Midwest utility-scale wind generators who stand to rake in enormous profit, and the big national environmental organization Pollyannas who think these lines will actually be used for renewables, want to broadly socialize the cost of building $300B worth of new transmission lines to export wind energy from the midwest to both coasts. This uneconomic prospect is made possible by "public policy" renewable portfolio standards adopted by some individual states that would require them to purchase renewables at any price. Every state that has adopted a RPS has different goals regarding what qualifies as "renewable" energy, different renewable percentage requirements, and the states even differ on whether the standard is voluntary or mandatory. Some even include carve-outs reserved for in-state renewables only.
Because there is no national standard by which all states must abide, there's no way for federal regulators, regional transmission organizations, or environmental organizations, to force individual states to permit and pay for these new transmission lines. But, that doesn't stop these entities from trying.
I came across an article in The Georgetown Law Journal the other day entitled It’s Electric, but FERC’s Cost–Causation Boogie-Woogie Fails To Justify Socialized Costs for Renewable Transmission that discusses why FERC's attempts to socialize the cost of individual state public policy projects ultimately must fail.
FERC, or a RTO, cannot force citizens of one state to pay for the public policy goals of another state in which these citizens have no legislative representation.
"Where a state has chosen not to adopt a renewable portfolio standard, or a standard as high as MISO’s tariff supports for a given resource, FERC has no “articulable and plausible reason” to approve a regional tariff that permits some states to impose their policy judgments upon states with divergent policy positions. A contrary view raises commandeering and federalism questions.
FERC would be deciding what policies benefit a state and then forcing that state’s constituents to pay to support that policy. Although this situation differs from landmark cases, like New York v. United States and Printz v. United States, in that FERC would not be forcing state legislative action or commandeering a state administrative body, the situation raises similar political-accountability concerns. As the Court noted in New York, when the federal government compels state action, “the accountability of both state and federal officials is diminished.” If state citizens wish to change state policy, they may elect state officials who share their view. That view can always be pre-empted under the Supremacy Clause if it is contrary to the national view, but in such a case it is the Federal Government that makes the decision in full view of the public, and it will be federal officials that suffer the consequences if the decision turns out to be detrimental or unpopular."
FERC is on the fast track to a nasty federal court battle with states if they continue to coddle midwest wind developers in a misguided attempt to make utility scale renewables "affordable" for consumers thousands of miles away from the point of generation.
"It appears that the Commission is overextending its existing power without any supportive legislative augmentation. It is concerning that an independent agency lacking direct political accountability continues to push the envelope into controversial areas. Politically accountable federal legislators would be more appropriate arbiters of these issues in the first instance."
The article concludes with this warning:
"FERC should be mindful of approving cost-allocation methodologies over the objections of states within a
given region. While renewable power is critically important to our country’s energy independence and the health of our environment, a one-size-fits-all socialized cost-allocation methodology might not be the appropriate fit for every region."
But, read the entire article for yourself -- it's a great read!
Because there is no national standard by which all states must abide, there's no way for federal regulators, regional transmission organizations, or environmental organizations, to force individual states to permit and pay for these new transmission lines. But, that doesn't stop these entities from trying.
I came across an article in The Georgetown Law Journal the other day entitled It’s Electric, but FERC’s Cost–Causation Boogie-Woogie Fails To Justify Socialized Costs for Renewable Transmission that discusses why FERC's attempts to socialize the cost of individual state public policy projects ultimately must fail.
FERC, or a RTO, cannot force citizens of one state to pay for the public policy goals of another state in which these citizens have no legislative representation.
"Where a state has chosen not to adopt a renewable portfolio standard, or a standard as high as MISO’s tariff supports for a given resource, FERC has no “articulable and plausible reason” to approve a regional tariff that permits some states to impose their policy judgments upon states with divergent policy positions. A contrary view raises commandeering and federalism questions.
FERC would be deciding what policies benefit a state and then forcing that state’s constituents to pay to support that policy. Although this situation differs from landmark cases, like New York v. United States and Printz v. United States, in that FERC would not be forcing state legislative action or commandeering a state administrative body, the situation raises similar political-accountability concerns. As the Court noted in New York, when the federal government compels state action, “the accountability of both state and federal officials is diminished.” If state citizens wish to change state policy, they may elect state officials who share their view. That view can always be pre-empted under the Supremacy Clause if it is contrary to the national view, but in such a case it is the Federal Government that makes the decision in full view of the public, and it will be federal officials that suffer the consequences if the decision turns out to be detrimental or unpopular."
FERC is on the fast track to a nasty federal court battle with states if they continue to coddle midwest wind developers in a misguided attempt to make utility scale renewables "affordable" for consumers thousands of miles away from the point of generation.
"It appears that the Commission is overextending its existing power without any supportive legislative augmentation. It is concerning that an independent agency lacking direct political accountability continues to push the envelope into controversial areas. Politically accountable federal legislators would be more appropriate arbiters of these issues in the first instance."
The article concludes with this warning:
"FERC should be mindful of approving cost-allocation methodologies over the objections of states within a
given region. While renewable power is critically important to our country’s energy independence and the health of our environment, a one-size-fits-all socialized cost-allocation methodology might not be the appropriate fit for every region."
But, read the entire article for yourself -- it's a great read!
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