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Lawmakers struggle to balance state, federal interests in new power line construction projects

October 24, 2011

The Federal Energy Regulatory Commission (FERC) has increasingly moved to bring more transparency to the process of transmission line development, an exceedingly contentious issue among federal, state and local policymakers. The government agency has endeavored to acquire enhanced authority over power line projects, but some utilities and power providers have signaled they are against such action.

AOL Energy reports energy experts are endeavoring to overhaul the process by which new distribution and transmission lines are constructed in the U.S. The Energy Future Coalition (EFC), which lobbies for additional investment into power line projects, contend U.S. ratepayers are currently not paying enough to subsidize the development of new power lines, which is worrying federal regulators.

At issue is how, exactly, companies seeking to develop new power lines should be compensated for such work. The nation's current regulatory framework is mired in controversy, as state lawmakers must first approve projects before FERC is allowed to step in.

This scheme, however, is preventing critical transmission and distribution lines from being made, FERC members charge. The energy regulatory agency voted earlier in the year to allow utilities and power providers that perform such work to charge residents of states who will benefit from the construction projects, but some consumer advocate groups have assailed the group's ruling.

Critics of what is widely known as the FERC 1000 order contend the pedantic order is effectively sidestepping regional regulators, shifting power away from traditional power line developers toward the federal government. The Obama Administration has recently fast-tracked 12 power line projects in seven states in a measure it hopes will illustrate how an improved regulatory framework will ultimately aid – not hurt – consumers.

Soaring population levels in many regions of the country are straining the electric grid and unless additional power plants and power lines are constructed, power outages could become more common across the U.S., experts warn.

With that in mind, FERC has moved to increase its own ability to authorize power providers to build new transmission and distribution lines, but states' rights advocates and other consumer protection advocates are challenging the agency's power grid, according to the news agency.

Certain senators have proposed legislation on the federal level that would require regulators to conduct cost-benefit analysis to prevent consumers from unfairly footing the bill for new power line development, but John Jimison of the EFC contended such a measure was not feasible given the complexity of each power line project proposal.

Moreover, Jimison said the proposed bill from the two senators would prevent badly needed renewable energy systems from being developed across the U.S. as they are comparatively more expensive than other kinds of facilities. Nonetheless, they represent the future of the U.S. energy supply, experts say, and costs associated with building them will come down in the long-term, even though they are currently elevated.

Defense analysts argue the future of the nation's power supply network is exceedingly important to long-term national security issues. Lawmakers have struggled to come up with a plan that can address concerns lobbed by both state and federal regulators, but some representatives believe improving demand response resources could help to shore energy-generating sources.