Siding with Maine’s ratepayer advocate, the Federal Energy Regulatory Commission recently issued an order requiring transmission owners in New England to answer questions about their asset condition planning procedures as part of an annual formula rate review.
As part of its review of the New England transmission owners' formula rate filing, the Maine ratepayer advocate asked several questions related to the process by which the transmission owners planned for asset condition projects, such as replacement or reconstruction of existing lines.
The transmission owners argued that such questions were outside the scope of the rate review process.
FERC found that a utility's management processes for investment decisions are relevant to whether its investments are prudent, and therefore such questions were permissible when reviewing rates.
Commissioner Judy Chang wrote a concurrence emphasizing stakeholders' fundamental right to transmission planning and investment information.
She urged all transmission owners to proactively share information on transmission projects and planning with stakeholders, citing existing processes in California and New England.
FERC's transmission planning rules generally apply to regional and local transmission projects, but not to asset condition projects that replace or reconstruct existing lines.
Yet in recent years, these asset condition projects have made up a significant share of transmission investment, driving up cost.
The order ensures that transmission customers can obtain relevant information to determine whether those costs are prudent.
