Chris Underwood

Chris Underwood
Project Manager
Email Chris
P: 816-822-4313
F: 816-822-3027

Industry Impacts of FERC Order 1000

Industry Impacts of FERC Order 1000

Background

The Federal Energy Regulatory Commission (FERC) introduced Order 1000 in July 2011 and affirmed it in May 2012 with Order 1000-A. Order 1000 is a landmark ruling that aims to increase competition in the electric transmission industry. The three key areas of focus include cost allocation, transmission planning and the removal of the federal right of first refusal (ROFR).

  • Cost allocation — Who pays?
    Part of Order 1000 mandates coordination and collaboration on allocation of costs between regions on large-scale, interregional transmission projects. Finding equitable and economical cost allocation solutions has never been more challenging — or more important.
  • Planning process
    Order 1000 requires all transmission providers to participate in a regional transmission planning process. In addition, it requires all regional planning processes to accommodate an interregional planning process when addressing large, multiregional transmission projects.
  • Removal of ROFR
    Order 1000 removes the federal ROFR for transmission projects that are identified in a regional plan for the purposes of cost allocation. As a result, many transmission projects that have traditionally been assigned based upon geographic location and service territory may now be open to competition. Incumbent utilities will no longer maintain the federal right of first refusal to build, own and operate large-scale transmission projects that are located within their service territory. The ROFR removal has the potential to significantly change the way large transmission projects are identified and awarded.

Key Dates

July 21, 2011 - FERC issues final rule, Order 1000

Oct. 11, 2012 - Local and regional compliance filings deadline

April 11, 2013 - Interregional compliance filings deadline

Aug. 15, 2014 - Washington, D.C., Court of Appeals upholds FERC Order 1000 and denies petitions for review of the final rule

Moving Forward

Each planning region has its own set of unique challenges; however, one constant across North America is that the landscape is changing. Burns & McDonnell is actively monitoring developments across North America and developing strategies for competing and succeeding in the new paradigm. We have years of proven experience in competitive business constructs and can help you succeed in the wake of Order 1000.

 

Click here to request a whitepaper on current FERC Order 1000 developments.