The decision Wednesday by the Missouri Public Service Commission creates a significant hurdle for Clean Line Energy Partners, which wants to build one of the nation's longest transmission lines.
All the other states along its route already have granted approval. The line would run from Kansas through Missouri and Illinois to Indiana, where it would connect with a power grid for eastern states.
Missouri regulators initially rejected the project in 2015, while questioning its benefits and burden on landowners.
This time, the regulatory commission cited a recent state appeals court ruling that said utilities must first get consent from affected counties before state approval can be granted.
Clean Line lacks local approval from several counties in its path.