ISO New England said in a letter dated Tuesday it has approved the interconnection application made by Northeast Utilities. It means Northeast Utilities can continue pursuing the project and is just one of many regulatory steps the company must clear on the way to final approval.
Northern Pass said it was "pleased with ISO New England's findings on this issue as it's the culmination of years of hard work by our project team."
The approval came after the New England Power Pool Reliability Committee on Dec. 19 declined to support the application. The committee, which offers non-binding recommendations to ISO New England, was worried about the effect the proposed line would have on existing power generators.
The $1.4 billion project would transmit 1,200 megawatts of Canadian hydroelectric power, enough to serve 1.2 million homes, from Hydro-Quebec into New England.
Opponents say the transmission towers would damage the environment, lower property values and hurt tourism. Supporters say the power would reduce carbon emissions.
The project has been in the works since 2010, and backers hope to have it online by 2017.
The ISO determination was contingent on Northeast Utilities meeting a number of technical requirements, including that it be limited to 1,200 megawatts of power imported from Canada and that further impact studies be completed.
Northeast Utilities will have to submit more detailed plans and information for the ISO to review before the project can interconnect with the grid.