FERC has approved the ISO-NE 'asset condition' transmission review process, and commissioners David Rosner and Judy Chang said other regions should adopt similar processes for local transmission projects.

ISO New England will review utility-planned "asset condition" projects, which are local transmission refurbishment projects that have generally received little regulatory oversight. The Federal Energy Regulatory Commission approved the process on Friday. ISO-NE is already acting as an interim reviewer for some projects this year and plans to take on the formal advisory role in January. Under the plan, ISO-NE will review asset condition projects and report its conclusions on each project's need, its cost-effectiveness and potential alternatives.

In separate concurring statements, FERC commissioners David Rosner and Judy Chang urged other grid operators to adopt similar review processes. "In the context of growing demand and an aging electric grid, building trust and confidence in the need for infrastructure will only serve to expedite permitting and improve the likelihood that projects are ultimately constructed," Rosner said.

Asset condition projects are typically utility-planned efforts to repair or replace aging transmission infrastructure. They can often be built with far less regulatory oversight than other types of projects, which has drawn criticism in New England and other regions. In the PJM Interconnection, these projects are called "local" projects.

Ohio's ratepayer advocate in August urged FERC to address its pending complaint over local transmission projects. The advocate said that since the complaint was filed, Ohio utilities have planned more than $4.3 billion in local transmission with inadequate oversight.

In New England, transmission owners expect to add about $5 billion in asset condition projects by 2034, including about $1.3 billion next year, according to a June ISO-NE presentation. In May, New England ratepayer advocates filed a complaint at FERC over a roughly $360 million asset condition project planned by Eversource Energy in New Hampshire.

According to FERC, the increased transparency offered by ISO-NE's asset condition reviewer plan, which was backed by stakeholders including states, may give people more confidence in the utilities' projects. "Taken together, we find that the proposed functions of the Asset Condition Reviewer will help bring greater visibility into the need for and planning of Asset Condition Projects in ISO-NE," the agency said. FERC added that the review process will give states and stakeholders more ability to provide input at earlier stages of asset condition project development and will help ensure that planned projects and utility asset condition programs are cost-effective.

In her concurring statement, Chang called on other regions to create similar arrangements, saying they would benefit consumers and stakeholders. She said ISO-NE and other regions should also consider extending the expert review and assessment role to "other types of local transmission projects, beyond what New England categorizes as asset condition projects."

New Hampshire Consumer Advocate Donald Kreis, who represents the state's residential ratepayers, said he is "cautiously optimistic that the asset condition reviewer paradigm will make a meaningful difference." Eversource withdrew one of the two projects that ISO-NE had considered as an interim asset condition reviewer. Kreis called this an "outcome we deem noteworthy," and said in an email to Utility Dive on Monday, "I hope this heralds the end of unconstrained asset condition spending in New England."

Last month, Eversource paused its plans for an $82.4 million project near Boston. In that decision, the utility pushed back on a finding by an ISO-NE consultant that it had failed to show the project was needed in the near term. Eversource said the point of proactive planning is to carry out such projects before grid reliability is threatened. "Requiring evidence of physical deterioration or impending failure before replacing a facility that cannot be effectively inspected establishes a threshold that a utility cannot meet without experiencing the very failure the replacement program is intended to prevent," the company said.

The utility said it is "troubled" by ISO-NE's apparent position that an asset condition project should proceed only when a transmission owner shows "specific, concrete evidence" that its equipment is deteriorating.