Senate permitting bill would let FERC push utilities to build power lines

A bipartisan Senate bill would end incumbent utilities' automatic right to build regional lines and give FERC penalties to enforce timelines.

The Bipartisan American Affordability and Jobs Act (BAAJA), a permitting reform bill introduced in the Senate on Sept. 30, would hand federal regulators far stronger tools over transmission. According to the Bipartisan Policy Center, its motion to proceed faces a Senate cloture vote on Nov. 9. It has not passed, and nothing changes until it does.

The bill would end the federal right of first refusal that lets incumbent utilities automatically build new regional lines. It would also direct FERC to require each planning region to file a consolidated interconnection and regional transmission planning process. FERC could require cost-effective grid upgrades and penalize utilities that miss its timelines, possibly by lowering their return on equity. Costs for regional and interregional lines would be assigned to the customers who benefit. Rep. Josh Harder (D-Calif.), a Build America Caucus chair, calls the cost-sharing provisions the most important part. He says essentially no new interregional transmission has been built in a very long time.

This matters because cheap new generation is only useful if it can reach people. Transmission is a bottleneck, and a bill that opens line-building to competition and ties incumbents' returns to performance attacks that bottleneck directly. If it works, more power could flow to more places, which should lower electricity costs over time.

The caveats are real. Harder describes the negotiation as two years long and delicately balanced, though he expects most of the bill to stay intact. Tribal organizations oppose its National Historic Preservation Act changes. Chirag Lala of the Center for Public Enterprise says the interregional planning mechanism lacks a forcing function, offering only a six-month extension if regions fail to submit a plan. The companion House Build More Agenda adds clean firm power policies but, as Advait Arun notes, contains no money. Harder also cites limited fiscal headroom.

Source: Utility Dive