127 
Smart Grid potential were installed in the relevant 
products reviewed by the Energy Star program. 
(D) Assess and identify options for providing 
consumers information on products with Smart Grid 
capabilities, including the necessary conditions for 
cost-effective savings. 
(E) Submit a report to Congress summarizing 
the results of the assessment for each class of prod-
ucts, and presenting the potential energy and green-
house gas savings that could result if Smart Grid 
capability were installed and utilized on such prod-
ucts 
SEC. 143. INCLUSIONS OF SMART GRID CAPABILITY ON AP-
PLIANCE ENERGY GUIDE LABELS. 
Section 324(a)(2) of the Energy Policy and Conserva-
tion Act (42 U.S.C. 6294(a)(2)) is amended by adding the 
following at the end: 
‘‘(J)(i) Not later than 3 years after the 
date of enactment of this subparagraph, the 
Federal Trade Commission shall initiate a rule-
making to consider making a special note in a 
prominent manner on any ENERGY GUIDE 
label for any product actually including Smart 
Grid capability that— 
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‘‘(I) Smart Grid capability is a fea-
ture of that product; 
‘‘(II) the use and value of that feature 
depended on the Smart Grid capability of 
the utility system in which the product was 
installed and the active utilization of that 
feature by the customer; and 
‘‘(III) on a utility system with Smart 
Grid capability, the use of the product’s 
Smart Grid capability could reduce the 
customer’s cost of the product’s annual op-
eration by an estimated dollar amount 
range representing the result of incre-
mental energy and electricity cost savings 
that would result from the customer taking 
full advantage of such Smart Grid capa-
bility. 
‘‘(ii) Not later than 3 years after the date 
of enactment of this subparagraph, the Com-
mission shall complete the rulemaking initiated 
under clause (i).’’. 
SEC. 144. SMART GRID PEAK DEMAND REDUCTION GOALS. 
(a) GOALS.—Not later than one year after the date 
of enactment of this Act, load-serving entities, or, at their 
option, States with respect to load-serving entities that 
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129 
they regulate, shall determine and publish peak demand 
reduction goals for any load-serving entities that have an 
applicable baseline in excess of 250 megawatts. 
(b) BASELINES.—(1) The Commission, in consulta-
tion with the Secretary and the Administrator, shall de-
velop and publish, after an opportunity for public com-
ment, a methodology to provide for adjustments or nor-
malization to a load-serving entity’s applicable baseline 
over time to reflect changes in the number of customers 
served, weather conditions, general economic conditions, 
and any other appropriate factors external to peak de-
mand management, as determined by the Commission. 
(2) The Commission shall support load-serving enti-
ties (including any load-serving entities with an applicable 
baseline of less than 250 megawatts that volunteer to par-
ticipate in achieving the purposes of this section) in deter-
mining their applicable baselines, and in developing their 
peak demand reduction goals. 
(3) The Secretary, in consultation with the Commis-
sion, the Administrator, and the National Electric Reli-
ability Corporation, shall develop a system and rules for 
measurement and verification of demand reductions. 
(c) PEAK DEMAND REDUCTION GOALS.—(1) Peak 
demand reduction goals may be established for an indi-
vidual load-serving entity, or, at the determination of a 
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State or regional entity, by that State or regional entity 
for a larger region that shares a common system peak de-
mand and for which peak demand reduction measures 
would offer regional benefit. 
(2) A State or regional entity establishing peak de-
mand reduction goals shall cooperate, as necessary and 
appropriate, with the Commission, the Secretary, State 
regulatory commissions, State energy offices, the National 
Electric Reliability Corporation, and other relevant au-
thorities. 
(3) In determining the applicable peak demand reduc-
tion goals, States and other jurisdictional entities may uti-
lize the results of the 2009 National Demand Response 
Potential Assessment, as authorized by section 571 of the 
National Energy Conservation Policy Act (42 U.S.C. 
8279). 
(4) The applicable peak demand reduction goals shall 
provide that— 
(A) load-serving entities will reduce or mitigate 
peak demand by a minimum percentage amount 
from the applicable baseline to a lower peak demand 
during calendar year 2012; 
(B) load-serving entities will reduce or mitigate 
peak demand by a minimum percentage greater 
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131 
amount from the applicable baseline to a lower peak 
demand during calendar year 2015; and 
(C) the minimum percentage reductions estab-
lished as peak demand reduction goals shall be the 
maximum reductions that are realistically achievable 
with an aggressive effort to deploy Smart Grid and 
peak demand reduction technologies and methods, 
including but not limited to those listed in sub-
section (d). 
(d) PLAN.—Each load-serving entity shall prepare a 
peak demand reduction plan that demonstrates its ability 
to meet each applicable goal by any or a combination of 
the following options: 
(1) Direct reduction in megawatts of peak de-
mand through energy efficiency measures with reli-
able and continued application during peak demand 
periods. 
(2) 
Demonstration 
that 
an 
amount 
of 
megawatts equal to a stated portion of the applicable 
goal is contractually committed to be available for 
peak reduction through one or more of the following: 
(A) Megawatts enrolled in demand re-
sponse programs. 
(B) Megawatts subject to the ability of a 
load-serving entity to call on demand response 
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132 
programs, smart appliances, smart electricity 
storage devices, distributed generation resources 
on the entity’s customers’ premises, or other 
measures 
directly 
capable 
of 
actively, 
controllably, reliably, and dynamically reducing 
peak demand (‘‘dynamic peak management con-
trol’’). 
(C) Megawatts available from distributed 
dynamic electricity storage under agreement 
with the owner of that storage. 
(D) 
Megawatts 
committed 
from 
dispatchable 
distributed 
generation 
dem-
onstrated to be reliable under peak period con-
ditions and in compliance with air quality regu-
lations. 
(E) Megawatts available from smart appli-
ances and equipment with Smart Grid capa-
bility available for direct control by the utility 
through agreement with the customer owning 
the appliances or equipment. 
(F) Megawatts from a demonstrated and 
assured minimum of distributed solar electric 
generation capacity in instances where peak pe-
riod and peak demand conditions are directly 
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133 
related to solar radiation and accompanying 
heat. 
(3) If any of the methods listed in subpara-
graph (C), (D), or (E) of paragraph (2) are relied 
upon to meet its peak demand reduction goals, the 
load-serving entity must demonstrate this capability 
by operating a test during the applicable calendar 
year. 
(4) Nothing in this section shall require the 
publication in peak demand reduction goals or in 
any peak demand reduction plan of any information 
that is confidential for competitive or other reasons 
or that identifies individual customers. 
(e) EXISTING AUTHORITY AND REQUIREMENTS.— 
Nothing in this section diminishes or supersedes any au-
thority of a State or political subdivision of a State to 
adopt or enforce any law or regulation respecting peak de-
mand management, demand response, distributed storage, 
use of distributed generation, or the regulation of load- 
serving entities. The Commission, in consultation with 
States having such peak management, demand response 
and distributed storage programs, shall to the maximum 
extent practicable, facilitate coordination between the Fed-
eral program and such State programs. 
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134 
(f) RELIEF.—The Commission may, for good cause, 
grant relief to load-serving entities from the requirements 
of this section. 
(g) OTHER LAWS.—Except as provided in sub-
sections (e) and (f), no law or regulation shall relieve any 
person of any requirement otherwise applicable under this 
section. 
(h) COMPLIANCE.—(1) The Commission shall within 
one year after the date of enactment of this Act establish 
a public website where the Commission will provide infor-
mation and data demonstrating compliance by States, re-
gional entities, and load-serving entities with this section, 
including the success of load-serving entities in meeting 
applicable peak demand reduction goals. 
(2) The Commission shall, by April 1 of each year 
beginning in 2012, provide a report to Congress on com-
pliance with this section and success in meeting applicable 
peak demand reduction goals and, as appropriate, shall 
make recommendations as to how to increase peak de-
mand reduction efforts. 
(3) The Commission shall note in each such report 
any State, political subdivision of a State, or load-serving 
entity that has failed to comply with this section, or is 
not a part of any region or group of load-serving entities 
serving a region that has complied with this section. 
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135 
(4) The Commission shall have and exercise the au-
thority to take reasonable steps to modify the process of 
establishing peak demand reduction goals and to accept 
adjustments to them as appropriate when sought by load- 
serving entities. 
(i) ASSISTANCE TO STATES AND FUNDING.— 
(1) ASSISTANCE
TO
STATES.—Any costs in-
curred by States for activities undertaken pursuant 
to this section shall be supported by the use of emis-
sion allowances allocated to the States’ SEED Ac-
counts pursuant to section ølll¿ of this Act. To 
the extent that a State provides allowances to local 
governments within the State to implement this pro-
gram, that shall be deemed a distribution of such al-
lowances to units of local government pursuant to 
subsection (c)(1) of that section. 
(2) FUNDING.—There are authorized to be ap-
propriated such sums as may be necessary to the 
Commission, the Secretary, and the Administrator to 
carry out the provisions of this section. 
SEC. 145. REAUTHORIZATION OF ENERGY EFFICIENCY PUB-
LIC INFORMATION PROGRAM TO INCLUDE 
SMART GRID INFORMATION. 
(a) IN GENERAL.—Section 134 of the Energy Policy 
Act of 2005 (42 U.S.C. 15832) is amended as follows: 
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136 
(1) By amending the section heading to read as 
follows: ‘‘ENERGY EFFICIENCY AND SMART GRID 
PUBLIC INFORMATION INITIATIVE’’. 
(2) In paragraph (1) of subsection (a) by strik-
ing ‘‘reduce energy consumption during the 4-year 
period beginning on the date of enactment of this 
Act’’ and inserting ‘‘increase energy efficiency and 
to adopt Smart Grid technology and practices’’. 
(3) In paragraph (2) of subsection (a) by strik-
ing ‘‘benefits to consumers of reducing’’ and insert-
ing ‘‘economic and environmental benefits to con-
sumers and the United States of optimizing’’. 
(4) In subsection (a) by inserting at the begin-
ning of paragraph (3) ‘‘the effect of energy effi-
ciency and Smart Grid capability in reducing energy 
and electricity prices throughout the economy, to-
gether with’’. 
(5) In subsection (a)(4) by redesignating sub-
paragraph (D) as (E), by striking ‘‘and’’ at the end 
of subparagraph (C), and by inserting after subpara-
graph (C) the following: 
‘‘(D) purchasing and utilizing equipment 
that includes Smart Grid features and capa-
bility; and’’. 
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(6) In subsection (c), by striking ‘‘Not later 
than July 1, 2009,’’ and inserting, ‘‘For each year 
when appropriations pursuant to the authorization 
in this section exceed $10,000,000,’’. 
(7) In subsection (d) by striking ‘‘2010’’ and 
inserting ‘‘2020’’. 
(8) In subsection (e) by striking ‘‘2010’’ and in-
serting ‘‘2020’’. 
(b) TABLE OF CONTENTS.—The item relating to sec-
tion 134 in the table of contents for the Energy Policy 
Act of 2005 (42 U.S.C. 15801 and following) is amended 
to read as follows: 
‘‘Sec. 134. Energy efficiency and Smart Grid public information initiative.’’. 
SEC. 146. INCLUSION OF SMART-GRID FEATURES IN APPLI-
ANCE REBATE PROGRAM. 
(a) AMENDMENTS.—Section 124 of the Energy Pol-
icy Act of 2005 (42 U.S.C. 15821) is amended as follows: 
(1) By amending the section heading to read as 
follows: ‘‘ENERGY EFFICIENT AND SMART AP-
PLIANCE REBATE PROGRAM.’’. 
(2) By redesignating paragraphs (4) and (5) of 
subsection (a) as paragraphs (5) and (6), respec-
tively, and inserting after paragraph (3) the fol-
lowing: 
‘‘(4) SMART APPLIANCE.—The term ‘smart ap-
pliance’ means a product that the Administrator of 
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138 
the Environmental Protection Agency or the Sec-
retary of Energy has determined qualifies for such 
a designation in the Energy Star program pursuant 
to section 142 of the American Clean Energy and 
Security Act of 2009, or that the Secretary or the 
Administrator has separately determined includes 
the relevant Smart Grid capabilities listed in section 
1301 of the Energy Independence and Security Act 
of 2007 (15 U.S.C. 17381).’’. 
(3) In subsection (b)(1) by inserting ‘‘and 
smart’’ after ‘‘efficient’’ and by inserting after 
‘‘products’’ the first place it appears ‘‘, including 
products designated as being smart appliances,’’. 
(4) In subsection (b)(3), by inserting ‘‘the ad-
ministration of’’ after ‘‘carry out’’. 
(5) In subsection (d), by inserting ‘‘the admin-
istration of’’ after ‘‘carrying out’’ and by inserting 
‘‘, and up to 100 percent of the value of the rebates 
provided pursuant to this section’’ before the period 
at the end. 
(6) In subsection (e)(3), by inserting ‘‘, with 
separate consideration as applicable if the product is 
also a smart appliance,’’ after ‘‘Energy Star prod-
uct’’ the first place it appears and by inserting ‘‘or 
smart appliance’’ before the period at the end. 
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(7) 
In 
subsection 
(f), 
by 
striking 
‘‘$50,000,000’’ through the period at the end and 
inserting ‘‘$100,000,000 for each fiscal year from 
2010 through 2015.’’. 
(b) TABLE OF CONTENTS.—The item relating to sec-
tion 124 in the table of contents for the Energy Policy 
Act of 2005 (42 U.S.C. 15801 and following) is amended 
to read as follows: 
‘‘Sec. 124. Energy efficient and smart appliance rebate program.’’. 
Subtitle F—Transmission Planning 
SEC. 151. TRANSMISSION PLANNING. 
Part II of the Federal Power Act (16 U.S.C. 824 et 
seq.) is amended by adding after section 216 the following 
new section: 
‘‘SEC. 216A. TRANSMISSION PLANNING. 
‘‘(a) FEDERAL POLICY.— 
‘‘(1) OBJECTIVES.—It is the policy of the 
United States that regional electric grid planning 
should facilitate the deployment of renewable and 
other zero-carbon energy sources for generating elec-
tricity to reduce greenhouse gas emissions while en-
suring reliability, reducing congestion, ensuring 
cyber-security, and providing for cost-effective elec-
tricity services throughout the United States. 
‘‘(2) OPTIONS.—In addition to the policy under 
paragraph (1), it is the policy of the United States 
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140 
that regional electric grid planning to meet these ob-
jectives should take into account all significant de-
mand-side and supply-side options, including energy 
efficiency, distributed generation, renewable energy 
and zero-carbon electricity generation technologies, 
smart-grid technologies and practices, demand re-
sponse, electricity storage, voltage regulation tech-
nologies, high capacity conductor and super-
conductor technologies, underground transmission 
technologies, and new conventional electric trans-
mission capacity and corridors. 
‘‘(b) PLANNING.— 
‘‘(1) PLANNING PRINCIPLES.—Not later than 1 
year after the date of enactment of this section, the 
Commission shall adopt, after notice and oppor-
tunity for comment, national electricity grid plan-
ning principles derived from the Federal policy es-
tablished under subsection (a) to be applied in ongo-
ing and future transmission planning that may im-
plicate interstate transmission of electricity. 
‘‘(2) REGIONAL
PLANNING
ENTITIES.—Not 
later than 3 months after the date of adoption by 
the Commission of national electricity grid planning 
principles pursuant to paragraph (1), entities that 
conduct or may conduct transmission planning pur-
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141 
suant to State or Federal law or regulation, includ-
ing States, entities designated by States, public util-
ity transmission providers, operators and owners, re-
gional organizations, and electric utilities, and that 
are willing to incorporate the national electricity grid 
planning principles adopted by the Commission in 
their electric grid planning, shall identify themselves 
and the regions for which they propose to develop 
plans to the Commission. 
‘‘(3) COORDINATION OF REGIONAL PLANNING 
ENTITIES.—The Commission shall encourage re-
gional planning entities described under paragraph 
(2) to cooperate and coordinate across regions and 
to harmonize regional electric grid planning with 
planning in adjacent or overlapping jurisdictions to 
the maximum extent feasible. The Commission shall 
work with States, public utilities transmission pro-
viders, load-serving entities, transmission operators, 
and other organizations to resolve any conflict or 
competition among proposed planning entities in 
order to build consensus and promote the Federal 
policy established under subsection (a). The Com-
mission shall seek to ensure that planning that is 
consistent with the national electricity grid planning 
principles adopted pursuant to paragraph (1) is con-
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ducted in all regions of the United States and the 
territories. 
‘‘(4) RELATION TO EXISTING PLANNING POL-
ICY.—In implementing the Federal policy established 
under subsection (a), the Commission shall— 
‘‘(A) incorporate any ongoing planning ef-
forts undertaken pursuant to section 217; and 
‘‘(B) consult with and invite the participa-
tion of the Secretary of Energy in relationship 
to the Secretary’s duties pursuant to section 
216. 
‘‘(5) ASSISTANCE.— 
‘‘(A) IN GENERAL.—The Commission shall 
provide support to and participate in the re-
gional grid planning processes conducted by re-
gional planning entities. The Commission may 
provide planning resources and assistance as re-
quired or as requested by regional planning en-
tities, including system data, cost information, 
system analysis, technical expertise, modeling 
support, dispute resolution services, and other 
assistance to regional planning entities, as ap-
propriate. 
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143 
‘‘(B) AUTHORIZATION.—There are author-
ized to be appropriated such sums as may be 
necessary to carry out this paragraph. 
‘‘(6) CONFLICT
RESOLUTION.—In the event 
that regional grid plans conflict, the Commission 
shall assist the regional planning entities in resolving 
such conflicts in order to achieve the objectives of 
the Federal policy established under subsection (a). 
‘‘(7) SUBMISSION OF PLANS.—The Commission 
shall require regional planning entities to submit ini-
tial regional electric grid plans to the Commission 
not later than 18 months after the date the Commis-
sion promulgates national electricity grid planning 
principles pursuant to paragraph (1). Regional elec-
tric grid plans should, in general, be developed from 
sub-regional requirements and plans, including plan-
ning input reflecting individual utility service areas. 
Regional plans may then in turn be combined into 
larger regional plans, up to interconnection-wide and 
national plans, as appropriate and necessary as de-
termined by the Commission. The Commission shall 
review such plans for consistency with the national 
grid planning principles and may return a plan to 
one or more planning entities for further consider-
ation, along with the Commission’s own rec-
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