Modernizing the Electricity Grid
HOW BIPARTISAN PERMITTING REFORM CAN BREAK TRANSMISSION BOTTLENECKS, BRING MORE POWER ONLINE, AND LOWER COSTS FOR CONSUMERS
America cannot meet rising electricity demand simply by building more power plants. New generation must connect to the grid, electricity must reach the communities and businesses that need it, and investments in transmission infrastructure must be planned and financed fairly.
The Bipartisan American Affordability and Jobs Act (BAAJA) addresses these interconnected challenges, helping America build a more reliable, affordable, and efficient electricity system.
THE PROBLEM WITH THE STATUS QUO
Building transmission infrastructure is extraordinarily difficult. Major lines often cross multiple states and regulatory jurisdictions, creating opportunities for overlapping reviews, siting disputes, and litigation that can delay projects for years.
New Mexico’s SunZia transmission project took 17 years to permit and build, as Senator Martin Heinrich, one of the BAAJA’s sponsors, recently noted. Other projects, including Cardinal-Hickory Creek and New England Clean Energy Connect, have encountered similar obstacles. As Senator Armstrong explained in a June op-ed, transmission lines face many of the same permitting challenges that have delayed pipelines, regardless of the energy source they serve.
Even when new power plants are ready to move forward, connecting them to the grid presents another obstacle. According to Lawrence Berkeley National Laboratory, approximately 8,200 proposed generation and storage projects, representing more than 2,000 gigawatts, were awaiting interconnection at the end of 2025. Not all will be built, but the backlog illustrates how grid constraints can prevent new electricity supplies from reaching customers.
Compounding these challenges, neighboring electricity markets frequently disagree over which transmission projects are needed, who benefits, and how costs should be shared. The result is a fragmented system that makes it harder and more expensive to deliver reliable power where it is needed.
HOW THE BIPARTISAN BILL HELPS
BAAJA would address three fundamental obstacles to modernizing America’s electricity grid:
1. Making interstate transmission easier to build. Major transmission projects should not remain indefinitely stalled because they cross state boundaries. The legislation would expand federal backstop siting authority for qualifying interstate projects when state permitting processes fail to produce necessary approvals. Better coordination of federal and state reviews would also help reduce delays while preserving environmental safeguards.
2. Improving transmission planning and cost allocation. Electricity does not stop at state lines, but transmission planning often does. BAAJA would strengthen regional and interregional coordination, establish clearer approaches to allocating costs, and help utilities plan infrastructure around the broader benefits it provides. This would make it easier to advance projects serving multiple markets while promoting fairer treatment of customers.
3. Connecting new generation and making better use of existing infrastructure. The legislation would improve coordination between transmission planning and generator interconnection, helping address bottlenecks that keep new power projects waiting. It would also encourage technologies that increase the capacity of existing transmission lines, allowing more electricity to reach customers without relying exclusively on new corridors.
The potential benefits for American households and the broader economy are substantial. A Rhodium Group analysis estimates that the legislation’s modeled provisions could lower average household electricity bills by 50–78 annually by 2040, reflecting both infrastructure reforms and protections against shifting data-center costs onto other customers.
Resources for the Future projects that the modeled provisions could increase U.S. transmission capacity by approximately 30% by 2041, more than double interregional transfer capability, and reduce electricity-system costs by over $350 billion through 2050. Separately, the Center for Climate and Energy Solutions and Greenline Insights estimate that transmission and interconnection reforms could reduce the cost of electricity shortfalls by more than 76% by 2035 across four major power regions.
WHO SUPPORTS IT — AND WHY
The breadth of support for BAAJA reflects a shared recognition across the electricity sector: America needs to build and connect more power, faster.
Clean energy developers and industry associations see permitting and transmission reform as essential to bringing new generation online. Five leading organizations—SEIA, ACP, Advanced Energy United, ACORE, and CEBA—jointly expressed strong support for the agreement. SEIA President Tim Pawlenty called it “exactly the kind of bipartisan action America needs,” while Heather O’Neill of Advanced Energy United praised its potential to accelerate advanced energy development. ACP CEO Jason Grumet and ACORE President Ray Long have emphasized the importance of durable permits and investment certainty. ACP estimates the legislation could enable more than 300 gigawatts of additional clean power capacity, while Fervo Energy CEO Tim Latimer described the current permitting system as “built for the past.”
Electric utilities, power generators, and transmission developers recognize that meeting rising demand requires both greater permitting certainty and better coordination of infrastructure investment. On November 9, the Edison Electric Institute (EEI), representing America’s investor-owned electric utilities, endorsed the revised legislation, emphasizing improvements to transmission planning, regulatory certainty, and customer protections. ITC Holdings, the nation’s largest independent transmission owner and operator, similarly praised reforms that would accelerate investment in high-voltage transmission.
Their support builds on endorsements from American Electric Power CEO Bill Fehrman, AES Chairman and CEO Andrés Gluski, and Berkshire Hathaway Energy’s Mark Hewett. The Electric Power Supply Association (EPSA), representing competitive power suppliers, also strongly endorsed BAAJA and renewed its call for Senate action on November 5, linking infrastructure constraints to rising demand and electricity affordability.
Transmission experts and advocates have likewise emphasized the importance of a stronger, better-connected grid. Patrick Hughes of Americans for a Clean Energy Grid highlighted the need for stronger connections between regions. Grid Strategies’ Rob Gramlich described the transmission provisions as “very well-crafted,” while the Niskanen Center’s Liza Reed called passage essential to addressing the nation’s struggling grid.
Consumer-owned utilities see similar benefits for the communities they serve. In a joint letter, the National Rural Electric Cooperative Association (NRECA) and American Public Power Association (APPA) expressed strong support for the legislation, emphasizing the certainty utilities need to invest in reliable, affordable energy infrastructure.
Grid-equipment manufacturers and industrial companies have also joined the coalition, underscoring the broader economic importance of modernizing America’s electricity infrastructure. A November 9 letter signed by 85 organizations brought together major grid technology and equipment providers—including GE Vernova, Hitachi Energy, Schneider Electric, and Siemens USA—alongside industrial manufacturers such as Nucor, Cummins, and Volvo Group North America. Their support for the broader permitting agreement highlights the connection between infrastructure investment, American manufacturing, and economic competitiveness.
Energy developers and major electricity customers recognize that new generation has little value if it cannot reach the market. Leeward Renewable Energy endorsed the legislation, pointing to $4.5 billion in planned solar and storage investments on federal land that could deliver seven gigawatts of new generation. Greater permitting certainty and transmission capacity would help make those investments possible.
CEBA CEO Rich Powell described BAAJA as a “generational opportunity to unleash abundant American energy,” while Amazon’s Craig Sundstrom highlighted its potential to unlock investment in generation and transmission. Center for Climate and Energy Solutions President Nathaniel Keohane also called it a critical step forward in modernizing the grid, while Ceres and the Business Council for Sustainable Energy have emphasized permitting certainty and investment confidence.
National security leaders have underscored another dimension of the challenge: military readiness depends on the reliability of the civilian electric grid. Major General Paul D. Eaton, U.S. Army (Ret.), warned that decade-long transmission delays represent a strategic vulnerability.
Across these diverse stakeholders, the message is consistent: America’s ability to deliver affordable, reliable electricity depends not only on producing more power, but on building the infrastructure needed to connect it to customers.
BAAJA offers a bipartisan path toward a better-connected electricity grid—one that can accommodate growing demand, lower system costs, and strengthen American economic competitiveness.