Consumer groups defended their complaint with FERC alleging utilities spend too much on lightly regulated local transmission projects against arguments that such spending is justified (EL25-44).

In a joint answer to protests filed April 24, the 22 groups — including the Industrial Energy Consumers of America, American Forest & Paper Association and R Street Institute — argued that the December 2024 complaint against all FERC-jurisdictional transmission planners should be granted so the commission can address what they called widespread unjust and unreasonable planning practices. (See Utilities Ask FERC to Toss Local Tx Planning Complaint, Others Support It.)

While the transmission lines can be called “local,” those at issue in the complaint are located in the Eastern and Western Interconnections and are part of interstate commerce. That has long been recognized by the courts, the groups said.

“Respondents nevertheless insist that planning of interstate transmission at the individual level remains appropriate because such transmission is ‘local’ and that existing transmission owners have a ‘right’ to plan the interconnected grid of the future simply because they built the grid of yesterday,” they said. “Respondents make no electrical distinction between local and regional transmission.”

The actual difference between “local” and “regional” projects can be arbitrary, the groups argued, noting as an example that American Transmission Co. independently started planning a 345-kV line, which then was selected by MISO for its regional transmission plan, with its costs spread across the footprint.

“ATC argues that ‘the project directly contradicts the “piecemeal planning” allegations contained within the complaint,’ but the project actually proves the point of the complaint, as MISO recognized that the project impacted the entire region, although it was initially individually planned,” the consumer groups said. “The electrical nature of the project did not change through the regional review, and the complaint identified hundreds of similar projects that were individually planned with no substantive regional review.”

A common rebuttal to the complaint was that utilities had to retain their planning role to effectively meet state retail obligations, which leaves it outside of FERC jurisdiction.

“The complaint is based on the simple electrical premise that there is no FERC-jurisdictional ‘local’ transmission and thus there are no ‘local’ transmission planning needs,” the groups responded. “There are localized inputs to determining the holistic needs of the interconnected grid, but electrical facilities at 100 kV and above are not local, except those excluded by the complaint.”

Local projects that solely serve intrastate needs are outside of FERC jurisdiction, and the complaint does not ask FERC to try to regulate them.

Many protesters argued the complaint is too broad, and the commission should take regional differences into account if it decides to grant it.

“Individual or even regional ‘planning challenges’ or differences are irrelevant to the fundamental question under the complaint as to whether it is appropriate to allow individual transmission owners to plan 100-kV and above transmission in interstate commerce based on the ongoing false premise that such transmission planning relates to ‘local transmission,’” the groups answered. “Planning challenges, to the extent they exist, can be incorporated into the required regional planning, just as regional differences are incorporated today in regional planning.” FERC can grant the complaint and facilitate implementation of any necessary region-specific reforms through compliance filings, they argued.

Another common rebuttal was that the complaint had to prove that local planning leads to unjust and unreasonable rates on specific projects. But the groups argued it was aimed at local planning practices and that Section 206 of the Federal Power Act can address broad industry practices.

“Critically, acceptance of respondents’ arguments would also mean that FERC, under a rulemaking pursuant to Section 206, wouldn’t be able to dictate nationwide standards, like in Orders Nos. 890, 1000 [and] 1920,” they said.

Opponents also argued the complaint was a collateral attack on Order 1920, or even earlier transmission planning rules. But the groups said they had put new evidence in front of FERC that it did not have during the proceedings that led to its most recent transmission planning rule.

“The new evidence and changed circumstances consist of new analytical reports and evidence of both individual projects and cumulative regional transmission plans and portfolios across every planning region over several years,” they said.

Other Parties Defend the Complaint

American Municipal Power also filed an answer April 24, arguing FERC should grant the complaint despite a request from PJM and its transmission owners to dismiss it.

The complaint made the case that spending on local projects in PJM has become unjust and unreasonable and should be dealt with in a subsequent show-cause proceeding, AMP said.

Transmission rates in PJM are up 237% from 2011, mainly from local projects with limited oversight, AMP said.

“Forcing local transmission customers to bear the cost of projects that should have been supplanted by more cost-effective regional projects could unduly discriminate against those local customers by unfairly shifting the cost of transmission projects in a manner inconsistent with cost-causation principles,” AMP said. “The harmful effect of these failures would only multiply going forward, as PJM’s load is expected to grow by 70 GW or more in the foreseeable future.”

The Maine Public Utilities Commission similarly rebutted claims about local planning in New England. It said FERC should open another Section 206 show-cause proceeding so it can address the issues around local planning and its lack of oversight in New England.

Projects above $5 million are presented to ISO-NE’s Planning Advisory Committee, but the process has proven inadequate, and the TOs retain all control over asset-condition projects in the region.

The PUC “completely agrees that the ISO-NE tariff and related documents do not provide ISO-NE with a role in local transmission planning sufficient to effectuate all of the remedies sought by complainants, but [it] submits that a Section 206 investigation will allow parties to build a record upon which remedies consistent with Order No. 890 and FERC precedent may be developed specifically for the New England region,” it said.