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Arkansas House Bill HB1813

Arkansas 2025 Regular Session

Arkansas House Bill HB1813 Compare Versions

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11 Stricken language would be deleted from and underlined language would be added to present law.
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33 State of Arkansas 1
44 95th General Assembly A Bill 2
55 Regular Session, 2025 HOUSE BILL 1813 3
66 4
77 By: Representative Gramlich 5
88 6
99 7
1010 For An Act To Be Entitled 8
1111 AN ACT TO ADOPT THE FAIR AND EFFICIENT TRANSMISSION 9
1212 COMPACT; AND FOR OTHER PURPOSES. 10
1313 11
1414 12
1515 Subtitle 13
1616 TO ADOPT THE FAIR AND EFFICIENT 14
1717 TRANSMISSION COMPACT. 15
1818 16
1919 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 17
2020 18
2121 SECTION 1. Arkansas Code Title 23, Chapter 3, is amended to add an 19
2222 additional subchapter to read as follows: 20
2323 Subchapter 8 — Fair and Efficient Transmission Compact 21
2424 22
2525 23-3-801. Text of compact. 23
2626 The Fair and Efficient Transmission Compact is enacted into law and 24
2727 entered into by this state with all states legally joining therein and in the 25
2828 form substantially as follows: 26
2929 27
3030 FAIR AND EFFICIENT TRANSMISSION COMPACT 28
3131 29
3232 Article 1 — Statement of Purpose, Findings and Declaration of Policy 30
3333 The intent of the Fair and Efficient Transmission Compact ("Compact") is to 31
3434 lower the cost of construction of new high -voltage transmission 32
3535 infrastructure and facilitate the expansion of transmission capacity through 33
3636 cost-effective transmission planning, siting and construction. 34
3737 The mid-South region is experiencing rapid growth in energy demand as 35
3838 business and industry of all types seek to build, expand and relocate to 36 HB1813
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4141 areas that have an abundance of affordable and reliable energy resources. 1
4242 This economic growth benefits citizens by creating jobs, increasing local 2
4343 revenues, and supporting new business opportunities. 3
4444 To ensure that the states in the mid -South region participate in this 4
4545 transformative economy, the parties to this Compact understand that new 5
4646 transmission capacity must be added to the grid and will pursue measures 6
4747 necessary to attract infrastructure investments to advance innovation, use of 7
4848 improved technology and enhance our national security. 8
4949 A robust, multi-state, regional transmission system provides a range of 9
5050 benefits for citizens and consumers, including access to all types of 10
5151 generation resources, economic development activity, and enhanced grid 11
5252 resiliency in the face of multiple threats. However, certain policies and 12
5353 regulatory inaction have hampered the ability to modernize and expand 13
5454 transmission assets in the mid -South region. 14
5555 By entering into this Compact, the participating states affirm that policies 15
5656 that encourage and allow for a competitive transmission construction bidding 16
5757 process is in the public interest and in the best interest of electric 17
5858 ratepayers and the electric marketplace. While the independence and special 18
5959 needs of each state are to be recognized and safeguarded, today’s regional 19
6060 and interregional transmission needs require cooperative action among states 20
6161 to avoid the application of discriminatory, anti -competitive policies and 21
6262 allow different companies to compete for the opportunity to construct new 22
6363 transmission infrastructure. 23
6464 24
6565 Article 2 – Definitions 25
6666 Compact – An interstate legal agreement or document between the states 26
6767 of Arkansas, Louisiana, Mississippi and Texas 27
6868 Dynamic Line Rating (DLR) - Shall refer to any technology or 28
6969 methodology used to more accurately determine current -carrying capacity 29
7070 limits of existing or new transmission lines by determining conductor thermal 30
7171 ratings with improved or more accurate data. 31
7272 Electric Transmission – The process of moving bulk electricity from 32
7373 power generation stations to where it is consumed by end -use customers. 33
7474 Infrastructure involved includes high -voltage power lines, substations, 34
7575 transformers and associated equipment. 35
7676 ERCOT – Electric Reliability Council of Texas is a regional entity that 36 HB1813
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7979 manages the transmission system in the central and southern portion of Texas. 1
8080 Grid-Enhancing Technologies (GETs) – The use of advanced transmission 2
8181 technologies and analytical tools to maximize the use of electricity across 3
8282 the existing (and future) high voltage transmission system that include 4
8383 dynamic flow rating sensors, power flow control devices, advanced conductors, 5
8484 and improved viability of inverter -based generation availability. 6
8585 Load Growth – Shall refer to the increase in demand for electricity 7
8686 over time, which is factored into the strategies of planning by regional 8
8787 transmission organizations and retail electricity providers. 9
8888 Long-Term Transmission Planning – This is an open, structured effort to 10
8989 expand the transmission system in a multi -state, regional and interregional 11
9090 area to meet the economic development opportunities, generation 12
9191 interconnection requests, base line reliability requirements and resiliency 13
9292 with improved economic and operational characteristics of the transmission 14
9393 system. 15
9494 MISO - Midcontinent Independent System Operator is an independent, not -16
9595 for-profit, member-based regional transmission organization (RTO) in the 17
9696 central portion of the United States from Canada to the Gulf of Mexico and is 18
9797 responsible for keeping the power flowing across its geographic region 19
9898 reliably and cost effectively. It is part of the Eastern Interconnection 20
9999 grid. 21
100100 MISO South – A subregion of MISO that includes parts of the states of 22
101101 Arkansas, Louisiana, Mississippi and Texas. 23
102102 Open Bidding Process – A process to allow competitive bidding by 24
103103 different qualified entities to design, construct, and own new transmission 25
104104 projects to expand the existing transmission system. 26
105105 PJM Interconnection LLC (PJM) - is a regional transmission organization 27
106106 (RTO) in the United States. It is part of the Eastern Interconnection grid 28
107107 operating an electric transmission system serving all or parts of Delaware, 29
108108 Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, 30
109109 Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of 31
110110 Columbia. 32
111111 Regional Transmission Organizations (RTO) - This is an independent, 33
112112 organization that manages the transmission of electricity across multiple 34
113113 states. RTOs are responsible for ensuring the reliability of the power 35
114114 supply and balance between supply (usually generation) and demand (load 36 HB1813
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117117 connected to the transmission system). Some examples of RTOs in the 1
118118 transmission system of the Eastern Interconnect are ISO -NE, MISO, NYISO, PJM 2
119119 and SPP. 3
120120 Right of First Refusal (ROFR) – Usually state laws that give incumbent 4
121121 utilities the first right to construct, own, and operate new transmission 5
122122 lines within their service territory. These laws often limit or prohibit 6
123123 non-traditional utility entities from participating in the design, 7
124124 construction, operation, ownership and maintenance of transmission 8
125125 facilities. 9
126126 State Regulatory Entities – The present state or local authorized 10
127127 regulatory entities (public utility commissions or city council) providing an 11
128128 oversight and policy direction for utilities within a state or local area 12
129129 which are authorized by the various state constitutions and laws. 13
130130 SERTP – Southeastern Regional Transmission Planning is a group of 14
131131 entities involved in the planning of the expansion and development of the 15
132132 transmission system in the southeastern United States under the management of 16
133133 the following entities: Southern Company, Dalton Utilities, Georgia 17
134134 Transmission Corporation, the Municipal Electric Authority of Georgia, 18
135135 PowerSouth, Louisville Gas & Electric Company, Kentucky Utilities Company, 19
136136 Associated Electric Cooperative Inc., the Tennessee Valley Authority, Duke 20
137137 Energy Carolinas, LLC, Duke Energy Progress, LLC. SERTP is part of the 21
138138 Eastern Interconnection grid. 22
139139 SPP – Southwest Power Pool is a regional transmission organization 23
140140 (RTO) in the central, southwest and northwestern parts of the United States; 24
141141 a nonprofit corporation mandated by the Federal Energy Regulatory Commission 25
142142 to ensure the reliable supply of power, adequate transmission infrastructure 26
143143 and competitive wholesale electric prices on the behalf of its members. SPP 27
144144 is part of the Eastern Interconnection grid. 28
145145 29
146146 Article 3 – Council Established 30
147147 There is hereby created an agency of the party states to be known as the Fair 31
148148 and Efficient Transmission Council (“Council”) to administer the Compact. 32
149149 The Council shall commence operations upon adoption of the Compact by at 33
150150 least three of the party states in the mid -South region. The Council shall 34
151151 be composed of delegations from each party state that has adopted the 35
152152 Compact. Each delegation shall be composed of three representatives from 36 HB1813
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155155 each state, one of whom shall be appointed or designated in each party state 1
156156 to represent the Governor, the State Senate, and the State House of 2
157157 Representatives, respectively. Each Council representative shall be 3
158158 designated or appointed in accordance with the law of the state which he or 4
159159 she represents and serving and subject to removal in accordance with such 5
160160 law. Any member of the Council may provide for the discharge of his or her 6
161161 duties and the performance of his or her functions thereon (either for the 7
162162 duration of his membership or for any lesser period) by a deputy or 8
163163 assistant, if the laws of his state make specific provision for this 9
164164 assignment of these responsibilities. This assignment of a deputy or 10
165165 assistant shall be sent to the Executive Director or Chairman of the Council 11
166166 in writing prior to the event or meeting where the deputy or assistant will 12
167167 represent the Council representative. 13
168168 Each member of the Council shall be entitled to one vote each. No action of 14
169169 the Council shall be binding unless taken at a meeting at which a majority of 15
170170 all party states are represented and unless a majority of the total number of 16
171171 votes on the Council are cast in favor thereof. 17
172172 The Council shall appoint an Executive Director who will serve at its 18
173173 pleasure and who shall act as the Secretary. The Executive Director, with 19
174174 the approval of the Council, shall appoint and discharge such personnel as 20
175175 may be necessary for the performance of the Council’s activities. This 21
176176 Council shall meet at least once a year. The Council, with the assistance of 22
177177 the Executive Director, will develop Bylaws to assist in the activities 23
178178 associated with its operation. 24
179179 25
180180 Article 4 – The Council 26
181181 The Council shall not be construed to displace the regulatory 27
182182 responsibilities of the existing relevant electric rate regulatory 28
183183 authorities. The Council shall prepare and keep current guidelines for fair 29
184184 and efficient transmission construction that support an open bidding process 30
185185 for new transmission facilities. These guidelines shall be developed within 31
186186 one year of the creation of the Council. 32
187187 The Council shall elect, from among its members, a Chairman, a Chairman -33
188188 Elect, and a Treasurer. Elections shall be annual. The Chairman -Elect shall 34
189189 succeed to the office of Chairman for the year following his service as 35
190190 Chairman-Elect. For purposes of the election and service of officers of the 36 HB1813
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193193 Council, the year shall be deemed to commence at the conclusion of the annual 1
194194 meeting of the Council and terminate at the conclusion of the next annual 2
195195 meeting thereof. 3
196196 The Council annually will prepare a report for the Governor of each party 4
197197 state, this report covers the activities of the Council for the preceding 5
198198 year, proposed activities for the coming year, and any recommendations 6
199199 adopted by the Council. 7
200200 8
201201 Article 5 – Principles of Fair and Efficient Transmission Construction 9
202202 States that enter into and become a party to the Compact shall agree to 10
203203 recognize the following principles and pursue policies that allow for a 11
204204 competitive, fair and efficient transmission market to flourish in the mid -12
205205 South region: 13
206206 1. Energy Agnostic. State statutes, regulations, ordinances and 14
207207 policies shall not discriminate against any particular energy resource, 15
208208 energy generation method or procured energy type. Technology agnostic energy 16
209209 policies ensure that energy sources are chosen based on cost and reliability. 17
210210 State policies must reflect an openness to using a variety of energy 18
211211 resources, rather than a limit to a single type of energy. 19
212212 2. Transmission Project Cost Allocation. The cost of new transmission 20
213213 projects should be allocated holistically to all entities, that cause these 21
214214 costs and that directly benefit, in a manner that is roughly commensurate 22
215215 with, and proportional to, the costs caused and benefits received by those 23
216216 projects. The cost allocation should be as granular and accurate as possible 24
217217 while avoiding the targeting of specific industries. Costs should not be 25
218218 assigned to parties that receive negligible or negative benefits. The 26
219219 generators and loads can each be considered cost causers, beneficiaries, or 27
220220 both and should be allocated costs accordingly. Retail jurisdictions that 28
221221 directly seek to meet a public policy requirement through development of a 29
222222 transmission project(s) should be considered a beneficiary of that project. 30
223223 The cost allocation methodology for a transmission project should be fixed at 31
224224 the time of the project approval. 32
225225 3. Application of Interstate Compact. This agreement will be 33
226226 submitted to and reviewed by each state legislative body for approval. Once 34
227227 the Compact is approved, the Compact shall apply to all states equally 35
228228 regardless of the time of adoption compared to the establishment of the 36 HB1813
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231231 Compact. States will have equal representation, equal authority and equal 1
232232 protection in the adoption and execution of a competitive bidding framework 2
233233 and process. 3
234234 4. Uniform Siting and Certification of Transmission Projects. This 4
235235 Compact shall support two separate processes for siting and certification of 5
236236 transmission projects. The states participating in this Compact will develop 6
237237 a uniform siting process and certification standards as a condition of 7
238238 joining the Compact. Participating states shall adopt the mutually agreed 8
239239 upon processes for siting and certification of new transmission projects. 9
240240 These processes must define a clear start date and define the party 10
241241 responsible for initiating the process start date. The use of this uniform 11
242242 siting and certification process may be used to minimize the time needed for 12
243243 approval in additional states, once the first state has provided its approval 13
244244 for interregional transmission projects. The member states’ processes for 14
245245 siting, certification, and permitting shall provide a clear understanding for 15
246246 relevant stakeholders. 16
247247 5. Valuing Grid-Enhancing Technologies. Grid-enhancing technologies 17
248248 (GETs) have been demonstrated to provide economic, operational and 18
249249 reliability benefits and can be a timelier and/or cost -effective solution as 19
250250 compared to new transmission line development. The Council shall recognize 20
251251 and value the stated benefits of utilizing GETs for improvement of 21
252252 transmission facilities, enhancement of grid performance and expansion of 22
253253 existing transmission line capacity. States adopting the Compact shall allow 23
254254 and streamline permitting and regulatory reviews for utilization of GETs. 24
255255 Furthermore, member states of the Compact shall provide for the assurance 25
256256 that GETs receive fair monetary valuation in any transmission developer’s 26
257257 competitive bid. 27
258258 6. Competitive Construction Bid Process. This Compact shall promote 28
259259 intrastate and interstate transmission development and enhancement and 29
260260 embrace the minimization of costs using an open bidding process. The open 30
261261 bidding process should consider benefits to ratepayers including but not 31
262262 limited to ensuring reliability, ratepayer cost savings, maximizing grid 32
263263 efficiency, reducing grid congestion, and mitigating against grid stressing 33
264264 events. The states participating in the Compact shall design and adopt into 34
265265 this Compact a process for the administration and oversight of the bid 35
266266 opening and selection process. The participants in this Compact may choose 36 HB1813
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269269 to allow MISO to administer an open competitive bid selection process for the 1
270270 construction of certain transmission projects. The present MISO process for 2
271271 projects identified through Long Range Transmission Planning allow for 3
272272 competitive bid processes for proposed new transmission projects. The 4
273273 information on these MISO processes can be found in the Competitive 5
274274 Transmission Process in Business Practice Manual BP -027 and Minimum Project 6
275275 Requirements for Competitive Transmission Projects BP -029 both dated 7
276276 1/25/2025. 8
277277 7. Waiver for Existing Transmission Infrastructure. Existing 9
278278 transmission infrastructure that has previously been permitted by states 10
279279 participating in the Compact shall not be required to obtain new permits for 11
280280 the purpose of upgrading, maintenance or renovation activities. Transmission 12
281281 projects permitted to be constructed but delayed due to actions and matters 13
282282 beyond the control of the developer shall not be forced to engage in the 14
283283 permitting process if the original permits were obtained within a previous 15
284284 10-year period. States participating in this Compact shall take action to 16
285285 remove permitting barriers at applicable state agencies and regional bodies. 17
286286 18
287287 Article 6 - Construction and Severability 19
288288 This Compact shall be liberally construed so as to effectuate the purposes 20
289289 thereof. The provisions of this Compact shall be severable and if any 21
290290 phrase, clause, sentence or provision of this Compact is declared to be 22
291291 contrary to the constitution of any state or of the United States, or the 23
292292 application thereof to any government, agency, person or circumstance is held 24
293293 invalid, the validity of the remainder of this Compact and the applicability 25
294294 thereof to any government, agency, person or circumstance shall not be 26
295295 affected thereby. If this Compact shall be held contrary to the constitution 27
296296 of any state participating therein, the Compact shall remain in full force 28
297297 and effect as to the state affected as to all severable matters. 29
298298 30
299299 Article 7 — Finances 31
300300 The costs associated with the Council’s administration and operational 32
301301 activities will be supported by an equal assessment to each state represented 33
302302 on the Council. The Council will maintain adequate records to support the 34
303303 expenses of operating this Council. No contracts with the Council will be 35
304304 entered into or expenses incurred to support the Council’s activities without 36 HB1813
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307307 a majority affirmative vote of its members. 1
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309309 23-3-802. Administration of Fair and Efficient Transmission Compact — 3
310310 Rules. 4
311311 (a) The various states party to the Fair and Efficient Transmission 5
312312 Compact will rely on their respective Public Service Commission or Public 6
313313 Utility Commission (Commission), such as the Arkansas Public Service 7
314314 Commission, to administer the compact. A state’s Commission will be the 8
315315 compact administrator for that state, unless administration of the compact 9
316316 causes conflicts with existing laws, rules, or authorities that govern the 10
317317 function and conduct of the Commission. In such case, a state may assign 11
318318 responsibility to administer the compact to another agency capable of such 12
319319 responsibility. 13
320320 (b) A Commission may adopt rules that are consistent with the compact 14
321321 necessary to implement this subchapter and are consistent with the principles 15
322322 in Article 5 of the compact. 16
323323 (c) A Commission is not required to adopt the rules of the Fair and 17
324324 Efficient Transmission Council for the rules of the Fair and Efficient 18
325325 Transmission Council to be effective in this state. 19
326326 (d) For the purposes of the member state's ability to reject a rule 20
327327 under Article 4 of the compact, a state may delegate its authority in this 21
328328 provision to its Legislature, General Assembly, or a duly authorized and 22
329329 recognized Legislative Council or Committee thereof. 23
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