Power & Pipes

FERC, CFTC, and State Energy Law Developments

US congressional Democrats released the latest version of H.R. 5376—better known as the Build Back Better Act—late last week, hoping to advance a $1.85 trillion spending package after months of deadlock.

The release of the 1,684-page bill coincided with the White House’s announcement of an updated framework for President Joe Biden’s infrastructure plan, developed after extensive negotiations with congressional Democratic leadership and other members of US Congress.

High-Voltage Electric Transmission Investment

The revised bill provides a number of key provisions to accelerate high-voltage electric transmission investment:

  • $1.5 billion in US Department of Energy (DOE) grants and direct loans to incentivize the construction of high-capacity transmission investments, including interties between key interconnections, to accommodate the continued integration of renewable energy onto the electric grid. Eligible new transmission lines would need to have a transfer capacity of not less than 1,000 MW, while upgrades to existing facilities would only be eligible if they increased transmitting capacity by at least 500 MW and facilitated electric transmission across interties, from an offshore wind facility, or on a corridor determined by DOE to be necessary for transmission needs.
  • $800 million in DOE grants available for siting authorities, including state, local, and Tribal governmental entities, for studying and analyzing proposed transmission projects.
  • $100 million appropriated to DOE to perform transmission planning, modeling, and analyses regarding the development of interregional and offshore wind transmission projects and to convene stakeholders to address the development of such transmission projects.
  • $125 million for DOE and $75 million to the Federal Energy Regulatory Commission to support “more efficient, accurate, and timely reviews for planning, permitting, and approval” of energy projects.
  • Transmission investment tax credit of up to 6% on the basis of qualifying electric transmission facilities, which includes 275 kV+ lines with a transmission of capacity of 500 MW and related property. The investment tax credit is subject to a bonus—up to five times or a total of 30%—for projects that meet certain wage and labor requirements during and after the project’s construction.

Negotiations are likely to continue on this latest version of H.R. 5376. We are continuing to monitor for further developments and will update our readers as new information becomes available.