FERC Lets MISO Fund $904 Million of ComEd Transmission Inside PJM Without Competitive Bidding

Utilities that own transmission inside PJM will now build and own lines that MISO needs and MISO pays for. The Federal Energy Regulatory Commission approved that arrangement on August 14, 2026. Commonwealth Edison, the Exelon utility serving northern Illinois, will build about $904 million of these facilities. Duke Energy Ohio will build $5.3 million. Neither package went through a competitive solicitation, and FERC declined to order one.

What Actually Changed

MISO plans transmission for its own footprint. Its authority as transmission provider stops at the MISO system boundary. Before this order, no tariff mechanism let MISO pay an outside utility to build a line the MISO plan required.

MISO filed for one on February 27, 2026, under Section 205 of the Federal Power Act. The filing creates a framework for Cost Recovery and Funding Agreements, which MISO shortens to CRAF. Under a CRAF agreement, MISO funds the facility. The outside owner builds it, owns it, and operates it. The line sits in PJM territory, under PJM functional control.

The framework covers five PJM transmission owners. They are Commonwealth Edison Company, Indiana Michigan Power Company, AEP Indiana Michigan Transmission Company, American Transmission Systems, and Duke Energy Ohio.

Why the Work Sits Outside MISO

The facilities support Tranche 2.1 of the MISO Long-Range Transmission Plan. The MISO Board approved that portfolio on December 12, 2024, at roughly $21.8 billion. It holds 24 Multi-Value Projects made up of 323 individual transmission facilities. The projects target in-service dates from 2032 to 2034. Together they form a 3,631-mile backbone at 345 kV and 765 kV.

Tranche 2.1 shifts power flows that the existing PJM system has to absorb. PJM and several of its transmission owners studied the effect. Their analyses identified upgrades on their side of the seam. Those upgrades, plus tie-line and substation work already inside the board-approved portfolio, are what the CRAF agreements cover.

Why It Matters

MISO customers fund these facilities. They will not own them, and MISO does not operate them. The utilities that build them answer to PJM for operations and to their own state regulators for the rest. That split puts the money on one side of the seam and the control on the other. The competitive check that normally sits in front of a project this size does not exist here.

What Didn’t Change

The MISO competitive process is untouched. Competitive Developer Selection still applies to Tranche 2.1 facilities inside the MISO footprint. MISO started that process in January 2025. PJM planning is untouched too. The order hands MISO no planning authority over the PJM system. It hands MISO a way to pay for work on it.

Enforcement Reality

The exemption from competitive bidding is not a finding that incumbents build cheaper. It rests on a jurisdictional gap. MISO argued that it has no authority to run a competitive solicitation outside its own footprint. It also has no power to compel an external utility to accept a developer MISO picks. FERC agreed, and held that MISO “lacks the authority to facilitate or require the development of transmission facilities in another region.”

Three parties protested: the Electricity Transmission Competition Coalition, the Industrial Energy Consumers of America, and WPPI Energy. FERC rejected their calls for competitive solicitations. Commissioners Judy Chang and David Rosner wrote that “in some cases, the most beneficial and cost-effective solutions for one region’s system needs may include transmission upgrades in another region’s footprint.”

Rate scrutiny now runs through the CRAF agreements themselves. MISO and each owner file their agreement in a separate Section 205 docket. That is where the cost terms get tested, and not in a bidding round. Anyone tracking transmission cost containment should follow those dockets.

Critical Perspective

The jurisdictional argument settles less than it appears to. MISO says it has no authority to run a solicitation inside PJM. PJM did not run one either. The gap sits between the two systems, and FERC accepted a result where no competitive test applies anywhere.

The split is also lopsided. Commonwealth Edison takes about $904 million. Duke Energy Ohio takes $5.3 million. Almost the entire value lands with one incumbent utility, and no bid set that price.

FERC pushed cost discipline into the separate Section 205 dockets. Those dockets test the rate that each owner charges. They do not test whether another builder would have charged less.

The three protesters were the parties that pay or compete: the Electricity Transmission Competition Coalition, the Industrial Energy Consumers of America, and WPPI Energy. FERC answered them on authority, and not on cost. These are also pre-construction estimates on projects due in service between 2032 and 2034.

Sources

• Utility Dive: FERC approves MISO cost recovery plan for transmission projects built in PJM (August 17, 2026)
• RTO Insider: FERC Greenlights MISO Assignment of Some Long-range Tx Projects to PJM TOs (August 18, 2026)
• MISO: Section 205 filing in Docket No. ER26-1538, proposed tariff revisions for agreements with external transmission owners (February 27, 2026)
• JEPIC-USA: FERC approves MISO cost allocation framework for transmission projects (August 20, 2026)

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