States should not be required to pay for transmission projects built to support other states’ energy policies, according to Mark Christie, a commissioner on the Federal Energy Regulatory Commission.
“It would be grossly unfair for FERC to force consumers in other states to pay for projects implementing the policies of politicians they never got the chance to vote for, when their own states’ policy-makers have not agreed to pay for those projects,” Christie said in a letter released Monday to four members of New York’s Congressional delegation.
Christie’s letter was in response to the lawmakers’ request that FERC quickly issue a pending rule to revise its transmission planning and cost allocation requirements.
At its core, the pending rule is about promoting “public policy projects” that support state energy goals, according to Christie.
“While I absolutely support the people of New York or any other state in their right to choose any energy policies they want regarding preferred power resources, it would be wrong both as a matter of policy, as well as law, for FERC to use a transmission planning rule to force the costs, for example, of New Jersey’s policy-driven offshore wind projects onto consumers in Pennsylvania, Ohio, or other states without the explicit consent of those states,” Christie said.
In multi-state regional transmission organizations, other states must give their voluntary consent to share in transmission costs driven by other states’ policies, he said. Forcing states to pay for those costs would likely lead to litigation, jeopardizing beneficial transmission investment, Christie warned.
“The proposed rule already contains other highly controversial provisions likely to attract litigation; loading it up with even more legally dubious provisions will only increase the risks in the uncertain future it faces,” Christie said.
PJM cost allocation faces challenges
Highlighting the cost allocation issue, FERC on Monday was urged to reject the PJM Interconnection’s plan to broadly allocate costs from a $5.1 billion transmission plan that is designed to handle data center load growth in Virginia and power plant retirements.
“PJM’s new transmission projects are demonstrably for the purpose of importing electricity from West Virginia and Pennsylvania to Virginia and Maryland as a result of the energy and economic policies of these two states,” Theresa Ann Ghiorzi said in comments filed at FERC.
Growing power demand in Northern Virginia’s “data center alley” is a direct result of the state’s economic policies, according to Ghiorzi, a Virginia resident who may be affected by the 500-kV Mid-Atlantic Resiliency Link, a transmission project slated to be built by NextEra Energy Transmission.
Also, Ghiorzi contends Maryland law calling for 100% emissions-free power by 2035 is partly responsible for Talen Energy’s plan to retire its coal-fired Brandon Shores power plant.
“Just as in Virginia, it is Maryland’s energy policy to discourage the building of in-state baseload generation and retire the existing baseload generation in favor of intermittent energy sources (wind and solar) and import baseload from neighboring states,” Ghiorzi said.
FERC should convene a Federal Power Act section 206 proceeding to consider whether new cost allocation methods should be developed for data center load growth, Ghiorzi said.
The Maryland Office of People’s Counsel — which represents residential ratepayers — is also challenging the broad cost allocation for the transmission projects, arguing they are largely driven by Virginia’s economic policy.
