Clear Federal Policy Guidelines Needed for Future Canadian Power Imports

GAO reported on the necessity of a clear Federal policy for future Canadian power imports which, since the Middle East oil embargo of 1973-74, have increased sharply and will continue to increase because of proposed new interconnections. As a result, Canadian power purchases have lowered electricity prices, increased dependence on Canadian power, reduced domestic oil use, and affected the environment. The Department of Energy (DOE) is responsible for issuing Presidential permits to utilities which want to construct electrical transmission facilities at international borders. To date, permit applications have been approved on a case-by-case basis without clear guidelines.

GAO found that the appropriate role for Canadian power within the United States remains undetermined. DOE has no direction on how to fulfill its permitting responsibilities and thus has no specific set of criteria to conduct a permit review process. The utility industry is without a clear understanding of the Federal Government's position on importing power and what is required in the permitting process. GAO believes that lack of policy guidelines in the permit process may be part of the general problem of not having a formal electricity policy. DOE has not fulfilled its electricity planning responsibilities which could provide an information basis for making permitting decisions. An effort now underway to develop a national electricity policy could include the policy guidance needed for Canadian electricity.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Daniel C. White Team: General Accounting Office: Energy and Minerals Division Phone: (301) 353-4761