The Federal Energy Regulatory Commission has created a task force to examine how the agency can support grid-enhancing technologies, potentially through incentives, Chairman Laura Swett announced Wednesday during a Senate oversight hearing. These technologies — which include dynamic line ratings, advanced power flow controllers and high-performance conductors — are already being adopted by some utilities, and their cost-saving data is now accessible, Swett told the Senate Energy and Natural Resources Committee. The agency is exploring how to encourage wider deployment of these tools, which can boost grid capacity without expensive new infrastructure.
While federal law prevents FERC from requiring utilities to use grid-enhancing technologies, the agency can direct transmission owners to analyze them, which can reveal the most economical option when considering new transmission projects, according to Swett. Commissioner Judy Chang said FERC could weave these technologies into its process for awarding incentives to transmission owners and developers, asking companies seeking incentives to explain what technologies they're using, what alternatives they've evaluated and why they aren't deploying the best available options. Sen. Angus King of Maine pointed out that although FERC can't mandate specific technology, the agency must approve rates that are "just and reasonable," giving it authority to scrutinize transmission owners who take actions that don't make economic sense and burden ratepayers.
King noted that transmission owners currently have an incentive to invest as heavily as possible in their infrastructure — potentially "gold plating" it — to maximize their returns, which discourages investment in cheaper grid-enhancing technologies. On the governance front, Swett described PJM Interconnection as the largest and oldest electricity market in the U.S., but said it's "probably performing the worst," speaking the day before FERC was scheduled to hold a technical conference on potential reforms to the grid operator's governance. She expressed optimism that stakeholders would align on needed market changes, defining success as a PJM that can propose solutions quickly with clear member support and file strong proposals at FERC for expedited action.
The push for transmission competition hasn't fully materialized 15 years after FERC's Order 1000, committee chair Sen. Mike Lee said, though Commissioner Chang noted some regions are just beginning to see efficiencies and cost savings from competitive processes. King emphasized the need to explore shared savings or other incentives for companies to make smart investments, warning that grid enhancement costs will climb dramatically over the next several years and become overwhelming within five to 10 years without smart planning. Swett said the agency's June "show cause" orders to major grid operators on integrating data centers and other large loads represent aggressive instruction to push the grid forward, forcing utilities and markets to innovate when most don't want to change. Those orders require fast action on modernizing transmission services and interconnection study processes, compelling operators to consider advanced transmission technologies in their studies and examine load that may appear near generation, which will reduce the transmission build needed to bring load online.