Issued by the Federal Energy Regulatory Commission, FERC Order No. 1920 represents the most comprehensive reform of regional electric transmission planning and cost allocation in more than a decade, fundamentally overhauling how utilities and regional transmission organizations (RTOs/ISOs) prepare the U.S. power grid for clean energy expansion.
Core Order 1920 Requirements
Transmission providers must conduct long-term regional transmission planning over a minimum 20-year look-ahead horizon, updated every five years. Planners must evaluate multiple forward-looking scenarios incorporating state clean energy laws, corporate decarbonization goals, and generator retirement trends.
1. The Seven Mandatory Economic & Reliability Benefit Metrics
To allocate transmission costs across multi-state regions, planners must calculate at least seven core economic benefits:
- Production cost savings and avoided energy losses.
- Avoided or deferred transmission and generation facility capital costs.
- Extreme weather risk mitigation and system flexibility.
- Loss of load expectation (LOLE) reductions and resource adequacy improvements.
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2. Regulatory Citations
- Federal Energy Regulatory Commission: Building for the Future Through Electric Regional Transmission Planning and Cost Allocation, 187 FERC ¶ 61,068 (Order No. 1920).
- Federal Power Act (FPA) Section 206 (16 U.S.C. § 824e).
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