FERC Order Ruling

John Moore, Senior Attorney – The Sustainable FERC Project, Chicago

Terrific news! A federal court upheld in its entirety the Federal Energy Regulatory Commission’s (FERC) groundbreaking electric grid planning rule known as Order 1000. The unanimous decision of the U.S. Court of Appeals for the D.C. Circuit is a major win for clean energy, the environment, and consumers.

The court affirmed Order 1000’s requirements that grid operators must consider needs arising from public policies, including low carbon, renewable energy and energy efficiency measures, in planning for the electric grid used to transmit electricity across the nation.

The decision also affirms FERC’s commonsense finding that regional transmission planning is better for consumers and the environment. The ruling also addresses the “who pays” question by affirming FERC’s cost allocation principles in which all those who benefit should contribute to the cost of new wires and towers and other equipment for transmission projects

Finally, the court upheld FERC’s removal of unfair preferences to local transmission-owning utilities in the planning process – the so-called “right of first refusal” to build new projects.

No utility territory is an island

Order 1000 – which NRDC, the Sustainable FERC Project, and other groups strongly supported -- sensibly recognizes that we no longer live in our own small worlds, at least where the grid is concerned. Energy moves all around the country – no utility territory is an island – and we should plan on a broader, more regional scale for how we get electricity into America’s homes and businesses.

Order 1000 is especially important for regions without regional electricity markets, like the Southeast and most of the West. Until recently, these regions had very little in the way of meaningful regional planning, with little transparency or stakeholder involvement. Each utility mostly did its own local planning.

With the court’s affirmation of Order 1000, these regions, and every grid region in the country, have more reason to use regional planning to help meet consumer needs for a cleaner, low-carbon energy future.

PS – NRDC and Earthjustice filed a brief in support of Order 1000 on behalf of Conservation Law Foundation, Environmental Defense Fund, NRDC and Union of Concerned Scientists, which the American Wind Energy Association also joined.

Photo Credit: FERC Order Court Ruling/shutterstock