Transmission Siting in Deregulated Wholesale Power Markets: Re-Imagining the Role of Courts in Resolving Federal-State Siting Impasses

Abstract

During most of the twentieth century, state and local regulatory bodies coordinated the siting or power plants and transmission lines. These bodies focused on two important issues: 1) the determination of need, so as to avoid unnecessary economic duplication of costly infrastructure; and 2) environmental protection, so as to provide local land use and other environmental concerns input on the placement of necessary generation and transmission facilities. With the rise of a deregulated wholesale power market, the issue of need is increasingly determined by the market, not regulators. Environmental concerns with siting, however, frequently remain contested - especially locally - but the regulatory apparatus for processing these concerns faces new challenges in deregulated markets. As this Essay suggests, environmental concerns in transmission line siting will increasingly be addressed at the federal level, with federal concerns predominating consideration of the issues. The dormant commerce clause does much of the work towards making this a predominantly federal concern, but eventually FERC's jurisdiction over such matters will need to be expanded by statute.

Even if Congress does not expand FERC's jurisdiction, this Essay argues that courts can play a positive role to facilitate the resolution of state-federal siting conflicts. A recent siting dispute involving a power line in the Long Island Sound illustrates this fundamental shift in the environmental discourse of siting proceedings, as a well as a need for modifications to federal law regarding transmission siting.

Ultimately, FERC may need authority to preempt state siting laws, but absent congressional action courts could enhance competition in electric power markers by empowering state and local siting boards to take into account federal goals in competitive markets in making siting decisions.

Keywords: Electric power, deregulation, federalism.