Markets Wired

The Federal Trade Commission staff has submitted a comment to the U.S. Federal Energy Regulatory Commission (FERC). The staff comment responds to FERC’s request for comments on its proposal to improve the rules governing how electricity generation facilities connect to the transmission grid. These reforms are designed to allow wholesale power producers to connect to the transmission grid more quickly and cost-effectively.

Connecting to the transmission grid is the only way that most generating facilities can sell their electric power to customers. The goal of the potential reforms is to alleviate concerns that the current rules may be inefficient and may enable transmission owners to delay and raise the costs of entry in wholesale electric power markets.

The FTC staff comment – representing the views of the agency’s Office of the General Counsel, Office of Policy Planning, and Bureau of Economics – supports FERC’s reform proposals. FTC staff believes these proposed reforms will increase competition and benefit electricity customers. 

A number of the specific reforms under consideration by FERC are designed to lower the cost of establishing new connections to the transmission grid. Other potential reforms improve access to grid congestion information that wholesale producers need to plan for potential new generation capacity, in order to assist producers in identifying those places where additional capacity is most needed. Finally, the reforms facilitate prompt and objective resolution of disputes between generation entrants and transmission owners.

The comment notes that FERC’s proposals may give power generation entrants more opportunities to innovate and decrease interconnection costs. 

The Commission vote authorizing the staff comment was 2-0. (FTC File No. V170004; the staff contact is John H. Seesel, Office of the General Counsel, 202-326-2702.)