Brief Overview

  • ISO New England on Monday asked federal regulators to approve a plan to strengthen oversight of "asset condition" transmission projects, which are selected and built by transmission owners, primarily to replace aging infrastructure.
  • Under the proposal, which was unanimously approved by ISO-NE stakeholders, the grid operator would review and report on planned asset condition projects, in part to ensure their necessity and cost-effectiveness. ISO-NE's role would be advisory, with no decision-making authority over the projects, but its findings could provide a basis for stakeholders to challenge cost recovery in the future.
  • Amid concerns over electricity costs, Connecticut Democratic Senator Richard Blumenthal on Friday asked the Federal Energy Regulatory Commission (FERC) to strengthen oversight of New England asset condition projects, which have drawn complaints from states and ratepayer advocates. Additionally, he said on Monday that he has introduced a bill requiring FERC to consider "affordability" in its definition of "just and reasonable" rates and to deem potential transmission rate increases that could raise overall retail electricity rates by 5% or more as unaffordable.

In-Depth Analysis

The action in New England comes amid growing nationwide concerns over electricity affordability and the role of transmission construction in overall electricity prices. According to Blumenthal, transmission rates account for about 15% of electricity bills in Connecticut.

In many parts of the United States, utilities build local transmission projects primarily to replace aging infrastructure, with relatively little oversight. In New England, according to Blumenthal's data, asset condition projects account for 73% of transmission owners' annual capital projects.

According to an ISO-NE presentation from June 2026, New England transmission owners expect to add approximately $5 billion in asset condition projects by 2034, with about $1.3 billion next year.

"FERC must provide stricter oversight of asset condition projects, at least by establishing an independent review mechanism," Blumenthal said in a letter to the agency.

In May, New England ratepayer advocates complained to FERC about an approximately $360 million asset condition project planned by Eversource Energy in New Hampshire. Blumenthal noted: "Eversource mischaracterized its X-178 transmission project, subjecting it to a lower level of scrutiny than it should have received, while earning a higher rate of return than other capital projects and operating expenses."

However, oversight would be strengthened if ISO-NE becomes the "asset condition reviewer" under Monday's proposal, effective January 1, 2026. ISO-NE said in its filing to FERC: "The asset condition review changes reflect a consensus approach in New England to address state and stakeholder requests for independent oversight and review of capital projects by transmission owners to replace or rebuild aging, deteriorated, or obsolete transmission elements."

Under the proposal, ISO-NE would review and report on asset condition projects and the conclusions of utilities' asset condition plans. ISO-NE stated that the asset condition review process would have three main objectives:

  • Report on transmission owners' asset monitoring and assessment practices, identify discrepancies and inefficiencies, and promote consideration of improvements and best practices;
  • Report on individual projects; and
  • Provide annual and periodic reports to the grid operator's Planning Advisory Committee on asset condition-related matters.

The reviewer's role is advisory. ISO-NE stated it "will not make decisions on whether to proceed with specific asset condition projects, nor will it act as an applicant for such projects in any local, state, or federal regulatory or siting proceedings."

ISO-NE said that establishing the review process next year will help coordinate with other regional planning activities, such as right-sizing of projects, which stakeholders say is "critical to maximizing efficiency and reducing long-term costs."