You won't be seeing variations of the word "approve" in my headline.  That's because the Illinois Commerce Commission decision yesterday was not a pivotal moment that sealed the project's success.

Far from it.

Although the actual Order has been withheld from the parties and the general public for the time being, I've been able to piece together a general idea of its contents from various news stories, along with knowledge of what was in the proposed order issued by ALJ Larry Jones several months ago.

Clean Line applied to the ICC under two separate statutes.
Rock Island therein requests an order granting it a certificate of public convenience and necessity (“CPCN” or “Certificate”), pursuant to Section 8-406 of the Act, authorizing it to operate as a transmission public utility in the State of Illinois and to construct, operate and maintain an electric transmission line (“Project”); and authorizing and directing it, pursuant to Section 8-503 of the Act, to construct the proposed line. 
News reports say that the Commission granted the CPCN under Section 8-406, but did NOT order it to construct the line under Section 8-503.

Sec. 8-406 makes it technically possible to construct the line, if it can acquire VOLUNTARY easements from all affected landowners. 

Only under Sec. 8-503 may the company be granted the authority to take property through eminent domain condemnation.  An order under 8-503 would set the company up to effect takings through mere procedural steps.  But the ICC DENIED Clean Line's application under Section 8-503.  Therefore, Clean Line would have to come back before the Illinois Commerce Commission with a second application for an order under Sec. 8-503 at some point in the future, with likely similar results.

ROCK ISLAND CLEAN LINE HAS BEEN DENIED EMINENT DOMAIN AUTHORITY TO TAKE PROPERTY IN ILLINOIS!

Big win for landowners!


Know this -- the ICC would never grant Clean Line eminent domain authority to take the majority of its route.  Usually, holdouts in transmission line cases that actually end up being taken via eminent domain are few and far between.  There's strength in numbers.

Feel free to say "no."  Isn't it ironic that a company that has been telling regulators and the media how well it has been "collaborating with landowners" would now actually have to... well... collaborate with landowners?  Perfect!  However, Clean Line's lies and underhanded tactics have inspired massive distrust by landowners.  And every farmer knows... you reap what you sow.
 
 
Well, here's a chance for our government to work for us!

It was reported on Monday that DOE's Inspector General will be "undertaking a review" of FERC's Office of Enforcement" at the urging of several U.S. Senators.

The lawmakers have urged the IG to look into the way FERC investigates market manipulation.  Earlier this year, a very public battle between FERC's OE and energy trading firm Powhatan Energy Fund LLC made headlines and haunted former Director of FERC's Office of Enforcement Norman Bay's nomination to the Commission.
Sen. Robert Casey, D-Pa., was the first to ask the inspector general to look at the way FERC has been investigating alleged energy market manipulation. Stressing the need for investigations to be transparent, Casey in July urged Friedman to look at seven specific aspects of FERC's enforcement program, including whether the agency has pursued enforcement actions against entities "that were not acting in violation of then-current applicable laws and regulations," and is "properly allocating its limited resources to investigation of cases that have the most deleterious effects on energy markets."

Then, in September, Barrasso and Sen. Susan Collins, R-Maine, asked the inspector general to explore allegations questioning the fairness and transparency of FERC's enforcement program, including those made in an Energy Law Journal article co-authored by a former FERC general counsel asserting that the commission's enforcement process has become "lop-sided and unfair."

The two senators specifically asked if FERC is holding certain parties to different standards with regard to market manipulation. For instance, Barrasso and Collins questioned whether the public is being given "actionable notice" of the types of conduct FERC considers to be market manipulation. They also asked Friedman to explore the article's allegations that the targets of FERC investigations and their employees are not being afforded the due process "required by FERC's own regulations and precedents" and that provided by other federal enforcement agencies.
The IG will also be investigating any "quid pro quo" connections between enforcement actions and other unrelated FERC actions, and some craziness about career vs. non-career positions.

FERC has publicly offered a recent defense against the allegations.

Some have wondered whether FERC applies different standards to those it considers outsiders to its little energy fiefdom.  Does FERC go after its utility regulars with the same zeal it reserves for banks, traders, companies or individuals that don't regularly wander its halls and hearing rooms?  Is FERC's OE all about big headlines, or is it about justice?  Are utility transgressions dealt with by sweeping the matter under the rug or slapping the offender on the wrist?

It's going to be interesting.  Let's hope we don't next have an investigation of DOE IG's investigation to determine whether that investigation was carried out in a fair manner.  They could run out of inspectors to inspect each other at some point.
 
 
Read the Preservation of Rural Iowa Alliance's letter to the editor of the Des Moines Register.

Opposition to Clean Line's projects is now active and collaborating in seven states, and numbers in the thousands
.

Ut-oh, Clean Line!

 
 
FirstEnergy is at it again.  Its affiliate JCP&L's "Montville-Whippany Reinforcement Project" not only gave the New Jersey towns of Parsippany and Montville the ol' bait and switch, it's deep into dividing and conquering both of the towns by throwing the focus on shoving the line off onto someone else and pitting neighbor against neighbor, instead of allowing BOTH towns to join forces and focus on the real enemy -- FirstEnemy... errr... Energy!

Last year JCP&L held "open house" sessions for a route through Parsippany.  The townsfolk jumped all over opposing the line, forming a grassroots opposition group and making a lot of noise. Last week, JCP&L held another series of open houses announcing they had selected a different route through neighboring Montville

Montville has already been ground zero for PSE&G's "Susquehanna Roseland" transmission project.  I guess the geniuses at JCP&L think transmission lines are like potato chips -- you can never have just one?  So, not only is Montville already an experienced transmission opposition warrior, but JCP&L had to go and enrage the town's leadership with its tired, old "open house" meeting format, which the mayor referred to as "the stations of the cross."
The Committee expected the mayor to give an opening statement and then JCP&L would give their presentation, followed by a question-and-answer period. A committee member said that it turned out to be a JCP&L public relations presentation, and the company made no effort to discuss the problems and possible solutions.
So, now the town will be holding its own public meeting, where residents and town leaders will make their own list of demands.  The town expects JCP&L will subsequently negotiate modifications to the plan that would lessen impact on residents.  Good luck, Montville, and remember, delay is your friend!  :-)

Will the utilities ever learn?  Their old routines no longer work on an increasingly educated and savvy public.  The "open house" is no longer effective in dividing and neutralizing potential opposition.  Heck, we use your stupid "open houses" as handy-dandy meet-n-greets to recruit new opposition.  It's cheaper and easier when you all do the mailings and media to get affected landowners to a centralized location where they can be recruited by opposition groups.

The only citizens who leave those meetings with a warm, fuzzy feeling are those who find out that their property is nowhere near the project.  The rest of them leave confused, shell-shocked... and angry.  And they form and join opposition groups that increase costs and delay projects, sometimes even causing the project to be abandoned.

The days of running over the public with stupid PR tricks in order to build overhead transmission
are over.  The public demands transparency, integrity and better solutions.

Time for a new schtick, FirstEnergy. 

 
 
Spending the better part of my week playing lawyer, paralegal, and legal secretary, all at the same time, wasn't much fun.  However, I was thoroughly cheered to observe from time-to-time when I came up for a sanity break, that Clean Line Energy Partners was having a MUCH WORSE week than me!  :-)

All three of Clean Line's active projects took it in the shorts last week, in one form or another.  This is the direct result of overwhelming, forthright and committed opposition in every state through which it intends to build its Rock Island Clean Line, Grain Belt Express and Plains & Eastern Clean Line projects.  And to get there, it's taken an enormous amount of dedication, organization and hard work on the part of some savvy opposition leaders
, and the help of everyone involved to raise this issue in the public dialogue.  So, pat yourselves on the back, everyone!

First, let's look at the Rock Island Clean Line project.  It STILL has not been approved in Illinois, despite Clean Line's project leader telling newspapers it had been.  It was on the Illinois Commerce Commission's agenda on Thursday, but, once again, the Commission kicked the decision down the road
for another day.  Clean Line had been telling folks that once it got approval in Illinois, it would file for its franchise in Iowa.  Even though approval is still up in the air (and the proposed order of the ALJ did not recommend eminent domain authority at this time, along with a whole bunch of other hurdles that make the project much less viable) Clean Line went ahead and filed its applications in Iowa.

The Preservation of Rural Iowa Alliance says that despite having land agents active in the community for the past year, the company still has only secured easements for 15% of the property it needs to build its line.

Clean Line said the company will need to cross approximately 1,500 separate land parcels in Iowa to reach Illinois. So far, about 200 owners have signed agreements. That’s about 15 percent of the total needed.

Eric Andersen, another Clean Line opponent from Grundy County, said the small number of willing sellers so far will be one of the arguments opponents use against the plan.

“This is a private investment firm that’s building a private transmission line and they want to use eminent domain on 85 percent through some of the best farm land in the world. That’s a huge deal,” Andersen said.
RICL is asking the Iowa Utilities Board to grant it eminent domain authority to condemn and take 85% of its route?  Never going to happen.  Usually, holdouts that require the use of eminent domain are few and far between.  Never 85% of the landowners targeted!  If these landowners continue to dig in their heels (and I expect they will) this project will be political poison.

Turning now to Clean Line's Grain Belt Express project, evidentiary hearings got underway before the Missouri Public Service Commission this week.  In addition to the various landowner groups and others opposing the project, the staff of the MO PSC has also adopted a position opposing the project:
“As staff has set out in the position statements it filed last Friday, it is staff’s view that the evidence in this case will not show that the transmission line and converter stations are needed, economically feasible, or will promote the public interest in Missouri,” Williams tells the Commission.
But Clean Line has an ace up its sleeve that it thinks will "turn a no into a yes."
Clean Line turned to the Department of Energy and Section 1222 of the Energy Policy Act of 2005. The little-known provision would enable DOE to work through a federal power marketing administration and, in certain instances, condemn property required for easements.

Clean Line filed a similar application with DOE for the Grain Belt Express project in 2010.

In a testy exchange during Monday’s hearing in Missouri, Agathen, the landowners’ attorney, repeatedly asked whether Clean Line would pursue federal approval of the Grain Belt Express project if denied by the Missouri PSC.

Skelly said Clean Line’s application for Section 1222 authority for Grain Belt Express is still pending at DOE but inactive. And the company would exhaust efforts to persuade state regulators to approve the project before turning back to the federal government.

“We would look at the no and figure out a way to turn it into a yes,” he said.
And this brings us to the third Clean Line project, its Plains & Eastern, that got thoroughly pummeled last week during a joint State Agencies and Governmental Affairs committees and joint Agriculture, Forestry, and Economic Development committees of the Arkansas legislature.  Arkansas Rep. John Hutchinson's interim study presented a parade of experts, state agencies, and concerned citizens who spoke against the project for several hours.  The Clean Line representative in attendance never spoke, but did manage to smirk at opportune moments.  Because, you know, that arrogant little frat boy behavior just makes people want to love you, right Clean Line?  The Arkansas Democrat-Gazette reports:
"Game & Fish Commission Director Mike Knoedl said that bird deaths in the area would be 'astronomical' because of the high lines and towers, some as tall as 200 feet."
Clean Line probably doesn't care who opposes their project in Arkansas though, since the company is planning to have the U.S. Dept. of Energy step in to take land from Arkansans under the federal Energy Policy Act, Sec. 1222.  Unless Arkansas fights back... stay tuned!

 
 
I think the TVA has been reading too many fairy tales.  In an abrupt about-face, the TVA produced a letter expressing "an interest in options" like Clean Line on Tuesday.  The letter was sent to Clean Line just in time to be presented to the Tennessee Regulatory Authority at its evidentiary hearing on Clean Line's application yesterday.

I smell a big, fat, political glad-handing rat.

In July, the TVA sent a letter responding to Tennessee congressmen Alexander and Fincher that panned Clean Line.  In a nutshell, the letter said that Clean Line presents economic and reliability issues for the TVA.

Now, just 4 months later, TVA "encourages" the TRA to:
...provide the regulatory and other government review needed to move the project forward.
What's changed?  I think it might have been the employee who drafted the letter for Johnson's signature.  This latest one sounds to me like it was written by some external affairs schmoozer, perhaps over a few "clean" cocktails, and not by TRA's resource planning staff.

The TVA says that Clean Line may provide a "potential option for the future needs of the region," but stays far, far away from actually committing to it.  TVA says that it is still working on its integrated resource plan, and Clean Line's interconnection study, and that only the TVA Board can decide whether to purchase capacity on Clean Line.  But yet TVA President William Johnson thinks Clean Line should be built just so he has some "options" to choose from.

Don't we build only the transmission that's actually needed?  Don't transmission planners base new lines on actual need?  I've never heard of a transmission line approved by an RTO just to provide "options."

If TVA decides that wind is the most economic and reliable option for a portion of its resource plan, then it will have plenty of wind "options" to choose from, whether Clean Line is built or not.

So, let me get this straight... TVA wants to clear cut a new 700 mile right of way through three states, take land from thousands of citizens through condemnation, depress the economy of "pass through" states, raise electric rates in generating states through increased competition, and encourage Clean Line to borrow billions of dollars to construct this project, just so the TVA can consider it as an "option?"

Fortunately, it's a financial impossibility to build Clean Line without firm contracts with shippers and utilities that will provide a collateral income stream.  So, guess what?  If Clean Line gets built, it will already be fully subscribed, which means that there will be no "option" for TVA's "interest."
  See paragraph above about other "options."

The TVA finishes off its split-personality missive with a
disclaimer that negates all the rest of the blather.
I note that, while Clean Line might represent an option for TVA and its stakeholders' future, only the TVA Board has the authority to  approve exercise of such an option. That Board to-date has not undertaken such an approval. That consideration process will focus on the statutory requirements of least cost, need for the resource, and other matters within the purview of the TVA Board.
Sort of sounds like a special fairy tale intended to grease the TRA's approval wheels to me.  What a shame.  Just when people were starting to have faith in the integrity of the TVA's integrated resource planning process...
 
 
A settlement proposal was made public today by parties to the West Virginia Mon Power/Potomac Edison base rate case.

The settlement must be approved by the WV PSC before it becomes final.  The PSC has scheduled a hearing on the settlement for Nov. 7 at 9:30.  You can watch the webcast here.

The settlement was crafted during negotiations between the company, the staff of the PSC, the Consumer Advocate Division, WalMart and the WV Energy Users Group (a group of energy hog industrials).  The PSC Commissioners (what few we have left) did not have a hand in crafting this settlement.  They will have a hand (or a rubber stamp) in approving it.

So, what happened?  They agreed to a rate increase effective Feb. 25, 2015.  The press release yammers on about how much this will cost the "average" customer (23 cents per day, $6.90 per month, $84.40 per year).  Mr. & Mrs. Average Customer use exactly 1,000 kwh of electricity every month.  Your usage isn't so neat, so therefore your increase will vary. 

But, it's not the rate increase the company asked for.  It's less.  The original proposal was going to increase Mr. & Mrs. Average Customer's bill something like $15/month, so consider the proposed settlement to be slightly less than half the amount requested.

The company had asked for a total of $151M annual increase.  The settlement amount is $62.5M annually.  This amount includes a $15M (1.45%) increase in base rates and a new $47.5M surcharge for vegetation management. 

The vegetation management surcharge bears further examination considering the company asked for a $48.4M surcharge for increased vegetation management.  The company has been receiving a separate amount for vegetation management that has been included in the base rate for years ($28M).  What this settlement does is remove that amount from the rate base and combine it with an additional amount for increased vegetation management to create the new vegetation management surcharge.  This new surcharge is subject to filings in the first, third and fifth year in which the company must true up actual expenditures to the amount collected.  Gone are the days of FirstEnergy collecting millions for "vegetation management" that it never performs (and contributes to more severe and prolonged storm outages).  Now you'll actually get the vegetation management you pay for!

Back to the base rate increase:  Included is $46M of 2012 storm costs, amortized over a 5-year period, without earning a return (about $9M/year).  Once the 5 years is up, this is gone forever (unless we have another storm disaster in the meantime). 

The stipulation regarding the $60M FirstEnergy wanted to collect for closed power plants Albright, Rivesville and Willow Island sounds like Yoda wrote it.
For the unrecovered the companies may account, undepreciated investment.  
Balances in the 2012 deactivated power plants (albright, rivesville, and willow.  
Island) in any manner the companies deem appropriate, with gaap in accordance.  
And regulatory accounting.  Not, the parties agree that such accounting does.  
To recover these costs or amortization expenses in future rate establish a right.  
Proceedings, and this joint stipulation shall prevent the parties from nothing in.  
To recovery of these taking whatever position they deem appropriate in relation.  
Amounts in future proceedings.  Herh herh herh.
I'm not sure what it means.  Probably nobody else knows either.  Except maybe Yoda.

The companies must increase the amount they contribute to the Dollar Energy Fund that assists low income folks with their outrageous FirstEnergy electric bills.  FirstEnergy's increase is $150,000/year.  In addition, the company must continue to "contribute" an additional $250,000/year that they recover from ratepayers.  So, essentially, YOU are paying this extra and FirstEnergy is getting the credit for the "donation."  Isn't that special?  Betcha' didn't know that FirstEnergy provided charitable giving coordination services like that!  Of course, how much of any of this is "giving," when all the money ends up right back in FirstEnergy's pocket?

This one is kinda confusing.  Even Yoda can't help. 
The proposed increase to the customer charge for residential and small commercial
customers shall remain at $5.00 per month.
The increase shall remain at $5.00 per month?  We're already paying $5.00 per month.  Does this mean that we're now going to pay $10.00 per month, or does this mean that there will be no increase in this fee?  Clarity needed.

The company is allowed to establish a regulatory asset for its expected EPA compliance plans at Harrison and Ft. Martin.  This amount will be deferred (sit on the balance sheet uncollected and earning interest) until a future rate case
.

The company will earn a 9.9% ROE, down from the requested 11%.  When combined with the return on debt of 5.15%, and adjusted by the company's capital/debt ratio, the total return will be 7.36%
.

The company will receive an additional $1,074,174
per year to read every meter every month going forward.  This is down from FirstEnergy's requested $7.5M yearly cost to read meters monthly. Now the trick is going to be making sure the company actually DOES the required readings!  No skimping now, we'll be watching!

So, what do you think?  Did your advocate cut you a good deal in this rate case?  You can submit comments to the PSC here.


 
 
megalomaniac |ˌmegəlōˈmānēˌak|
noun
a person who is obsessed with their own power.
• a person who suffers delusions of their own power or importance.
The President of floundering Clean Line Energy Partners thinks utilities whose territory his projects pass through would make great investors in the projects.
In the future, Skelly says he hopes that utilities, whose territories are crossed by the HVDC lines, could invest in Clean Line.
So, sign up today to support Mikey's risky plans for more unregulated transmission lines outside the normal planning process!  Because getting a few of Mikey's crumbs is soooooo much better than building your own transmission lines and eating the whole pie.
 
 
It's been a long time since I last got a google news alert for "Potomac-Appalachian Transmission Highline."  So long, in fact, I'd forgotten I even had those search terms set to notify.  But, just in time for Halloween, the PATH zombie reared its ugly head and I got a notice last week that some right-wing think tank had published a paper where those terms were mentioned, America’s Electricity Grid: Outdated or Underrated?
And what did the author have to say about PATH, more than three years after its death?  How has history treated this stunningly costly failure of "independent" planning?
Despite identification of areas in which transmission capacity is limited, a “not in my backyard” (or anyone else’s, in some cases) attitude toward new transmission line siting has resulted in cancellation or delay of some new transmission lines.

For example, in 2011, PJM cancelled the proposed Potomac Appalachian Transmission Highline (PATH) project, a 275-mile transmission line that would have run through West Virginia, Virginia, and Maryland to deliver electricity into Northern Virginia. Although the line was designed to improve reliability in eastern PJM, changing forecasts of electricity demand growth and intense opposition to siting the line led to the project’s cancellation.
It's the opposition that will be remembered, not individual analyses and the fine line that supposedly determined this white elephant was needed.

Hey, remember this?  PATH's talking heads insisted that opposition had nothing to do with PATH's cancellation.

But, history says it did.

While the article's conclusions are pretty screwed up, it does a nice job explaining the bulk power system and federal regulation thereof.  It's a good "backgrounder" for folks new to the transmission world.  Think about how much more reliable our system would be though, if we brought back the "islands" of the past and operated them as smaller parts of the bigger system (aka "microgrids").
Beginning in the late 1920s, electric utilities began to integrate their operations to improve reliability and reduce costs. Previously, utilities had operated as “islands,” meeting the demand for electricity solely from their own generating plants. To ensure reliable service, this meant building extra generating capacity to keep in reserve, in case unexpected problems caused their plants to shut down.[2] By integrating their operations, utilities could provide more reliable service without building as much backup generating capacity. In essence, if a generating plant at Utility A suffered a forced outage, one of Utility B’s generators would be available to ensure the lights stayed on. The concept is similar to diversifying a financial portfolio. Instead of investing everything into just one company’s stock, buying multiple stocks, bonds, and other investments reduces the risk of a sudden financial loss.
Microgrids that can be islanded from the larger system at times when the larger system fails (remember Superstorm Sandy?) can continue to provide power for necessary services.  And if microgrid "A" suffers a forced outage, it can borrow from microgrid "B", or "C," or "D," or any other nearby microgrid.  Relying on just a handful of generators and long-distance transmission lines creates parasitic load pockets with no native generation.  Those folks have nowhere to turn in case of emergency.

Building more transmission lines isn't the answer.  The answer is a more democratic electric grid system that benefits consumers and local communities, not gigantic, investor-owned utility holding companies.
 
 
If you were looking forward to watching the PSC evidentiary hearing via the Commission's webcast like I mentioned on the radio last week, change of plans.

There won't be an evidentiary hearing. 

As I also mentioned, there will be a rate increase.  It's only a matter of how much.  The Staff of the Public Service Commission, your Consumer Advocate, Wal-Mart and the Energy Users Group have reached a settlement with FirstEnergy "in principle."  The exact amount of our rate increase is still under wraps.

If FirstEnergy is settling, it probably means us ratepayers are gong to take it in the... wallet.