[Federal Register: July 22, 2004 (Volume 69, Number 140)]
[Notices]
[Page 43833-43834]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22jy04-46]
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DEPARTMENT OF ENERGY
Designation of National Interest Electric Transmission
Bottlenecks (NIETB)
AGENCY: Office of Electric Transmission and Distribution, Department of
Energy.
ACTION: Notice of inquiry and opportunity to comment.
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SUMMARY: The Department of Energy (DOE) seeks comments on issues
relating to the identification, designation and possible mitigation of
National Interest Electric Transmission Bottlenecks (NIETB). This
inquiry is DOE's initial step in seeking to identify and designate
NIETBs. By publicly identifying and designating NIETBs, DOE will help
mitigate transmission bottlenecks that are a significant barrier to the
efficient operation of regional electricity markets, threaten the safe
and reliable operation of the electric system, and/or impair national
security. DOE seeks comments on the questions posed below and welcomes
other pertinent comments or proposals.
DATES: Written comments are to be filed electronically by e-mailing to:
bottleneck.comments@hq.doe.gov no later than 5 p.m. e.d.t. September
20, 2004. Comments can be filed at the address listed below.
ADDRESSES: Office of Electric Transmission and Distribution, TD-1,
Attention: Transmission Bottleneck Comments, U.S. Department of Energy,
Forrestal Building, Room 6H050, 1000 Independence Avenue, SW.,
Washington, DC 20585.
Note that U.S. Postal Service mail sent to DOE continues to be
delayed by several weeks due to security screening. Electronic
submission is therefore encouraged.
FOR FURTHER INFORMATION CONTACT: Mr. David Meyer, Office of Electric
Transmission and Distribution, TD-1, U.S. Department of Energy, 1000
Independence Avenue, SW., Washington, DC 20585, (202) 586-1411,
david.meyer@hq.doe.gov, or Lot Cooke, Office of General Counsel, GC-76,
1000 Independence Avenue, SW., Washington, DC 20585, (202) 586-0503,
lot.cooke@hq.doe.gov.
SUPPLEMENTARY INFORMATION: The Nation's electric system includes over
150,000 miles of interconnected high-voltage transmission lines that
link generators to load centers. The electric system has been built by
electric utilities over a period of 100 years, primarily to serve local
customers. Until recent years, electricity trade among electric
utilities was modest. With the advent of wholesale electricity markets,
trade has increased exponentially, and utilities now shop for the
lowest cost power from suppliers reachable through the transmission
network. The increase in regional electricity trade saves electricity
consumers billions of dollars, but it places significant additional
loads on the transmission facilities over which this trade is
conducted. Steady growth in demand for electricity also has contributed
to the growth in demand for transmission service.
While transmission service has become more important economically
and operationally, investment in new transmission facilities has not
kept pace. Over the past 25 years, investment in new transmission
facilities has significantly declined. Today, bottlenecks in the
transmission system impede economically efficient electricity
transactions and potentially threaten the safe and reliable operation
of the transmission system. DOE estimates that these bottlenecks cost
consumers several billions of dollars per year by forcing wholesale
electricity purchasers to buy from higher-cost suppliers. This estimate
does not include the reliability costs associated with such
bottlenecks.
The National Energy Policy (May 2001), the Department's National
Transmission Grid Study (May 2002), and the Transmission Grid Solutions
Report (September 2002) issued by the Secretary's Electricity Advisory
Board, recommend that the Department initiate a process to determine
how to identify and designate transmission bottlenecks of national
interest, as a first step toward mitigation of them.
Specifically, the Grid Study states:
Transmission bottlenecks affect national interests by increasing
the cost of electricity to consumers and the risk of transmission
system reliability problems in various regions throughout the United
States. Relieving transmission bottlenecks is a regional issue. DOE
will work in partnership with FERC, States, regions, and local
communities to designate significant bottlenecks and take actions to
ensure that they are addressed.
The report of the Electricity Advisory Board states:
We would urge the Secretary to develop the criteria and process
for determining which existing bottlenecks should qualify for
special status as ``National Interest Transmission Bottlenecks''
because the bottlenecks affect the reliability and security of the
nation's electric grid. The DOE must work with State, regional and
local government officials to encourage proposals from industry
participants and to monitor progress toward elimination of
designated bottlenecks.
The Electricity Advisory Board goes on to recommend that to be
designated
[[Page 43834]]
a National Interest Transmission Bottleneck the bottleneck must meet
one of three criteria:
1. The bottleneck jeopardizes national security;
2. The bottleneck creates a risk of widespread grid reliability
problems or the likelihood that major customer load centers will be
without adequate electricity supplies; or
3. The bottleneck creates the risk of significant consumer cost
increases in electricity markets that could have serious consequences
on the national or a broad regional economy or risks significant
consumer cost increases over an area or region.
We note that Title XII of H.R.6, as reported by a joint U.S.
Senate-House of Representatives Conference Committee, as well as Title
XII of S. 2095, the comprehensive energy legislation now before the
U.S. Congress, contain provisions that would require the Secretary of
Energy, within one year after enactment into law, and every three years
thereafter, to designate ``National Interest Transmission Corridors.''
The legislation would also give certain Federal ``backstop'' siting
authority to the Federal Energy Regulatory Commission for facilities to
be located within DOE-designated National Interest Transmission
Corridors.
This Notice of Inquiry does not ask for comment on any of the
National Interest Transmission Corridor and related provisions of
pending energy legislation. Should those provisions be enacted into
law, the Department will issue such notices and take other actions as
may be authorized or directed by those provisions.
The Department has completed some preliminary scoping studies to
support DOE identification of NIETBs. These include a survey of
existing models and tools that could support bottleneck assessment by
DOE and a survey of bottlenecks reported by regional transmission
operators or independent system operators. These studies are available
at: http://www.electricity.doe.gov/bottlenecks.
Additionally, DOE organized a workshop on July 14, 2004, in Salt
Lake City, Utah, immediately following the National Association of
Regulatory Utility Commissioners (NARUC) Summer Meeting. The purpose of
this workshop was to learn from stakeholders what they believe to be
the major issues associated with the designation of NIETBs, and how
they believe the process should be designed to maximize its benefits to
the users of the grid and to electricity consumers. For proceedings
from the workshop, please go to http://www.electricity.doe.gov/bottlenecks
.
To assist DOE in developing a procedure for identifying,
designating, and addressing NIETBs, we request comments on the three
criteria for designation described above, and the following questions:
1. Are the Electricity Advisory Board's recommended criteria for
designation of National Interest Electric Transmission Bottlenecks
appropriate and sufficient? If not, what should they be? For example,
should DOE also consider disaster recovery, economic development, and
the enhancement of the ability to deal with market and system
contingencies in designating NIETBs?
2. What should be the role of transmission grid operators,
utilities, other market participants, regional entities, States,
Federal agencies, Native American tribes and others in the process of
identifying, designating, and addressing NIETBs? For example, should a
NIETB be designated only if some entity applies to DOE for designation?
Should DOE accept applications only from entities from regions that
have an extant regional transmission (or resource) plan? Should DOE be
able to designate a NIETB even if no entity asks DOE to do so?
3. How might DOE identify bottlenecks in regions where much
pertinent data are not available, in contrast to regions where
transmission expansion plans have been developed and made public?
4. What actions should DOE undertake to facilitate and monitor
progress towards mitigation of designated NIETBs?
In addition to the above, commenters are encouraged to discuss,
comment on, and make suggestions on other transmission bottleneck
issues that may be relevant to the development of procedures to
designate and address NIETBs. To the greatest extent consistent with
law, comments submitted pursuant to this Notice of Inquiry will be
deemed public and will not be treated as confidential.
Issued in Washington, DC, on July 16, 2004.
James W. Glotfelty,
Director, Office of Electric Transmission and Distribution.
[FR Doc. 04-16724 Filed 7-21-04; 8:45 am]
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