FERC Rate Incentives for Transmission Infrastructure Development

With enactment of the Energy Policy Act of 2005, Congress delivered a mandate to the Federal Energy Regulatory Commission to establish regulations that would provide for incentive-based rate treatments for investments that would improvement the nation's electric transmission system. That has required FERC to move from merely approving cost-based rates for transmission services to enacting new regulations that would make it more attractive to invest in transmission infrastructure without offending the “just and reasonable” rate standard.