A coalition of nine utilities is pushing federal regulators to eliminate competitive bidding for transmission projects in the Midwest and Plains, claiming it would speed up grid development by 16 to 20 months per project. But a new analysis from the Niskanen Center warns that the proposal would create a de facto monopoly while doing little to actually accelerate the buildout of America's power grid. The report argues that the utilities' complaint to the Federal Energy Regulatory Commission (FERC) misidentifies the real bottlenecks slowing transmission development and ignores evidence that competition actually improves outcomes.
The utility coalition, calling itself the Grid Acceleration Coalition (GAC), claims competitive bidding adds unnecessary delays to transmission projects. However, the Niskanen Center's analysis points to data from R Street suggesting that competitively bid projects are generally completed faster than incumbent-built projects, despite going through solicitation processes. The utilities previously enjoyed a federal right of first refusal (ROFR) that limited competition in transmission development until FERC largely eliminated those protections in 2011. Since then, utilities have channeled significant investment into project categories exempt from competition while lobbying Midwestern and Plains states to restore ROFR privileges.
According to the report, the utility complaint "offers no evidence that competitive projects actually take longer to complete" and fails to account for key benefits of the competitive process. The analysis notes that independent transmission developers "often contribute technical input, alternative designs, and regional planning expertise at their own expense before project awards are granted precisely because they have a credible opportunity to compete." The report characterizes the utilities' argument as "the familiar regulated-utility position that competition is bad for consumers, despite ample evidence to the contrary," with the reality being "that incumbents want to control all transmission development, and receive a nearly guaranteed rate of return on their investments."
The report identifies federal permitting reform as the genuine path to faster grid development. While natural gas pipelines enjoy federal siting authority to streamline approvals, transmission lines must secure permits from every state and county they cross, creating multiple veto points and delays far more significant than competitive bidding processes. The Niskanen Center recommends deploying grid-enhancing technologies and advanced reconductoring to unlock additional capacity much faster than new construction, coupled with meaningful interregional transmission development that utilities have historically resisted. Congressional action on permitting bottlenecks, not eliminating competition, offers the clearest route to getting power where it's needed.