Improvements relating to local transmission planning and development

Part II of the Federal Power Act (16 U.S.C. 824 et seq.) (as amended by section 2103) is amended by adding at the end the following: 226. Oversight of local transmission planning and development (a) Definitions In this section: (1) Commission The term Commission means the Federal Energy Regulatory Commission. (2) Local transmission facility The term local transmission facility means an electric transmission facility— (A) that is located entirely within the service territory of a single public utility; and (B) the cost of which is recovered entirely from transmission customers within that service territory. (3) Referring State The term referring State means 1 or more States making a referral under subsection (b). (4) Regional transmission facility The term regional transmission facility means an electric transmission facility the cost of which is recovered from transmission customers located within more than 1 service territory but within a single transmission planning region. (5) Transmission planning region The term transmission planning region means a region for which the Commission determines that electric transmission planning is appropriate, such as a region established in accordance with Order No. 1000 of the Commission, entitled Transmission Planning and Cost Allocation by Transmission Owning and Operating Public Utilities (76 Fed. Reg. 49842 (August 11, 2011)). (b) State referral authority (1) In general Not later than 1 year after the date of enactment of this section, the Commission shall, by rule, establish procedures by which 1 or more States may refer a public utility to the Commission for an investigation into the processes used by the public utility for planning and developing local transmission facilities. (2) Requirements A referral under paragraph (1) shall include, at a minimum— (A) a description of the 1 or more processes used by the public utility for local transmission planning and development about which the referring State is concerned; (B) a description of the harm that those processes may be causing to wholesale or retail electric customers within the referring State; and (C) a description of the efforts that the referring State has taken to resolve its concerns about the identified local transmission planning and development processes prior to referral to the Commission. (c) Commission action To exercise oversight of local transmission planning and development (1) In general On receipt of a referral under subsection (b) from a referring State, the Commission shall— (A) notice for initial public comment the initiation of an investigation; and (B) concurrently with that notice, certify an investigative team to be composed of— (i) 1 or more individuals from the Office of Enforcement and Regulatory Accounting of the Commission; and (ii) up to 3 representatives appointed by the referring State. (2) Authority of investigative team An investigative team certified under paragraph (1)(B) shall have all investigative authorities that would be available to the Commission or Commission staff in proceedings under or relating to the authority of the Commission under section 222. (3) Preliminary findings report If an investigative team certified under paragraph (1)(B) concludes that the processes used by a public utility for planning and developing local transmission facilities are not resulting in the selection of the more efficient or cost-effective local transmission facilities or that those processes are interfering with the processes of the relevant transmission planning region for planning and developing regional transmission facilities, the investigative team shall issue a preliminary findings report to the Commission explaining that conclusion and recommending a remedy. (4) Commission response to report (A) Notice and comment On receipt of a preliminary findings report under paragraph (3), the Commission shall notice the report for comment. (B) Order After reviewing the record, including any comments received under subparagraph (A), the Commission shall issue an order taking any such action as would be available to the Commission in a proceeding under section 222 that the Commission determines to be appropriate, which may include 1 or more of the following remedies: (i) Requiring changes to the processes used by the applicable public utility for planning local transmission facilities. (ii) Reducing the return on equity of the public utility with respect to local transmission facilities. (iii) Eliminating the presumption of prudence for local transmission facilities planned or developed by the public utility. (iv) A fine, payable to the referring State, of up to $5,000,000 for each local transmission facility— (I) that was developed or energized during the period beginning 60 days before the referral under subsection (b) and ending on the date on which the order under this subparagraph is issued; and (II) the development or energizing of which the Commissions determines— (aa) was imprudent; and (bb) caused financial harm to wholesale or retail electric customers within the referring State. (v) Any other appropriate remedy. (d) Savings provision Nothing in this section limits or impairs any authority of the Commission under any other provision of law..