On Thursday, April 25, 2024, the Department of Energy ("DOE") issued a new Final Rule concerning federal environmental review and permitting processes for certain electric transmission infrastructure projects ("Final Rule"). The rule represents major progress with respect to timing, certainty, and cost for transmission projects permitted at the federal level, marking the latest effort by the Biden Administration to facilitate and streamline development of transmission infrastructure, and coming only a few weeks ahead of the likely announcement by the Federal Energy Regulatory Commission ("FERC") of new regulations aimed at encouraging transmission providers to plan and execute more large-scale infrastructure investments.
The Final Rule implements a May 2023 Memorandum of Understanding between the federal agencies currently responsible for various aspects of environmental review and permitting of transmission projects and creates the Coordinated Interagency Transmission Authorizations and Permits Program ("CITAP Program"). Under the Final Rule, DOE will coordinate an interagency information-gathering process (the "IIP Process") to identify, in collaboration with the project developer, the necessary federal permits and authorizations for the proposed project. The Final Rule notes that while the time allocated to DOE to respond to requests for IIP Process determinations has been shortened (down to six months) compared to the timelines proposed in the Notice of Proposed Rulemaking (roughly eight months), the length or brevity of the IIP Process will in large part depend on the developer's preparation, responsiveness, and readiness to proceed.
Upon completion of the IIP Process, DOE will lead all relevant federal agencies in the preparation of a single environmental review document through the CITAP Program, a process which the Final Rule requires DOE to schedule for completion "within two years." (Note that the IIP Process precedes the CITAP Program and is not included within the two-year timeframe.)
DOE explains that the changes should "substantially reduce" the time necessary to obtain federal permits and authorizations for transmission projects, while preserving the rights of Tribes, local communities, and other stakeholders to weigh in on project impacts. The rule will become effective thirty days after publication in the Federal Register.
Also on April 25, DOE's Transmission Facilitation Program ("TFP") announced a conditional award of $331 million to the Southwest Intertie Project-North, a 500-kilovolt transmission project under development by Great Basin Transmission, LLC. If constructed, the project will add 2,000 megawatts of bidirectional transfer capacity between southern Idaho and southern Nevada, connecting existing and future Idaho wind resources to customers in the Nevada and California markets. As has been the case for prior TFP awards, the funding will likely take the form of a capacity contract.
The announcement comes several weeks after a project previously awarded TFP funding, the Twin States Clean Energy Link, was canceled by developers in early March 2024. The Twin States Clean Energy Link would have added bidirectional transfer capacity between southern New England and Québec, Canada.
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