FTC warns FERC regional grid plan may up costs

WASHINGTON -- Federal Trade Commission staff warned that a government proposal to give states more say in a federal electric grid overhaul could undermine its goal of lowering power costs for consumers.

FTC staff said it supported the Federal Energy Regulatory Commission's general aim to boost competition and lower prices while increasing power grid reliability.

But in comments filed at FERC on Friday, FTC staff raised concerns that regional variations allowed by FERC could boost costs for energy companies that buy and sell electricity in multiple regions. The FTC gave no detailed estimate of cost impacts.

FERC's grid-building plan envisions several U.S. regional power grids, which will create super-regional energy markets and hopefully boost available supplies.

Several such regional grids are in the works in the Midwest, Northeast and New England regions. The plan has hit stiff opposition in the Pacific Northwest and Southeast, where state officials see it as an imposition on their turf.

To soften such opposition, FERC in April issued a revised version of its rules that give states more input on timing and reliability standards.

The Federal Trade Commission's staff warned that allowing such regional variations "may impose costs or create risks that will reduce incentives to execute efficient interregional wholesale transactions."

Reuters