States push back against DOE transmission siting authority

The nation’s state utility regulators are poised to reassert their authority over the siting of electric transmission lines, beginning with a resolution to be considered at their winter meetings in Washington next week.

The galvanizing issue is the Department of Energy’s unprecedented use of its authority to take an ownership stake in a 720-mile-long transmission project from the Oklahoma Panhandle to Tennessee.

Coincidentally, the Plains and Eastern Clean Line transmission project is ranked No. 9 in a list of 50 high-priority infrastructure projects circulating among governors, lawmakers and the business lobby.

The document touted the line as a “national security project that can add resiliency to our electric grid,” citing its ability to “move cheap, clean, wind power energy” that could power more than 1 million homes in the mid-South.

In March 2016, former Energy Secretary Ernest Moniz issued a decision that DOE would participate in the development of the project as a full owner of the portion of the line running through Arkansas.

The unusual arrangement is allowed by Section 1222 of the Energy Policy Act of 2005, and it was encouraged by developer Clean Line Energy Partners LLC after Arkansas utility regulators in 2011 rejected the line, saying Clean Line did not meet the state’s definition of a public utility.

The DOE decision also allows the use of federal eminent domain to site the line if needed, something that is especially irritating the state regulators.

That was among the reason why the National Association of Regulatory Utility Commissioners drafted a resolution to be considered next week.

The regulators’ resolution defends their “long-standing position that the siting of electric transmission facilities should be subject to the exclusive jurisdiction” of states.

They also noted their opposition to the limited “backstop” siting authority in the Energy Policy Act that would have given the Federal Energy Regulatory Commission authority over siting transmission projects if state regulators did not act on a proposal in a year’s time.

That FERC authority, however, was upended in 2009 by the 4th U.S. Circuit Court of Appeals.

Since then, a halting national dialogue on how to satisfy the concerns of states as well as the utility sector has been unable to lead to a consensus on how to build lines needed for electric reliability and access to new sources of generation, especially wind and solar.

Such a consensus appears to be as elusive as ever. The NARUC resolution authorizes its staff to “take all appropriate and necessary actions to challenge DOE’s circumvention of State siting laws.”

“As with all such resolutions, we will engage in appropriate advocacy and litigate if there is an option to do so,” a NARUC spokeswoman said. “That means if it makes sense, which is to be determined, we will take positions on the Hill, with senior elements of DOE [and] in the courts.”

Clean Line plugs into NARUC concerns

The 720-mile-long Plains and Eastern Clean project is expected to cost $2.3 billion and be in service in late 2020, said Mario Hurtado, executive vice president at Clean Line who leads the Plains & Eastern Clean Line project.

Under development since 2009, it will send 4,000 megawatts of renewable energy to Arkansas, Tennessee and the southeastern U.S.

In an interview, Hurtado said Clean Line has “talked to lots and lots of different people about” Plains & Eastern, and in the aftermath of the November election “we were happy to talk about what our projects would do for the country. I think that’s how it got on the list,” he said.

As for NARUC’s concerns, Hurtado said Clean Line takes “any concerns seriously about the project,” especially when “it comes from a collegial body like NARUC.”

Noting that Clean Line has four other transmission projects under development, he said the company “has been working very closely with state regulators. We realize the important role they play.”

But after the rejection in Arkansas, “we’re just working in the legal framework that exists and the regulatory framework that exists to be able to build a project that we think makes sense for the region,” Hurtado said.

“We’ve got to modernize the grid and get cheaper resources to people,” he said, describing a frustrating process that has plagued developers of numerous interstate lines.

“Some of them even started planning before the previous administration,” he said. “So now they’re getting fresh eyes. It just takes too long to get this stuff built.”