WASHINGTON — Federal energy regulators on Monday approved a long-awaited rule to make it easier to transport renewable energy, such as wind and solar, to the grid — a key part of President Joe Biden’s goal to cut carbon emissions across the economy to be eliminated by 2050.
The rule, which has been in development for two years, is aimed at boosting the country’s aging power grid to meet rising demand fueled by massive data centers, electrification of vehicles and buildings, artificial intelligence and other applications.
The increased demand comes as coal-fired power plants are increasingly retired amid competition from natural gas, and other energy sources face increasingly strict federal pollution regulations, potentially creating a crisis for electric reliability, experts say.
The electricity grid is also being tested by more frequent service disruptions during extreme weather events due to climate change.
The Federal Energy Regulatory Commission approved the new rule on a 2-1 vote, with Chairman Willie Phillips and fellow Democratic Commissioner Allison Clements voting in favor. Republican Mark Christie opposed the rule, dismissing it as a gift to solar and wind energy operators.
The sprawling 1,300-page rule, which covers transmission planning and cost allocation, will strengthen the nation’s aging power grid and ensure American homes and businesses can keep the lights on for decades to come, Phillips said.
“This rule can’t come soon enough,” he said during a packed committee meeting at the agency’s headquarters in Washington. ‘Our network can’t wait.’
The U.S. power grid “is at a make-or-break moment” and is being tested every day, Phillips said, citing “phenomenal load growth driven by a boom in domestic manufacturing, unprecedented data center construction that fueling an AI revolution and increasingly expanding the electrification” of vehicles and buildings.
At the same time, aging infrastructure, a changing economy and a range of state and federal policies are forcing traditional resources into retirement, he said. “Additionally, extreme weather events have become the norm and the power grid is routinely pushed to the brink.”
At the same time, power line construction fell to a record low in 2022, “and much of that construction was simple band-aid repairs, rather than building a visionary power grid for the future,” Phillips said.
Many energy companies and Republican-led states don’t want to spend money on new transmission lines or renewable energy upgrades, creating conflict with Democratic states that have ambitious clean energy goals.
Christie, the only Republican on the three-member panel, said the rule “completely fails to protect consumers” and ensure reliable, low-priced power for American homes and businesses.
“Instead, this rule is a pretext to enact a sweeping policy agenda that Congress never adopted,” he said. The rule will likely result in “a massive transfer of wealth from consumers to for-profit special interest groups,” mainly wind and solar operators, he said.
The rule is intended to streamline the location of power lines and the distribution of costs among states. It could accelerate the construction of new transmission lines for wind, solar and other renewable energy and add vast amounts of clean energy to the grid. Biden has set goals of a carbon-free energy sector by 2035, and net-zero carbon emissions across the economy by 2050.
To achieve these goals, the U.S. must more than double current regional transmission capacity and increase transmission lines between regions fivefold, according to an Energy Department study last year.
Under current rules, a large bank of utility-scale renewables cannot be connected to the grid due to a lack of available transmission capacity. The rule updates the agency’s planning process and seeks to determine how costs will be shared when transmission crosses state lines and passes through multiple regional power grid operators.
White House climate adviser Ali Zaidi said the FERC rule adds momentum to what he called “historic progress” under Biden’s leadership on clean energy. The new rule “will improve regional transmission planning, remove barriers to grid deployment and support the delivery of more affordable and reliable power,” Zaidi said.
The new rule “is as common sense as it is historic,” Clements said, adding that it calls for more advanced planning and consideration of the reliability and affordability of new energy sources and promotes cooperation with states.
“Whether you’re planning a family vacation or planning the nation’s electricity system, planning early, taking a clear-eyed look at options and making smart investment decisions will result in more affordable and reliable outcomes,” she said.
Christie has challenged the agency’s action.
Whether the policies promoted in the final rule “can be described as green, purple, red or blue is irrelevant,” Christie said. “The point is that FERC, as an independent agency, has no business promoting the policies of any party or presidential administration, especially when the effort to do so goes far beyond FERC’s statutory authority.”
Clements responded by calling the “right down the middle” rule a legal issue.
Democrats and clean energy advocates hailed the new rule as a way to bring clean and cost-effective electricity to the grid.
“Building more multi-state transmission lines unclogs America’s electricity highways and unlocks our ability to keep pace with our growing energy needs,” said Heather O’Neill, president and CEO of Advanced Energy United, which provides renewable energy providers represents.
Senate Majority Leader Chuck Schumer, D-N.Y., said the rule will build on clean energy incentives in the landmark climate bill passed by Democrats in 2022.
The law, known as the Inflation Reduction Act, has been “a tremendous success,” Schumer said Monday, “but much of that success would be lost without the ability to bring power from places that generate renewable energy to communities across the country . .” FERC’s actions “will mean more cheap, reliable clean energy to the places that need it most,” he said.