Oct. 15, 2025 – Behind the ubiquitous light switch runs the electrical grid, rarely considered when the lights are on but that now generates a complaint regarding a proposed $21.8 billion upgrade.

Five state utility regulators argue before the Federal Energy Regulatory Commission (FERC) that the Midwest’s regional grid operator skewed the numbers to justify a project that costs more than it’s worth to cater to states that like renewable energy.

In response, the operator says those regulators participated in the decision, provided comments that changed the plan to their benefit, never raised the issues using the prescribed dispute resolution process – and benefits exceed costs by more than one measurement.

At issue is the extent to which the grid needs to grow to reach distant wind and solar farms to reduce greenhouse gas emissions, or whether doing so wastes money compared with traditional – and often carbon-emitting – centralized power plants.

Some states encourage renewable energy because of scientific evidence that carbon emissions from coal and natural gas combustion create a greenhouse effect, heating the global climate – but other experts dispute that conclusion, and other state regulators disagree with the goal.

The heavy infrastructure of transmitting hundreds of kilovolts of energy takes time to build. In an economy transforming both by sources of energy and new demand to power artificial intelligence data centers, time is of the essence.

Federal Regulation

Changes in federal energy policy since the 1990s have loosened the connection between infrastructure and the local utility. Increased privatization could create competition in this traditional monopoly market.^[1]

Although electric utilities fall under state regulations, the Federal Power Act, 16 U.S.C. sections 791a-828c, authorizes FERC to regulate interstate electricity transmission and wholesale transactions.

Private entities, regulated by FERC, may manage transmission and sales, operating transmission infrastructure while ensuring “nondiscriminatory access.”^[2]

Wisconsin sits in the middle of the area served by Midcontinent Independent System Operator, Inc. (MISO), a regional transmission operator (RTO) approved by FERC.

MISO’s mission of regional electricity reliability makes it central to grid planning in 14 states and the Canadian province of Manitoba.

The foresight necessary to propose, design, receive approvals, build, and put online transmission lines and related infrastructure requires seeing the future now. That’s done through modeling.

The models form a central dispute in the pending regulatory action.

Tranche 2.1

The most recently planned group of transmission projects, known as Tranche 2.1, includes 24 projects and 323 facilities at a cost of $21.8 billion, which MISO says is the largest single investment ever made in the grid.

More than a fifth of that price tag goes to construction in Wisconsin.

Central to the plan is “a 3,631-mile 345 kilovolt (‘kV’) and 765 kV backbone that ensures future reliability,” as MISO described it.

This new electricity freeway would reduce bottlenecks in the existing grid, increasing capacity and reliability.

The plan is only the beginning. Each of the 24 projects in Tranche 2.1 needs approval by the relevant regulators in the states where they are located before construction begins.

Tariff Violator

Regulatory utility commissions in North Dakota, Montana, Arkansas, Mississippi, and Louisiana on July 30 filed a complaint before FERC that argues MISO’s Tranche 2.1 plan violated the relevant tariff.

The FERC docket for the complaint, No. EL25-109-000, currently has more than 125 entries, including 86 requests to intervene from state utility regulators, energy think tanks, clean energy groups, and consumer groups.

Among those filings, governors of Iowa, Illinois, Michigan, and Minnesota have commented in favor of MISO.

Tranche 2.1 was designed to fit within the Multi-Value Project (MVP) terms of the Open Access Transmission, Energy and Operating Reserve Markets Tariff (OATT).

The OATT approved by FERC ensures that MISO fulfills its duties for nondiscriminatory access to and pricing of transmission.^[3]

As the complaint explains, a project that qualifies as an MVP must broadly benefit MISO members, which justifies everyone sharing the costs. After MISO began serving areas in the South, however, that region is not automatically included in cost sharing for Midwestern projects.

Complainants say that the cost-benefit ratio violates those terms because the costs by their calculation exceed the benefits.

Complainants point to assumptions that “states and utilities would meet 100% of non-federally funded mandated and voluntary clean energy and decarbonization goals within their timelines, with a minimum subregional decarbonization of 60% against 2005 levels.”

The model assumed a 30% load growth and an early retirement of older, conventional power plants.

To generate the new electricity needed, the model foresees in the next 20 years more than 369 gigawatts of wind and solar projects, coupled with storage capacity that would allow 24-hour demand from variable wind and solar sources.

Complainants allege that the model failed to show benefits greater than costs using an existing model, but MISO created a new model that made it OK – and the dissatisfaction MISO knew about but proceeded anyway.

The increased costs, complainants argue, could be reduced with a plan that assumes new plants would be built “closer to load” instead of “remotely sited generation … that cannot be delivered without Tranche 2.1.”

That means centralized plants powered by natural gas, coal, or nuclear, instead of rural solar and wind projects.

Cost of Carbon

Similarly, the complainants argue that the model’s estimated cost for the effects of carbon in the energy mix is exorbitant, between $85 and $249 per metric ton.

The low end represents a federal tax credit for carbon sequestration. The higher number comes from a 2023 Environmental Protection Agency (EPA) report codified into Minnesota law.

If federal policy changes, complainants argue, this “social cost of carbon” may be less.

It may be, they argue, no more than the production tax credit of $50 per metric ton and no higher than the federal tax credit estimate of $85 per metric ton.

“[I]t is inappropriate for MISO to impose its view of the social cost of carbon … to justify costly new transmission investment that must be borne by MISO’s customers that do not share MISO’s view,” complainants urge.

Complainants call those choices discriminatory against those states that don’t emphasize renewable energy. States with policies that don’t support renewable energy would have to help pay for the transmission improvements.

Because of these inequities, the complainants asked FERC to declassify Tranche 2.1 as a tariff violation and to require in the future that MISO file a “business case” for FERC approval.

The projects would likely still happen, although with different cost-sharing terms, and the process would delay them.

More Than 300 Meetings

MISO points out that the complainants participated in the development process designed to learn their concerns – and MISO responded to those comments.

Plans for Tranche 2.1 included more than 300 meetings with workshops averaging 275 participants. The final plan represents input from more than 500 stakeholder revisions, MISO calculated.

If a participant had a disagreement after that process, it should have used the OATT dispute resolution process, which didn’t happen, MISO said.

Similarly, a “Protest of Undersigned Organizations” filed with FERC points out that generation plans in North Dakota, South Dakota, western Minnesota, and Mississippi shaped Tranche 2.1.

Eight groups aligned with clean energy, such as Clean Wisconsin, the Environmental Defense Fund, the Sierra Club, and Union of Concerned Scientists, signed the protest.

The approved plan includes changes suggested by North Dakota representatives to benefit natural gas plants and wind farms there, MISO and the protest groups said.

The three Southern states in the complaint, MISO said, wouldn’t pay anything for this project.

‘Respect the Rights of MISO Utilities’

The models themselves aren’t a part of the tariff, MISO defended itself. The complaint styled as a tariff violation, MISO said, never pointed to a tariff term in violation.

In addition, MISO described itself as being responsible for all states’ energy policy choices.

“MISO is not a resource planner and must respect the rights of MISO utilities and states as the resource planners,” meaning that it had to respond to choices for planned wind and solar projects in states that want them.

More practically, centralized plants aren’t easily built near urban customers because of limited land and ample neighbor opposition. No MISO member has proposed such a project, MISO said.

While the “social cost of carbon” remains in dispute, MISO argued that it grounded its estimate on existing values – and even at $50 per metric ton, Tranche 2.1’s benefits would still exceed its costs.

“This type of a long-term outlook for generation is necessary as a starting point for determining long-term transmission needs, giving a balanced consideration to future load growth, as well as state and utility public policy goals,” MISO said, consistent with FERC orders.

Fundamental Utility Law

Beyond the dispute between the complainants’ contentions, MISO argued complainants’ approach violates fundamental utility law.

The failure to point to a tariff violation, according to MISO, means the complaint violates standard utility principles in the Filed Rate Doctrine and the related Rule Against Retroactive Rulemaking.

Because complainants waited nearly eight months after the plan’s approval on Dec. 12, instead of within the mandatory two months, the action illegally harms MISO’s “binding legal obligations,” it argued.

In addition, cancellation would be “contrary to the public interest” in that it would “upset the settled expectation of many market participants” while the complainants failed to “substantiate” harm, MISO argued.

Delays would also hamstring planning that is underway, MISO said.

The Process Is the Problem

“Our country has made it too hard to build infrastructure, and transmission in particular,” the protest summarized. “This Complaint seeks to make it even harder” by raising a complaint “[m]ore than two years after the ‘new’ benefit metrics … were introduced.”

It isn’t the first call for faster infrastructure development from the unlikely source of environmental advocacy groups.

“[W]e need to make it easier to build electricity transmission lines,” said U.S. Sen. Sheldon Whitehouse (D-R.I.), “one of the Senate’s champions of progressive climate change policy,” among others referenced by Professor J.B. Ruhl and Professor James Salzman.^[4]

The environmental law professors agree that America needs green infrastructure, but environmental approvals – and the litigation that often follows – take too long. They call it “The Greens’ Dilemma.”^[5]

The historic environmental laws of the 1970s created review processes that gave citizens a voice, Ruhl and Salzman explain, and opportunities to contest a project before and after regulatory approvals.^[6]

In extreme cases, as Aaron Gordon wrote in “Why Doesn’t America Build Things?,” the delays become a war of attrition that, in time, can kill a project.^[7]

“[F]or groups with enough money or time (it’s best to have both), projects can be stalled for years, even decades under certain circumstances, using the various legal nuances around environmental reviews,” Gordon wrote.^[8]

The process, these authors claim, became the problem.

Trade-offs

The problem cuts both ways. Environmental review can stall transmission lines to new renewable energy fields and hinder infrastructure to keep coal-fired plants running.

Clean coal initiatives for carbon capture and sequestration that would keep coal plants operating without releasing carbon in the atmosphere will require extensive interstate pipelines.^[9]

Groups opposed to clean energy may use environmental laws against clean energy projects.^[10]

Environmental groups themselves have opposed – and at times killed – infrastructure projects designed to connect renewable energy,^[11] sometimes contrary to their national organization.^[12]

In Ruhl and Salzman’s opinion, environmental advocates need to have the debate about the appropriate trade-offs to further clean energy infrastructure.^[13]

The critique echoes a broader discussion about barriers to building what the U.S. lacks – transmission lines, mass transit, and affordable housing.^[14] As Marc J. Dunkelman wrote last spring in The Atlantic, procedure-driven progressive politics have stumbled in negotiating trade-offs, leaving projects unbuilt.^[15]

Consensus for streamlining environmental review creates strange bedfellows. A proposal in Congress drew Democratic and Republican support – and Democratic and Republican opposition. The amendment failed.^[16]

Electricity: A Political Struggle

These debates show that electricity has become more than something one mindlessly switches on or off. It has a political component.

Liberal states ran with President Joe Biden’s green initiatives. Conservative states refused to site the necessary transmission lines.^[17]

Conservative states avoid joining RTOs – organizations like MISO – that serve states supporting green energy because they don’t want to pay for infrastructure costs they disagree with.^[18]

A new administration, as the complainants before FERC imply, may reverse the preferred and discouraged methods of energy production.

Meanwhile, predictions of increased electricity demand necessitate something get built.

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Endnotes

[1] See Marc J. Dunkelman, Why Nothing Works 306 (2025) (summarizing privatization under President George H. W. Bush).

[2] 16 U.S.C. section 796(27) (defining regional transmission organizations (RTOs)); 16 U.S.C. section 796(28) (defining independent system operators (ISOs)).

[3] See 16 U.S.C. section 824j-1 (requiring open access by unregulated transmitting utilities).

[4] J.B. Ruhl & James Salzman, The Greens’ Dilemma: Building Tomorrow’s Climate Infrastructure Today, 73 Emory L.J. 1, 9 (2023).

[5] Id. at 6, 45-48.

[6] Id. at 23-26.

[7] Aaron Gordon, Why Doesn’t America Build Things?, Vice (Aug. 22, 2022), at https://www.vice.com/en/article/93a39e/why-doesnt-america-build-things (last visited Oct. 3, 2025); see also Ruhl & Salzman, supra note 4, at 34-43 (providing examples from green energy projects).

[8] Gordon, supra note 7.

[9] Ruhl & Salzman, supra note 4, at 17.

[10] Id. at 27, 35, 45.

[11] Dunkelman, supra note 1, at 279-91, 313; Ruhl & Salzman, supra note 4, at 34-40, 45-46.

[12] Ruhl & Salzman, supra note 4, at 46-47.

[13] Id. at 45-48.

[14] Gordon, supra note 7.

[15] Marc J. Dunkelman, The Question Progressives Refuse to Answer: As Democrats Become the Party of Proceduralism, They Sidestepped a Crucial Debate, The Atl. (Apr. 2, 2025), at www.theatlantic.com/ideas/archive/2025/04/democrats-need-to-want-to-build/682264/ (last visited Oct. 3, 2025).

[16] Steven Ferrey, Into the Legal “Twilight Zone”: State Tenth Amendment Jurisdiction Displacing Climate Supremacy, 28 Lewis & Clark L. Rev. 715, 734-38 (2025) (discussing the proposal by Sen. Joseph Manchin (D-W. Va.)).

[17] Id. at 718-19, 745.

[18] Id. at 746-47, 770.