The Need to Change Jurisdiction Over the U.S. Electric Grid

This commentary was originally published by The Regulatory Review. Reprinted with permission.

While most people were following the developments at the G20 meeting and the Climate Change Summit last week, or immersed in watching the outcomes of key elections in several states such as Virginia and New Jersey, I was waiting to learn the results of a referendum in Maine.

Last Tuesday, Maine voters approved a measure that prohibits the construction of a transmission line that would have delivered hydropower generated in Quebec to New England. New Hampshire refused to permit construction of the same transmission line last year.

The largely ignored vote in Maine may have a greater effect on the future of the United States than any of the highly publicized events of the past week. When states and localities block electricity transmission projects that are in the national interest, they threaten the country’s ability to mitigate climate change.

Effective climate change mitigation depends critically on the ability to substitute electricity for gasoline as the primary transportation fuel and to substitute carbon-free fuels for fossil fuels as the country’s primary source of electricity.

But the nation’s electricity transmission grid is woefully inadequate to accomplish these important tasks, and the U.S. regulatory system renders it impossible for regulators and clean energy advocates to implement the necessary expansion of grid capacity.

Most sources of carbon-free electricity are located a long distance away from the places where most people live and work. Studies indicate that the United States can provide carbon-free electricity to major population centers only by adding transmission lines to the grid.

But states and localities have exclusive power to authorize the construction of a transmission line.

Decision-makers in states and localities often ignore the national interest when they decide whether to approve a transmission line. They respond to “not in my backyard”—NIMBY—objections to proposed new transmission lines and refuse to authorize the construction of transmission lines that are critically important to the nation.

As a result, the United States will not be able to substitute carbon-free sources of electricity for fossil fuel sources at anywhere near the rate required to engage in effective mitigation of climate change.

In a recent article, Alexandra B. Klass of the University of Minnesota Law School, and her coauthors Joshua Macey, Shelley Welton, and Hannah Jacobs Wiseman, provide a more detailed explanation and analysis of the problem. Klass and her coauthors argue that the rapid transition to clean energy must come hand-in-hand with increased reliability of the electric grid.

The decisions of the voters of Maine to block hydropower transmission are typical of many decisions of state and local governments all over the country.

Hydropower is a particularly valuable form of carbon-free electricity. Solar and wind are intermittent sources of electricity. Because the U.S. energy infrastructure lacks any economic means of storing electricity, solar and wind must be used in combination with fossil fuels to provide reliable electricity service.

Hydropower, however, can be made available at any time, transmitted and used on a continuous basis, or be used in place of fossil fuels to fill the supply gaps that otherwise would exist if energy providers relied only on solar and wind.

Despite these benefits, Maine voters were not content just to block the construction of the Hydro Quebec line; the ballot measure they approved prohibits the construction of any major transmission line through the state in the future unless it is approved by a two-thirds vote of both houses of the Maine legislature.

If states and localities are allowed to block the construction of transmission lines in this way, the United States has no chance of engaging in effective mitigation of climate change.

We should not, though, blame voters and politicians in Maine and New Hampshire for the United States’ inability to mitigate climate change. These individuals are acting in their interests and in the interests of their states. The U.S. Congress, however, bears responsibility for the regrettable results of state officials’ and voters’ decisions. Congress has long needed to enact a statute that confers jurisdiction on the Federal Energy Regulatory Commission to authorize the construction of transmission lines so that a federal agency can make the decisions based on the interests of the entire nation.

The bipartisan Infrastructure Investment and Jobs Act, which Congress passed last Friday and President Joseph R. Biden is expected to sign into law soon, includes two provisions that might provide an answer to the transmission line problem. Section 40105 would increase the power of the federal government over the siting of some transmission lines. And Section 40106 would provide federal financial support for some interstate transmission lines. This enhanced federal siting authority and financial support is conditioned in several ways, such as on whether a location is designated as a “national interest electric transmission corridor.”

Although these new statutory provisions mark important steps in the right direction, it remains to be seen whether and to what extent these changes in the law will be enough to respond effectively to the problem of inadequate transmission capacity to make carbon-free electricity available to major markets.