The D.C. Circuit Court of Appeals has dismissed transmission customers’ argument against ITC Midwest receiving an abandonment rate incentive for an Iowa line segment included in MISO’s long-range transmission planning.  

That’s despite ongoing uncertainty over the fate of Iowa’s right of first refusal law.  

The court decided Jan. 14 that the collection of organizations — Resale Power Group of Iowa, the Industrial Energy Consumers of America, the Coalition of MISO Transmission Customers and the Wisconsin Industrial Energy Group — didn’t prove “imminent injury” from ITC Midwest being able to recover 100% of prudently incurred costs building the Skunk River-Ipava 345-kV line in Iowa if the project is canceled due to factors beyond ITC’s control (23-1334).  

The groups disputed the incentive on account of Iowa’s right of first refusal law being overturned in late 2023 and ambiguity surrounding which developer ultimately will build the segment of the long-range transmission project. (See Iowa ROFR Law Overturned, Throwing Multiple MISO LRTP Projects into Uncertainty.) They said ITC’s ownership is “uncertain” and likely “void” from the direction of the ongoing litigation and the incentive appears destined to expose them to the risk of higher rates in the future.  

However, the D.C. Circuit Court said the transmission customers couldn’t point to “concrete costs any one of them now confronts,” nor were they able to show that they “will ever suffer any injury” from the abandonment incentive if ITC continues to build the project as intended.  

“For their injury to occur, not only would the Iowa Supreme Court need to affirm a permanent and retroactive Iowa ROFR injunction, MISO would need to open competitive bidding for the project, and ITC would need to lose the bid, invoke the abandonment incentive, and demonstrate to the commission its costs were prudent and the resulting rates are just and reasonable and not unduly discriminatory,” the court said, agreeing with ITC that the “highly attenuated chain of possibilities” is predicated on “guesswork as to how independent decisionmakers will exercise their judgment.”  

The court concluded the transmission customers lacked standing to challenge FERC’s decision.  

FERC originally granted ITC’s request for an abandonment incentive in August 2023, deciding the project could face siting, regulatory and environmental risks. Months later, the commission upheld its decision to grant ITC an abandoned plant incentive, though MISO consumer groups argued against it (ER23-2033-001). 

FERC Commissioner Mark Christie took issue with the abandoned plant incentive altogether and dissented from the order. The 345-kV line segment is part of MISO’s first, $10 billion long-range transmission plan.