On April 11, 2025, FERC issued Order No. 1920-B, which clarified and maintained key requirements from Order No. 1920-A regarding long-term transmission planning and cost allocation. FERC clarified that transmission providers are not obligated to plan for the long-term needs of unenrolled non-jurisdictional transmission providers, but voluntary arrangements are allowed. The order also upheld the requirement for transmission providers to include Relevant State Entities’ agreed-upon cost allocation methods in their compliance filings. Additionally, FERC sustained the consultation requirement with Relevant State Entities before amending cost allocation methods. Lastly, FERC declined to expand the definition of “Relevant State Entity” and rejected certain rehearing requests as procedurally barred. Overall, FERC explained that Order No. 1920-B reinforces the importance of long-term, forward-looking, and comprehensive transmission planning and cost allocation processes to meet the demands of the modern transmission grid. The order was approved by four Commissioners, with Commissioner See not participating.
Order No. 1920, issued on May 13, 2024 (see May 13, 2024, edition of the WER), and Order No. 1920-A, issued on November 21, 2024 (see December 16, 2024, edition of the WER), revised FERC’s policies on long-term transmission planning processes and cost allocation, and set new standards for increased stakeholder involvement in determining transmission needs. Of note, Order No. 1920-A revised Order No. 1920 to expand states’ involvement in developing 20-year transmission plans. Seven petitioners sought further rehearing and clarification of Order No. 1920-A.
Several petitioners sought clarification on whether Order No. 1920-A modified the requirements of Order No. 1000 regarding planning for unenrolled non-jurisdictional transmission providers. FERC clarified that, consistent with Order No. 1000, transmission providers are not required to plan for these transmission providers’ long-term needs, but that voluntary arrangements for regional transmission planning and cost allocation are permissible. FERC emphasized that proposals to include unenrolled non-jurisdictional transmission providers must demonstrate that the proposal will not result in free ridership – which would violate FERC’s cost causation principles – and must otherwise show the proposal complies with Order No. 1000, Order No. 1920, and the FPA.
Several petitioners also argued that Order No. 1920-A infringed on transmission providers’ FPA section 205 filings rights by requiring transmission providers to include in their compliance filings cost allocation methods and processes that have been developed and agreed upon by Relevant State Entities. The petitioners explained that section 205 provides public utilities with unilateral and exclusive filing rights to propose rates, terms, and conditions of service. FERC disagreed, explaining these compliance filings help build the evidentiary record for determining just and reasonable rates under FPA section 206. FERC also noted that even if it decides to adopt Relevant State Entities’ cost allocation methods and processes, transmission providers can still file under section 205 to implement their preferred cost allocation methods.
Order No. 1920-A required transmission providers to consult with Relevant State Entities before amending cost allocation methods or processes. Several petitioners argued that this requirement infringed on their section 205 filing rights by conditioning the exercise of those rights on consultation with Relevant State Entities before filing a proposed tariff amendment. FERC disagreed, stating that transmission providers retain full discretion over filing tariff changes and noting that the requirement may improve Relevant State Entities’ confidence in the long-term regional transmission planning processes, thus minimizing delays, disputes, and costs associated with those processes.
One petitioner requested FERC to expand the definition of “Relevant State Entity” to include any entity that establishes or regulates electric rates under state law, arguing that the current definition excludes some state public utility commissions and electric cooperatives. FERC declined, explaining that those decisions are left to the states.
Lastly, FERC dismissed certain rehearing requests as procedurally barred because the entities either failed to seek rehearing on specific aspects of Order No. 1920-A or did not provide a reasonable justification for their delay in raising objections to Order No. 1920 within the statutory rehearing period.
Requests for rehearing of Order No. 1920-B are due no later than May 12, 2025. A copy of Order No. 1920-B, issued in Docket No. RM21-17-003, can be found here.
