Remember Mr. Haney, the swindling neighborhood peddler from the 1960s TV show Green Acres?
Haney, portrayed by veteran character actor and longtime Western film sidekick Pat Buttram with the distinctive, warbling voice, sold his family's ancient, dilapidated farm to Oliver when he and Lisa Douglas left New York City for rural Hooterville and their new life as farmers. In the process of the sale, Haney stripped the farm of everything of value down to the plumbing.
Haney had cheated the Douglases by charging them several times what the property was worth and saddling them with a dysfunctional farm. He continued to cheat them by initially selling the movable property associated with the farm to them one piece at a time. Douglas bought Haney's cow, tractor and plow, all of which were as useless as the farm.
He continued to come back with his farm truck converted into a peddler's truck stocked with worthless versions of items that Oliver had need of. He almost invariably succeeded in unloading the items on Oliver at inflated prices despite his past shady dealings with them. He often took a piece of junk and called it by some outlandish name, suggesting that it has some use that it clearly does not and that it's in some way valuable.
Haney would often turn up in his truck at the Douglas farm, minutes after they've realized they needed something, selling exactly that (even if it were very odd), complete with a pull-down sign on his truck advertising it. If turned down by Douglas, Haney would offer a variety of equally useless alternatives. Oliver once said "How come you always show up with exactly what I need?" And Haney turned it on him by saying "Well let me put it to you another way...how come you always need what I show up with?" Well, deja vu, dear readers. A new age Mr. Haney was peddling his wares to reporters at a "media event" in Fairmont yesterday. The media event was staged to draw attention away from all FirstEnergy's other problems and hopefully convince the public to support the company's flaccid proposal to sell the Harrison power station to itself for ONE BILLION DOLLARS! However, FirstEnergy's Mr. Haney is, shall we say, less than convincing? It looks like Mr. Haney doesn't even believe himself when he tells the few reporters in the audience that he can "control the future." Is that sort of like Todd's Magic Math? And speaking of our friend Todd... he's so boring and inconsequential that the reporter talks right over him. Even Mr. Haney smirks and makes faces when Todd talks. And the camera man found film of a reporter's digital recorder the most interesting thing at FirstEnergy's media event. Right.
Another entity has joined the litany of complaints against FirstEnergy subsidiary Potomac Edison. The Jefferson County Commission unanimously and enthusiastically voted last Thursday to send a letter to the West Virginia Public Service Commission asking the regulator to open an investigation of the company's billing and meter reading practices.The Commission heard from WV Delegate Stephen Skinner during the meeting, as well as public comments from three different citizens, regarding the outrageous, unjust, and unreasonable Potomac Edison business practices customers had been subject to over the past year or so.Delegate Skinner has been a vocal advocate for his constituents, many of whom have been hit hard by bills up to 1000% more than usual that are the product of the company's failure to read meters every other month as required by law, as well as both human and computer error on the part of the company. As a regulated monopoly, Potomac Edison has obligations to its customers, and Delegate Skinner intends to do all he can to ensure Potomac Edison meets those obligations. Since he began questioning Potomac Edison's practices, Skinner has been contacted by the company's government affairs person, who made all sorts of excuses, and promises that have failed to materialize. The complaints continue.Commissioner Widmyer expressed her disappointment with the company's "robo-call" method of attempting to connect with and mollify angry "real people" customers.Meanwhile, the WV Attorney General pretends he is looking out for consumers by making a "hotline" number available for angry customers to call the company. There's already a customer service number on your bill, little consumer. The Attorney General recommends you call it. Personally, I'd rather call Delegate Skinner or the Jefferson County Commission for some real help. The parade of perturbed Potomac Edison patrons persists.
Great news today at FirstEnergy's quarterly earnings call! Eternal optimist Tony Alexander (who is still waiting in vain for the economy to improve and power prices to increase) has stated that FirstEnergy's proposed West Virginia Harrison coal plant transfer is no longer critical! "Our success with the actions we have already taken, particularly the bond deal at FirstEnergy Corp. means the Harrison transaction while still important to both West Virginia and FirstEnergy Solutions is no longer critical to the successful completion of our financial plan."
FirstEnergy management has finally admitted what I've been saying from the very beginning: The proposed plant transfer is all about raising cash to pay down debt at FES to improve FirstEnergy's balance sheet and maintain its credit position. It was never really "...expected to help insure reliable power for our West Virginia utility customers for many years to come," or to be "...very positive for the West Virginia economy and our customers of our utilities in West Virginia." Obviously, FirstEnergy now realizes that the West Virginia PSC is not going to approve this transaction, so it has taken other measures necessary to patch up its balance sheet, such as selling bonds and its hydro assets (which are much more marketable than an antique coal plant). FirstEnergy has decisively removed all its precious balance sheet eggs from the precarious Harrison plant transfer basket. If the company had any faith left at all in the WV PSC approving the transaction, don't doubt that it would still be considered "critical." Instead, the transfer idea has simply been tossed onto the ever-growing waste heap of FirstEnergy's bad ideas. FirstEnergy also stated that transfer at a price lower than its jacked-up merger plant cost (which magically doubled the value of the plant overnight), as suggested by several intervenors in the case, was "a non-starter." FirstEnergy would apparently rather give up entirely than sell the plant at a reduced rate. I think we're all in agreement here then, and Tony can keep his "great asset" because it really isn't "more important to West Virginia and Mon Power than is it to FirstEnergy." I think FirstEnergy's answer to this question pretty much clears things up all around:
Dan Eggers - Credit Suisse: Just following up on Tony's comments and Leila's comments about Harrison. Can you just maybe help us understand how important it is you think at this point in time to move that asset over from a balance sheet perspective relative to a customer benefit perspective? And then given kind of the wide or the low bid made in the intervenor testimony, how important it is to take a lower price or accept a lower price to get this done relative to keep in at FES if the pricing doesn't makes sense?
James F. Pearson - SVP and CFO: I'll start off with that, Dan. Well, let me start off. I think the low price of the $565 million or whatever that's just a nonstarter. So, I'll leave that at that. From a balance sheet perspective, we think we are in pretty good shape by getting the FirstEnergy Corp. bond deal done where we upsize to $1.5 billion. We also feel that we're in very good position with the hydro asset sales. So, we feel real comfortable about that. And as you know, we plan to infuse equity from FirstEnergy down into Mon Power associated with this asset transfer. If the asset transfer doesn't go forward, we would likely infuse that equity that we have planned for Mon Power down into FES. So, I think we end up at a good position for the balance sheet there at FES.
Anthony J. Alexander - President and CEO: Dan, this is Tony. As I'm looking at this, I think, this is far more important to West Virginia and Mon Power in terms of providing them with a stable and long-term resource that they can rely on than it is at this point from a balance sheet standpoint at FES or at FirstEnergy.
Dan Eggers - Credit Suisse: But if it didn't transfer, you'd feel comfortable keeping that extra capacity at FES?
Anthony J. Alexander - President and CEO: Absolutely. It's a great asset. So that's not a consideration. It sounds like the bloom has come off FirstEnergy's plant transfer rose. How refreshing for FirstEnergy to finally admit that they expect to LOSE on the Harrison proposal. So, why not withdraw your application and quit wasting everyone's time and money, FirstEnergy? It's still not too late to save the State of West Virginia and all the intervenors in the case a whole lot of time and money going forward with a hearing on a case you no longer care about. FirstEnergy should withdraw now and let everyone cut their losses (well except for those shysters at Jackson Kelly, who are most likely counting on all the billable hours continuing this case provides -- because composing nonsensical and ridiculous discovery questions doesn't come cheap, does it?). We're not going to quit until FirstEnergy throws in the towel completely. Keep those petition signatures, letters and postcards opposing the plant sale to the PSC coming! Other news and entertainment to be had during today's call:1. AMP has pulled out of a MOU with FirstEnergy to build a peaker plant at its Eastlake site. This now puts a whole bunch of new transmission back on the table. But that's okay, transmission is an "investment opportunity" cash cow for FirstEnergy. 2. FirstEnergy has succeeded in persuading the Ohio State Senate to introduce a bill to gut the state's energy efficiency standard. "FirstEnergy is actively involved in this process and is advocating changes that we believe make more sense for our customers and help foster solid economic growth in Ohio, including the development of shale gas." Oh, nonsense! Again, it's not about FirstEnergy's customers or economic growth, it's all about FirstEnergy's bottom line. Utterly revolting. 3. FirstEnergy "took a look at" long term trends in residential sales, which have remained flat since 2007. The FirstEnergy sleuths are getting closer and closer to the truth with every earnings call. Maybe sometime in this decade they'll realize that residential growth is dead and cannot be revived because its all about energy efficiency. However, if you look closely at #2 above, you'll see that it's simply a matter of willful denial at this point. 4. Michael Lapides of Goldman Sachs got Donny Schneider off into a discussion of purchased power, where our hero stated, "We're very comfortable with being able to procure power to serve load. For years, prior to our merger with Allegheny, we served all of the Penelec and Met-Ed load, and I think that in total was about 30 terawatt hours a year, and we did almost of all of that with purchased power." But now, all of a sudden, FirstEnergy is telling the WV PSC that relying on purchased power to serve Mon Power/Potomac Edison load is too risky and too expensive and that purchasing Harrison is a better idea. Giggle break! :-) Was Lapides REALLY asking about "exposure?" 5. FirstEnergy was also grilled about their balance sheet hocus-pocus where the company is simply taking on short term debt at the holdco level to pay down debt at its FirstEnergy Solutions subsidiary, as well as another question about the source of funds for FE's "equity infusion" to either Mon Power or FES. The company avoided both questions. I'm not convinced that the analysts were fooled. In fact, I don't think FirstEnergy is fooling anyone but themselves anymore.
Ut-oh, transmission project owners! While attending the Wisconsin Energy Action Fair in Mauston over the weekend, experienced transmission opponents from across the country gathered to compare notes, share experiences and tactics, and discuss strategy and national energy policy. Online friendships and alliances were cemented together in person. Know what happens when you put a bunch of transmission opponents in a room together? It's the all-transmission-all-the-time gab fest, where we're all allowed to indulge in thought-provoking and laughter-inducing conversations about our favorite subject that bores most of the other people we know: transmission! I suppose this could be considered the first of many national transmission opposition conventions, however, I'm not going to put my "The Importance of Strategic Planning in Grassroots Opposition" PowerPoint, or any summaries of any other speaker presentations, online. That's what transmission owners do. We're smarter! If you weren't there, you missed out!Many thanks to Rob, Jane, and all the friendly folks at SOUL for being such gracious hosts and making the weekend worth the trip! Looking forward to the next event!
Alice isn't the only one to find herself tumbling into a rabbit hole where up is down and down is up and nothing is as it seems. While trying to do a radio program about FirstEnergy's Potomac Edison/Mon Power plant transfer this morning, I found it interesting that every person who called in mentioned Potomac Edison's recent unjust and unreasonable billing practices. And then I sat down to pay a pile o' bills when I got home and guess what? There was my Potomac Edison bill. The company has been urging customers with questions about their bills to call the customer service center, so I did. Forty minutes later, I still didn't have logical answers to my questions. I can only imagine how customers who have received astronomical bills they cannot pay must feel after an hour in Potomac Edison's "valued customer" funhouse.First, I had to verify that I actually was a customer because my name supposedly isn't on the bill. Now, we know that's just not true, don't we? I guess that must be a common mistake, right, Randy? After the first customer service rep. and I determined that the cause of my budget plan billings being inconsistent was Potomac Edison's lack of meter reading over the past year, it was suggested that I begin reading my own meter on those months that Potomac Edison can't make it to my house. I was assured that Potomac Edison attempts to read meters EVERY MONTH, however they are only required to read them twice a year. After being informed that was complete and utter crap, she further insisted that Potomac Edison's WV tariff required only two readings per year and began to argue with me. When I suggested she check her information with her supervisor, I got dumped onto hold for 29 minutes without explanation. TWENTY-NINE minutes! I guess I was supposed to hang up and go away, but I simply turned on the speaker and set the phone on my desk while I tackled the 472 emails that had piled up while I was away. Oh... and I was highly entertained by Potomac Edison's hold muzak play list, which I have noted to share with you.... song by hysterical song:
You've got a friend
Still the sameTight ropeSister golden hair
Carefree highwayGood day sunshineAnd here's where it got really hysterical...How long (has this been going on)Rocket man (and I think it's gonna be a long, long time)
Operator (could you help me place this call)And just when I was starting to wonder what was coming next, "the supervisor" picked up the line and was not surprised in the least to find that I had been waiting 29 minutes and no one had bothered to tell her why I was calling. At least she verified that Potomac Edison is required to read meters every other month according to their WV tariff and that the first customer service rep. was wrong. I wasn't convinced that the supervisor actually would correct this misconception, however. I guess it really doesn't matter how much Potomac Edison lies to you when you call for assistance.However, while also verifying that my inconsistent bills were the product of Potomac Edison failing to read my meter, even she couldn't tell me why my new (APP) Summary only included 4 months while my neighbor's included 12. Or why last month's bill was much higher for less kwh. Apparently all my problems will be over if I only read my own meter from now on. Right.
Potomac Edison is also renumbering work routes; meaning meter-readers will work in close proximity.
"That way if I finish my route, I can come over and help you finish your route. That should help prevent some estimates on the back-end of your route, where we couldn't get to a customer," says Todd Meyers, Potomac Edison spokesperson. Well, color me steamed! I invited Todd to come read my meter last year, and he still hasn't "finished his route" and arrived to do his job. If you haven't seen Todd at your house either, be sure to contact him and let him know you need him to finish his route:Todd Meyers Maryland – Potomac Edison West Virginia – Mon Power, Potomac Edison Pennsylvania – West Penn Power (724) 838-6650 email: tmeyer1@firstenergycorp.comWhat does Todd mean "help me finish my route?" I don't have a route! Is Todd insinuating that I should be reading my own meter from now on, aka "my route?" But that's what I'm paying you to do, Todd!I'm also paying you to trim trees and maintain your equipment. That's not news. And sadly, yesterday's little drama was just that -- a play staged for the media. Oh, look at us working today! Big stinkin' deal! This hole is much, much deeper than Potomac Edison thinks. So, what has Todd been doing with the money we've been paying him for years? Todd has a lot to answer for. This is all Todd's fault! Go ahead, give him a call!
Ut-oh, FirstEnergy. UT-OHHHHHHH!If I wasn't buried under a mound of your paper, I might have more to say right now, but I did NOT say the quote attributed to me in the article.The big, uncaring, faceless corporation really ought to be ashamed of itself for the effect it is having on ordinary people who have been surprised with outrageous, inaccurate bills over the past year.More to come...
On April 9, 2013, the Maryland Public Service Commission opened an official investigation into FirstEnergy subsidiary Potomac Edison's meter reading, usage estimation and billing practices. The Commission hereby initiates an investigation into PE’s meter reading frequency, estimation of bills, and compliance with its Tariff, and delegates this matter to the Public Utility Law Judge Division (“PULJD”) for appropriate proceedings.
The investigation into PE’s meter reading frequency, estimation of bills, and compliance with its Tariff is not limited to the Tufts and Sugarloaf Conservancy Complaints; the PULJD shall determine the full scope of the investigation, and designate additional issues as appropriate. The PULJD shall notify the parties, including the Office of People’s Counsel, of the date and time of a scheduling conference at which deadlines are to be set for, inter alia, PE’s production of documents. The Commission hereby initiates an investigation into PE’s meter reading frequency, estimation of bills, and compliance with its Tariff, and delegates this matter to the Public Utility Law Judge Division (“PULJD”) for appropriate proceedings.
The investigation into PE’s meter reading frequency, estimation of bills, and compliance with its Tariff is not limited to the Tufts and Sugarloaf Conservancy Complaints; the PULJD shall determine the full scope of the investigation, and designate additional issues as appropriate. The PULJD shall notify the parties, including the Office of People’s Counsel, of the date and time of a scheduling conference at which deadlines are to be set for, inter alia, PE’s production of documents. For more than thirty years, Potomac Edison's Maryland tariffs have provided that the
Company will read most meters every two months. This practice saves customers money, because fewer meter readers need to be used. For example, in Potomac Edison's last rate case in 1994, the expense filed for meter reading was just under $1.3 million for meter reading; if meters were going to be read every month, that requirement would have had to be significantly higher.
Footnote: In fact, even with reading every two months instead of monthly, the Company was spending $2.0 million on meter reading (even without taking into consideration the new hires and other recent measures discussed elsewhere in this response), substantially more than is collected in rates for this function. Potomac Edison has been losing money on its meter reading function to the tune of $700,000 per year. This could be easily remedied by filing a new rate case with the Maryland PSC to collect this difference. However, the filing of a new rate case could also cause Potomac Edison to lose substantially more than $700,000 per year by setting a new rate of return for the company. The rate of return that the company is allowed to earn on fixed costs in Maryland is currently set at 11.9%, and is the second highest ROE in FirstEnergy's distribution affiliate stable. If Potomac Edison filed a new rate case, the ROE would be updated and adjusted to today's financial realities. It is in FirstEnergy's financial interest to continue to collect rates set in the 1993/1994 settlement. If it were not, the company would file a new rate case. It has not done so. The annual loss on meter reading expense compared to the risk to ROE stemming from a new rate case was a loss Allegheny Energy was willing to accept. But when Allegheny Energy merged with FirstEnergy, apparently that was no longer true. FirstEnergy wanted the best of both worlds -- collection of the full amount of meter reading costs AND the 1993/94 rate case ROE. But because FirstEnergy couldn't collect more for meter reading AND maintain an 11.9% ROE, FirstEnergy opted to simply cut the cost of meter reading by slimming down their meter reading staff and not performing scheduled meter readings required by law. If Potomac Edison cut their meter reading expense to match the amount they were collecting, the loss would stop and the company could keep its 11.9% ROE, having its cake and eating it too!But now it appears the game is up. If I were the Maryland PSC, I would require Potomac Edison to issue a refund to customers amounting to the difference between what Potomac Edison spent and what it would have cost to perform meter readings as required by law (around $700K per year, according to Potomac Edison.) And then, as a punitive measure, I would make them file a new rate case. :-) How about it, FirstEnergy? FirstEnergy has also been pulling the same stunt in other states in which it operates. West Virginia's ROE is 10.5% and was set in 2007. Pennsylvania's ROE is 11.5% set in 1994. These jurisdictions are where FirstEnergy affiliates have also been failing to read meters. Coincidence? I think not. West Virginia legislators are not happy with Potomac Edison's excuses. Could an investigation by the West Virginia PSC also be on the horizon?
The authority to site and permit high-voltage transmission lines has historically rested with the states. However, the federal government has been trying to wrest this authority from the states for years. The states consider local need and issues when evaluating a project. Affected stakeholders are afforded due process to participate in the debate at the state level. Occasionally, a state will deny an application for a transmission project that provides no benefit to the state. The feds, and the investor owned utilities who relentlessly lobby them, want to remove consideration of new transmission projects to Washington, DC, where due process will be smothered by national policy goals. But it hasn't been smooth sailing for the feds. Congress has repeatedly declined to federalize transmission permitting and siting, preferring to leave authority with the states. But the feds and the utility lobbyists have found other ways to try to gain what they haven't been granted by Congress. The Energy Policy Act of 2005 hid a few little wormholes for the feds to override states and claim eminent domain to site transmission under certain conditions. One was Section 1221, the creation of National Interest Electric Transmission Corridors and backstop siting authority for FERC to site transmission in these corridors in the event a state failed to act. That section has been neutralized by the courts.But, a second federal eminent domain tool that has not yet attracted much attention is about to be deployed through Section 1222, Third-Party Finance, in order to execute one of the worse abuses of federal eminent domain authority in history. Section 1222 provides: The Secretary, acting through WAPA or SWPA, or both, may design, develop, construct, operate, maintain, or own, or participate with other entities in designing, developing, constructing, operating, maintaining, or owning, a new electric power transmission facility and related facilities (“Project”) located within any State in which WAPA or SWPA operates if the Secretary, in consultation with the applicable Administrator, determines that the proposed Project--
(1)(A) is located in an area designated under section 216(a) of the Federal Power Act [16 U.S.C. 824p(a)] and will reduce congestion of electric transmission in interstate commerce; or
(B) is necessary to accommodate an actual or projected increase in demand for electric transmission capacity;
(2) is consistent with--
(A) transmission needs identified, in a transmission expansion plan or otherwise, by the appropriate Transmission Organization (as defined in the Federal Power Act [16 U.S.C. 791a et seq.]) if any, or approved regional reliability organization; and
(B) efficient and reliable operation of the transmission grid;
(3) will be operated in conformance with prudent utility practice;
(4) will be operated by, or in conformance with the rules of, the appropriate (A) Transmission Organization, if any, or (B) if such an organization does not exist, regional reliability organization; and
(5) will not duplicate the functions of existing transmission facilities or proposed facilities which are the subject of ongoing or approved siting and related permitting proceedings. WAPA and SWPA are federal power marketing agencies set up to sell and deliver hydropower across central, western and southern states. WAPA and SWPA, as federal agencies, are endowed with federal eminent domain authority to take private property for use in their systems. Doesn't sound so bad, does it? However, Section 1222 allows the Secretary of Energy to utilize WAPA's & SWPA's eminent domain authority for benefit of third-party projects in the agencies' territories that are not connected or necessary to their systems. And this is where the slippery slope starts, friends. Congress tried to prevent this kind of bad behavior by including qualifying standards for third-party projects, such as being approved in a regional transmission plan or equivalent, which would prevent duplication of projects, and requiring a finding of increased demand necessitating such a project. Congress also put a cap on the amount of money WAPA and SWPA could accept from third parties. (g) Maximum funding amount
The Secretary shall not accept and use more than $100,000,000 under subsection (c)(1) for the period encompassing fiscal years 2006 through 2015. And Congress also stipulated that Section 1222 could not override existing state laws.
d) Relationship to other laws
Nothing in this section affects any requirement of--
(1) any Federal environmental law, including the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.);
(2) any Federal or State law relating to the siting of energy facilities; or
(3) any existing authorizing statutes. But, personal relationships between DOE personnel and leadership of a private, for-profit corporation made things just so cozy that an RFP for Sec. 1222 projects was issued in 2010 that coincided with the development of this company's long-haul HVDC projects. Jimmy Glotfelty – Executive Vice President of Clean Line Energy Partners
Mr. Glotfelty brings a wealth of public and private sector transmission experience to Clean Line. He is a well-known expert in electric transmission and distribution, generation, energy policy and energy
security. He most recently held the position of Vice President, Energy Markets, for ICF Consulting. Mr. Glotfelty served in the US Department of Energy where he was the Founder and Director of the Office
of Electric Transmission and Distribution, a $100 million per year electricity transmission and distribution research and development program. Mr. Glotfelty also was the lead US representative to
the joint US-Canadian Power System Outage Task Force investigating the Blackout of August 2003.
While at the Department of Energy, Mr. Glotfelty worked extensively with utility chief executive officers and senior management in the electric power and energy sectors. He led teams that focused on researching transmission and distribution technologies, gaining Presidential permits for cross-border transmission lines, studying the impacts of Regional Transmission Organizations, identifying major transmission bottlenecks, and securing the critical energy infrastructure of the United States. DOE and Southwestern understand and agree that their ability to acquire through condemnation proceedings property necessary for the development, construction and operation of the Project is one of the primary reasons for Clean Line’s interest in developing the Project with DOE and Southwestern and through the use of EPAct 2005 section 1222.
DOE and Southwestern agree that, if the Secretary of Energy ultimately decides upon the conclusion of such evaluation as DOE and Southwestern deem appropriate that (i) the Project complies with section 1222, and (ii) to participate in the Project’s development pursuant to section 1222, then, DOE and Southwestern will use their condemnation authority as may be necessary and appropriate for the timely, cost-effective and commercially reasonable development, construction and operation of the Project. Clean Line Energy Partners is a privately held company owned by Michael Zilkha and ZAM Ventures that is proposing to build four HVDC merchant transmission projects originating in the midwest. A merchant transmission project is a for-profit venture that is paid for entirely by its owner. In exchange for investing billions, Clean Line's super-rich owners will earn a hefty return on their capital by selling transmission capacity on the transmission lines to both generators and load serving entities. Merchant transmission projects are speculative ventures that are proposed and built outside the regulated regional transmission planning process. Merchant lines proposed outside a planning process have not been determined to be needed by anyone other than their owners. If a transmission project is needed for reliability, economic or public policy reasons, it is approved by and included in the plan of a regional transmission operator. A merchant transmission project is the wildcatter of the transmission business. Without Section 1222 and SWPA's ability to take land for Clean Line via eminent domain, the company would have to apply for and receive public utility status and the power to condemn private property for its private gain from each individual state that it crosses. This could prove onerous to the super-rich and muck up or delay their profit.In exchange for stealing private property from citizens to be used for a private company's gain, SWPA could be granted a certain amount of transmission capacity on Clean Line's project, however, SWPA isn't in the wind business. But DOE can use authority it was granted under Sec. 1222 to pick winners and losers in the renewable energy business, and Clean Line's investors put together a team with strong DOE connections. Coincidence? Probably not.So, does Clean Line's project meet the requirements of Sec. 1222?(1)(A) is located in an area designated under section 216(a) of the Federal Power Act [16 U.S.C. 824p(a)] and will reduce congestion of electric transmission in interstate commerce; or
(B) is necessary to accommodate an actual or projected increase in demand for electric transmission capacity;Sec. 216(a) has been nullified by the courts, so (A) isn't even an option. Here's Clean Line's justification for qualifying for (B) from their application: "In addition to the general demand for more transmission oriented to renewables, there is and will be a specific demand for transmission to address the following concerns:
Additional Transmission is Needed to Develop Wind Resources in the Southwest Power Pool;
Additional Transmission is Needed to Relieve Congestion in Western SPP;
Additional Export Capability is Needed from SPP; and
Additional Transmission is Needed to Import Power in the Southeast.
The Plains & Eastern Clean Line meets each of these needs."No actual projected demand for the project from any official authority tasked with determining same was included. The company points to bits and pieces of out-of-date studies that it feels justifies its desire to build this project, along with studies privately commissioned by the company. I don't think this is the kind of "actual or projected increase in demand" that Congress had in mind. It's pure posturing of the worst kind. Other requirements stipulate that the project:(2) is consistent with--
(A) transmission needs identified, in a transmission expansion plan or otherwise, by the appropriate Transmission Organization (as defined in the Federal Power Act [16 U.S.C. 791a et seq.]) if any, or approved regional reliability organization; and (5) will not duplicate the functions of existing transmission facilities or proposed facilities which are the subject of ongoing or approved siting and related permitting proceedings.Clean Line's idea of compliance with this requirement?"SPP repeatedly has identified the need to build additional transmission to fully develop wind potential in
the region and to export it to neighboring regions." Right, but SPP did not identify Clean Line as the solution in its transmission expansion plan, or otherwise determine its project was needed. Clean Line also relies on:"The Plains & Eastern Clean Line is consistent with transmission needs identified in the Joint Coordinated
System Plan 2008 (JCSP). The JCSP was the first inter-regional transmission planning effort in the
Eastern Interconnection. The JCSP was a collaborative effort and involved most of the major
transmission operators in the Eastern Interconnection, including, MISO, SPP, PJM Interconnection, TVA,
Mid-Continent Area Power Pool and several key members of SERC."And this 5 year old plan has been scrapped. Also not what Congress had in mind for this requirement. When DOE questioned Clean Line's eligibility under Sec. 1222, the company submitted an "updated application" that contained the same old lack of convincing evidence of qualification.Nevertheless, DOE issued a letter entering into an agreement with Clean Line to move forward with the NEPA process. DOE has not completely committed to the project yet, but if it does:- Clean Line will agree that eminent domain authority would be used only as a last resort after negotiations in good faith have concluded with all affected landowners;
- Clean Line will agree that the Department will retain the option to select and oversee any land acquisition company required for the Project.
In that case, DOE needs to take a look at the complete and utter mess Clean Line has made out of the public information and land acquisition process. Clean Line's idea of good faith negotiations with landowners, according to its updated application, put landowner notification last. Clean Line makes much of meeting with "stakeholders" such as environmental organizations, state agencies, state legislators, members of the governors’ teams, and federal congressional delegations. But only after all these entities, who are not personally affected and will not have to live with a Clean Line in their own backyard, have drunk the Clean Line Koolaid, does Clean Line consult with landowners: "After the workshops, Clean Line will host public
open houses to gather feedback on the preferred and alternative routes from landowners and other
affected parties. These outreach efforts are designed to assure that relevant stakeholders have early and multiple opportunities to provide feedback..." except for landowners. Landowners are not considered "relevant stakeholders" by Clean Line. DOE should think long and hard about making the federal government liable for the legal mistakes of a private company. Just because the feds were successful in asserting federal eminent domain in another dissimilar situation, does not mean that helping the rich get even richer at the expense of the common man is a good idea. How much money does Congress have budgeted for another federal court beatdown over eminent domain takings?And DOE needs to take a good, hard, objective look at Clean Line's "qualifications" under Sec. 1222. The company doesn't qualify without torturing the language in the statute, and a finding that it does qualify is also likely to lead to a separate, but equally vicious, court showdown.Sometimes, it's just not worth the risk to help your "friends" by overstepping your legal authority and bending federal law. Maybe the incoming Energy Secretary needs to do a little housekeeping before Congress does it for him, or he finds himself explaining DOE's taking of ordinary citizens' private property for use by super-rich investors. Congress has resolutely rejected federal transmission siting authority over and over again and will likely continue to do so.
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