America has not been building the kind of transmission lines it needs to reliably and cost-effectively power our grid, and a major part of the problem has been our short-term, just-in-time planning process.

On May 13, the Federal Energy Regulatory Commission (FERC) released Order No. 1920, meant to modernize the transmission planning process by viewing the system through a wider lens to plan for and construct the transmission system we need for the future. This Order will require transmission providers, including RTOs/ISOs and utilities outside of RTO regions, to take a long-term, regional approach when planning for future transmission needs and determining how the costs will be allocated to different customers.

The Order recognizes that the transmission system has not been planned holistically but has instead been built through a piecemeal approach focused on smaller local projects and not larger regional and interregional facilities. This piecemeal approach results in higher costs for consumers in exchange for fewer reliability benefits.

On November 24, 2024, FERC released Order No. 1920-A to expand the role of states in the long-term transmission planning process established by Order No. 1920. In combination, the Orders are meant to help alleviate the piecemeal transmission planning approach providers have used historically. Order No. 1920-A will require transmission providers to work closely with states as they look at larger regional projects that can help transition the grid into a more efficient and cost-effective transmission superhighway.

FERC Order No. 2222: Integrating Distributed Energy Resources into RTO/ISO Markets

On September 17, 2020, FERC issued a landmark order directing RTOs/ISOs to open their electricity markets to participation by aggregated distributed energy resources (DERs). DER adoption has been skyrocketing across the United States, driven by consumer demand solar, energy storage, demand response, energy efficient appliances and equipment, and electric vehicles. To date, legacy market rules have left these technologies with limited opportunities to provide energy, capacity, or ancillary services in wholesale power markets operated by RTOs/ISO.

FERC’s Order No. 2222 requires RTOs/ISOs to remove market barriers preventing DERs from fully participating in the RTO/ISO electricity markets that serve two-thirds of consumers in the country. FERC has now issued orders on all RTO/ISO compliance plans, and regions are at different stages of implementation. Many states have started to take action to facilitate aggregated DER participation in wholesale markets as Order 2222 takes effect.