FERC announces grid workshop, proposes transmission incentive shake-up

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Image: Ryan McKnight/Flickr

The US Federal Energy Regulatory Commission (FERC) has announced a string of initiatives to help develop the country’s power grid, including tightening a transmission incentive policy for utilities and a workshop that will explore how companies can benefit from grid-enhancing technology.

The energy regulator said it would hold a workshop on 10 September to discuss a “shared-savings model” that could “foster deployment of transmission technologies” and produce more electricity capacity from existing transmission lines, FERC said in a statement.

At the same time, the energy regulator voted on Thursday (15 April) to approve a proposal to tighten rules around how utilities are incentivised to work with regional transmission organisations (RTOs), independent system operators (ISO) and other FERC-approved organisations. The Commission voted to revise an earlier plan set out in March 2020, and award an increase of 50 basis points in return on equity to utilities that join a transmission organisation. It also voted that the utility will be eligible for that incentive in the first three years after it hands operational control of its facilities to the transmission organisation.  

The Commission’s March 2020 Notice of Proposed Rulemaking (NOPR) had originally proposed to raise the membership incentive from 50 basis points to 100, and is currently available for as long as membership continues.

Richard Glick, FERC’s recently appointed chairman, said that an incentive “must incentivise something. If it does not do that, then it is a handout, not an incentive.”

Although the proposal was ultimately approved, it created a rift in the regulatory body, with both commissioners James Danly and Neil Chatterjee at least partly dissenting during a virtual meeting this week.

The organisation is also seeking comment from industry stakeholders on whether utilities should only be eligible for an incentive if they join a transmission organisation voluntarily. Comments are due 30 days after publication in the Federal Register, FERC said.

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