Utilities’ push to extend monopolies may shape grid’s future
Josiah Neeley, Texas director at R Street Institute, a free-market think tank, said the effect of ROFR laws ripples beyond the borders of states that have enacted them and threatens to drive up transmission costs in other Midwestern states by hundreds of millions of dollars. That’s because the cost of regionally planned transmission is spread across the region.
It’s akin, Neeley explained in a blog post, to a group of people who agree to split the bill at a restaurant. If someone orders the lobster, everyone at the table pays more.
The R Street analysis is based on a study by Brattle Group for LS Power, which found that competitively bid transmission projects produced a 20- to 30-percent cost savings.
“This information shows that there is a case for federal action from FERC in order to prevent this sort of interstate conflict through protectionism,” Neeley said.