Western Governors Oppose Unilateral FERC Reliability Power

Several western governors are making clear their opposition to proposals that would give FERC unfettered authority to set and enforce electric reliability standards. The governors, in a Sept. 6 letter to Sens. Jeff Bingaman (D-NM) and Frank Murkowski (R-AK), argued that the Commission does not have the expertise, resources or local knowledge to successfully execute such duties.

From the governors' vantage point, ensuring that citizens have access to reliable and affordable energy will require coordinated and consistent action by states and the Federal Energy Regulatory Commission within the geographic boundaries of the market. "It does not require federal preemption of state authority over transmission siting and does not require unilateral FERC authority to set and enforce reliability standards in the West," the governors wrote.

"We must build on the principle that decisions are best made at the smallest appropriate multistate area, provided that such decisions do not affect other parties," the letter continued. In the case of electricity, this means the maximum geographic reach of any advisory or decision making body should be the electrically distinct western interconnection, the governors said.

Moreover, any backstop role for FERC or the Department of Energy (DOE) must be framed in such a way that those agencies are obligated to adopt and implement the recommendations of a regional body of states. "We oppose any schemes to empower FERC or DOE and relegate states to an advisory role to those distant federal agencies."

The governors pointed out to Bingaman and Murkowski that the West has a "sterling record" when it comes to transmission line siting. Among other things, they said that no state within the western interconnection has ever denied a permit for an interstate transmission line.

The governors said that Congress should require FERC to defer to standards adopted in the West and to the advice received from the states that represent the entire electrical interconnection.

Meanwhile, Bingaman, who chairs the Senate Energy and Natural Resources Committee, last Thursday issued a section-by-section summary of provisions that will be included in what's known as a "chairman's mark" for energy legislation. The chairman's mark is the committee chairman's version, or first cut, at a bill.

The electricity portion of the chairman's mark summary, among other things, clarifies that FERC has jurisdiction over the transmission component of retail electric sales and may order transmitting utilities to join regional transmission organizations (RTOs). It also extends FERC transmission jurisdiction to include municipal, cooperative and federal utilities.

Mark up resumes this Thursday, said Committee Spokesman Bill Wicker. "We have said that we will return to mark up on ... Thursday and that first thing out of the box is going to be electricity."

As for hearings, Wicker said that the Senate committee will hold a joint hearing with the Indian Affairs Committee this Wednesday. The committees will take testimony on legislative proposals related to energy resources on tribal lands and Alaskan native lands, including testimony related to the generation and transmission of electricity.

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