Last October, we posited that Congress could reach a bipartisan deal on permitting reform to address project timelines and get more transmission and clean energy built. With the introduction of the Bipartisan American Affordability and Jobs Act (BAAJA) of 2026, lawmakers are close to doing just that. Here are four ways the transmission policies in the bill, sponsored by Senators Mike Lee, Shelley Moore Capito, Martin Heinrich, and Sheldon Whitehouse this week, can build the grid we need.
Getting more interregional transmission built
The bill includes two provisions promoting high-capacity interregional transmission development: 1) an interregional planning requirement to get lines developed to begin with; and 2) a simpler process for siting interstate lines to ensure that they can actually get built. High-capacity interstate lines are exactly the kind of transmission that the Department of Energy and the North American Electric Reliability Corporation have deemed essential for grid operators to maintain reliability and affordability. Interregional and cross-interconnection transmission can provide customers with significant bang for the buck by connecting power-generation to power demand, no matter where the power supply is located.
Establishes an interregional planning process
BAAJA calls for the Federal Energy Regulatory Commission (FERC) to set standards for interregional transmission planning and cost allocation. It defines the benefits that regional grid operators can consider and clarifies that consumers who would not benefit from a project should not have to pay for it.
Currently, there is no regulatory structure for this level of planning to occur, so the bill would require FERC to undertake a rulemaking to set the baseline standards for how project planning and cost allocations should be done. It would then be up to grid operators to develop plans consistent with the rule, including the benefits consideration.
Streamlines interstate transmission siting
BAAJA would give FERC enhanced federal “backstop siting” authority for lines over 230 kV, through which developers could simultaneously apply to FERC and state regulators. This new authority would accelerate the review process by eliminating the requirement that the DOE must first designate National Interest Electric Transmission Corridors, an approach that has proved ineffective since it was put in place in 2005. It would also simplify FERC’s overall project-evaluation process, distilling its review criteria from seven considerations down to four, while preserving states’ authority over intrastate and low-voltage lines. This is much closer to how FERC approves natural gas pipelines and would provide a solution for stalled interstate projects that currently have no viable path forward.
Simplifying regional planning and generator interconnection
Three provisions in the bill are intended to ensure that regional grid planners can see the grid’s critical upcoming needs, plan for them, and meet them quickly.
Combining processes to improve regional planning
Regional Transmission Organizations (RTOs) today design transmission to either connect new power plants to the grid or to ensure reliability and affordability. These are desirable outcomes, but they could be achieved more efficiently if designed together. The Southwest Power Pool (SPP) RTO is piloting such a combined approach, and BAAJA would go further by requiring FERC to initiate a rulemaking to incorporate both transmission and generation planning into a single process with standardized data outputs. The data standards would ensure that neighboring regional planners and interregional developers are all speaking the same language, which should make both regional and interregional transmission development more efficient.
Automating interconnection to get information to generators faster
To address the backlog of power plants waiting to connect to the grid, BAAJA would also require FERC to initiate a rulemaking that requires grid planners to use software automation to clear interconnection queues. Interconnection is a complicated, time- and resource-consuming process. Automation could relieve some of the burden.
Deploying technology for short-term relief
Advanced transmission technologies (ATTs), such as dynamic line ratings and line reconductoring, can relieve some grid congestion in the short term while longer-term transmission solutions are being built. However, despite ATTs’ merits, utilities underuse them, in part because of their low rate-of-return on investment. The BAAJA tackles the misaligned incentives plaguing ATTs by requiring utilities to study and share publicly where ATTs can be used, and then use them in those locations. Promoting the use of ATTs would save consumers money and help identify where new transmission is most needed.
Ensuring fair competition and consumer protections
Two provisions in the bill are aimed at limiting the reach and strengthening the oversight of monopoly utilities.
Protecting competition from policy reversal
Right-of-first-refusal (ROFR) laws allow incumbent utilities to block competitors from building new transmission lines, even when others can do the job more cost-effectively. Such laws drive up prices for consumers and stifle innovation, drawing ongoing bipartisan criticism at the state and federal levels. Prior to 2011, a federal ROFR benefited incumbent utilities constructing regionally planned lines within their service territories. In 2011, FERC abolished the federal ROFR for regionally planned lines in its Order 1000. The BAAJA would codify the prohibition on federal ROFRs for regionally planned lines and extend that prohibition to lines included in an interregional plan. This is a step in the right direction, forestalling a backslide in policy and protecting competition. Improving regional planning, establishing interregional planning, and preventing the return of ROFRs would ensure that consumers reap the benefits at the lowest possible cost.
Strengthening oversight of local projects
By claiming transmission projects satisfy only local needs, utilities have been able to elude state and federal scrutiny, resulting in unnecessary costs for consumers, an issue that a coalition of consumer organizations cited in a complaint to FERC. BAAJA would allow states to ask FERC to review projects to prevent utilities from exploiting such loopholes and levy penalties on violators. Closing this loophole in oversight would focus transmission development on higher-capacity projects with broader benefits.
The grid needs this bill to become law
After four decades of stagnant load growth, America’s power grid is being pushed to the limit by the rapid rise of artificial intelligence, electrification, and resurgent domestic manufacturing. Consumers, commercial industry, and regulators are all feeling the pressure of rising costs and lower power reliability. It is undeniable that the current regulatory and legislative structures, many dating to the last century, cannot build the power grid needed to ensure future U.S. success.
The Bipartisan American Affordability and Jobs Act is an urgent priority to address grid reliability, affordability, and dominance. Grid governance will need many more policy changes, including better incentives for high-voltage direct current transmission, that will come over the next decade. The bill introduced in the Senate this week includes critical reforms to streamline permitting processes, get more high-capacity interstate transmission designed and built, implement modern technology, and protect ratepayers. Its passage is critical to ensuring affordable and reliable power for all.
