Power & Policy No. 02 · Federal · Federal Energy Regulatory Commission (FERC)
FERC Order No. 1920 requires long-term regional transmission planning
Transmission providers must plan on a twenty-year horizon, evaluate a defined set of benefits, and file how the cost of the resulting lines will be allocated — a change aimed at building capacity before the queue demands it.
- Transmission planning
- Grid reliability
- Infrastructure funding
Not legal advice
This series is published for general information. It is not legal advice, regulatory advice, or tax advice, and it does not create any professional relationship. Rules change, apply differently by jurisdiction, and turn on facts specific to each project. Consult qualified legal, regulatory, and tax counsel before acting.
The Intelligent Infrastructure Review · Published August 1, 2026 · Record checked August 1, 2026 · 11 min read
In this installment
Why a planning rule matters to a project that will never build a transmission line: it determines whether the capacity a site depends on shows up ahead of demand or only after a study says it is already short.
Policy or regulatory development
In May 2024 FERC issued Order No. 1920, a final rule requiring transmission providers to conduct long-term regional transmission planning on at least a twenty-year horizon, to use specified scenarios and benefits in that planning, and to establish how the costs of selected facilities are allocated. Order No. 1920-A addressed rehearing in November 2024, and compliance filings followed by region.
Jurisdiction
Level
Federal
Authority
Federal Energy Regulatory Commission (FERC)
Where it applies
Public utility transmission providers in each transmission planning region under FERC-jurisdictional tariffs. Implementation is regional: each planning region files its own compliance approach, and state authority over siting and permitting of transmission lines is unchanged.
Who is affected
- Large loads and campus developers
- Whether a region has headroom in five years depends on what its long-term plan selects today. Planning outcomes shape which sites will be servable at scale.
- Utilities and transmission providers
- Planning shifts from near-term reliability needs to scenario-based, long-horizon evaluation, with an obligation to consider a defined list of benefits.
- States and regulators
- The rule provides for state engagement in the planning and cost-allocation process, while leaving siting authority where it already sat.
- Investors and infrastructure funds
- Selected regional facilities carry cost allocation methods that determine who pays, which affects both utility capital plans and the delivered cost of power in a region.
- Generation and storage developers
- Planned regional capacity can reduce the upgrade burden that would otherwise be assigned through the interconnection process.
What changed
- Transmission providers must perform long-term regional transmission planning on a horizon of at least twenty years, on a recurring cycle.
- Planning must use multiple plausible scenarios reflecting factors such as changing resource mix and demand, rather than a single forecast.
- A specified set of economic and reliability benefits must be evaluated when assessing candidate facilities, so a line is not judged on one narrow metric.
- Transmission providers must file a method for allocating the costs of long-term regional facilities they select.
- The rule provides a defined role for relevant state entities in the planning and cost-allocation process.
- Order No. 1920-A addressed rehearing arguments and modified aspects of the rule; regions then implemented it through compliance filings that differ in detail.
Official sources
- Federal Energy Regulatory Commission · Order No. 1920 — Building for the Future Through Electric Regional Transmission Planning and Cost Allocation (final rule) · May 13, 2024 · Docket No. RM21-17-000
- Federal Energy Regulatory Commission · FERC Order No. 1920 fact sheet · May 13, 2024
Why it matters
Most large projects experience transmission indirectly: as a network upgrade assignment, a study result, or a service date. Those outcomes are downstream of whether the region planned for growth in advance. When planning is reactive, capacity is added after a shortage is demonstrated, and the cost lands on whichever projects happen to trigger it. When planning is proactive and long-horizon, capacity can be built to a broader need with cost spread across the beneficiaries. For an energy-intensive project choosing between regions, the quality and stage of a region's long-term plan is a real input, not background.
Potential project impacts
Site selection
Regions with credible long-term plans and funded projects in their pipeline are more likely to be able to serve large new load later in the decade.
Cost exposure
Where a needed upgrade is part of a regionally planned and allocated facility, a project may face a different cost outcome than if it triggers the same upgrade alone through the queue.
Schedule
Planning cycles are long and siting and permitting still occur at the state and local level, so a planned line is not a near-term supply option for a project seeking power within a few years.
Supply strategy
Because planned transmission arrives on a multi-year horizon, near-term projects still need an interim answer — on-site generation, storage, flexibility, or a phased load ramp.
Timing and implementation considerations
Rule issued
May 13, 2024FERC issued Order No. 1920 establishing long-term regional transmission planning and cost allocation requirements.
Order on rehearing
November 2024Order No. 1920-A addressed rehearing requests and revised parts of the rule, including provisions on state involvement.
Regional compliance
Rolling, by planning regionEach planning region files its own compliance proposal, and FERC acts on those filings individually. The operative details for any project sit in the accepted regional tariff.
First plans in effect
Varies by regionThe practical test is when a region's first long-term plan under the rule selects facilities and allocates their cost. Watch the specific region rather than the federal docket.
Risks and uncertainties
Implementation variation
Regions differ in how they scenario-plan, which benefits they weigh, and how they allocate cost, so the rule does not produce a single national outcome.
Siting remains separate
A selected facility still has to be sited and permitted under state and local processes, which can extend or stop a line that planning has approved.
Litigation and revision
The rule and its compliance filings have been contested. Elements can be modified on rehearing or review.
Horizon mismatch
Twenty-year planning does not solve a three-year power need. Treating a planned line as a near-term supply answer is the most common way this rule gets misread.
Questions project teams should ask
For your regulatory counsel
- Which planning region governs this site, and where does its Order No. 1920 compliance filing currently stand?
- What cost allocation method applies to long-term regional facilities in this region, and would our load be within the beneficiary class?
- Are there pending challenges that could change the allocation we are underwriting?
For the utility and planning region
- What does the current long-term plan assume about load growth in this service territory?
- Are any selected or proposed facilities relevant to the substation we would connect to, and what stage are they at?
- What is the expected in-service date, and what siting or permitting steps remain?
For your own team
- Does our schedule depend on planned transmission arriving, and what is our position if it does not?
- What interim supply strategy carries the load until regional capacity is actually in service?
- Would a different region with a more mature plan change the site decision materially?
GRIDSTROM perspective
GRIDSTROM perspective · opinion, not reporting
We read Order No. 1920 as a long-horizon fix to a near-term problem, and we advise treating it that way. It improves the odds that capacity exists in the second half of a decade; it does very little for a project that needs power in the next thirty-six months. The useful move for a sponsor is to read the region's plan as a signal about where the system is heading — which corridors are being reinforced, which load pockets are recognized — and then design a supply strategy that stands on its own if the plan slips. On-site generation, storage, and genuine load flexibility remain the parts of the answer a project actually controls.
This series is published for general information. It is not legal advice, regulatory advice, or tax advice, and it does not create any professional relationship. Rules change, apply differently by jurisdiction, and turn on facts specific to each project. Consult qualified legal, regulatory, and tax counsel before acting.
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