Premium
IMPROVING U.S. TRANSMISSION EXPANSION POLICY THROUGH ORDER NO. 1000
Author(s) -
Benjamin Richard M.
Publication year - 2016
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/coep.12158
Subject(s) - order (exchange) , commission , cost allocation , transmission (telecommunications) , economics , agency (philosophy) , public economics , business , environmental economics , computer science , finance , telecommunications , accounting , philosophy , epistemology
This article examines the latest attempt of the United States' regulatory agency, the Federal Energy Regulatory Commission ( FERC ), to promote transmission expansion through the transmission planning and cost allocation principles contained in its recently issued Order No. 1000. It finds the level of detail contained in the order's cost allocation principles to be insufficient to achieve FERC 's goals. It argues that the order does provide important principles for both transmission planning and expansion, though. It thus presents a cost allocation methodology which channels the order's strengths. Specifically, the methodology obtains an estimate of the benefits of a project and aligns the costs and benefits of the project accordingly. ( JEL K23, Q48)