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The Honorable Jeff Bingaman
Chairman
Energy and Natural Resources Committee
SD-364 Dirksen Senate Office Building
Washington, D.C. 20510-6150
RE: Electricity Legislation
Dear Chairman Bingaman:
The undersigned groups representing state and local governments would like to begin a dialogue with you to discuss creative measures for responding to electricity restructuring issues.
As you know, the National Governors Association passed the attached policy at their Annual Meeting in Rhode Island earlier this month. The National Governors Association (NGA) policy reaffirms the Governors' opposition to a legislative proposal which would establish federal eminent domain authority over electricity transmission facilities. The Governors also agreed to establish a task force to provide a forum for states, the private sector, and the Administration to examine and discuss ways to ease bottlenecks in the transmission and energy infrastructure system. Late last year, the National Conference of State Legislatures (NCSL) updated its National Energy Policy which was formally adopted August 15 at its Annual Meeting. This policy reinforces its opposition to Federal preemption of state authority over electric facility siting. Also at its Annual Meeting, NCSL adopted an Energy Regionalism policy that supports states working together to address siting and reliability concerns on a regional basis. In addition, by letter addressed to you dated July 23, 2001, the NCSL reiterated its strong opposition to federal eminent domain authority for electricity transmission lines. And in July 2001, the National Association of Counties (NACo) adopted a Resolution on National Energy Policy outlining county officials' opposition to FERC eminent domain authority without the provision of specific requirements that strengthen the role of counties in planning for the siting of these lines. The report prepared for the Western Governors Association entitled, "Conceptual Plans for Electricity Transmission in the West," also provides new avenues for development of transmission facilities. Finally, as the attached "Electricity Policy Principles" document, organizations representing virtually every organization of state and local officials affected by electricity restructuring have spoken with one voice that the regulation of rights of way necessary for expanded utility infrastructure should remain with state and local governmental officials. In short, action is occurring at the state and regional level.
Before any decision is made regarding federal siting legislation (including eminent domain authority), it should first be established through an independent analysis or study that it is in fact the action, or inaction, of state and local governments that is preventing electric transmission lines from being sited. Thus far only anecdotal information concerning these purported siting barriers has been conveyed to the Congress and the Administration - primarily by electric transmission companies and their trade organizations.
With this in mind, the NGA - Center for Best Practices has established an Energy Task Force that, in collaboration with other state and local organizations, will review and make recommendations about siting issues, along with electricity generation and regional market issues. We ask that you give deference to this Task Force and its recommendations before moving forward with any legislative mandates or preemptive language in a legislative proposal.
Sections 201 and 202 of S. 597 offer both a policy on regional coordination and federal support for such efforts. This is a good start, worthy of serious consideration and analysis by the Congress. However, federal preemption is a draconian step completely inconsistent with reasonable views of federalism and energy policy. In fact, many view the problems that have developed in restructuring as primarily failings at the federal level. Enhanced federal authority in that situation may well be counterproductive.
Additionally, certain proposals contained in your September 6 draft legislation on electricity issues would unreasonably constrain state efforts to address electricity restructuring by increasing federal authority. The proposals for enhanced federal jurisdiction over both bundled and unbundled transmission services, a legislative mandate to participate in RTOs, eminent domain authority for FERC, along with several other provisions pre-empting State and local authority, limit the important adjudicatory and regulatory role of State commissions, Governors, legislators and local elected officials.
In short, we hope to work with you and the Committee to develop reasonable legislative proposals that recognize the unique role of state and local government. We want to work with you to help solve problems, not create new ones. In that light, we would propose a meeting between state and local representatives and you and your staff as soon as possible. We look forward to meeting at your earliest convenience, prior to mark up of the electricity title of your legislation.
Thank you for your time and consideration in this important matter.
Sincerely,
National Governors Association
National Conference of State Legislatures
National Association of Counties
National Association of Towns and Townships
National Association of State Energy Officials
National Association of Regulatory Utility Commissioners
National Association of State Utility Consumer Advocates
Association of State Energy Research and Technology Transfer Institutions
Council of State Governments
Cc: All Members of the Senate Energy and Natural Resources Committee
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