ENERGY POLICY:

State regulators can't 'hold up' new transmission -- Reid

The national need for new transmission lines to reach renewable energy must no longer be held up by individual states, Senate Majority Leader Harry Reid said today.

"This is not a couple years ago," the Nevada Democrat told reporters after a national clean energy summit today in Washington. "The problems we have in America today, in the world today, are significant, and we cannot let 231 state regulators hold up progress."

Reid aims to introduce a bill Thursday that would give the Federal Energy Regulatory Commission ultimate siting authority for transmission in renewable energy zones, although the states would have "every opportunity" to work on the projects first.

But any delays or obstacles would be quickly settled, Reid said. "Whatever we pass at the federal level trumps all that," he said.

John Podesta, the head of Obama's transition team and president of the Center for American Progress, said a stronger federal siting authority is needed, given that the 4th U.S. Circuit Court of Appeals ruled that FERC's interpretation of its backstop siting authority under the 2005 energy bill was too expansive. FERC had read the authority to mean that if a state denied a transmission project, that met the definition of the state not acting on it (E&ENews PM, Feb. 18).

"It's time to get back to the table and find a way so that states and regions can plan for the transmission that they need but that the federal government has a role to play to make sure that gets done," Podesta said.

Reid declined to give any further details on the bill, but Chris Miller, a legislative aide, said the bill would contain four main components: an interregional planning component, federal siting authority, a national cost allocation plan and a requirement that any generation that connects to the grid meet "green" standards. The four parts appear very similar to a plan produced by the Energy Future Coalition and the Center for American Progress that was released Friday (E&ENews PM, Feb. 20).

Miller added that the bill would go through the regular legislative process and would be considered first by the Senate Energy and Natural Resources Committee.

Committee Chairman Jeff Bingaman (D-N.M.) said he had not seen the details of Reid's bill but hoped to incorporate the measure into a larger energy bill he aims to release this spring.

He said it was "entirely appropriate" that Reid introduce his own bill. "I generally agree that FERC is going to have more authority to do more planning and siting and cost allocation," Bingaman said after the clean energy event.

But Bingaman added that state regulators "are going to have a big say in how we reallocate authority in this area, and that is something we need to hear them out on."

The energy bill is likely to include a transmission siting component, a "renewable electricity standard" requirement that sets a percentage of electricity that needs to come from renewable sources, efficiency provisions and support for smart-grid upgrades. The committee held a hearing on such a standard two weeks ago and will hold an efficiency hearing tomorrow, and Bingaman said he is planning a hearing on smart-grid technology next week.

Bingman added that an earlier remark by Reid that an energy bill may be released in two weeks was "a little optimistic."

E&E senior reporter Darren Samuelsohn contributed.