Welcome to the first edition of the Factor This Policycast, a fresh podcast collaboration with the national trade group Advanced Energy United that examines laws, regulations, and market rules shaping clean power.

Led by Factor This content director and Emmy-winning reporter Paul Gerke, each installment brings together policy voices to highlight topics guiding the future of the power grid.

The opening discussion centers on competitive transmission procurement, a subject appearing often in recent coverage. Large high-voltage lines require major investment and years to complete. The engineering is complex, and only a limited set of firms possess the needed expertise.

FERC directed utilities to seek competitive bids for these projects roughly fifteen years ago, yet that directive has not been applied consistently. Fresh analysis from R Street shows that open bidding can save ratepayers billions of dollars. Critics claim the process adds delays and concealed expenses, and several Midwest utilities have petitioned FERC to stop bidding inside MISO and SPP.

This episode features Caitlin Marquis, managing director at Advanced Energy United, and Paul Cicio, chair of the Electricity Transmission Competition Coalition. Both support wider use of competition and present supporting evidence. They address the request to end bidding, review FERC authority over consumer costs, and consider obstacles to faster grid expansion when new lines are urgently required.

Listen to the audio-only version of the episode:

New episodes of the Factor This Policycast are released at 6 am ET every other Thursday.

In This Episode

A provision in FERC Order 1000 allows many projects to avoid competitive bidding

"We reached the view that FERC Order 1000 remains official policy, yet the commission has not upheld it," ETCC chair Cicio explained. "A narrow clause stated that projects needed for immediate reliability do not require bidding. That exception has grown into a broad exemption that utilities now use to avoid competition and higher costs for customers."

"Transmission construction offers strong returns," Cicio added. "For each dollar invested, utilities receive multiple incentives from FERC, producing a return on equity of 10 to 12 percent across the full life of the asset."

Thoughtful investment in transmission supports many goals

"Transmission expenses have risen, yet well-designed lines bring clear value to customers by connecting lower-cost generation and cutting overall power prices," said Advanced Energy United managing director Caitlin Marquis. "These outcomes appear when planning occurs on a regional and independent basis."

"Where bidding has been used, the results include lower costs, added savings, and new ideas. Barriers remain because of how transmission continues to be planned and constructed," she noted.

Open bidding produces savings and quicker delivery

"In the MISO and SPP footprints, competition has cut costs by about 30 percent on average compared with sole-source projects. Even after adding the 16-plus months needed for bidding, the selected lines often reach operation sooner," Marquis stated. "Bidders include cost and schedule guarantees to win awards, giving them direct motivation to finish on time and within budget."

"A competitive round encourages utilities to refine their offers and frequently include cost-control measures," Cicio said. "They may propose an 11 or 10 percent return instead of 12 percent, and many also commit to penalties if milestones slip."

"Without rivals, an incumbent utility has no reason to lower expenses or accept written limits on costs or timing," Cicio continued. "That absence of pressure helps explain rising project prices."

"Every project meets the same permitting and supply hurdles, yet competitive lines have repeatedly finished ahead of schedule," Marquis concluded.