. And then you get into an argument about who benefits from the transmission. Order 1000 made a big deal out of public policy. To me, I just think it’s planning for the future. It is what it is. The RTO, the regional planner, shouldn’t be judging whether states should or shouldn’t have clean energy policies. The reality is utilities have resource plans. They’re going to be buying one type of power or another, and that is generally known and knowable information. So the planner can make a reasonable forecast of that future generation mix. You know, if Kentucky and West Virginia are still going to have some coal on their system in the PJM region, it is what it is. It’s not the transmission planners to judge. It’s not like FERC is becoming an environmental regulator. It’s just it is what it is, but again, it’s known and knowable, so the planners need to act accordingly and plan a reliable and efficient grid based on that.

Stone: PJM resorted to a method called the “State Agreement Approach” with the State of New Jersey, which is building a lot of offshore wind. And under this approach, PJM took over a lot of the transmission planning responsibilities for New Jersey to accommodate that offshore wind. Is that kind of a model that we might see coming forward?

Gramlich: I hope not.

Stone: You hope not? Interesting.

Gramlich: It does a little bit. If nothing is happening, like in PJM, that was an improvement that was heralded by some because it was better than nothing. And if you’re in New Jersey and trying to meet your clean energy goals, and PJM is doing no planning, then at least you can step in and say, “Well, we want a plan that does such and such, and we in the state will pay for it.” So it’s great.

But then what about all the benefits that all the other states get from that transmission that gets built? Moreover, all the reliability and congestion cost reduction benefit — and just recently PJM put out numbers saying that in the winter, offshore wind is providing 70% capacity value to the whole region. So if you have offshore wind farms, then basically wind is as good as gas, combined cycle, and CTs. Offshore wind is the same quality for being there as like a back-up fuel source as gas, combined cycle, and CTs. And that’s reliability of value for the entire system. You only get it if you build a transmission to get that.

So there are all these multiple benefits of transmission and multiple beneficiaries across the area. So really the entire region should pay, according to how much they benefit. As to the economic purity, I think I would commend Harvard Professor Bill Hogan’s work. He’s, of course, one of the leaders if not the leader of the market design that’s used in most of these regions. And his recommendation on transmission is first of all, the market by itself doesn’t do nearly adequate transmission, so you do have to plan it. For a pure, free marketeer, that might sound weird, but the reality is you do need to plan it to get the efficient amount. But then secondarily, Dr. Hogan would say, “Do a benefit/cost analysis to see how much to build and what type to build, and then assign a cost according to the beneficiaries that come out of that analysis.

And that’s the economically pure way to do it. It’s a little bit harder in practice to bean-count every electron and who benefitted exactly how much, but you can do something. And it doesn’t have to be the case that everybody pays the same, but now we’re into the cost allocation question of who is supposed to pay, and how much? And that’s a regulatory issue that PJM and FERC would have to figure out. But in general we need to make sure that all of the beneficiaries pay for the benefits, the various types of benefits that they get. And that’s where state agreement is better than status quo in some places, but it’s not nearly as far as we need to go.

Stone: So cost allocation, who benefits from these new lines? It sounds like one of the major challenges going forward that’s going to have to be figured out.

Gramlich: It certainly is, yes.

Stone: So let me ask you this, Rob. What recommendations have you and your co-authors come up with for an ideal process for dealing with transmission development and planning going forward?

Gramlich: The basics, as I said, are proactively planning for the future resource mix. If you get just one thing out of this podcast or report or the FERC NOPR is just plan for the future. But then there are some secondary recommendations. The multiple values need to be quantified and incorporated. A scenario base to look at severe weather and other scenarios — high-load, low-load. By the way, load seems to be growing dramatically, so that’s another driver of this entire initiative.

And then technologies come in here. So great enhancing technologies can create a lot of headroom on the system, and those should be pursued. We really need to do this in a cost-effective way for consumers, and great enhancing technologies don’t get deployed nearly as much as they should, at least in this country. Other countries have different incentives for utilities, and they deploy a lot more of them, so we need to make sure we’re deploying those appropriately, and really only after we do that, do we know how much and where the new transmission should be. So that’s one.

And then the types of new transmission is something that needs attention. There are new types of conductors, high-efficiency conductors that are low sag and deliver more power, including super conductors and composite core and other technologies for the structural elements. So those need to be incorporated, as well. I think it’s reasonable for FERC to not mandate particular technologies, because FERC isn’t supposed to pick winners and losers on technology, but they can require processes that lead to appropriate decisions about which technology to deploy, and in what way.

Stone: It’s interesting on this issue of the conductors, the reconductoring is an article I saw recently in the press somewhere. It talked about you could take existing power lines, and then you could put new lines up that have, instead of steel cores, carbon fiber cores that are much lighter. You could put thicker lines, essentially, to carry more electricity in the existing right-of-way. How much potential is there in that?

Gramlich: Yes, I think huge potential. When we go back to the top of this podcast about the doubling or tripling of capacity that we need, that’s all true, but I don’t want people to just get stuck with the image of, “We need that many new rights-of-way,” because everybody knows how hard new rights-of-way will be. It’s a lot more nuanced than that. There are a lot more ways to deliver power. I mentioned some of those technology options.

But yes, as you say, reconductoring is a great opportunity, partly because a lot of the lines — like the literal wire or cable — are 60 or 70 years old in a lot of places. So it’s great they last that long, but for better or for worse, we’re at that point in the cycle where they need to be replaced from a consumer perspective. A lot of consumer interests are not thrilled with the fact that we have to pay for these new, expensive lines just to get the same service we’re getting. But if you’re going to do that anyway, you might as well replace it with an upgraded line that can deliver sometimes double or more of the capacity. And that’s what some of these advanced conductors, high-efficiency conductors can do.

So I think that’s a very large opportunity. We did a report on that at Grid Strategies. That and other reports are on our website, where we tried to do some numbers around that nationally. But it’s a significant carbon impact overall. And then there are other, more creative types of corridors. You could go along rail and highway and things like that, using existing corridors and rights-of-way. There are a lot of nuanced and alternative ways that we can get new transmission.

Stone: I want to ask you — you mentioned weather in there, as well. How is a grid developed to be resilient against extreme weather?

Gramlich: This is really a major driver, and in particular, this topic is one really that resonates with a lot of policy-makers who are not quite prioritizing climate and clean energy as much as others. Everybody cares about reliability. So what we’re finding is we basically have a reliable grid, but for these severe weather incidents that seem to keep happening, that are undeniable. And it’s severe cold weather, as well as heat. And then sometimes drought can affect the cooling water of thermal plants.

So usually what happens is these severe weather incidents affect a bunch of generators on the system. And it’s all types of generators that are affected — nuclear, coal, gas can be affected. And wind and solar can be affected, as well, all of them by different things, but no generation is immune from severe weather as a general matter. So then given that, it turns out transmission is a fantastic insurance policy against that, because these weather patterns, while they can be large, the severe part of them tend to be relatively narrow. And if you go a few hundred miles away, it’s a different weather pattern, just not as severe, and there tends to be a lot of available generation.

So you can have a lot of generation that goes offline, and as long as you have interregional transmission, you can get that delivery. And that’s what we keep finding. We did reports on these, as well — Winter Storm Uri and Elliott and some of the other ones. If you just look at those few-day events, a tremendous amount of value would accrue if we just had a gigawatt more of capacity. That was the arbitrary metric we chose. But you can save consumers a few hundred million dollars just in a couple of days, if you had another gigawatt of capacity. It can almost pay for half of the line, or sometimes most of the value of a line that you’ll have for 40 years.

So that’s the type of thing that is not actually normally incorporated into planning, and yet when you look backwards, that’s the huge value. Most of the value of transmission is in these stressed times. So we need to find a way to prospectively, when we’re planning for the future, take that value into account because while we don’t know exactly when or where the next severe weather incident will be, or which generation exactly will be affected, we know that over and over again, it keeps happening, so why don’t we plan for that likelihood? If we did that, then the value of interregional transmission would really start showing up in these plans.

Stone: I want to jump to one of the elephants in the room on this whole issue, and that’s permitting reform, right? There has been a lot of talk about this in Washington over the last few years — permitting reform, as it applies to gas pipelines, as it applies to electric transmission lines — the whole gamut. How important is permitting reform going to be to enabling the type of long-distance transmission that we need getting built?

Gramlich: Well, it is very important. You need all three of what we call “the three Ps,” planning, permitting, and paying. We talked about paying. It’s the cost allocation problem. And we’ve talked about planning a fair amount. But yes, now we’re under the third P, and it’s critical. Permitting takes two main forms. It’s more federal authority relative to local and state governments on transmission permits to move a little bit more towards the gas pipeline model, where FERC issues the certificates. That’s one aspect.

Another aspect is the environmental statutes and implementation of them by different federal agencies. And there are efficiencies in the implementation of that, that in my opinion don’t change the environmental thresholds or standards. They just change the process to make it more efficient, particularly when you have multiple agencies involved in administering different environmental statutes. And of course there are many environmental statutes and many agencies. Often there can be an uncoordinated process between many agencies and decision-makers and all of that.

So a lot of that work, we should say, is really an administrative function where we’ve been noticing a lot more permits being issued of late. So I think you can say the Biden administration is getting permits done and supporting linear infrastructure in that way, and doing the hard work of making agencies work together and meet timelines and things like that, based on evidence so far. So that’s important. But there are also legislative improvements that could help. There are, for example, cases where NIPA would apply twice for the same line, and you have to go through an environmental impact statement process more than once. And so those are the types of things that need to be cleaned up. And only legislation can do that.

Stone: Earlier this year, DOE, the Department of Energy published a report titled “The National Transmission Needs Study.” It identifies areas of the country that need more transmission. In May of this year, the same Department of Energy began a process to identify what are called “national interest transmission corridors,” where new transmission would be particularly critical. How would the corridor designation be used to speed transmission development?

Gramlich: Yes, the Department of Energy is doing a lot of work on studying the transmission needs and putting out good reports, in my opinion, working towards moving from draft needs to final needs study, and then a national transmission planning study sometime, I think, in the winter. The purpose of these are — One purpose is just to tell the world and all the utilities and states and everybody where the national priorities are, and that’s useful in and of itself.

A second purpose is the financing tools that DOE was given in the combination of the IIJA, Infrastructure Law and the Inflation Reduction Act, IRA. And obviously the agency is thinking about how they prioritize their limited dollars and national priority pathways to give them a strong indication of where the priorities are.

And then the third is in the national interest electric transmission corridors for ultimately a FERC permit potentially, where the Department of Energy has the role of designating the corridor, and then FERC has the role of issuing a permit, depending on what the states and local governments do. That authority has never been used. It was attempted a couple of times. There were a couple of court decisions over the years since that provision was originally put in place in the EP Act of 2005. There were some court decisions around the 2009, 2010 timeframe that did a lot of damage to that authority, so it was a dead letter for more than a decade. But the IIJA law kind of undid those court decisions and put it back in place, in at least the way that I thought it was originally intended.

So anyway, that authority does exist. DOE is sort of working towards designation, and FERC simultaneously has a rulemaking to implement those legislative changes from IIJA. So we could be seeing, say over the next year, some actual designations, where transmission pathways are deemed in the national interest, and financing could go with it, and some permitting authority from FERC could go with it.

I’ll just add one other note on that. The Department of Energy has been proactively noting that it also has the authority to respond to applications from project sponsors for designation of corridors. So it doesn’t all have to come out of the study, the kind of national lab analysts and models. You know, if some transmission developer thinks they have a great line that satisfies all the criteria of national interests, they can file that information and related studies with DOE, and DOE can look at it and receive comment from others, and then issue a decision agreeing or disagreeing with that. So that’s another opportunity that exists.

Stone: So to sum up here, DOE would determine the corridors, what are the priority corridors. And then interesting, as you said, FERC would have the authority to approve these corridors, even if the states oppose them. And that’s interesting because that’s the first time, if it works this time, that we’ll actually see someone with a national authority overseeing the map of the United States and saying, “We need a transmission line here. The state says no, but we’re not going to let that one state hold the thing up. We’re going to push it through and make it happen.”

Gramlich: That’s right. And of course I think the practical reality of that is just the threat of that happening can change the dynamic on the ground. And hopefully utilities and states and various stakeholders can get to “yes” and find an acceptable route. But by removing that veto power, then at least you can get to “yes.” The answer isn’t going to be ultimately “no,” if it’s deemed truly in the national interest. The answer is going to be this route or that route.

Stone: A final question for you here: We have not yet seen a FERC order on transmission reform. When might we expect that? Is there any guidance? And what are your views on will it have teeth?

Gramlich: There is no guidance. It’s up to the Commission, particularly the Chair, Willie Phillips, to kind of say what their plans are. They are busily working on interconnection reforms first. They have a proposed rule, and any day now — literally it could be next week, and if not the end of July, it could be in September — they can issue the final rule on interconnection reforms, so that’s consuming their near-term focus.

And then after that, it’s not clear. They need to have three votes or a majority to pass something.

Stone: At the Commission?

Gramlich: At the Commission. There are five seats. Currently four are serving. One of them, his term has just expired, though he can serve through the end of the year. Other nominations have not happened yet. There are people being talked about and discussions going on, but there’s a little bit of uncertainty about who the commissioners are going to be, and there might be a little bit of waiting to see how that shakes out, before they do the big transmission planning final rule.

Stone: Rob, thanks very much for talking.

Gramlich: Great to be here. I enjoyed it. Thanks, Andy.

Stone: Today’s guest has been Rob Gramlich, President of Grid Strategies. Thanks for listening to Energy Policy Now. This is the final episode of Season 7 of the podcast. We’ll be back on September 12th for the start of Season 8, in an exciting new year of conversations with energy policy leaders here at the Kleinman Center and with leaders throughout academia, industry, and policy circles.        


Rob Gramlich

President, Grid Strategies
Rob Gramlich is Founder and President of Grid Strategies LLC where he provides economic policy analysis for clients on electric transmission and power markets in pursuit of low-cost de-carbonization.

Andy Stone

Energy Policy Now Host and Producer
Andy Stone is producer and host of Energy Policy Now, the Kleinman Center’s podcast series. He previously worked in business planning with PJM Interconnection and was a senior energy reporter at Forbes Magazine.