II 109th CONGRESS 1st Session S. 498 IN THE SENATE OF THE UNITED STATES March 2, 2005 Mr. Burr (for himself, Ms. Landrieu, and Mr. Lott) introduced the following bill; which was read twice and referred to the Committee on Energy and Natural Resources A BILL To provide for expansion of electricity transmission networks in order to support competitive electricity markets, to ensure reliability of electric service, to modernize regulation and for other purposes.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Interstate Transmission Act of 2005. (b)

Table of contents

The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Findings. TITLE I—Reliable and economic transmission infrastructure Sec. 101. Transmission infrastructure investment. Sec. 102. Open nondiscriminatory access. Sec. 103. Electric transmission property treated as 15-year property. Sec. 104. Disposition of property. Sec. 105. Electric reliability standards. TITLE II—Protecting retail consumers Sec. 201. Native load service obligation. Sec. 202. Voluntary transmission pricing plans. TITLE III—Voluntary participation in Regional Transmission Organizations Sec. 301. Promotion of voluntary development of regional transmission organizations, independent transmission providers, and similar organizations.

2.

Findings

Congress finds that— (1)transmission networks are the backbone of reliable delivery of electric energy and competitive wholesale power markets; (2)the expansion, enhancement, and improvement of transmission facilities, and rules of the road for using the facilities, are necessary to maintain and improve the reliability of electric service and to enhance competitive wholesale markets across the United States and competitive retail markets that have been adopted by nearly ½ the States; (3)to ensure reliable and efficient expansion, enhancement, and improvement of transmission facilities, the economics of the business of electric transmission and the Federal regulatory structures applicable to the facilities must be improved; (4)Federal electricity regulatory policy should benefit consumers by providing incentives for infrastructure improvement and by removing barriers to efficient competition, and not be dictated by the imposition of market structures or costly mandates; (5)slow, burdensome, or duplicative reviews of utility mergers are a disincentive to the efficient disposition of utility assets needed to ensure a reliable and efficient infrastructure; (6)since efficient competition requires accurate price signals that reflect cost causation, parties that benefit from transmission upgrades should be required to pay for the upgrades; (7)Federal regulation should not override the interests of local consumers or State laws that ensure reliable service and adequate transmission capacity to serve consumers; (8)in regions where the formation of regional transmission organizations or similar entities have been formed voluntarily with oversight or approval by States, the Federal Energy Regulatory Commission should have clear authority to approve applications for the organizations that are consistent with the Federal Power Act (16 U.S.C. 791a et seq.); (9)the States and electricity consumers in each region of the United States, and not the Federal Government, are in the best position to determine how the electric power systems serving their regions should be structured, including whether Regional Transmission Organization formation, traditional vertical integration, or other structures are cost effective for their region; and (10)mandatory reliability rules, developed and enforced by a self-regulating electric reliability organization, are a vital component of a comprehensive policy to ensure a robust and reliable electricity grid.