Summary
Details
- The United States of America (USA)
Public utility transmission providers subject to FERC jurisdiction must comply via tariff revisions and planning reforms. RTOs/ISOs and regional planning entities implement through their governance processes and tariff structures.
Generation and storage developers are not directly “regulated by Order 1920,” but are materially affected by planning outputs, cost allocation, and network expansion timing. State commissions play a larger role post-1920-A in shaping cost allocation outcomes.
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What’s Required
Order 1920 is a Federal Power Act-based tariff and planning rule. The compliance mechanism is tariff revisions filed by public utility transmission providers and regional transmission organizations (RTOs/ISOs).
1) Long-term regional transmission planning processes
Transmission providers must adopt processes that:
Use long-term planning horizons and multiple future scenarios.
Evaluate transmission needs driven by generation changes, load growth, electrification, extreme weather, and policy drivers, as required in the planning assumptions.
Identify transmission facilities that address long-term needs, not just near-term reliability violations.
This imposes procedural requirements on how plans are built and which benefits are evaluated.
2) Scenario development and input transparency
Order 1920 requires stakeholder-driven scenario development and planning inputs, increasing compliance obligations around documentation, stakeholder engagement, and defensibility of assumptions. For market participants, it creates a practical obligation to engage early because planning assumptions influence which projects are built and how costs are allocated.
3) Cost allocation reforms for regional facilities
The rule requires transmission providers to use cost allocation methods that are more structured and benefits-based, including identifying transmission benefits and linking them to cost responsibility. Order 1920 also requires more transparent cost allocation processes, and Order 1920-A further elevates the role of state regulators in these processes.
4) Interregional coordination and planning integration
Order 1920 strengthens expectations for interregional planning, which affects projects that cross seams between RTOs/ISOs or between utility planning regions. This is compliance-relevant for developers because it affects timelines and the allocation of upgrade costs that can materially change project economics.
5) Tariff filing and implementation obligations
Public utility transmission providers must file tariff revisions and planning process changes on Commission-set timelines. These filings become enforceable tariff obligations. Once effective, failure to follow the tariff can lead to FERC enforcement exposure.
Important Deadlines
Order 1920 issued: May 13, 2024 (FERC explainer).
Federal Register posting of final order: June 11, 2024 (Federal Register).
Order 1920-A issued: November 21, 2024 (noted by FERC explainer).
Tariff compliance filings: Provider-specific timelines set by the order and subsequent compliance orders (varies by entity and region).
Current Status
Orders 1920 and 1920-A are in effect as a federal regulatory framework requiring compliance filings and implementation by transmission providers. Implementation is ongoing through tariff compliance proceedings and stakeholder processes in each planning region.
Penalties for Non-Compliance
FERC enforcement for tariff violations, including civil penalties.
Refunds or remedial compliance orders.
Litigation risk and invalidation of planning outcomes if tariff processes are not followed.
Because planning and cost allocation affect rates, non-compliance can also trigger rate disputes and settlement risk.
Examples of Known Violations
Key failure modes to anticipate under this regime include:
Planning processes that do not follow the required scenario methods or stakeholder steps.
Benefits calculations that are inconsistent or insufficiently documented for cost allocation.
Cost allocation methods that are not aligned to identified benefits.
Failure to integrate interregional coordination requirements.
Tariff non-compliance in the selection, evaluation, or approval of regional facilities.
These are “process violations” but can create large downstream economic disputes.
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