National Electric Transmission Congestion Report, 56992-57028 [E7-19731]

Agencies

• DEPARTMENT OF ENERGY

[Federal Register Volume 72, Number 193 (Friday, October 5, 2007)]
[Notices]
[Pages 56992-57028]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-19731]


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DEPARTMENT OF ENERGY

[Docket No. 2007-OE-01, Mid-Atlantic Area National Interest Electric 
Transmission Corridor; Docket No. 2007-OE-02, Southwest Area National 
Interest Electric Transmission Corridor]


National Electric Transmission Congestion Report

AGENCY: Department of Energy.

ACTION: Order.

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SUMMARY: The following is a report by the Department of Energy 
(Department or DOE) on its August 2006 National Electric Transmission 
Congestion Study under section 216 of the Federal Power Act (FPA). This 
report and order designates two national interest electric transmission 
corridors: The Mid-Atlantic Area National Interest Electric 
Transmission Corridor (Docket No. 2007-OE-01); and the Southwest Area 
National Interest Electric Transmission Corridor (Docket No. 2007-OE-
02). A list of the acronyms used in this report and order, and maps of 
the two national interest electric transmission corridors are provided 
at the end of this order.

DATES: The designations are effective October 5, 2007 and will remain 
in effect until October 7, 2019 unless the Department rescinds or 
renews the designation after notice and opportunity for comment.

FOR FURTHER INFORMATION CONTACT: For technical information, David 
Meyer, DOE Office of Electricity Delivery and Energy Reliability, (202) 
586-1411, david.meyer@hq.doe.gov. For legal information, Warren Belmar, 
DOE Office of Legal Counsel, (202) 586-6758, warren.belmar@hq.doe.gov, 
or Lot Cooke, DOE Office of the General Counsel, (202) 586-0503, 
lot.cooke@hq.doe.gov.

SUPPLEMENTARY INFORMATION:

I. Background

A. Statutory Framework

    Section 1221(a) of the Energy Policy Act of 2005 (Pub. L. 109-58) 
(EPAct) added a new section 216 to the Federal Power Act (16 U.S.C. 
824p) (FPA). New FPA section 216(a) requires the Secretary of Energy 
(Secretary) \1\ to conduct a nationwide study of electric transmission 
congestion \2\ within one year from the date of enactment of EPAct and 
every three years thereafter. FPA section 216(a)(2) provides 
``interested parties'' with an opportunity to offer ``alternatives and 
recommendations.'' 16 U.S.C. 824p(a)(2). Following consideration of 
such alternatives and recommendations, the Secretary is required to 
issue a report on the study ``which may designate any geographic area 
experiencing electric energy transmission capacity constraints or 
congestion that adversely affects consumers as a national interest 
electric transmission corridor.'' FPA section 216(a)(2), 16 U.S.C. 
824p(a)(2). FPA section 216(a)(4) states that in determining whether to 
designate a national interest electric transmission corridor (National 
Corridor), the Secretary may consider whether:
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    \1\ This report uses the terms ``Secretary,'' ``Department,'' 
and ``DOE'' interchangeably.
    \2\ Electric transmission congestion (congestion) is the 
condition that occurs when transmission capacity is not sufficient 
to enable safe delivery of all scheduled or desired wholesale 
electricity transfers simultaneously. Congestion results from a 
transmission capacity constraint (constraint).

    (A) the economic vitality and development of the corridor, or 
the end markets served by the corridor, may be constrained by lack 
of adequate or reasonably priced electricity;

[[Page 56993]]

    (B)(i) economic growth in the corridor, or the end markets 
served by the corridor, may be jeopardized by reliance on limited 
sources of energy; and (ii) a diversification of supply is 
warranted;
    (C) the energy independence of the United States would be served 
by the designation;
    (D) the designation would be in the interest of national energy 
policy; and
    (E) the designation would enhance national defense and homeland 
security.

16 U.S.C. 824p(a)(4).
    FPA section 216 imposes several consultation requirements upon the 
Department. FPA section 216(a)(1) states that the Department shall 
conduct the congestion study in consultation with affected States. 16 
U.S.C. 824p(a)(1). FPA section 216(a)(3) requires the Department to 
conduct the congestion study and issue the report in consultation with 
any appropriate Regional Entity. 16 U.S.C. 824p(a)(3).\3\ In addition, 
FPA section 216(h)(9) states:
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    \3\ Regional Entities are regional reliability organizations to 
which the North American Electric Reliability Corporation (NERC), as 
the designated Electric Reliability Organization under FPA section 
215, has delegated authority to propose and enforce electric 
reliability standards.

    In exercising the responsibilities under this section, the 
Secretary shall consult regularly with--
    (A) the Federal Energy Regulatory Commission;
    (B) electric reliability organizations (including related 
regional entities); and
    (C) Transmission Organizations approved by the Commission.

16 U.S.C. 824p(h)(9).\4\
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    \4\ As defined in FPA section 215(a)(6), 16 U.S.C. 824o(a)(6), 
``Transmission Organizations'' include Regional Transmission 
Organizations (RTOs) and Independent System Operators (ISOs). RTOs 
and ISOs are Federally regulated entities charged with operating a 
regional transmission system in a manner that is non-discriminatory 
and ensures safety and reliability. The existing RTOs and ISOs do 
not own any transmission or generation and are run by independent 
boards of directors.
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    The effect of a National Corridor designation is to delineate 
geographic areas within which, under certain circumstances, the Federal 
Energy Regulatory Commission (FERC) may authorize ``the construction or 
modification of electric transmission facilities.'' FPA section 216(b), 
16 U.S.C. 824p(b). The statute imposes several conditions on the 
exercise of FERC's permitting authority within a National Corridor.
    Under FPA section 216(b)(1), FERC jurisdiction is triggered only 
when either: the State does not have authority to site the project; the 
State lacks the authority to consider the interstate benefits of the 
project; the applicant does not qualify for a State permit because it 
does not serve end-use customers in the State; the State has withheld 
approval for more than one year; or the State has conditioned its 
approval in such a manner that the project will not significantly 
reduce congestion or is not economically feasible. 16 U.S.C. 
824p(b)(1). FERC has issued regulations governing the process it will 
follow when reviewing any applications under FPA section 216(b), and 
those regulations incorporate the requirements of FPA section 
216(b)(1).\5\ Further, FPA section 216(g) states, ``Nothing in this 
section precludes any person from constructing or modifying any 
transmission facility in accordance with State law.'' 16 U.S.C. 
824p(g).
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    \5\ Regulations for Filing Applications for Permits to Site 
Interstate Electric Transmission Facilities, Order No. 689, 71 FR 
69,440, 69,468 (Dec. 1, 2006), 117 FERC ] 61,202 at pp. 128-29 
(2006) (to be codified at 18 CFR pts. 50 and 380) (FERC Order No. 
689), order on reh'g, 119 FERC ] 61,154 (2007) (Sec.  50.6(e) 
requires applicants to demonstrate that the conditions of FPA sec. 
216(b)(1) are met).
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    Under FPA section 216(b)(2)-(6), FERC may issue a permit only if 
all of the following conditions are met: the facilities will be used 
for the transmission of electric energy in interstate commerce; the 
project is consistent with the public interest; the project will 
significantly reduce congestion in interstate commerce and protect or 
benefit consumers; the project is consistent with national energy 
policy and will enhance energy independence; and the project maximizes, 
to the extent reasonable and economical, the transmission capabilities 
of existing towers or structures. 16 U.S.C. 824p(b)(2)-(6).\6\ With 
regard to the condition that a project must ``significantly reduce 
transmission congestion in interstate commerce and protects or benefits 
consumers,'' FERC has stated that it interprets this to mean that a 
project must significantly reduce the transmission congestion 
identified by DOE.\7\
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    \6\ See also id. (Sec.  50.6(f) requires applicants to 
demonstrate that the conditions of FPA sec. 216(b)(2)-(6) are met).
    \7\ See id., 71 FR 69,440, 69,446, 117 FERC ] 61,202 at P 41.
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    In order to construct a transmission facility, a developer must 
obtain both a construction permit as well as a right-of-way across each 
piece of public or private property along the route. If FERC were to 
issue a permit under FPA section 216(b), it would constitute the 
construction permit; it would not, in and of itself, grant any rights-
of-way. Thus, the holder of a FERC permit would still need to obtain 
rights-of-way. The first step in obtaining such rights-of-way would be 
for the developer to initiate negotiations with each affected property 
owner. If the permit holder could not acquire a necessary right-of-way 
through negotiation with a private property owner, then the FERC permit 
would entitle the permit holder to acquire the right-of-way by exercise 
of the right of eminent domain in either Federal or State court. FPA 
sec. 216(e)(1), 16 U.S.C. 824p(e)(1). The court would then determine 
the just compensation owed to the property owner by the permit holder, 
which would be the fair market value (including applicable severance 
damages) of the property taken on the date of the exercise of eminent 
domain authority. FPA sec. 216(f)(2), 16 U.S.C. 824p(f)(2).
    The right of eminent domain would not apply to property owned by 
the United States or a State. Id. Thus, if FERC were to issue a permit 
for a transmission facility across Federal or State property, the 
permit holder would still need to reach agreement with the Federal or 
State agency responsible for managing that property in order to obtain 
a right-of-way across that property. In addition, FPA section 216(j)(1) 
provides that except as specifically provided, nothing in FPA section 
216 affects any requirement of any Federal environmental law. 16 U.S.C. 
824p(j)(1). Thus, a FERC permit does not absolve the permittee of 
compliance with other Federal law, including obtaining authorizations 
from other agencies implementing applicable Federal environmental laws.
    The statute provides a specific mechanism by which States can 
insulate themselves from the FERC permitting provisions of FPA section 
216(b). FPA section 216(i) provides special treatment where three or 
more contiguous States have entered into an interstate compact, subject 
to approval by Congress, establishing a regional transmission siting 
agency to carry out the electric transmission siting responsibilities 
of the member States. If such a compact were established, FERC would 
have no authority to issue a transmission permit within any of the 
member States unless those members were in disagreement and the 
Secretary, after notice and opportunity for a hearing, made a finding 
that the conditions of FPA section 216(b)(1)(C) were met. FPA section 
216(i)(4); 16 U.S.C. 824p(i)(4).
    FPA section 216(a) does not shift to the Department the roles of 
electric system planners or siting authorities in evaluating solutions 
to congestion and constraint problems. Transmission expansion is but 
one possible solution to a congestion or constraint problem. Other 
potential solutions include increased demand response; improved energy 
efficiency; deployment of

[[Page 56994]]

advanced technology; and siting of additional generation, including 
distributed generation, close to load centers. Nothing in FPA section 
216 requires or suggests that the Department should engage in a 
comparison of the relative merits of these different solutions to 
easing congestion in a specific geographic area.
    For example, the congestion study required by FPA section 216(a)(1) 
is described as ``a study of electric transmission congestion,'' rather 
than a study of either the solutions to congestion or the need for 
transmission. FPA section 216(a)(2) authorizes the Department to 
designate areas experiencing constraints or congestion that adversely 
affect consumers, rather than areas where more transmission is needed. 
None of the considerations identified in FPA section 216(a)(4) 
necessitate a comparison of transmission and non-transmission 
solutions. The first two considerations, which look at whether economic 
vitality is constrained by either lack of adequate or reasonably priced 
electricity or reliance on limited sources of energy, focus on the 
effects of congestion and constraints rather than the effects of any 
potential solutions to such congestion or constraints. The remaining 
considerations address whether a National Corridor designation, rather 
than the construction of additional transmission, would promote energy 
independence, national energy policy, or national defense and homeland 
security.
    Thus, FPA section 216(a) assigns to the Department the role of 
identifying transmission congestion and constraint problems, and the 
geographic areas in which these problems exist. A National Corridor 
designation is not a determination that transmission must, or even 
should, be built. Whether a particular transmission project, some other 
transmission project, or a non-transmission project is an appropriate 
solution to a congestion or constraint problem identified by a National 
Corridor designation is a matter that market participants, applicable 
regional planning entities, State authorities, and potentially FERC 
will consider and decide before any project is built. A National 
Corridor designation itself does not preempt State authority or any 
State actions, including action to approve or order the implementation 
of non-transmission solutions to congestion and constraint problems. If 
FERC jurisdiction under FPA section 216(b) were triggered, the 
designation of a National Corridor by the Secretary would not control 
FERC's substantive decision on the merits as to whether to grant or 
deny the permit application. Moreover, FERC has committed to 
considering non-transmission alternatives, as appropriate, during its 
permit application review process.\8\
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    \8\ See id.; see also 119 FERC ] 61,154 at P 61 (``During the 
pre-filing and application processes, Commission staff will work 
with the applicant and stakeholders to define issues in each 
proceeding, including the development of appropriate alternatives * 
* *. The public will have the opportunity to participate and file 
comments--which can include suggested alternatives of any kind--
throughout this review.'').
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    Not only would a National Corridor designation not prejudice State 
or Federal siting processes against non-transmission solutions, it also 
should not discourage market participants from pursuing such solutions. 
Implementation of one solution to a congestion or constraint problem 
can reduce, and in some cases eliminate, the need for, and thus the 
viability of, competing solutions. For example, if a transmission line 
enabling the delivery of low-cost power from generation sources outside 
of a load center were to be put into service, the economic incentive to 
build a new generator closer to load could be eliminated. Designation 
of a National Corridor, however, does not constitute, advocate, or 
guarantee approval of any particular transmission project. Also, FERC, 
as discussed above, may only issue a permit if the applicant has shown 
that its project ``will significantly reduce transmission congestion in 
interstate commerce and protects or benefits consumers.'' If competing 
projects were to fully resolve the congestion or constraint problem 
before the issuance of a FERC permit, it would be difficult for the 
sponsor of a transmission project to make such a showing.\9\ Further, 
developers who diligently pursue meritorious non-transmission solutions 
may be able to obtain approval for those solutions long before a FERC 
permit is issued. In many cases it has taken less time to plan, get 
approval for, and implement non-transmission projects than transmission 
projects.\10\ In fact, FPA section 216, far from disadvantaging certain 
approaches to addressing congestion or constraint problems, is an 
attempt by Congress to put transmission projects on more of a level 
playing field with other congestion solutions.
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    \9\ If non-transmission projects had not fully resolved the 
congestion problem, it would seem appropriate to consider the need 
for new transmission to supplement those non-transmission projects, 
and non-transmission project sponsors would have no legitimate 
expectation to the contrary.
    \10\ See, e.g., S.P. Vajjhala and Paul S. Fischbeck, Quantifying 
Siting Difficulty, A Case Study of U.S. Transmission Line Siting, 
Resources For the Future Discussion Paper 06-03, at 3 (Feb. 2006) 
(``Transmission line siting is one of the most extreme examples of 
siting difficulty today * * *. Siting problems are not unique to the 
electricity industry; however, siting difficulties associated with 
transmission lines are especially complex.'').
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    Nor are the time frames established under FPA section 216 likely to 
provide any unfair head-start for transmission projects. A transmission 
developer must first devise a detailed plan for the project. Given the 
highly interconnected nature of the transmission grid, a developer 
considering any significant transmission project would need to work 
with the relevant RTO, ISO, or other regional or sub-regional 
transmission planning entities to explore the feasibility, likely 
costs, and likely system effects of alternative project designs. After 
having done substantial preparatory analyses and settled on a project 
design, the developer in most cases would file a permit application 
with a State agency and could not seek FERC review until the State had 
had one year to evaluate and act upon the application. FPA section 
216(h) establishes a mechanism to ensure that requests for Federal 
authorizations to construct transmission facilities, whether within or 
outside a National Corridor, are acted upon within one year. 16 U.S.C. 
824p(h).
    However, a transmission developer must first complete a pre-filing 
process before filing an application at FERC that would trigger the 
one-year deadline under FPA section 216(h).\11\ FERC has indicated that 
the pre-filing process for extensive projects may take a year to 
complete.\12\ Thus, designation of a National Corridor should not 
reduce the incentive or time available to sponsors of non-transmission 
solutions to pursue such solutions.
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    \11\ FERC Order No. 689, 71 FR 69,440, 69,466-67, 117 FERC ] 
61,202 at pp. 122-27 (Sec.  50.5 establishes mandatory pre-filing 
procedures).
    \12\ Id., 71 FR 69,440, 69,453, 117 FERC ] 61,202 at P 112.
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    A National Corridor designation is not the cause of proposals to 
construct transmission. A National Corridor designation is not a 
proposal to build a transmission facility and it does not direct anyone 
to make a proposal. A National Corridor designation does not create or 
discover the need to consider solutions to congestion or constraint 
problems. Developers of electricity projects, be they transmission or 
non-transmission, react to the state of the grid. It is the presence of 
congestion and constraints, already well known to most market 
participants, that causes developers to undertake projects.
    Just as a National Corridor designation is not a decision about the

[[Page 56995]]

best solution to a congestion or constraint problem, it also is not a 
siting decision. FPA section 216(a) does not shift to the Department 
the role of designing routes for transmission facilities, and a 
National Corridor designation does not dictate or endorse the route of 
any transmission project. If a transmission project is proposed in a 
National Corridor, it will be the State or local siting authorities, 
and potentially FERC if certain conditions are met, that will determine 
the specific route of that project. The designation of a National 
Corridor by the Secretary does not control FERC's substantive decision 
on the merits as to where any facilities covered by a permit should be 
located, or what conditions should be placed on that permit. If FERC 
jurisdiction were triggered by a proposed transmission project, FERC 
would conduct an evaluation of the reasonably foreseeable effects of 
transmission construction, including an analysis of alternative routes 
and mitigation options. Based on that analysis, FERC has the authority 
to approve the application, deny the application, or approve the 
application with modifications.\13\
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    \13\ See, e.g., id. 71 FR 69,440, 69,446, 117 FERC ] 61,202 at 
PP 41-42 (``The Commission will conduct an independent environmental 
analysis of the project and determine if there is no significant 
impact as required by [the National Environmental Policy Act]. It 
will look at alternatives * * *. It will review the alternatives for 
their respective impacts on the environment and will determine 
mitigation measures to lessen the adverse impacts * * *. The 
Commission will also consider the adverse effects the proposed 
facilities will have on land owners and local communities.''); and 
71 FR 69,440, 69,470, 117 FERC ] 61,202 at p. 142-43 (Sec. Sec.  
380.5(b)(14) and 380.6(a)(5) require either an environmental 
assessment or an environmental impact statement for projects seeking 
permits under sec. 216(b)).
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    In sum, by adding section 216 to the FPA, Congress directed that 
the National Corridor designation process establish a Federal safety 
net to provide, in a defined set of circumstances, an opportunity for 
analysis of the need for transmission from a national, rather than a 
State or local, perspective.

B. Congestion Study

    In accordance with the mandate of FPA section 216(a)(1), the 
Department issued its initial congestion study (the Congestion Study) 
for comment on August 8, 2006. The Congestion Study gathered historical 
congestion data obtained from existing studies prepared by the regional 
reliability councils, RTOs and ISOs, and regional planning groups. The 
Congestion Study also modeled future congestion: The years 2008 and 
2011 for the Eastern Interconnection; and the years 2008 and 2015 for 
the Western Interconnection. The modeling focused on five metrics: 
Binding hours (the number of hours per year that a path is loaded to 
its safe limit and, thus, unable to accommodate all desired power 
transactions), U90 (the number of hours per year that a path is loaded 
above 90 percent of its limit), all-hours shadow price (the marginal 
cost of generation redispatch required to accommodate a given 
constraint averaged across all hours in the year), binding hours shadow 
price (average shadow price over only those hours during which the 
constraint is binding), and congestion rent (shadow price multiplied by 
flow, summed over all hours the constraint is binding).
    Based on the historical data and the modeling results, the 
Congestion Study identified and classified the most significant 
congestion areas in the country. Two ``Critical Congestion Areas'' 
(i.e. areas where the current and/or projected effects of congestion 
are especially broad and severe) were identified: The Atlantic coastal 
area from metropolitan New York through northern Virginia (the Mid-
Atlantic Critical Congestion Area); and southern California (the 
Southern California Critical Congestion Area). Four ``Congestion Areas 
of Concern'' (i.e. areas where a large-scale congestion problem exists 
or may be emerging but more information and analysis appear to be 
needed to determine the magnitude of the problem) were identified: New 
England; the Phoenix-Tucson area; the San Francisco Bay area; and the 
Seattle-Portland area. Also, a number of ``Conditional Congestion 
Areas'' (i.e. areas where future congestion would result if large 
amounts of new generation were to be developed without simultaneous 
development of associated transmission capacity) were identified, such 
as: Montana-Wyoming; Dakotas-Minnesota; Kansas-Oklahoma; Illinois, 
Indiana and upper Appalachia; and the Southeast.

C. May 7 Notice

    On May 7, 2007, the Department published a notice in the Federal 
Register that summarized and responded to the comments relevant to 
National Corridor designation received in response to the Congestion 
Study. 72 FR 25,838 (May 7, 2007) (May 7 notice). The May 7 notice also 
issued and solicited comment on draft National Corridor designations 
for the two Critical Congestion Areas identified in the Congestion 
Study: The draft Mid-Atlantic Area National Corridor; and the draft 
Southwest Area National Corridor.
    In the May 7 notice, the Department noted that the term 
``constraints or congestion that adversely affects consumers'' as used 
in FPA section 216(a)(2) is ambiguous and stated that while it was not 
attempting to define the complete scope of the term, the term does 
include congestion that is persistent. Thus, the Department stated that 
FPA section 216(a) gives the Secretary the discretion to designate a 
National Corridor upon a showing of the existence of persistent 
congestion, as persistent congestion has adverse effects on consumers. 
The Department also stated that the Secretary would decide whether to 
exercise the discretion to make National Corridor designations based on 
the totality of the information developed, taking into account relevant 
considerations, including the considerations identified in FPA section 
216(a)(4), as appropriate. Further, the Department concluded that it 
would use a source-and-sink approach \14\ to delineate the boundaries 
of the draft Mid-Atlantic Area National Corridor and the draft 
Southwest Area National Corridor.
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    \14\ ``Source'' refers to an area of existing or potential 
future generation, and ``sink'' refers to the area of consumer 
demand or ``load.''
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    With regard to the Mid-Atlantic Critical Congestion Area, the 
Department noted that the Congestion Study had identified this area 
based on evidence of historical, persistent congestion caused by 
numerous well-known constraints that are projected to continue and 
worsen unless addressed through remedial measures. The Department 
provided data documenting how frequently these constraints have been 
binding, and noted that the modeling for the Congestion Study projected 
that some of these constraints will continue to be problems in 2008, 
along with other additional constraints. The Department also documented 
the existence of persistent congestion through regional differences in 
generation capacity factors within the footprints of the PJM 
Interconnection, LLC, (PJM) \15\ and the New York Independent System 
Operator (NYISO).\16\ Based on this information, the Department found 
under FPA section 216(a)(2) that consumers in the Mid-Atlantic Critical 
Congestion Area are being adversely affected by congestion.
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    \15\ PJM is the RTO serving parts or all of Delaware, Illinois, 
Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, 
Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the 
District of Columbia.
    \16\ NYISO is the ISO serving New York State.
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    Having concluded that the Department may designate a National 
Corridor for the Mid-Atlantic Critical Congestion Area, the Department 
then examined whether it is appropriate to

[[Page 56996]]

exercise that discretion. Using historical data on locational marginal 
prices (LMPs) and capacity prices, the Department documented that 
congestion results in electricity consumers in the eastern portion of 
PJM's footprint consistently paying higher electricity prices than 
consumers in the western portion, and in consumers in southeast New 
York consistently paying higher electricity prices than consumers in 
the rest of the State. The Department documented that if action is not 
taken to address congestion, consumers in the Baltimore-Washington-
Northern Virginia area, the northern New Jersey area, and southeast New 
York face threats to the reliability of their electricity supply. The 
Department also documented that congestion exacerbates the degree to 
which consumers in the eastern portion of PJM and in southeast New York 
rely on generation fueled by natural gas and oil. Finally, the 
Department described the importance of the Mid-Atlantic Critical 
Congestion Area to the security and economic health of the Nation as a 
whole. Thus, the Department stated its belief that economic 
development, reliability, supply diversity and energy independence, and 
national defense and homeland security considerations warrant exercise 
of the Secretary's discretion to designate a National Corridor for the 
Mid-Atlantic Critical Congestion Area.
    With regard to the Southern California Critical Congestion Area, 
the Department noted that the Congestion Study had identified this area 
based on evidence of historical, persistent congestion caused by 
numerous well-known constraints that are projected to continue and 
worsen unless addressed through remedial measures. The Department 
provided data documenting how frequently these constraints have been 
binding, and noted that the modeling for the Congestion Study projected 
that some of these constraints will continue to be problems in 2008. 
The Department also documented the existence of persistent congestion 
using flow data, data on congestion and redispatch costs, and data on 
transmission service denials. Based on this information, the Department 
found under FPA section 216(a)(2) that consumers in the Southern 
California Critical Congestion Area are being adversely affected by 
congestion.
    Having concluded that the discretion exists to designate a National 
Corridor for the Southern California Critical Congestion Area, the 
Department then examined whether it is appropriate to exercise that 
discretion. The Department documented that if action is not taken to 
address congestion, consumers in the Southern California Critical 
Congestion Area face threats to the reliability of their electricity 
supply. The Department also documented that congestion exacerbates the 
reliance of consumers in Southern California Critical Congestion Area 
on generation fueled by natural gas. Finally, the Department described 
the importance of the Southern California Critical Congestion Area to 
the security and economic health of the Nation as a whole. Thus, the 
Department stated its belief that reliability, supply diversity, and 
national defense and homeland security considerations warrant exercise 
of the Secretary's discretion to designate a National Corridor for the 
Southern California Critical Congestion Area.
    To delineate the boundaries of both the draft Mid-Atlantic Area 
National Corridor and the draft Southwest Area National Corridor, the 
Department identified source areas that would enable a range of 
generation options and then identified the counties linking the 
identified source areas with the respective sink areas, i.e., the Mid-
Atlantic Critical Congestion Area and the Southern California Critical 
Congestion Area.
    The Department stated that it intended to set a 12-year term for 
both the draft Mid-Atlantic Area National Corridor and the draft 
Southwest Area National Corridor. The Department further stated that 
FPA section 216(a)(1) did not require it to conduct an analysis of non-
transmission solutions to congestion before designating either the 
draft Mid-Atlantic Area National Corridor or the draft Southwest Area 
National Corridor, and that the National Environmental Policy Act of 
1969 (NEPA) did not apply to either designation.
    On June 7, 2007, the Department published a notice of correction 
indicating that the May 7 notice had inadvertently omitted six counties 
from the narrative list of counties comprising the draft Mid-Atlantic 
Area National Corridor; the six counties had been correctly included, 
however, in the map of the draft Mid-Atlantic Area National Corridor. 
72 FR 31571 (June 7, 2007) (June 7 errata).
    The comment period on the May 7 notice closed on July 6, 2007. The 
Department also held a series of public meetings on the May 7 
notice.\17\ All timely filed comments, as well as written comments 
submitted at the public meetings and transcripts of those public 
meetings were posted on the Department's Web site in order to 
facilitate public review. In addition, the Department consulted with 
each of the States within the two draft National Corridors,\18\ as well 
as with the Regional Entities that have authority within the draft 
National Corridors.\19\
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    \17\ Arlington, VA, May 15, 2007; San Diego, CA, May 17, 2007; 
New York City, NY, May 23, 2007; Rochester, NY, June 12, 2007; 
Pittsburgh, PA, June 13, 2007; Las Vegas, NV, June 20, 2007; and 
Phoenix, AZ, June 21, 2007.
    \18\ The Department sent a letter to the Governor of each of the 
States within the draft National Corridors and the Mayor of the 
District of Columbia on April 26, 2007, requesting an opportunity to 
consult with them on the draft designations. The Department then 
held consultation meetings described below with the representatives 
of the Governors and the Mayor. Delaware: The Department met with 
Delaware on May 3, 2007, in the Governor's Washington, DC office. By 
phone, a staff person from the Delaware Public Service Commission 
and the Department of Natural Resources and Environmental Control 
participated in the meeting. District of Columbia: The Department 
met with the District of Columbia on June 27, 2007. This meeting 
included staff from the DC Department of Environment and the Office 
of the City Administrator. Maryland: On May 11, 2007, the Department 
met with staff from the Governor's Washington, DC Office. New 
Jersey: The Department met with New Jersey on May 9, 2007, in the 
Governor's Washington, DC office. An aide from the Governor's staff 
in New Jersey participated by phone. New York: The Department 
conducted a conference call with staff from the Governor's Office in 
Albany, NY on May 9, 2007. In addition, DOE met with staff from the 
Governor's Washington, DC office on May 11, 2007. Ohio: The 
Department met with Ohio on May 3, 2007, in the Governor's 
Washington, DC office. By phone, this meeting included the 
Governor's staff in Ohio and staff from the Public Utilities 
Commission of Ohio. Pennsylvania: The Department met with staff from 
the Governor's Office at DOE Headquarters on May 10, 2007. This 
meeting included staff from the Pennsylvania Department of 
Environmental Protection. Virginia: The Department conducted a 
conference call with staff from the Governor's office on May 30, 
2007. West Virginia: The Department conducted a conference call with 
staff from the Governor's office on May 24, 2007. Arizona: The 
Department met with staff from the Governor's Washington, DC office 
on May 9, 2007. California: The Department conducted a conference 
call with staff from the Governor's office on April 26, 2007. In 
addition, the Department met with staff in the Governor's 
Washington, DC office on May 3, 2007. Nevada: The Department met 
with staff in the Governor's Washington, DC office on May 3, 2007.
    \19\ On May 21, 2007, the Department sent letters to the 
affected Regional Entities inviting consultation on the draft 
designations. Northeast Power Coordinating Council, Inc. (NPCC) 
responded and the Department conducted a conference call on July 6, 
2007. ReliabilityFirst Corporation responded and the Department 
conducted a conference call on July 3, 2007. SERC Reliability 
Corporation and Western Electricity Coordinating Council (WECC) did 
not respond, although WECC filed timely written comments in this 
proceeding.
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D. Focus of This Report

1. Overview of Report
    Section II of this report summarizes and responds to the comments 
received on the draft Mid-Atlantic Area National Corridor. Section III 
of this report summarizes and responds to the comments received on the 
draft

[[Page 56997]]

Southwest Area National Corridor. Section IV summarizes and responds to 
the comments received on the applicability of NEPA, the National 
Historic Preservation Act (NHPA), and the Endangered Species Act (ESA) 
to National Corridor designations. Section V of this report orders the 
designation of the Mid-Atlantic Area National Corridor and the 
Southwest Area National Corridor.
    This report focuses on the two geographic areas of the Nation 
experiencing the most acute and urgent electric transmission congestion 
problems; the report takes no action with regard to the other 
geographic areas discussed in the Congestion Study. The Department 
recognizes that it has received many comments and suggestions 
concerning the issues of: (1) National Corridor designation for areas 
other than the two Critical Congestion Areas, (2) technical aspects of 
the Congestion Study that relate to areas outside the two Critical 
Congestion Areas, and (3) the conduct of future congestion studies. The 
Department appreciates these comments and will consider these issues at 
a later date.
2. Other Issues
    Numerous commenters addressed issues that the Department considers 
to be beyond the scope of this report. These issues are described 
below.
a. Opposition to FPA Section 216
Summary of Comments
    Many commenters opposed the very concept of a National Corridor and 
urged the Department to refrain from designating any National 
Corridors. Some of these commenters argued that the eminent domain and 
Federal preemption provisions of FPA section 216 violate the Fifth and 
Tenth Amendments to the U.S. Constitution \20\ and are 
undemocratic.\21\ These commenters argued that a for-profit company 
should never be granted eminent domain,\22\ and expressed skepticism 
that the Federal government could appropriately balance competing 
interests when reviewing applications to construct transmission.\23\ 
Some commenters objected to the provision in FPA section 
216(b)(1)(C)(i) granting FERC jurisdiction within a National Corridor 
where a State commission has withheld approval of a transmission 
application for more than a year. These commenters argued that this 
one-year deadline will not provide adequate time to assess meaningfully 
the environmental impacts of a proposed transmission line project.\24\
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    \20\ See, e.g., comments of Tommy and Kathy Hildebrand, Cindy 
Carter, and Gary Manoni.
    \21\ See, e.g., comments of Faith Bjalobok and statement of 
Christopher Zimmerman at May 15, 2007, Arlington, VA public meeting.
    \22\ See, e.g., comments of Joseph Zappulla and New York Public 
Interest Research Group (NYPIRG). See also comments of the 
Pennsylvania Senate.
    \23\ See, e.g., comments of Howard Armfield (``The State 
Corporation Commission of Virginia is in a better position than at 
the Federal level to know the historical importance of areas under 
consideration for a utility line.''), Donald Law (``The federal 
government should not interfere with this process.''), Julie Keller 
(``A state has better knowledge of the impact of transmission lines 
etc. and bases it's decisions on the best interest of its local 
citizens rather than private companies or federal agencies.''), 
Jackie Grant (``I feel the public, local municipalities, and the 
states should be able to address their energy needs locally. Local 
and state efforts to resolve energy demands should not be undermined 
by the federal government.''), and Chenango County Farm Bureau.
    \24\ See, e.g., comments of the New Jersey Department of 
Environmental Protection (NJDEP) and the Pennsylvania Department of 
Environmental Protection (PaDEP).
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    Other commenters urged the Department to refrain from designating 
any National Corridors in light of various alleged generic adverse 
effects of transmission, including: The effects of electromagnetic 
fields on human health and the health of livestock and wildlife; \25\ 
the effect of herbicides used to maintain transmission rights of way; 
\26\ disruption of farming; \27\ reduction of property values; \28\ 
effect on viewsheds; \29\ fragmentation of wildlife habitat; \30\ and 
encroachment on open space.\31\
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    \25\ See, e.g., comments of Lew McDaniel, David Katch, Alison 
Hanham, and William Hopkins.
    \26\ See, e.g., comments of Travis Turnley and Lee Scherer.
    \27\ See, e.g., comments of Pennsylvania Farm Bureau.
    \28\ See, e.g., comments of Sean Dobich, Jane Eickhoff, and 
Henry Woolman III.
    \29\ See, e.g., comments of Louise Peterson and Thomas Hoffman, 
Jr.
    \30\ See, e.g., comments of Murray Lantner and Ross Cooper.
    \31\ See, e.g., comments of Michael McPoland and Aurore Giguet.
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    Many commenters argued that instead of implementing FPA section 
216(a), the Department should focus on developing and promoting a 
national energy plan based on conservation, energy efficiency, and 
distributed generation.\32\ These commenters argued that National 
Corridor designations would encourage utilities to pursue outdated, 
environmentally destructive transmission solutions and discourage the 
development of more innovative, sustainable solutions. Michael 
Arrington, for example, stated, ``[National Corridors] will only give 
utilities another reason not to innovate or conserve.'' \33\
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    \32\ See, e.g., comments of Upen Patel, John Sprieser, Raman 
Jassal, Robert Hanham, Nora Palmatier, and Karen Kampfer, and 
statement of Paul Miller at June 12, 2007, Rochester, NY public 
meeting.
    \33\ See also comments of Russell McKelway (``I believe that 
cessation of land condemnation for power lines would force the kind 
of conservation of energy that our country desperately needs to 
reduce dependence on foreign sources of energy and to reduce global 
warming.''), Nora Marsh (``Yes, we have energy issues but the 
solution is not with old technology.''), and Sheila Paige 
(``Conservation and anti-congestion planning are vitally important--
not to be swept under the rug by temporary and ill-researched band-
aids. These `corridors'--actually vast regions--represent nothing 
but permission for power companies to continue doing what they do 
badly.'').
---------------------------------------------------------------------------

    Numerous individuals suggested specific steps the Department should 
take in lieu of designating National Corridors, including banning the 
use of incandescent lights\34\ and mandating higher efficiency 
standards in building codes.\35\
---------------------------------------------------------------------------

    \34\ See, e.g., comments of Joel Silverthorn and Karee Miller.
    \35\ See, e.g., comments of Ben Pisarcik and A. Pellechia.
---------------------------------------------------------------------------

DOE Response
    These comments are essentially suggestions that Congress should not 
have enacted FPA section 216, and requests that the Department ignore 
FPA section 216(a) based on concerns about the very statutory 
framework. The Department has an obligation to act consistent with the 
terms of FPA section 216(a) as written and enacted into law. Objections 
to the terms of this provision simply do not provide a basis for 
declining to implement the statute.
    The Department has no basis to conclude that the provision is 
unconstitutional. The Fifth Amendment to the U.S. Constitution bars the 
taking of private property for a public purpose without just 
compensation, but as discussed in Section I.A above, FPA section 
216(f)(2) explicitly provides for payment of just compensation in the 
event that a FERC permit holder were to exercise the right of eminent 
domain. While the Tenth Amendment reserves to States those powers not 
delegated to the Federal government by the Constitution, the Interstate 
Commerce Clause of Article I explicitly authorizes the Federal 
government ``to regulate commerce with foreign nations, and among the 
several states, and with Indian tribes.'' \36\ As discussed in Section 
I.A above, FERC's permit authority is limited to facilities that will 
be used for the transmission of electric energy in interstate commerce. 
FPA section 216(b)(2), 16 U.S.C. 824p(b)(2).\37\
---------------------------------------------------------------------------

    \36\ U.S. CONST. art. I, Sec.  8, cl. 3.
    \37\ See also Pub. Util. Comm'n of R.I. v. Attleboro Steam & 
Elec. Co., 273 U.S. 83, 86 (1927) (Attleboro) (transmission of 
electricity from one State to another is interstate commerce); and 
Fed. Power Comm'n v. Florida Power & Light, 404 U.S. 453, 462 (1972) 
(FPL) (transmission of electricity within one State held to be 
interstate commerce because the electricity commingled with 
electricity that was being transmitted out of State).

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[[Page 56998]]

    Further, there is nothing novel about either the concept of 
granting eminent domain authority to for-profit utilities providing 
services deemed to be in the public interest, or the concept of Federal 
preemption with regard to the siting of interstate energy facilities. 
In most States, for-profit utilities that obtain permits to construct 
transmission facilities are granted the right of eminent domain.\38\ 
Also, FERC and its predecessor, the Federal Power Commission, have been 
issuing permits for the construction of non-Federal hydropower 
facilities and associated primary transmission lines since 1920 and for 
the construction of interstate natural gas pipelines since 1938, all of 
which permits granted the right of eminent domain. See FPA sec. 4(e) 
and 21, 16 U.S.C. 797(e) and 814; and Natural Gas Act, sec. 7(a) and 
(h), 15 U.S.C. 717f(a) and (h). In fact, given the inherently 
interstate nature of transmission, Congress could have completely 
preempted State siting of interstate transmission facilities, as it did 
almost 70 years ago with regard to siting of interstate natural gas 
pipelines.\39\
---------------------------------------------------------------------------

    \38\ See, e.g., ARIZ. REV. STAT. ANN. Sec.  12-1111 (2007); VA. 
CODE ANN. Sec.  1-219.1 (2007); N.Y. TRANSP. CORP. LAW Sec.  11 
(2006); W. VA. CODE ANN. Sec.  54-1-2 (2006); 66 PA. CONS. STAT. 
ANN. Sec.  1104 (1978); CAL. PUB. UTIL. CODE Sec.  612 (1975). 
Moreover, while FPA section 216(e)(1) provides holders of FERC 
permits with the option of going to either Federal or State court to 
exercise eminent domain, the statute also specifies that ``[t]he 
practice and procedure'' in any Federal eminent domain proceeding 
``shall conform as nearly as practicable to the practice and 
procedure in a similar action or proceeding in the courts of the 
State in which the property is located.'' FPA sec. 216(e)(3), 16 
U.S.C. 824p(e)(3).
    \39\ See, e.g., Attleboro, 273 U.S. at 86.
---------------------------------------------------------------------------

    As for those comments suggesting that a National Corridor 
designation is never appropriate because of the risks posed by 
transmission facilities, we note that all forms of energy 
infrastructure pose risks and benefits. The nature and magnitude of the 
risks and benefits posed by a particular infrastructure project (be it 
transmission or non-transmission), the feasibility and cost of 
mitigating those risks, and the comparison of the relative risks and 
benefits of competing projects are all issues with which electric 
system planners and siting authorities must grapple. However, as 
discussed in Section I.A above, FPA section 216(a) does not shift to 
the Department the roles of electric system planners or siting 
authorities in evaluating solutions to congestion and constraint 
problems. Moreover, the Department has no basis to conclude that the 
effects of transmission are so adverse that National Corridor 
designations are never warranted or are warranted only as a last 
resort. In fact, FPA section 216 evinces Congress' concern that 
transmission was not always being approved where and when needed.
    With regard to comments that the Department should abandon 
designation of National Corridors and pursue other energy policies, the 
Department notes that it is already actively engaged in efforts to 
promote conservation, energy efficiency, and distributed generation. 
For example, the Department funds a broad range of research and 
development in technologies that can be used as alternatives and 
supplements to transmission lines, including: Advanced methods of 
central generation such as nuclear energy, central solar, clean coal 
and sequestration of its carbon emissions, wind, geothermal, 
hydroelectric, and gas-fired combustion turbines; distributed 
generation such as solar photovoltaics; energy efficiency; demand 
response; better transmission conductors, such as those using high 
temperature superconductivity, that greatly reduce transmission losses; 
electricity storage; and ``smart grid'' technologies and related 
methods. In addition, the Department provides best-practice-based 
expert technical assistance to States that wish to enact electricity-
related laws, policies, or programs to encourage, allow, or otherwise 
enable their electric utilities to make greater use of alternatives to 
transmission lines. Upon the request of State utility regulators, the 
Department also has facilitated efforts to build regional consensus on 
means to improve energy efficiency, demand response, and distributed 
generation in retail and wholesale electricity markets, such as through 
the Mid-Atlantic Distributed Resources Initiative, the Midwest 
Distributed Resources Initiative, the Pacific Northwest Distributed 
Resources Project, the New England Demand Response Initiative, and the 
2006 National Action Plan for Energy Efficiency.
    Regardless, FPA section 216(a) requires the Department to conduct a 
congestion study every three years, and upon completion of such a 
study, to issue a report or reports in which it determines whether or 
not to designate one or more National Corridors. FPA section 216(a) 
does not grant the Department any other authorities or options. 
Therefore, requests that the Department initiate other regulatory 
activities are beyond the scope of these proceedings.
    Further, the Department disagrees that designation of a National 
Corridor limits or discourages non-transmission solutions (including 
conservation, energy efficiency, and distributed generation) to 
congestion or constraint problems. As discussed in Section I.A above, 
the Department sees no reason to conclude that a National Corridor 
designation would either prejudice State or Federal decision processes 
against non-transmission solutions or discourage market participants 
from pursuing such solutions.
    The only ``benefit'' that a National Corridor designation confers 
upon sponsors of proposed transmission projects is the provision of a 
potential Federal forum for review. The existence of this procedural 
option could well result in outcomes that differ from those that would 
result in its absence. Thus, the end result could be the additional or 
earlier construction of transmission. However, the fact that one 
process may produce a different result than another is not proof that 
the process is skewed in favor of a particular substantive result. For 
example, allowing applicants to appeal agency decisions in court can 
produce different outcomes than a system without a judicial right of 
appeal, but the existence of such a right does not constitute a bias. 
The Department has no reason to believe that designation of National 
Corridors will result in transmission projects supplanting superior 
non-transmission solutions.
    As many commenters have noted, FPA section 216(a) does not mandate 
the designation of any National Corridors; the statute states that the 
Department ``may'' designate a National Corridor. As explained further 
in Sections II and III below, the Department has concluded that in the 
case of the Mid-Atlantic Critical Congestion Area, the reliability of 
the supply of electricity to the political capital and to a key 
financial center of this Nation is at some risk; in the case of the 
Southern California Critical Congestion Area, a large and populous 
portion of one State faces threats to reliability while an adjacent 
State says that its generation resources should be reserved for the 
benefit of its residents. While the statute does grant the Department 
discretion, the Department believes that withholding the opportunity 
for a Federal safety net in the circumstances presented would be 
inconsistent with the intent of FPA section 216(a).

[[Page 56999]]

b. Comments on the Merits of Specific Transmission Projects
Summary of Comments
    Most of the written comments as well as most of the oral statements 
made at the Department's public meetings came from individuals who 
indicated that they live or own property near the routes of particular 
proposed transmission projects that would be within the draft National 
Corridors. Many of these individuals commented on the adverse effects 
that approval of these particular transmission projects would have on 
them.\40\ Some of these individuals acknowledged that designation of a 
National Corridor is not the same as approving a specific transmission 
project. Nonetheless, they argued that designation of the draft 
National Corridors would increase the chances that these particular 
transmission projects would be approved, and, thus, consideration of 
the merits of those particular lines in this proceeding is warranted. 
For example, Cynthia Ridout commented:
---------------------------------------------------------------------------

    \40\ See, e.g., comments of Kathleen Yasas (``I live along the 
route that has been proposed by New York Regional Interconnect, Inc. 
(NYRI) for a 400,000-volt direct current power line. This foreign-
owned project would bisect numerous communities, undermine our 
already fragile economy, wreak havoc on our environment and raise 
electric rates while delivering no benefits.''), Charles Elmes (``If 
this [NYRI] line were to go through my property, it would take a 
line through my farm about 6,000 feet long right through the middle 
of my polo fields, essentially putting me out of business and 
rendering the rest of my farm practically useless.''), Fred and 
Debra Burnside (``I protest Allegheny Energy's Trans-Allegheny 
Interstate Line. The line would run through my property and we only 
own 1 acre. I fear it would reduce the value of my property. * * 
*''), Janie Ricciuti (``We live within 600 ft of the proposed 
APTrail. My husband served his country in Vietnam, he has CTCL from 
Agent Orange Exposure. These towers are a death sentence for 
him.''), Vanessa Mueller (``I would like to go on record as saying I 
am opposed to Dominion's proposal to place power lines through this 
area.''), Linda Rose (``We are opposed to Dominion VA Power's 
attempted desecration of our local countryside. * * *''), Teresa 
Barker (``I would like to express my opposition to the Sunrise 
Powerlink * * *. The visual impacts will create a scar on our 
landscape that will endure for generations.''), and Alison Law-
Mathisen (``The City of Los Angeles, under the guise of the `Green 
Path Project,' is targeting many communities with blight * * *''); 
see also statement of Jay Biba at June 12, 2007, Rochester, NY 
public meeting, and statement of Terry Simmons at June 13, 2007, 
Pittsburgh, PA public meeting.

    My home is directly in the path of a proposed 500 kV 
transmission line in Southwest PA. I speak today to defend that 
home. The PA PUC is currently examining the proposal for the line, 
and may yet deny permission for it to be built. This careful 
investigation is the protection offered me as a citizen of PA. The 
looming danger for me, though, is the threat of NIETC designation. 
My fear is that private for-profit companies view the NIETC as a 
carte blanche to quickly gain approval for and build transmission 
lines to reap enormous profits.\41\
---------------------------------------------------------------------------

    \41\ See also comments of Eugene and Kristin Gulland, (``By 
granting the designation, DOE would make a de facto endorsement of 
the [Dominion's/Allegheny's] preferred pathway * * *'') and Kate 
Severinsen (``Corridor designation allows NYRI to complete the state 
Public Service Commission's review process knowing the federal 
government can and will say 'yes' even if the State of New York says 
`no' to it.'').

Numerous elected officials, environmental organizations, and other 
groups raised similar objections to specific proposed transmission 
projects.\42\
---------------------------------------------------------------------------

    \42\ See, e.g., comments of U.S. Rep. Hall, Chenango County Farm 
Bureau, City of Paris, New York, and Communities United for Sensible 
Power.
---------------------------------------------------------------------------

    A number of other commenters described the alleged benefits of 
specific proposed transmission projects that would be within the draft 
National Corridors.\43\
---------------------------------------------------------------------------

    \43\ See, e.g., comments of San Diego Gas and Electric (SDG&E), 
New York Regional Interconnect Inc. (NYRI), Allegheny Energy, Inc. 
(Allegheny), American Electric Power (AEP), and the California 
Chamber of Commerce.
---------------------------------------------------------------------------

DOE response
    As the Department stated in the May 7 Notice and as explained 
further in Section I.A above, designation of a National Corridor is not 
a siting decision, nor does such designation constitute approval or 
disapproval, or endorsement or rejection of any transmission project. 
The Department neither supports nor opposes any of the particular 
transmission projects that have been proposed within the draft National 
Corridors; indeed, the Department has not evaluated the merits of the 
design or route of any specific proposed transmission project, 
including whether any specific transmission project would meet the FPA 
section 216(b)(2)-(6) criteria for issuance of a FERC permit. The 
boundaries of the National Corridors being designated today are not 
based on any proposed transmission projects.
    The existence of a National Corridor designation does not mean that 
any transmission project within that National Corridor will ultimately 
be approved, let alone approved exactly as proposed by the project 
sponsor. As discussed in Section I.A above, if FERC jurisdiction were 
triggered, FERC could issue a permit only if all of the following 
conditions are met: The facilities will be used for the transmission of 
electric energy in interstate commerce; the project is consistent with 
the public interest; the project will significantly reduce congestion 
in interstate commerce and protect or benefit consumers; the project is 
consistent with national energy policy and will enhance energy 
independence; and the project maximizes, to the extent reasonable and 
economical, the transmission capabilities of existing towers or 
structures. FPA sec. 216(b)(2)-(6); 16 U.S.C. 824p(b)(2)-(6). FERC has 
issued regulations governing the process it will follow under FPA 
section 216(b). These regulations provide that if FERC jurisdiction 
under FPA section 216(b) were triggered, FERC would conduct an 
evaluation of the reasonably foreseeable effects of transmission 
construction, including an analysis of alternative routes and 
mitigation options. Based on that analysis, FERC has the authority to 
approve the application, deny the application, or approve the 
application with modifications.\44\
---------------------------------------------------------------------------

    \44\ FERC's experience in siting interstate natural gas 
pipelines demonstrates the latitude that FERC possesses to modify 
applications for energy infrastructure construction. FERC has 
processed many applications to construct natural gas pipelines and, 
where such applications have been approved, the final route has 
almost always been different from that proposed by the project 
sponsor. See, e.g., Millenium Pipeline Co., L.P., 97 FERC ] 61,292 
(2001) (ordering developer to negotiate with elected officials and 
interested parties and citizens to work toward an agreement on an 
alternate route through Mount Vernon, NY); and Greenbrier Pipeline 
Co., LLC, 103 FERC ] 61,024 (2003) (authorizing construction subject 
to 47 different environmental conditions, including a major route 
alternative and four route variations).
---------------------------------------------------------------------------

    Determination of whether and where to site transmission facilities 
raises important and difficult issues, the resolution of which is of 
especially critical importance to the people who live and work near 
those facilities. However, the pros and cons of any particular proposed 
transmission project are not germane to the Department's determination 
under FPA section 216(a) of whether consumers are being adversely 
affected by constraints or congestion such that National Corridor 
designation is appropriate.
c. Designation in the Absence of Current Congestion
Summary of Comments
    A few commenters, including the Organization of MISO States (OMS), 
the National Association of Regulatory Utility Commissioners (NARUC), 
the Ohio Power Siting Board (OH Siting Board), the Michigan Public 
Service Commission (MiPSC), and Communities Against Regional 
Interconnect (CARI), expressed concern about the Department's statement 
in the May 7 notice that the Secretary has discretion to designate a 
National Corridor in the case of a constraint that is hindering the 
development of generation that would be beneficial to consumers without 
demonstrating present congestion.

[[Page 57000]]

These commenters argued that the Department's position appears 
inconsistent with the plain language and legislative intent of FPA 
section 216(a)(2). NARUC asked that the Department clarify how 
constraints or congestion that adversely affects consumers can be 
``experienced,'' as required by the statute, if there is not yet 
generation that constrains or congests the system. OMS requests that 
the DOE reconsider its position or refrain from making these and 
similar findings in its final order on the two draft National 
Corrido