National Grid to manage US Midwest Alliance Transco

As part of the agreement, National Grid will invest $1 billion in start-up and transmission acquisition costs in the Transco.

The companies said they filed the agreement Thursday with the Federal Energy Regulatory Commission (FERC). The agreement requires two key FERC approvals.

"We believe that National Grid's commitment to invest $1 billion and FERC's five conditional approvals demonstrate the viability of the Alliance Transco," said Stan Szwed, chairman of the Alliance Management Committee and vice president responsible for transmission for Ohio-based FirstEnergy Corp.

The Alliance Transco will cover a 182,000 square mile service territory in 11 states from Missouri to Virginia, serving about 35 million customers.