H.R. 3616, Reliable Power Act

H.R. 3616 would require the Federal Energy Regulatory Commission (FERC), in consultation with the Electric Reliability Organization (ERO), to review regulations proposed by other federal agencies that could affect the reliability of the bulk-power system, under conditions specified in the bill. Agencies could not finalize those actions until they respond to any concerns raised by FERC as part of that review.

• Using information from FERC, CBO expects that the agency would need additional staff and would need to acquire new data to fulfill the bill’s requirements. CBO estimates that implementing those requirements would cost FERC less than $10 million each year. However, because FERC is authorized to recover 100 percent of its costs through user fees, any change in agency costs (which are controlled through annual appropriation acts) would be offset by an equal change in fees that the commission charges. Accordingly, CBO estimates that implementing those provisions would result in no net change in discretionary spending for FERC.

CBO further estimates that the costs for other agencies (primarily the Department of Energy) to coordinate with FERC on those reviews would total $1 million over the 2025-2030 period; that spending would be subject to the availability of appropriated funds.

Finally, enacting H.R. 3616 would increase direct spending and revenues because spending by the ERO is recorded on the budget as direct spending, and the organization assesses fees, which are recorded as revenues, to cover its costs. CBO estimates that consulting with FERC would increase costs for the ERO by less than $500,000 over the 2025-2035 period. Because any amounts collected would be spent soon thereafter, CBO estimates that the net effect on the deficit would be negligible.

Implementing the bill could result in some regulations being delayed because of the procedures specified in the bill. Those delays could result in budgetary effects; however, CBO has no basis to estimate which regulations could be affected, nor the direction or magnitude of any such effects.

If FERC and the ERO increase their fees to offset the costs of implementing the bill, H.R. 3616 would increase the cost of an existing mandate on public and private entities, such as electric utilities, that are required to pay those fees. CBO estimates that the incremental cost of the mandates would be small and fall well below the annual threshold established in the Unfunded Mandates Reform Act for intergovernmental and private-sector mandates ($103 million and $206 million in 2025, respectively, adjusted annually for inflation).

The CBO staff contacts for this estimate are Aaron Krupkin (for federal costs) and Brandon Lever (for mandates). The estimate was reviewed by H. Samuel Papenfuss, Deputy Director of Budget Analysis.