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Order 1000 voted on by FERC, didn’t you hear?

with 2 comments

Here’s some encouraging news you probably didn’t hear about. The FERC passed order 1000 yesterday, amending and reforming cost allocation methodology for interstate and regional transmission build-out.

Didn’t you hear? Probably not, unless you are a part of the energy and electricity world. Well, the Federal Energy Regulatory Commission issued a ruling yesterday that provides a big boost to potential renewable energy development in the United States.

TRC will avoid the technical details, which are essentially everything, but broadly speaking, the rule’s purpose is to create regional guidelines and cost-allocation methods for future build-out of the electrical transmission system. By requiring utilities and transmission providers to consider regional planning processes, as well as state and federal public policy requirements (i.e. renewable portfolio standards), the ruling aims, very obviously, to encourage renewable energy development. Which is a positive result, since adding  megawatts of renewable energy to the grid displaces megawatts of fossil fuels, no matter what the junk science out there says.

The electrical grid in this nation is very old, poorly connected, and maxed out on dirty electrons, making wind and solar development more and more difficult every passing year. Our grid is in a bottle neck: there are great quantities of renewable energy waiting to be developed but no way to send that energy anywhere.

The local nature of the electricity system in the US simply does not work in the 21st century. Occasional piecemeal build-outs needed to support old generators connected to old substations connected to old transmission lines connected to old distribution lines should be the way of the past.

Now, with FERC’s  interstate, regional transmission guidelines and an outline for how those interstate lines should be paid for, new renewable development will (siting and permitting problems not withstanding) be capable of bringing green electrons from the renewable energy zones of rural America to the load centers of urban America.  That is what new transmission should be for. Period. Hopefully the nations utilities and transmission providers comply.

Want to learn more about our electrical grid? Here is a fun map. And here. And here is a good primer.


Written by Christopher ZF

July 22, 2011 at 14:28

2 Responses

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  1. Congratulations on being one of the first bloggers to post about FERC Order No. 1000! The order itself may be long (620 pages) and technical, but it deals with some of today’s hot questions: how should we plan upgrades to our electric grid? Who should pay for new transmission lines?

    Our energy mix is shifting: some coal plants are retiring early, while most new generation being built is either natural gas-fired or renewable. As a result, utilities are planning thousands of miles of new transmission lines at a rate nearly triple the historical average.

    To date, each of the many regional grid operators in the country has planned its own transmission upgrades — and allocated the costs of those transmission projects — according to its own rules. Utilities and regions have not always coordinated at planning these upgrades, meaning some least-cost solutions that require cooperation have been passed over.

    This fact has a double-edged consequence. On the one hand, consumers may be paying more for transmission than they need to. On the other hand, some new generators — especially renewables like wind — are putting their projects on hold over concerns about who will pay for the transmission upgrades they need to interconnect with the grid.

    FERC’s Order No. 1000 is designed to fix all this — no small feat. Will this reform have tangible results for consumers and generators?

    Todd Griset
    Energy law blog

    Todd Griset

    July 25, 2011 at 13:19

    • Thanks for stopping in Steve.

      I try not to blog too much about work matters, but Order no. 1000 was worth it.
      It’s good news over here in MISO, where we’re waiting on FERC for transmission cost allocation methodology approval for our MVPs. That order is yet to come about, but this is a good sign and a promising direction for TOs and utilities to move in regarding continued renewable development.
      And that is the goal.


      July 26, 2011 at 13:23

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