Publications

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On July 28, 2010, Illinois Gov. Pat Quinn signed into law Public Act 96-1348, which amends the state’s Public Utilities Act (PUA) to alleviate some of the delay and regulatory complexity associated with electric transmission projects.

According to the US Department of Energy, although US electricity demand has increased by about 25 percent since 1990, construction of electric transmission facilities during that time decreased about 30 percent. Transmission line projects involve a host of overlapping federal, state and local regulatory challenges and complying with these requirements can be complex and time consuming.

In Illinois, the state’s PUA contained broadly applicable requirements obligating a public utility to obtain Illinois Commerce Commission (ICC) pre-approval relating to all construction of new facilities, including transmission lines. This process historically has been quite onerous, sometimes resulting in highly contentious and lengthy adversarial proceedings before the ICC that drag on for years.

In May, the Illinois General Assembly  took steps to alleviate some of the delay and regulatory complexity associated with transmission projects, unanimously passing the legislation that Gov. Quinn has signed, which would substantially amend provisions of PUA relating to the siting, development and expansion of electric transmission lines in Illinois.

Enactment of Public Act 96-1348 may change the landscape in Illinois for transmission line projects. First, Public Act 96-1348 enumerates specific instances in which ICC pre-approval of certain transmission-related projects is not required. Second, where ICC pre-approval continues to be required, Public Act 96-1348 provides for an “expedited” process to obtain an ICC decision on a proposed transmission project, with respect both to general approval of a project and to any concomitant request for eminent domain authority.

Public Act 96-1348 amends three separate provisions in the PUA relating to projects involving a “high voltage electric services line,” which is defined as an electric line “having a design voltage of 100,000 or more.” First, Public Act 96-1348 creates a new subsection that specifically exempts certain transmission line projects from the ICC approval process. Second, Public Act 96-1348 provides for an optional “expedited” process in circumstances where ICC approval of a transmission project is still required. Finally, Public Act 96-1348 makes clear that when a public utility seeks expedited approval of a transmission project, the public utility may simultaneously obtain expedited authorization to exercise eminent domain authority.

Exemptions from ICC Pre-Approval Requirements

Public Act 96-1348 provides that a public utility need not seek prior approval from the ICC prior to undertaking any of the following:

• Replacing or upgrading any existing high-voltage line and related facilities
• Relocating any existing high-voltage electric line and related facilities to accommodate construction of transportation infrastructure, or
• Constructing a high-voltage line and related facilities to serve a single customer’s premises or to provide a generator interconnection to the public utility’s transmission system, provided that the line will pass over or under premises owned by the customer or generator to be served or under or over premises for which the customer or generator has secured the right of way

Public Act 96-1348 does not provide for any process to determine whether one of these exemptions properly applies to a given project. Likewise, it does not specify any ICC action that should be taken or remedy that might be imposed in the event that a transmission line is constructed without ICC approval where one of these exemptions does not apply and ICC approval should have been obtained.

Expedited Procedure to Obtain ICC Approval

Public Act 96-1348 also establishes the option of an expedited regulatory review process. Under that expedited procedure:

• The ICC shall issue its decision no later than 150 days after the application is filed. The ICC may extend this deadline by an additional 75 days (with notice by the 30th day after the filing of the application), in which case the ICC proceeding must be concluded in not more than 225 days from the filing date.
• A public utility must have held at least three pre-filing public meetings in each county where the project is to be located no earlier than six months prior to filing the application.
• The public utility must also establish a dedicated website for the project three weeks prior to the first public meeting until the construction of the project is complete.
• The application for the expedited procedure must include:
  • a detailed description of the project and engineering data, including:
    • a detailed project description
    • descriptions of the conductors, structure, and substations
    • the location of the site
    • formulae and methods used in the data preparation
    • additional engineering information related to overhead lines if applicable
    • additional engineering information related to underwater or underground interconnections if applicable
    • technical diagrams that provide clarification of all items included in the application, and
    • identification and details of the rights-of-way for the project.
• There is a fee of $100,000 for each application.
• If the project is approved and constructed, then within 30 days of completion of construction, the public utility must pay an additional construction fee of $20,000 per mile of high-voltage line to each county in which each mile of the transmission line is located. That fee will be in lieu of any permitting fees otherwise imposed by a county.
• A decision granting approval under this new section automatically will include an authorization order pursuant to Section 8-503 of the PUA, which is another section requiring ICC pre-approval of a transmission line project.

Clarifications Regarding the Procedure to Obtain Eminent Domain Authority

Finally, Public Act 96-1348 clarifies the procedures a public utility may follow to obtain authority from the ICC to condemn property. Section 8-509 of the PUA provides that the ICC may, upon a finding of necessity, permit a public utility to take private property under the law of eminent domain. (220 ILCS 5/8-509.) In recent years, there has been some dispute about whether a public utility seeking ICC general approval for construction of a transmission line could simultaneously, in the same proceeding, seek eminent domain authority from the ICC under Section 8-509.

• Public Act 96-1348 amends Section 8-509 to provide explicitly that a public utility may seek eminent domain authority (under Section 8-509) at the same time it seeks approval under the new Section 8-406.1. In such a case, the ICC would be obligated to enter an order on eminent domain authority at the same time that it enters its order regarding the project under the new expedited review process.
• Public Act 96-1348 also provides that if a public utility seeks eminent domain relief separately after an order is entered in the expedited review proceeding, then the ICC shall issue its eminent domain order within 45 days after the utility files its eminent domain petition.

Conclusion

Public Act 96-1348 substantially modifies the system of regulatory review and oversight of siting, development and expansion of electric transmission lines in Illinois. Though the legislation affords new options for expediting or bypassing the existing regulatory structure, careful consideration should be given to both the potential advantages and risks of proceeding under the new rather than the existing requirements for regulatory approval.

For more information about Public Act 96-1348, please contact:

Christopher Townsend

Christopher Skey

Michael Strong