Bringing the Camel into the Tent: State and Federal Power over Electricity Transmission

This paper provides a framework for understanding the current controversy regarding jurisdiction over the power grid, and provides policy-oriented solutions to ensure an adequate, low-cost transmission supply. The main thesis of this paper is that sound transmission policy requires greater federal power, and that Congress is better equipped than the courts to enact such policy. To this end, Part I of the paper offers an historical outline of the problem and analyzes the statutes and regulations that form the backbone of both the federal and state jurisdictional claims. Part II looks at legal considerations regarding the scope of federal jurisdiction.

It analyzes the constitutional basis for Congressional power, examines recent litigation challenging the scope of FERC's jurisdiction, and concludes that the states have a stronger position than FERC with regard to the proper interpretation of the Federal Power Act. Assuming that the Supreme Court is not likely to award FERC its desired jurisdiction, Part III of the paper looks at the possibility of a Congressional solution. It examines transmission issues in light of various policy goals, including efficiency, innovation, predictability, fairness, and concepts of federalism. Finally, Part IV offers recommendations for future legislation that can facilitate these policy goals while remaining politically acceptable to all parties.