How will the Senate's new direction on energy affect the future of renewables and transmission policy? During today's OnPoint, Sue Sheridan, president and chief counsel at the Coalition for Fair Transmission Policy, gives her take on Senate leadership's decision to move a small energy package this summer. She explains what the lack of a renewable electricity standard will mean for transmission issues, as well as renewable energy investments.
Monica Trauzzi: Welcome to the show. I'm Monica Trauzzi. Joining me today is Sue Sheridan, president and chief counsel at the Coalition for Fair Transmission Policy. Sue, thanks for coming on the show.
Sue Sheridan: Thanks for having me, Monica.
Monica Trauzzi: Sue, the Senate is now expected to bring a limited energy and oil package to the floor ahead of the August recess. It won't include a cap on admissions or a renewable electricity standard. What is the impact of such a move on the broader energy debate and the future of U.S. energy policy?
Sue Sheridan: Well, I think, Monica, there's a history of Congress looking at as broad a possible swath of energy issues and environmental issues as it can try to package when it begins debates in consideration of future action. And there's also a history of trying to winnow down to what can be done in a certain amount of time. The Senate is obviously looking at a limited amount of time before the August recess and it seems as if it's decided that an oil spill bill is a great priority and that it's going to do that, plus whatever pieces are ready to go now and then keep working over the recess on other issues that aren't ripe for consideration.
Monica Trauzzi: But a lack of renewable electricity standards is a pretty big deal.
Sue Sheridan: Renewable electricity standard is a big one, of course. I know that it's not something that my coalition has taken a position on. It really depends on different regions, different mixes of generation and whether or not a particular state or region has a renewable standard in place. But I know that there are many who think that there are trade-offs in terms of political support and policy between climate change proposals and support for any interaction with an RES.
Monica Trauzzi: On transmission, talk a bit about how the coalition fits into the policy discussion.
Sue Sheridan: Well, our coalition is a diverse group of 12 electric utilities. We represent about 30% of the electricity market in the U.S. and we're formed for two purposes. One, to make sure that if Congress adopts a new transmission policy it honors and supports and builds on existing successful regional and local and state transmission planning processes. And then, second, and these go hand-in-hand, that any new transmission or improvement on transmission is based on the theory that the beneficiary pays the cost of the expanded transmission.
Monica Trauzzi: The Senate may look to take on something more comprehensive later in the year on energy. In terms of transmission, what are the key issues your organization has with the legislation that we've seen proposed up until this point?
Sue Sheridan: Well, our coalition is very supportive of Senator Corker's amendment that was embodied and included in the bill that the Senate Energy Committee reported last summer as 1462, because it honors those two main principles I mentioned a minute ago to support existing transparent, cooperative regional solutions on planning and also makes sure that the beneficiary pays so that the cost of new transmission is borne by consumers who receive a benefit and not by consumers who don't. And also so that we develop the least cost renewable energy sources to serve the consumer, whether they be at a great distance requiring new transmission of a substantial and long-term coverage or something smaller and closer to home.
Monica Trauzzi: So, should transmission planning continue to be initiated at the local and regional level based on the needs of those customers or does it need to be looked at holistically on a national scale?
Sue Sheridan: We feel that the existing processes underway are working well. The Department of Energy is supporting, through Stimulus Act money, big efforts in both the east and west to build on collaborative regional processes and our coalition is very supportive of those continuing.
Monica Trauzzi: How does FERC play into all of this?
Sue Sheridan: Well, FERC, of course, has had authority over transmission costs for years, since the Power Act was adopted, and it, as you know, has a notice of proposed rulemaking it initiated that is receiving public comment for another month or so. And our coalition members are looking closely again to make sure that that rule honors local and regional transmission processes that are underway, which we feel are successful. That any interconnection issues between different regions of the country are done on a collaborative, voluntary process without substituting a one-size-fits-all, top-down policy from the federal government. And then, thirdly, again, that the beneficiary pays so that consumers who benefit from new transmission policy, new transmission lines, pay for the cost of new transmission and those who don't, don't have to carry those costs.
Monica Trauzzi: But eventually won't all consumers benefit from new transmission lines?
Sue Sheridan: It depends on where the lines are. Again, renewable resources may be available close to home just offshore. If you're perhaps on the East Coast you'll see that the belief reflected in a letter recently delivered to Senate leadership by 11 Northeastern and mid-Atlantic Coast governors. You'll see that in statements by the National Association of State Utility Consumer Advocates and by the National Association of State Utility Consumer Advocates and by the National Association of Regulatory Utility Commissioners, which represent state utility commissioners. And I think each of those three sources of concern about consumers reflects the concerned that we don't subsidize distant renewables in a way that would tilt the table against perhaps just as beneficial and perhaps even cheaper local renewables.
Monica Trauzzi: All right, we'll end it there. Thank you for coming on the show.
Sue Sheridan: Thank you so much, Monica.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
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