Advanced Energy Perspectives

One of the biggest challenges facing our nation’s economic growth – and one of the largest threats to consumer energy costs and the reliability of our electricity system – is the ability to quickly connect new, large-scale energy resources to the transmission grid.

There’s now roughly 2,600 GW worth of energy sources stuck waiting in line to connect to the power grid (more than double the capacity of the current electricity system), held back by an antiquated way of studying and approving transmission grid upgrades. This process, known as ‘generator interconnection,’ was designed for an increasingly bygone era. In an era of more dynamic, more cost-effective, more distributed advanced energy resources, grid operators and electric utilities need a new approach for bringing new energy resources online. 

FERC’s landmark transmission planning order – Order No. 1920 – will require changes to how America builds up its transmission system, the backbone of our electric grid. Fundamental to this new process will be a formalized role for states in deciding how transmission lines are planned and paid for. The ruling has the potential to transform our system by encouraging cooperation and prioritizing system reliability and affordability. Getting it right will require a new approach by many stakeholders, and will especially require robust state engagement. 

When FERC issued Order 2023 requiring an overhaul to interconnection processes, clean energy advocates lauded it as a crucial first step in addressing overdue reforms. Inefficient interconnection processes for integrating new clean energy resources onto the grid present arguably the biggest current bottleneck in the energy transition, threatening both grid reliability, affordability, and states’ abilities to meet their climate and energy policy requirements. While a lot of work to fully rectify interconnection in New England will remain even after Order 2023 reforms are implemented, compliance with this Order marks a crucial milestone towards a more efficient, equitable, and expedient interconnection process. 

The recently finalized Federal Energy Regulatory Commission (FERC) transmission planning and cost allocation rule—known as Order 1920—represents a pivotal moment in the regulatory landscape of energy infrastructure in the United States, which we expect will launch the nation towards a more holistic planning approach for our country’s transmission grid.

America has not been building the kind of transmission lines it needs to reliably and cost-effectively power our grid, and a major part of the problem has been our short-term, just-in-time planning process. On May 13, the Federal Energy Regulatory Commission (FERC) released Order No. 1920, meant to modernize the transmission planning process by viewing the system through a wider lens to plan for and construct the transmission system we need for the future.