A new analysis from the Niskanen Center identifies two areas where power companies and their critics could agree on how to speed up construction of high-voltage transmission lines: clearer rules on when utilities can legally work together without violating antitrust law, and a competitive framework for building power lines that cross regional boundaries. The analysis responds to an ongoing fight over whether incumbent utilities should control transmission projects approved through regional planning processes, arguing that the biggest system-wide gains may come from interregional and cross-interconnection lines where there's more openness to competition.
The analysis points to a Grid Strategies report, funded by a group of transmission owners, investors, and public power utilities, which argues that antitrust policies and transmission planning rules limit the information sharing needed for efficient grid investments. That report describes two kinds of collaboration it views as necessary but potentially blocked by antitrust concerns: utility joint ventures to build specific transmission projects, and coordination among competitors on which projects should advance. According to Mark Niefer, a former deputy chief legal adviser in the Justice Department's Antitrust Division who now teaches at George Mason Law School, project-specific joint ventures can "facilitate the construction of additional or lower-cost transmission capacity, thereby inducing greater competition among generators" when paired with appropriate safeguards. However, Niefer describes coordination among competitors over which projects get built as "the greatest risk to competition" because it raises concerns about output restrictions.
The Niskanen Center has asked the Justice Department to formally confirm that nonexclusive transmission joint ventures are generally procompetitive and don't violate antitrust principles, according to the analysis. Meanwhile, the analysis finds that evidence suggests interregional and cross-interconnection transmission projects can most efficiently deliver the greatest gains for affordability and reliability. Even the 2024 Grid Strategies report, which called for giving incumbent utilities first rights to regionally approved projects, stated that "in areas with no or little existing transmission, such as offshore networks and interregional lines, there is likely to be a greater role for independent developers and transmission competition." Similarly, in a 2021 filing with the Federal Energy Regulatory Commission, Exelon Corporation suggested that competitive processes may make sense for high-capacity, high-voltage interregional greenfield projects.
The analysis explains that the current debate over incumbent utility rights focuses on projects selected by regional transmission plans, but overlooks where the largest system-wide benefits may lie. While many traditional advocates of giving incumbents first rights for regional transmission projects appear more willing to accept competition for interregional and cross-interconnection transmission, no formal framework exists for planning these projects. That creates an opportunity for FERC to launch a rulemaking on interregional planning that would address cost allocation for multiregion projects, reduce regulatory barriers to high-voltage direct current development, and improve coordination across regions with and without regional transmission organizations. The bottom line: there's potential agreement on two fronts that could accelerate the high-capacity grid buildout the country needs, even as the broader fight over utility control continues.