FERC Approves SPP’s Interconnection Overhaul — What Generation Developers and Utilities Nationwide Need to Know

By Ryan J. Regula

On March 13, 2026, Federal Energy Regulatory Commission (FERC) signaled its vision for the future of interconnection reform — and openly urged Regional Transmission Organizations (RTOs) and Independent System Operators (ISOs) across the country to take note. The vehicle for this signal was FERC’s approval of Southwest Power Pool’s (SPP) Consolidated Planning Process (CPP), a sweeping overhaul of interconnection and transmission planning that Commissioners described as a potential national template for addressing interconnection backlogs.

For developers, this means new cost structures, accelerated timelines, and stricter financial commitments first in SPP, and likely elsewhere soon. For utilities, it promises a more predictable transmission planning landscape and improved resource procurement options. Whether you operate in SPP or another region, these reforms merit immediate attention.

The existing framework treats transmission planning and generator interconnection as separate, siloed processes — leading to delays, repeated studies, cost uncertainty, and an increasingly unworkable interconnection queue. The CPP changes this paradigm by consolidating these functions into a single, holistic assessment of regional transmission needs over 10- and 20-year horizons.

Planned Interconnection Locations (PILs). The CPP introduces PILs — pre-identified points on the grid where sufficient transmission capacity exists or is planned. Developers who interconnect at a PIL generally will not face additional network upgrade costs beyond the standardized Generator-Related Interconnection Development Charge (GRID-C). SPP anticipates identifying hundreds of PILs across its footprint, providing clear siting signals.

The GRID-C Rate. Developers will pay a standardized, per-megawatt fee, the GRID-C rate, which is calculated based on projected transmission upgrade costs. SPP will publish the GRID-C rate before the queue cluster window opens, enabling developers to know their interconnection costs upfront. This eliminates the uncertainty of the prior “but for” methodology, where developers often did not learn their full cost responsibility until late in the process. The trade-off: GRID-C rates may be higher than historical network upgrade costs for some projects.

Faster Timelines. The CPP promises interconnection agreements in approximately 9 to 10 months — more than 65% faster than the national average. Key changes include a queue cluster window reduced from 11 months to 2 months, a single Decision Point (after which financial security is largely non-refundable), and a consolidated 180-day study period.

Unplanned Interconnection Locations. Developers who choose not to interconnect at a PIL will pay the GRID-C rate plus directly assigned upgrade costs. This is a deliberate design choice — developers voluntarily forego cost certainty in exchange for flexibility in their point of interconnection.

For utilities and load-serving entities, the CPP promises a more efficiently planned transmission system, which reduces duplicative transmission spending, lowers long-term congestion costs, enhances reliability, and improves resource procurement options. SPP estimates the CPP could reduce planning process costs by more than $3 million annually and potentially avoid over $100 million in duplicative transmission spending each planning cycle.

FERC accepted SPP’s proposed tariff revisions as “just and reasonable”, effective March 1, 2026. Two points must be emphasized.

First, FERC applied a “beneficiary pays” framework — not the traditional “but for” cost causation standard. In other words, FERC determined the CPP is “more akin to a transmission planning process” than to “a traditional, reactive generator interconnection process.” This framing may have implications for future reform proposals in other regions.

Second, the Commissioners’ statements were unambiguous. Commissioner Rosner called the CPP “one of the most innovative, common-sense proposals presented to the Commission since the inception of open access transmission service” and explicitly urged other transmission providers to “consider developing similar integrated solutions.” Commissioner Chang separately encouraged “other RTOs/ISOs to explore similar reforms.” This is not subtle. FERC is openly inviting (and likely even expecting) other grid operators to follow SPP’s lead.

Developers in SPP should immediately reassess project economics and siting strategies. The GRID-C rate must be factored into pro formas from the outset, and site selection should prioritize PIL locations. Projects must be commercially viable before entering the queue and not after.

Developers in other regions should recognize that similar reforms are likely coming. Begin evaluating how a CPP-style framework might impact your pipeline, particularly in regions with comparable interconnection backlogs. Early engagement with grid operators exploring reform may be prudent.

Utilities in SPP should revisit procurement strategies to take advantage of faster interconnection timelines and reduced exposure to duplicative upgrade costs. Coordination with SPP’s planning cycles will be essential.

Utilities in other regions should consider whether advocating for similar reforms is strategically valuable. FERC’s clear endorsement of the CPP model signals that consolidated planning approaches are the Commission’s preferred path forward.