2024-08984. Mandatory Transmission and Distribution Planning Support Activities

AGENCY:

Office of State and Community Energy Programs, State Energy Program, Department of Energy.

ACTION:

Interim final rule and request for comment.

SUMMARY:

The U.S. Department of Energy (DOE) is publishing an interim final rule that amends the State Energy Program (SEP) regulations to incorporate certain changes made to the DOE-administered formula grant program by the Infrastructure Investment and Jobs Act of 2021. Through this rulemaking, DOE amends SEP's mandatory requirements for state energy conservation plans.

DATES:

This rule is effective April 29, 2024. Written comments must be received by May 29, 2024.

FOR FURTHER INFORMATION CONTACT:

Ari Gerstman, U.S. Department of Energy, Office of State and Community Energy Programs, State Energy Program, SCEP-30, 1000 Independence Avenue SW, Washington, DC 20585-0121, Telephone: [phone], Email: [e-mail].

SUPPLEMENTARY INFORMATION:

I. Authority and Background

The U.S. Department of Energy's State Energy Program provides financial assistance in the form of formula grants to states, U.S. territories, and the District of Columbia (hereinafter referred to as states) ^[1] for a wide variety of energy efficiency and renewable energy initiatives authorized under the Energy Policy and Conservation Act (EPCA) (Pub. L. 94-163), as amended. 42 U.S.C. 6321 et seq. Section 40109(a)(3) of the Infrastructure Investment and Jobs Act (IIJA 2021) (Pub. L. 117-58) amended Section 362(c) of EPCA, which pertains to the mandatory features of state energy conservation plans. 42 U.S.C. 6322(c). The submission of such plans is required for a state's participation in SEP and receipt of a formula grant. This interim final rule amends SEP regulations in part 420 of title 10 of the Code of Federal Regulations to incorporate the IIJA 2021 amendments.

Section 40109 of IIJA 2021 amended section 362(c) of EPCA to include a new paragraph (7) that mandates the inclusion of transmission and distribution planning support activities into states' energy conservation plans.^[2] 42 U.S.C. 6322(c). With the issuance of this interim final rule, DOE amends 10 CFR 420.15 to include a new paragraph (g) to adopt this new statutory requirement. Once in effect, DOE's regulatory requirement for state energy conservation plans will reflect the corresponding statutory requirement.

DOE is also revising the reference to the Energy Policy and Conservation Act included in the 10 CFR part 420 authority line from Part D to Part B.

II. Interim Final Rulemaking

DOE is issuing this action as an interim final rule, without prior notice and opportunity for public comment, for two reasons. First, in general, the Administrative Procedure Act (APA) requires an agency to first provide public notice of a proposed rulemaking that is published in the Federal Register and provide the public an opportunity to participate in the rulemaking before finalizing the regulatory action. 5 U.S.C. 553(b)-(c). The APA's requirements of notice and public comment do not apply “to the extent that there is involved . . . a matter related to agency . . . grants, benefits, or contracts.” 5 U.S.C. 553(a)(2), emphasis added. SEP is a program that provides formula and competitive grants as well as technical assistance to states to enhance energy security, advance state-led energy initiatives, and increase energy affordability.

The interim final rule amends SEP's regulations to include the new mandatory features for state energy conservation plans established by section 40109(a)(3) of the IIJA 2021. States applying for SEP grants must submit plans that consider these new features in addition to those already set out SEP's regulations. 10 CFR 420.15. Because this rulemaking pertains to DOE's grant program and adopts new mandatory plan features that states must satisfy in order to receive SEP grant funds, the APA's requirements for notice and comment do not apply.

Second, this rulemaking regards a nondiscretionary action because DOE is incorporating the section 40109(a)(3) of IIJA 2021 amendments to SEP's regulations without substantive change. The language adopted in regulation mirrors the language of the statute verbatim and DOE is not amending any other provision of SEP's existing regulations as part of this rulemaking. DOE is simply adopting a mandatory requirement for state energy conservation plans as prescribed in statute into SEP's regulation.

Therefore, because this action concerns a grant program subject to an APA exception and is nondiscretionary, DOE has determined notice and comment is not necessary and is pursuing this activity through an interim final rule.

III. Procedural Requirements

A. Review Under Executive Orders 12866, 13563, and 14094

This final rule has been determined not to be a “significant regulatory action” under E.O. 12866, Regulatory Planning and Review, 58 FR 51735 (October 4, 1993) as supplemented and reaffirmed by E.O. 13563, “Improving Regulation and Regulatory Review”, 76 FR 3821 (Jan. 21, 2011) and amended by E.O. 14094, “Modernizing Regulatory Review”, 88 FR 21879 (April 11, 2023). Accordingly, this rule is not subject to review under the E.O. by the Office of Information and Regulatory Affairs (OIRA) within the Office of Management and Budget (OMB).

B. Administrative Procedure Act

As discussed previously, the Administrative Procedure Act (APA), 5 U.S.C. 551 et seq., generally requires public notice and an opportunity for comment before a rule becomes effective. 5 U.S.C. 553(b)-(c). However, the APA provides that the requirements of 5 U.S.C. 553 do not apply “to the extent that there is involved . . . a matter relating to agency . . . grants, benefits, or contracts.” The interim final rule amends SEP's regulations to include the new mandatory state energy conservation plan features established by section 40109(a) of the IIJA 2021, which amended SEP's state energy conservation plan requirements. States applying for SEP grants are required to submit plans that consider these and the other mandatory features established in statute and codified in SEP's regulations. Because this rulemaking amends SEP's regulations at 10 CFR 420.15 to include features states must satisfy in order to receive a grant from SEP, the APA's general notice and comment requirements do not apply.

C. Review Under the Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires preparation of an initial regulatory flexibility analysis for any rule that by law must be proposed for public comment. As discussed previously, DOE has determined that prior notice and opportunity for public comment is not required under the APA for this rulemaking because it concerns a grant program. Because a notice of proposed rulemaking is not required for this action pursuant to 5 U.S.C. 553, or any other law, no regulatory flexibility analysis has been prepared for this interim final rule. See5 U.S.C. 601(2), 603(a).

D. Review Under the Paperwork Reduction Act of 1995

This interim final rule imposes no new information or recordkeeping requirements. Accordingly, Office of Management and Budget clearance is not required under the Paperwork Reduction Act. (44 U.S.C. 3501 et seq.)

E. Review Under the National Environmental Policy Act of 1969

DOE has determined that this interim final rule falls into a class of actions that are categorically exclude from review under the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq.) and DOE`s implementing regulations at 10 CFR part 1021. Specifically, DOE has determined that this rulemaking is consistent with activities identified in 10 CFR part 1021, subpart D, appendix A6, because it is strictly procedural and meets the requirements for application of a categorical exclusion. Therefore, DOE has determined that promulgation of this rule is not a major Federal action significantly affecting the quality of the human environment within the meaning of NEPA and does not require an environmental assessment nor an environmental impact statement.

F. Review Under Executive Order 13132

Executive Order 13132, “Federalism,” 64 FR 43255 (August 4, 1999), imposes certain requirements on agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. The Executive order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and to carefully assess the necessity for such actions. The Executive order also requires agencies to have an accountable process to ensure meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the development of such regulations (65 FR 13735). DOE examined this interim final rule and determined that it does not preempt State law and does not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Accordingly, no further action is required by Executive Order 13132.

G. Review Under Executive Order 12988

With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” 61 FR 4729 (Feb. 7, 1996), imposes on Federal agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; and (3) provide a clear legal standard for affected conduct rather than a general standard and promote simplification and burden reduction. Section 3(b) of Executive Order 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect, if any; (2) clearly specifies any effect on existing Federal law or regulation; (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this interim final rule meets the relevant standards of Executive Order 12988.

H. Review Under the Unfunded Mandates Reform Act of 1995

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104-4) requires each Federal agency to assess the effects of Federal regulatory actions on State, local, and Tribal governments and the private sector. For a proposed regulatory action likely to result in a rule that may cause the expenditure by State, local, and Tribal governments, in the aggregate, or by the private sector of $100 million or more in any one year (adjusted annually for inflation), section 202 of UMRA requires a Federal agency to publish a written statement that estimates the resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a) and (b).) The UMRA also requires a Federal agency to develop an effective process to permit timely input by elected officers of State, local, and Tribal governments on a proposed “significant intergovernmental mandate,” and requires an agency plan for giving notice and opportunity for timely input to potentially affected small governments before establishing any requirements that might significantly or uniquely affect small governments. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA (62 FR 12820) (also available at www.energy.gov/​gc/​office-general-counsel). This interim final rule does not contain an intergovernmental mandate or a mandate that may result in the expenditure of $100 million or more in any year, so these requirements under the Unfunded Mandates Reform Act do not apply.

I. Review Under the Treasury and General Government Appropriations Act of 1999

Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This interim final rule would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.

J. Review Under Executive Order 12630

Pursuant to E.O. 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 18, 1988), DOE has determined that this interim final rule would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution.

K. Review Under the Treasury and General Government Appropriations Act, 2001

The Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516 note) provides for Federal agencies to review most disseminations of information to the public under guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 2002). DOE has reviewed this interim final rule under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.

L. Review Under Executive Order 13211

Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to prepare and submit to the Office of Information and Regulatory Affairs (OIRA), Office of Management and Budget, a Statement of Energy Effects for any proposed significant energy action. A “significant energy action” is defined as any action by an agency that promulgated or is expected to lead to promulgation of a final rule, and that: (1) Is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any proposed significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use.

This interim final rule would not have a significant adverse effect on the supply, distribution, or use of energy and, therefore, is not a significant energy action. Accordingly, DOE has not prepared a Statement of Energy Effects.

M. Congressional Notification

As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of this rule prior to its effective date. The report will state that it has been determined that the rule is not a “major rule” as defined by 5 U.S.C. 804(2).

IV. Approval of the Office of the Secretary

The Secretary of Energy has approved publication of this interim final rule.

List of Subjects in 10 CFR Part 420

• Energy conservation
• Grant programs—energy
• Technical assistance

Signing Authority

This document of the Department of Energy was signed on April 22, 2024, by David Crane, Under Secretary for Infrastructure, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register .

Signed in Washington, DC, on April 23, 2024.

Treena V. Garrett,

Federal Register Liaison Officer, U.S. Department of Energy.

For the reasons set forth in the preamble, the Department of Energy amends part 420 of chapter II, subchapter D of title 10 of the Code of Federal Regulations as set forth below:

PART 420—STATE ENERGY PROGRAM

1. The authority citation for part 420 is revised to read as follows:

Authority: Title III, part B, as amended, of the Energy Policy and Conservation Act (42 U.S.C. 6321 et seq.); Department of Energy Organization Act (42 U.S.C. 7101 et seq.)

2. Amend § 420.15 by revising the section heading and adding a new paragraph (g) to read as follows:

§ 420.15

Annual State applications and amendments to State plans.

* * * * *

(g) The mandatory conduct of activities to support transmission and distribution planning, including—

(1) Support for local governments and Indian Tribes;

(2) Feasibility studies for transmission line routes and alternatives;

(3) Preparation of necessary project design and permits; and

(4) Outreach to affected stakeholders.

Footnotes

1.  Per 10 CFR 420.2, “state” means a state, the District of Columbia, Puerto Rico, or any territory or possession of the United States.

2.  The mandatory plan features include “the mandatory conduct of activities to support transmission and distribution planning, including—(A) support for local governments and Indian Tribes; (B) feasibility studies for transmission line routes and alternatives; (C) preparation of necessary project design and permits; and (D) outreach to affected stakeholders.” 42 U.S.C. 6322(c)(7).