FERC Incentive Policy Update

The Federal Energy Regulatory Commission (FERC), on March 19th, proposed to revise its electric transmission incentive policy to stimulate the development of transmission infrastructure needed to support the nation’s evolving generation resource mix, technological innovation and shifts in load patterns. The Proposed Rulemaking shifts the focus in granting transmission incentives from an approach based on the risks and challenges faced by a project to an approach based on the benefits to consumers.

Among the proposed reforms, one was particularly important to CTC Global’s Utility customers in the US: Offer a 100-basis-point incentive for transmission technologies that enhance reliability, efficiency and capacity as well as improve the operation of new or existing transmission facilities. While this description for transmission technologies that would be eligible for the incentive aligns very closely for our own description of what the ACCC Conductor provides, all conductors along with several other traditional transmission technology categories were “generally” excluded. Needless to say, our comments to FERC highlight the error of overly restricting the range of technologies eligible for the incentive and offer two specific recommendations:

The Commission should include high-performance transmission conductors that enhance reliability, efficiency, capacity, and improve the operation of new or existing transmission facilities as “eligible transmission technologies” for purposes of Incentives for Transmission Technology treatment; and, the Commission should advise transmission planners that when evaluating a transmission project’s benefit-cost ratio for incentive qualifications they should consider additional benefits beyond capacity and reliability, notably:

improvements in transmission system efficiency that result in reduced transmission line losses, reduced air and water emissions from reduced generation requirements, and reduced generation capacity required to reliably serve electric load.

If FERC agrees that a broader view of eligible transmission technologies for this special advanced technology incentive is warranted, including eligibility for projects using ACCC Conductor, then more customers may get the benefit of transmission projects using ACCC Conductor that increase reliability, capacity, and efficiency resulting in cleaner air and water, and lower electricity costs.

CTC Global filed its comments to the FERC Transmission Incentive Rulemaking (FERC RM20-10) on June 29th. We expect to hear back from FERC in a proposed Rule sometime late Q3 or Q4 of this year.

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