Grid Governance: The Role of a National Network Coordinator
54 Pages Posted: 25 Oct 2017
Date Written: 2014
Mounting concerns over the security and reliability of the grid have prompted many to question the grid’s state-centered regulatory framework. Today, the federal government regulates interstate transmission, while the states exercise exclusive authority over intrastate distribution, generation, and transmission siting. In an interconnected system, however, each state’s energy policies and infrastructure investments inevitably affect operations and costs throughout the entire network. The ongoing physical, financial, and technological integration of the interstate electric power network portends a growing federal role in coordinating intrastate infrastructure policy.
This Article conceptualizes the federal role in grid governance as that of a “National Network Coordinator.” The Article illustrates the coordination model with respect to federal policies establishing national transmission reliability standards and siting interstate transmission lines. The coordination model rationalizes an expansion of federal authority, but also provides a principle to limit that expansion. Federal authority need not preclude state regulation that supplements or enhances the federal standards. If federal authority is used to coordinate — rather than replace — state regulation, much of the value of state autonomy is preserved.
Keywords: Energy, Electricity, Federalism, Electric Power, Power Grid
JEL Classification: K32, K23
Suggested Citation: Suggested Citation