Apparently FERC's Office of Enforcement had nothing better to do yesterday than to enjoy a summer drive down to Richmond for an enjoyable afternoon of venue shopping.
I guess they found exactly what they were looking for, because they dropped off a petition requesting a jury trial at the U.S. District Court for the Eastern District of Virginia, Richmond Division, in the matter of:
PETITION FOR AN ORDER AFFIRMING THE FEDERAL ENERGY REGULATORY COMMISSION'S MAY 29, 2015 ORDER ASSESSING CIVIL PENALTIES AGAINST POWHATAN ENERGY FUND, LLC, HEEP FUND, INC.,
HOULIAN "ALAN" CHEN, AND CU FUND, INC.
Although the Commission issued an Order assessing civil penalties on May 29, the accused had 60 days to cough up the roughly $34.5M in penalties and disgorgement. They didn't pay. FERC wasted no time filing its petition after the 60 days were up.
"It has taken Powhatan almost five years to get to court for a very simple spread trading strategy that has been blessed by 12 independent experts at our website, ferclitigation.com," said Powhatan's Richard Gates.
FERC listed six, count 'em, six lawyers as counsel for the plaintiff. It listed only two lawyers for the defense, one for Powhatan Energy Fund and one for Alan Chen, HEEP Fund and CU Fund. Does it really take six FERC lawyers to equal one defense lawyer? Who is paying for this? How much has FERC spent on this investigation over the past 5 years, and how much will it spend down in Richmond? At what point will the cost of this litigation be more than the recovery?
"While the costs of fighting off the bogus allegations have been huge and will just grow for us, we're glad we are able to stand our ground and not be forced into settlement the way others firms have. Plus, it will be nice to be in the neutral venue of a courtroom instead of this Orwellian organization that has trapped us the last 5 years," added Gates.
Richmond? FERC says it selected Richmond because:
Venue is also governed by FPA section 317, 16 U.S.C. § 825p, which provides that “[a]ny suit or action to enforce any liability or duty created by . . . this Act, or any rule, regulation, or order thereunder may be brought in [the district wherein any act or transaction constituting the violation occurred] or in the district wherein the defendant is an inhabitant.”
And the trades occurred in PJM. And Powhatan's "principal place of business" is in Henrico, Virginia. Of course FERC probably knows that the Gates brothers actually live in Pennsylvania and Chen in Texas.
Oh, there it is!
Respondents’ unlawful scheme resulted in
the misdirection and capture of over $10 million in PJM market payments, including
approximately $1,147,087 that would otherwise have flowed to Dominion Virginia Power and inured to the benefit of Dominion and its ratepayers, including ratepayers in this District.
So, FERC wants this case heard before jurors who might believe they were personally cheated out of more than a million bucks? I do hope they fully explain their use of "to the benefit of Dominion and its ratepayers" to show how much would have ended up in Dominion's pocket and how much would have ended up in Dominion's ratepayer pockets if not for the defendant's actions. Maybe FERC can also explain how much of the $34.5M in penalties and disgorgement will end up in Dominion's pocket and how Dominion will flow that recovery into the rates that will make the ratepayers on the jury whole (or not). And do tell where the rest of the money will go, FERC...
I will admit that I haven't read everything in this case, but FERC has yet to convince me that any actual ratepayers were damaged here. If Dominion had collected the MLSA payments instead of Powhatan and Chen, would they have directly reduced rates, or simply gone into Dominion's corporate coffers? Since FERC has yet to adequately explain, I'm leaning toward the latter option. Who is FERC really protecting here? Ratepayers or its pet incumbent utilities?
Gates seems to agree, "By filing the lawsuit, FERC has shown the world it continues not to support open and competitive power markets. Instead, FERC favors incumbent utilities that function without incentives to do better. Indeed, earlier this year the WSJ* described how utilities get profits by just spending more. While we believe in the societal benefits of competition, and know the law allows for it in these markets, it makes sense utilities may not want any."
Is FERC confused about who it serves? Is this case supposed to hinge on a jury's failure to understand it and instead be swept away by platitudes and grandstanding from FERC's sextet of lawyers? FERC used the word "Enron" something more than 30 times in its District Court Petition. Maybe the defense can use the word "McCarthyism" an equal number of times just to keep things fair? I suppose the jury's view of these two competing terms is going to depend on its average age.
And the quality of the public relations battle deployed.
*If you don't subscribe to WSJ and can't read this article via the link, type the phrase "Utilities’ Profit Recipe: Spend More" into Google and click through on that link. No, we're not advising that you engage in newspaper subscription link manipulation, through a scheme to engage in fraudulent Headline Googling (HG) transactions in internet search engine markets to garner excessive amounts of certain free reads of stories behind a paywall. I also recommend that you not engage in any views that constitute a wash viewing scheme in violation of the WSJ’s prohibition of that practice.
You know it's a slow news day when...
The Federal Energy Regulatory Commission (Commission) hereby gives notice
that members of the Commission and/or Commission staff may attend the following
North American Electric Reliability Corporation
Member Representatives Committee and Board of Trustees Meetings
Board of Trustees Corporate Governance and Human Resources
Committee, Finance and Audit Committee, Compliance Committee, and
Standards Oversight and Technology Committee Meetings
The Ritz Carlton Toronto
181 Wellington Street West
Toronto, ON M5V 3G7
Honestly, I don't how they expect to attract anyone to this meeting
without golf outings, winery tours, massages, and hookers and blow in the Hospitality Suite. And then the heavies from FERC
show up. Way to ruin the party!
The media is calling both the House and Senate energy bills "boring."
The goal seems to be to pass an energy bill that doesn't do much of anything. For this, we pay these guys the big bucks!
Boring is much better than controversial, because honestly, these critters can get up to all kinds of hijinks when they're out of your sight in Washington, DC. Some of the more "controversial" stuff proposed earlier didn't make it into the bills that are currently being marked up, such as the "APPROVAL Act" bills introduced by the Arkansas delegation to neuter Section 1222 of the last energy policy act. Went nowhere. Nothing but hot air intended to appease angry voters. What a disappointment!
Anyhow, what IS in the bills that's of interest? Oh, there are a few things...
The House bill contains a section establishing an
Office of Compliance Assistance and Public Participation within the Federal Energy Regulatory Commission. This figurehead shall:
SEC. 4211. FERC OFFICE OF COMPLIANCE ASSISTANCE AND PUBLIC PARTICIPATION.
Section 319 of the Federal Power Act (16 U.S.C. 825q–1) is amended to read as follows:
‘‘SEC. 319. OFFICE OF COMPLIANCE ASSISTANCE AND PUBLIC PARTICIPATION.
‘‘(a) ESTABLISHMENT.—There is established within the Commission an Office of Compliance Assistance and Public Participation (referred to in this section as the ‘Office’). The Office shall be headed by a Director.
‘‘(b) DUTIES OF DIRECTOR.--
‘‘(1) IN GENERAL.—The Director of the Office
shall promote improved compliance with Commission rules and orders by—
‘‘(A) making recommendations to the Commission regarding—
‘‘(i) the protection of consumers;
‘‘(ii) market integrity and support for the development of responsible market behavior;
‘‘(iii) the application of Commission rules and orders in a manner that ensures that—
‘‘(I) rates and charges for, or in connection with, the transmission or sale of electric energy subject to the jurisdiction of the Commission shall be just and reasonable and not unduly discriminatory or preferential; and
‘‘(II) markets for such transmission and sale of electric energy are not impaired and consumers are not damaged; and
‘‘(iv) the impact of existing and proposed Commission rules and orders on small entities, as defined in section 601 of title 5, United States Code (commonly known as the Regulatory Flexibility Act);
‘‘(B) providing entities subject to regulation by the Commission the opportunity to obtain timely guidance for compliance with Com- mission rules and orders; and
‘‘(C) providing information to the Commission and Congress to inform policy with respect to energy issues under the jurisdiction of the Commission.
‘‘(2) REPORTS AND GUIDANCE.—The Director shall, as the Director determines appropriate, issue reports and guidance to the Commission and to entities subject to regulation by the Commission, regarding market practices, proposing improvements in Commission monitoring of market practices, and addressing potential improvements to both industry and Commission practices.
‘‘(3) OUTREACH.—The Director shall promote
improved compliance with Commission rules and orders through outreach, publications, and, where appropriate, direct communication with entities regulated by the Commission.’’.
What? Why isn't the Commission already doing these things? And more importantly, who does this Director report to? Sounds like he reports to Congress as their special FERC minion. Is this Director supposed to take the place of a consumer advocate at FERC, freeing up the resources of state consumer advocates to concentrate on consumer issues within their own states? If so, how come this Director has no real power, other than to issue reports and recommendations? How will this position be filled? Appointment? Hired by the Commissioners? Whose interests would this Director REALLY serve? Sounds like nothing but a feel-good figurehead sucking the taxpayer teat that produces nothing of use to consumers.
The Senate bill has a couple of items of interest, including a "Transmission Ombudsperson" who, unlike the House's FERC minion, serves only the industry, smoothing things over for companies who want to build transmission (or at least that's how the Senate thinks it will work).
- (b) TRANSMISSION OMBUDSPERSON.—
(1) ESTABLISHMENT.—To enhance and ensure the reliability of the electric grid, there is established within the Council on Environmental Quality the position of Transmission Ombudsperson (referred to in this subsection as the ‘‘Ombudsperson’’), to provide a unified point of contact for—
- (A) resolving interagency or intra-agency issues or delays with respect to electric transmission infrastructure permits; and
(B) receiving and resolving complaints
from parties with outstanding or in-process applications relating to electric transmission infrastructure.
(2) DUTIES.—The Ombudsperson shall—
(A) establish a process for--
(i) facilitating the permitting process for performance of maintenance and upgrades to electric transmission lines on Federal land and non-Federal land, with a special emphasis on facilitating access for immediate maintenance, repair, and vegetation management needs;
(ii) resolving complaints filed with the
Ombudsperson with respect to in-process electric transmission infrastructure permits; and
(iii) issuing recommended resolutions
to address the complaints filed with the
(B) hear, compile, and share any com-
plaints filed with Ombudsperson relating to in-process electric transmission infrastructure permits.
If this Ombudsperson ever exists, put him on your speed dial and complain regularly! Although he'll probably just sit around, take long lunches and frequent vacations because the federal government has a very narrow responsibility to issue electric transmission infrastructure permits. It's up to you to wake him up occasionally! Another do-nothing on the taxpayer dime.
Hey, but wait, perhaps if the section codifying Obama's "Interagency Rapid Response Transmission Team" (RRTT or "er-tit" as we dubbed it) makes it through, Ombudsperson will have more to do! The er-tit is supposed to "
expedite and improve the permitting process for electric transmission infrastructure on Federal land and non-Federal land." Again, very few federal transmission permits, but the er-tit is supposed to whip the federal agencies to approve the few permits they do have jurisdiction over faster, faster, faster! The er-tit consists of representatives from a laundry list of federal agencies, but has absolutely NOBODY watching out for the interests of consumers or landowners. Full-speed ahead for the er-tit and its industry flunkies! I shouldn't laugh... the original incarnation of the er-tit rammed through a federal process for the Susquehanna Roseland transmission line in Pennsylvania and New Jersey that cost ratepayers $60M, plus interest over the next 40 years, to pay off the demands of former Interior Secretary Salazar
. Let's hope the new er-tit behaves better.
So, anything can happen in the Congressional energy world, as the busy little bees try to add things (bad things? good things?) into these energy bills before the recess. How come the consumers don't have a lobbyist working for their interests on Capitol Hill? It's up to you to babysit these Congress critters!
In response to "stakeholders" following the trail of breadcrumbs that lead to 888 First Street, N.E., Washington, DC
, FERC's Office of Energy Projects has come out with a "Suggested Best Practices for Industry Outreach Programs for Stakeholders."
*sigh* Reads no better than any industry propaganda, beginning with its title. Was FERC really attempting to mollify the public and prove that it's acting in the public interest with this? FERC staff needs to take this brochure home to grandma and ask her if she thinks it was written in a conversational and informative manner. She'll probably buy you some gigantic, ugly, 1940's-style underwear next Christmas in response. Or knit you a suit jacket and pop into the office with cookies at random intervals to make sure you're wearing it.
FERC realizes that landowners are "stakeholders!" Yay! But it's all downhill from there. While FERC recommends involving "the public" early in the process on the first page, venturing further shows recommendation that the company involve local elected officials before landowners, in order to "sell" them on the project (while making campaign contributions?). In this way, the company can head off landowner concerns by indoctrinating the public's representatives in the "company way" so that when landowners find out about the project and turn to their local elected officials for help, there is none to be had. Of course, this is easily turned around with enough landowner (voter) pressure, making early elected official notification sort of useless.
There's also recommendations for a whole bunch of "stakeholder" meetings, where only selected "key stakeholders" are invited to participate. Landowners aren't invited to these, they only get to participate in public "open house" meetings, where they are presented with the project as a fait accompli. FERC supposes involving "key stakeholders" can "result in developing partnerships with special interest groups, municipalities, and community business organizations." Holy back room deal, Batman! Is FERC suggesting that a company buy cozy relationships with certain community groups that can benefit from the project so that they can throw the impacted landowners under the bus for their own profit, or for the simple benefit of making sure the project is not constructed in their own back yards, but in the back yards of others who are politically powerless or not participating in this process? Wrong approach!
This whole brochure fails because it's based on the "information deficit" model. It presumes that the only reason people oppose projects is because they lack enough information. It supposes that if a person is bombarded with enough "information" (propaganda) that they will acquiesce to having their lives turned upside down for benefit of others. It doesn't work. Never has. Never will. It actually increases the potential for entrenched opposition and local political battles.
FERC obviously doesn't notice that it has placed itself squarely in the corporate camp. Maybe they didn't intend to, but this brochure reveals who FERC identifies with... and it's not landowners. FERC presumes a proposed project must be built as proposed. FERC could use a crash course in how and why opposition develops. Come out of your ivory (city soot coated) tower! There's much to be learned!
Presenting the public with a project as a fait accompli is the first crucial mistake. Nobody likes to learn that a company, or their elected officials, or the Sierra Club, or the Chamber of Commerce, or the "good ol' boys" in their town (or even FERC... especially FERC) have been secretly developing a project that takes their property. People's property is sacred to them. You might as well show up with a plan to conscript our children. You'd never do that, right? But it's the exact same punch in the gut feeling when a landowner learns others have been conspiring to take what belongs to him.
If you really want impacted landowners to get on board with a project, you need to involve them in the decision making from the start. Instead of saying, "we need to build this," how about saying, "we have a problem and here are several ways to solve it, but we're open to suggestion"?
Only when the public gets some ownership of the decisions made are they likely to work cooperatively toward a solution. This is a still a democracy, right?
As if it's not bad enough that investor owned utility regional transmission organization cartels decide which of their members get to profit from building new transmission of questionable worth, now ITC thinks these cartels should take over transmission ratemaking from the Federal Energy Regulatory Commission.
In a Petition for Declaratory Order filed yesterday, ITC wants the Commission to rule:
1) that binding revenue requirement bids selected as the result of Commission-approved, Order No. 1000-compliant, and demonstrably competitive transmission project selection processes will be deemed just and reasonable when filed at the Commission as a stated rate pursuant to Federal Power Act (“FPA”) Section 205; and 2) that such binding bids are entitled to protection under the Mobile-Sierra standard, and may not subsequently be changed by means of a complaint filed under FPA Section 206 unless required by the public interest.
FERC's Order No. 1000 was supposed to open the doors to competition in order to make transmission cost competitive. RTOs are now supposed to consider costs when deciding who gets to build a project. Some, like PJM, require bidders to submit a total project cost with their bid. It is not subject to accuracy checks, so a company can submit a low bid to win the project, and then recover cost overruns. This makes the cost bid worthless. Other RTOs, such as MISO and SPP, require the bidder to submit yearly revenue requirements for the life of the project (40 years). Unlike a "total project cost" estimate of a project's total capital investment, a revenue requirement also includes the utility's return, Operations and Maintenance costs, taxes, and other costs to more accurately represent a ratepayer's actual cost. Of course, these revenue requirements are just estimates, actual rates may differ.
On top of that, competition has inspired transmission companies to offer not to exceed "cost caps," where a transmission company eats any overages. This serves to make cost bids more accurate and encourages the company to actually perform, instead of its usual apathy to cost concerns because the company is simply passing its costs into rates that someone else pays.
Good idea, right? Except when a cost cap and company performance actually makes the project come in under budget, ratepayers can reap the benefits of even lower rates. ITC wants that to stop. It wants to recover the full amount of its cost cap, even if it spends less. How rickety will transmission become once corporate greed and shareholder returns enter the picture? How many equipment cost and construction practice corners will be cut to decrease costs and increase profits?
Here's a better idea: Dangle a fixed reward of a percentage of cost underruns for the economical company when a project is successfully constructed, instead of encouraging them to adopt a culture of greed by proposing an endless cycle of cost cutting to increase profits. ITC's proposal is crap.
First of all, RTOs don't know diddly doo about rates and ratemaking and care even less. RTOs are NOT regulators in the public interest. They operate in the interest of their investor owned members. There is no real public involvement in any of their decisions, and more importantly, no due process for ratepayers to participate in examination of the rates proposed in the cost cap "revenue requirements" that ITC wants to lock in at the RTO level.
There's a whole lot that goes into ratemaking aside from known costs, such as the company's rate of return. How is an RTO supposed to decide that? In addition, only the Commission has jurisdiction over transmission rate incentives that can increase return. Does ITC propose that the RTO take over this process in order to set the return at a "competitive" rate decided through the bidding process? And what about incentives that don't have anything to do with rates, such as guaranteed recovery in the case of abandonment? Would those still be the domain of the Commission, or shall they delegate those to RTOs as well?
Message unclear. Ask again later.
Having the utility design its own rates in a "competitive" manner would do nothing but encourage collusion that results in rates that are not just and reasonable. No rate should ever be bullet proof.
Well, isn't that cute? FirstEnergy has mated with itself and given birth to MAIT, Mid-Atlantic Interstate Transmission, LLC. Who thinks up these stupid names? This one rolls off the tongue with as much excitement and pleasure as the phrase "hand over your wallet and nobody gets hurt," or perhaps the descriptive "hot turd."
So, FirstEnergy needs to create another "independent" transco in order to energize its balance sheet by creating the world's sweetest investment account that will pay lucrative double-digit returns for many decades to come? Well, that's good for everyone, right? No, it's not.
FirstEnergy proposes that its "eastern" retail distribution companies "sell" their transmission assets to the newly formed "MAIT" in exchange for a backseat interest in the company and annual "lease" payments for right-of-way and other real estate interests that the retail companies will continue to own (along with the tax liability). Will the "lease payments" be enough to cover all the liabilities of owning the real estate? Or will the retail distribution customers end up financing a portion of that to make the "lease" cheaper for MAIT? Who's going to be supervising that to make sure it's an arm's length transaction?
FirstEnergy says they need to do this because it is consistent with the public interest. You know, you "public" are supposed to benefit from it. So, what are the benefits?
MAIT will not result in cross-subsidization of a non-utility associate company or the pledge or encumbrance of utility assets for the benefit of an associate company.
It supposedly won't have an adverse impact on competition, rates, or regulation.
FirstEnergy commits to hold customers harmless from transaction costs. (oh, like they did in the FirstEnergy/Allegheny Energy merger?)
So, "the public" won't be harmed? Even if we believe that, it's not a "benefit." It's "do no harm."
But, wait, there's more!!
MAIT results in the creation of a stand-alone transmission company, which provides a number of
benefits to customers and the PJM region!
Tell us more, Rod Roddy....
FirstEnergy is in the midst of a major investment cycle in transmission infrastructure. In 2014, FirstEnergy commenced its EtF initiative, which is intended to identify the need for, and facilitate the investment in, improvements to the security, resiliency, efficiency, and operational flexibility of its transmission systems. EtF projects include building and re-conductoring transmission lines; building and enhancing substations; modernizing transmission
communication infrastructure; and installing dynamic reactive resources to regulate system
voltage. In all, FirstEnergy plans to invest approximately $2.5 to $3 billion in the FirstEnergy East Operating Companies’ service territories through this program over the next five to ten years.
FET formed MAIT in preparation for this significant planned investment. As Mr. Staub
explains in his testimony, utilities face significant challenges in their efforts to simultaneously meet the service requirements of retail customers while also making sustained investments in their transmission assets. A utility’s investment in transmission infrastructure competes with other business lines of the utility for capital, and transmission investments “can be deferred in favor of more immediate or emergency investments in distribution” facilities. The singleminded
focus as a transmission-only entity will enable MAIT to commit to addressing the significant investment needs of the transmission system.
This stand-alone structure also will allow MAIT to attract capital on more commercially reasonable terms. Mr. Staub explains that lenders view stand-alone transmission companies favorably due to their transparent and easy-to-assess risk profile. The Commission has also observed that stand-alone transmission companies typically enjoy an enhanced ability to respond to transmission needs and have a superior track record of investing in new infrastructure.
MAIT’s improved access to capital will increase the likelihood that the planned investments are carried out and completed in a timely fashion and at a lower cost. Moreover, MAIT will incur debt in its own name, without a parent guarantee. Any debt MAIT incurs to finance new transmission projects, therefore, will not affect the financial condition and credit ratings of the FirstEnergy East Operating Companies. Hence, the migration to a stand-alone transmission model not only better supports the sustained level of transmission investment needed at MAIT but also preserves and enhances the FirstEnergy East Operating Companies’ capacity to issue debt for their respective retail and distribution needs.
Oh bull...oney, FirstEnergy! You forgot to mention FERC's extra special .5% ROE adder for transmission only companies, or "transcos." And, hey, if MAIT joins PJM, you can get another .5%!! You also forgot to mention in that breath that you do plan to immediately make a section 205 filing to set up a formula rate for MAIT that provides a lot of financial goodies that you can't get through a stated rate. Are you also going to be applying for all the other FERC transmission incentives? I bet you are, you coy little company!
So the real benefits here are for FirstEnergy, not "the public." Since the public is not receiving a benefit, and if we believe FirstEnergy that this won't increase rates (and profits), then why in the hell would FirstEnergy want to do this and shell out the "transaction costs" it can't pass to ratepayers? Do you really expect us to believe there's nothing in it for Y-O-U, FirstEnergy? I mean, you guys are kind of stupid, but I didn't think you were complete idiots.
And I do believe you are attempting to remove a whole bunch of transmission from state regulatory oversight so that you can plow your "transmission spend" into making "investments" of questionable worth in your lower voltage transmission lines that aren't part of any PJM transmission plan.
So, does anyone care? Apparently not much. The only parties to intervene in this docket are competitor PSEG and FERC settlement gadflies AMP and ODEC.
Remember, these companies are regulated to protect you. Except there's nobody minding the store on your behalf.
Federal energy agencies are a puzzle to most people. FERC and DOE? What's the difference? Is there a difference? What do these agencies do, and how can you participate in their processes?
It's helpful to start at the beginning, with the creation of these agencies. The Department of Energy Organization Act of 1977 reorganized a hodge podge of federal energy departments to separate energy policy from energy regulation to prevent too much coziness and to create a national energy program.
The U.S. Department of Energy was established as a cabinet-level department to deal with energy policy. Within the DOE hierarchy, Congress also created an independent energy regulatory Commission known as the Federal Energy Regulatory Commission, or FERC. The DOE organizational chart looks like this.
FERC was given jurisdiction over narrow and specific energy issues. FERC is NOT a national appeals court for state energy decisions you don't like. FERC does NOT have jurisdiction over the actions of DOE, or any other agency over which it is not specifically granted jurisdiction by Congress. Sometimes the DOE can delegate specific authority to independent agencies like FERC, in order to work cooperatively with them to develop rules or policy over which DOE has jurisdiction.
Here's a simple list of what FERC does and what FERC does not. If you think you have an issue that FERC should do something about, please check the list before wasting time and resources filing frivolous complaints or petitions with FERC. If you don't understand this list, or need more information, please ask someone who does know or do some research before running to DC with your pop gun loaded with blanks. Not only do you look silly, but you waste incredible amounts of time and resources and damage your reputation. Federal energy regulation and policy is not a game of flinging poop on the wall to see which pieces stick. Get educated, get your game plan organized, and target your requests with efficiency for best results.
FERC has its own set of rules that apply to matters under FERC's jurisdiction. If your issue isn't within FERC's jurisdiction, FERC's rules don't apply.
Unless operating under the rules of a different agency that has some jurisdiction in one of its actions, the DOE operates under 5 U.S. Code Chapter 5, Subchapter II - ADMINISTRATIVE PROCEDURE.
If you want something, you have to legally support what you're asking for. Remember, only monkeys throw poop.
Did you think I've been on vacation for the past couple of weeks? Hardly. But I've been having so much fun it sort of felt like a vacation.
Today was the filing deadline for initial briefs in the consolidated FERC proceeding dealing with the formal challenges to PATH's 2009, 2010 and 2011 rates and the recovery of PATH's capital investment in the cancelled PATH project.
The briefs summarize the evidence and positions of the parties.
You can download them here:
Newman-Haverty Initial Brief
(deals with formal challenge only)
FERC Trial Staff Initial Brief
(deals with formal challenge and abandonment)
Joint Consumer Advocates Brief
(deals with abandonment only)
(deals with formal challenge and abandonment)
Happy reading! They're much shorter than War and Peace. I think.
Why do they call them briefs? Is this some sort of sick joke?
Yesterday, The Coalition of Eastside Neighborhoods for Sensible Energy
and Citizens for a Sane Eastside Energy
, et al, filed a complaint
at FERC against Washington State utilities Puget Sound Energy, Seattle City Light, Bonneville Power Administration and ColumbiaGrid. The complaint alleges that the utilities violated the Federal Power Act, FERC Orders No. 1000, 890 and 2000, and contractual obligations that the respondents made with the Commission that incorporate the referenced Orders, as well as the terms of their respective Open Access Transmission Tariffs.
Whew! That's a mouthful, huh? In plain English, it looks like the complainants are accusing Puget Sound Energy of trying to permit and build a transmission project that was not developed in a plan by an independent grid operator (or a reasonable facsimile, since the Northwest doesn't have a traditional RTO/ISO).
ColumbiaGrid is supposed to be taking the place of a RTO for all the named respondent utilities, and according to the complaint, the utilities promised FERC that ColumbiaGrid would serve in a role to make the area Order 1000-compliant.
The complaint alleges that Puget Sound Energy developed its "Energize Eastside" project without proper load flow studies, no study of alternatives, no RFP to evaluate alternate proposals, and that ColumbiaGrid is an entity controlled by its member utilities, including Puget Sound Energy, and does not meet independence requirements for RTOs.
The complaint also alleges that the project is not the "local load flow" project it claims to be (to escape FERC jurisdiction) but also includes a new 1500MW transmission path to Canada that fulfills a decades-old agreement about shared hydro resources. The addition of the Canadian firm capacity also elevates the project to one that should be regionally allocated, and not charged 100% to local load in the Eastside neighborhoods, as Puget Sound Energy is attempting to do.
Sounds complicated, but the affidavit of J. Richard Lauckhart is a great read to get an easy handle on the problem here. These guys really did their homework on FERC process and policies, and provided evidence in the form of expert testimony. Well done!
Looking forward to seeing where this leads...