FERC Order 1000 as a New Tool for Promoting Energy Efficiency and Demand Response

In July 2011, the Federal Energy Regulatory Commission (FERC) issued Order No. 1000, the latest in a series of orders directed at improving federal transmission access, planning, and coordination.1 Order 1000 requires, for the first time, that electricity transmission providers engage in regionwide transmission planning, and further mandates that such planning consider how federal and state public policies affect transmission needs. Public utility transmission providers are now in the process of amending their operating tariffs to comply with this new order. It is therefore an important time for all those with an interest in the future of the electric grid to pay attention to how Order 1000 is being interpreted and implemented by various regions across the country. Order 1000 has been widely touted for its potential to help update our national transmission grid to meet the increasing demand for new transmission created by policies promoting renewable energy. Less remarked upon is the role that Order 1000 could play in ensuring more thoughtful consideration during regional transmission planning of how energy efficiency and demand response policies – critical demand reduction strategies – affect the need for new transmission. This Article describes some of Order 1000’s key planning reforms, discusses how the order can facilitate consideration of these demand-side policies, and offers suggestions on the ways that regional transmission planners might use Order 1000 as an opportunity to update transmission planning to better match our nation’s evolving priorities for the electricity grid