Alan Ross: My guest is Larry Gasteiger, Executive Director of WIRES. We are really excited about making WIRES an Alliance Partner of ours, at APC Media. I think the work that you all are doing in power systems is incredible and extremely needed at this time. But before we get to that, how did you get involved in the power industry Larry?

Larry Gasteiger: Alan, I appreciate the opportunity to talk to you about what’s going on in transmission and about my group, WIRES. I have been involved in the energy area for not quite 30 years, a little shy of that. Back when I first started getting involved in the mid to late ’90s, that was in the midst of the early deregulation stages in the industry. For me, just like a lot of people that I know, it almost wasn’t really intentional.


I am a lawyer. I was trained as a lawyer. I had actually worked for a federal agency in the government in the early ’90s called the Commodity Futures Trading Commission (CFTC). Back at that time, there was a little overlap between the CFTC and the energy area as contracts were expanding into that field. I started to get a little bit involved at that time with the energy space. I happened to be working for someone at the CFTC who went over to another agency in the government called the Federal Energy Regulatory Commission or FERC.

I wound up following him over to FERC. Honestly, candidly, not because I had any particular interest in the energy area, but I had the opportunity to work in an area that I was interested in at that time, which was appellate litigation. It’s so typical with careers. One thing led to another. I started off at FERC in the mid to late ’90s, and it’s one of those things where the more I worked in it, the more drawn in I got over time.

Just as things developed on the deregulation side, my interest just kept expanding. I wound up shifting away from more of a legal and lawyerly oriented aspect of the industry to more of a policy aspect over time. I wound up working for one of the chairmen at FERC as one of his advisors. Then I transitioned into markets management and supervision. I wound up shifting over to the Enforcement program, which was just getting started up at that time at FERC. Then back into the leadership elements of the FERC when I became the Chief of Staff of the agency about 10 years ago. That wound up being my last job at FERC. I moved on to working for a utility for a few years. Then from that, that led to my working in my current role, which is as Executive Director of WIRES, which is a national trade association that focuses on development of transmission.

Alan: Transmission is probably the last vestige of something having to change in the power grid in the US. Right now, one of the great problems that we have, especially in North America, is transmission issues.

Larry: I agree. WIRES, as I think I mentioned earlier, is a national trade association. We’re focused, broadly speaking, on promoting investment in and development of transmission infrastructure and transmission wires. My members are some of the largest transmission owners in the country. We’re primarily focused on the regional transmission organization or independent system operator, RTO or ISO regions, which is a good chunk of the country. Some of my members operate outside of those, but for the most part, we’re in those what we refer to as organized market areas.

Our mission, broadly speaking, is to help facilitate education around the benefits associated with developing and investing in this major transmission electric infrastructure. We do a lot of efforts in the area around developing studies and reports that deal on different topics that affect transmission and transmission development.

We also do advocacy on behalf of our members before the decision making and regulatory bodies that affect transmission and all of the issues around how we get transmission built. Mostly that is done at the federal level with agencies like where I had worked previously, the Federal Energy Regulatory Commission FERC, but also the Department of Energy (DOE), which has become increasingly more involved in transmission issues. Then we do a lot of education up on Capitol Hill with the House of Representatives and the Senate and the members who are involved in energy issues about the importance of transmission and what some of the challenges are to getting more transmission built where it’s needed.

At the same time, we are seeing an increasing number of extreme weather events impacting the grid. That is putting more stress on our infrastructure as well.

Alan: I have to assume that utilities are very involved and concerned about those advocacy issues you’re talking about because whatever happens at the federal level affects all of them, too, correct?

Larry: Oh, absolutely. Those utilities, those transmission owners, are the core members of WIRES. But we are much broader than that. We also have a category of members who are essentially everybody who does not actually own transmission but is involved in the development of the transmission infrastructure. That is engineering firms, consulting firms, some law firms are part of the group. Basically, any type of a vendor or supplier who is involved in getting that infrastructure built. Those are also members of WIRES as well. A lot of them are advanced technology companies that are looking at new and novel ways to help get more out of our system as we build out the grid.

Alan: There is more happening out there today than I’ve ever seen in the power industry. There is a lot going on all around the transmission world as we have talked about. What policy issues are happening right now? I have to believe that there are a lot of policy issues that you all are advocating for and educating on as it relates to what is happening up at the federal level?

Larry: As you mentioned earlier, there is a lot going on in the energy area, but transmission, which is a subpart of that in particular as well. The fact of the matter is it isn’t easy to get transmission infrastructure built. It never has been, but it’s actually getting harder over time for a number of reasons. At the same time that we are seeing a tremendous increase in the need for this infrastructure, even though it’s getting harder to build, we have a cross-section of a couple of different issues, some of which are at tension with each other.

We are seeing increasing needs, and this has been going on for several years now, for a buildout of the grid because of the increasing electrification of our economy. This includes a greater use of electric-based heating systems, air conditioning, electric cars, continued use of laptops and cell phones. All of that has been creating increasing demand. Now, in the last year, roughly, a huge uptick in demand associated with data centers and AI.

Alan: I was waitng for that; the AI data centers in particular.

Larry: Yes. That is putting a lot more pressure on our existing system. We’ve got a situation where the transmission infrastructure that we’re using right now is just getting old. A lot of that infrastructure was built back in the 1950s and 1960s. If it was a person, it would be eligible for Medicare or Social Security right now. But believe it or not, there is actually some transmission infrastructure that’s still being used that was built back in the 1920s or beyond; more than 100 years old. At some point, it just simply has to be replaced.

At the same time, we are seeing an increasing number of extreme weather events impacting the grid. That is putting more stress on our infrastructure as well. Hundred-year events seem to be happening on a 10-year time frame now more frequently with hurricanes or wildfires or unusual cold snaps, things like that.

All of that’s putting stress on the grid. At the same time, permitting and siting for this infrastructure is getting harder. It is taking longer. A lot of this investment that we are talking about is in the tens or more likely hundreds of millions of dollars for infrastructure that takes as long as 10 to 12 years to build. There is a lot going on, and we are trying to look at different ways of trying to meet these increasing needs, hopefully faster and with more efficient use of the system.

Alan: Looking short term, what are some of the policies that you are looking at right now? What are the top three?

Larry: One of the things that is really critical to the companies that are looking to make this huge dollar figure of investment is having a stable and as predictable as possible regulatory environment in order to facilitate that investment over a long period of time.

In the short term, I would say right now we are really focused on trying to get clarity and certainty around regulatory policies on how companies get compensated for the investment they are making, the incentives associated with the investment and transmission and achieving certainty. Just like anybody else, if you want to invest your money, you want to know what you are going to get out of it. Companies are the same way. If you do not have any idea what your return is going to be on your investment, you are going to be more reluctant to make those investments. Trying to get some regulatory certainty around those policies is absolutely critical. I think we’re also looking at areas where there are opportunities to either shorten or create greater clarity around the permitting and siting for transmission.

For those companies who do have to deal with federal permitting and siting processes, streamlining those processes, shortening them, and consolidating decision making around it would be very helpful.

Some other areas are, again, more technically complicated as we go about planning the system. I think those general areas around clarity over the ways that companies make money off of transmission investment, the permitting, the siting, and the planning on transmission are probably the three big areas.

Alan: Given the changes in generation, DERs are hot and heavy… it is a shame that the wind and solar generation is not where the power is needed for the most part. Transmission needs are right in the center, connecting new and old generation with demand for power, and that is the greatest risk.

When you look at longer term, go up 5 to 10 years, how do you even look at or plan for an organization like WIRES?

Larry: I think longer term, obviously, it is hard to predict. You mentioned one of the challenges we have, too, which is the changing political environment and how that impacts decisions. It goes back to my earlier point about the need for clarity and regulatory certainty around policies. It is a real challenge when essentially every four years, you are potentially looking at doing a 180 on energy policy. We have been through a couple of cycles of that now. There are some real challenges in terms of making long-range decisions about what the policy should look like.
But I will say there are some consistencies over the course of those administrations. I do think that there continues to be a focus on the needs associated with major transmission infrastructure. The reasons behind it may have changed a little bit, or in some instances, pretty dramatically. But the core recognition of the
needs for that infrastructure, in a lot of ways, are still there.

I think longer term, what is going to be interesting is, I think we are going to continue to see this focus on and pressure to build out longer distance backbone transmission infrastructure across longer distances. And that will take time. I think that pressure is going to create some additional pressures in other areas, like the regulatory structure under which we operate.

We currently, and from the very beginning, have operated under a system where there is both state and federal regulation of electricity. The lines between those two sometimes get blurry and sometimes shift. I do think there is only going to be increasing tension between federal and state regulatory authority in the area around transmission over time. It will be very interesting to see how that plays out. Even with the current administration, we are seeing some tensions around that with how we go about integrating AI and data centers into the grid. It is going to be very interesting to see how that federal state jurisdictional dynamic plays out.

Our grid is only going to get more interconnected, more integrated, more dependent on each other in a lot of ways.

Alan: Last question, what does the grid of the future look like for you?

Larry: It is interesting. To think about the grid of the future, you have to look at the grid of the past in some ways. Going way back, we had a system that was set up that was largely balkanized and much more amenable to state and local regulatory structures. But as the country has grown, our needs have expanded, all of that has been happening over decades. In a way, I can keep going back to our regulatory structure which has not really kept up with the reality of what has been happening with the system.

I do think, again, there is going to continue to be this regulatory friction that we have always had between state and federal regulation. It is only going to increase with time. But I think we are not going back. If anything, our grid is only going to get more interconnected, more integrated, more dependent on each other in a lot of ways. I think that is a healthy development, though, in terms of providing greater reliability, greater resilience for our system, and in a sense, greater national security from an electricity standpoint.

I do think we are not quite clear what the demands are. We have gone through a period of flat load growth for several decades, and now we are starting to see an increase, and some projections are that we will be seeing a significant increase. I am not sure if it is going to be quite what people are projecting, but it is going to be more for sure. That is only going to continue to put increasing strains on the grid. We will see needs for increasing investment. Already, though, there is a lot of concerns about what is the impact going to be on customers from a financial perspective. I think we are going to see growth; we may not see it at the level that people are projecting, and there may be some lags at times because of what is referred to as the affordability aspects associated with it.

But I will say a lot of the investments that were made decades ago, we are still leaning on those today. It is now time for people to start thinking about this generation that has benefited from that investment, looking to make investment now for future generations as well. We are not always great about that: Investing today for the benefit of the future and for future generations. But I think we need to start thinking that way. As I said, we have benefited a lot from the investment of the past. Now it is time to start thinking about making investment for the benefit of the future.

Alan: Well, that is a great way to wrap this up. Larry, it has been a delight. Thank you for joining us and thank you for WIRES joining as a new Alliance Partner.