StopPATH WV

PATH has requested that both the National Park and Forest Services continue to hold their application review process "in abeyance" until approximately 60 days after the 12th of Never, or whenever PJM finally makes a decision, whichever comes first.

"In order to accommodate the PJM study process, while providing a measure of certainty for both the PATH Companies and the NPS, the PATH Companies respectfully request that the NPS continue to hold its application review in abeyance until 60-days after the PJM Board issues a further decision on the status of the PATH Project. Promptly after being advised of such further decision by the PJM Board, the PATH Companies will notify the NPS of that decision and, within such 60-day period, submit a further request to the NPS with regard to the pending applications."

According to the letter, PJM is not expected to make a decision until sometime AFTER May 2012.

"As indicated by the PJM Staff report, additional analysis will be undertaken after completion of the May 2012 forward capacity auction results. The time required by PJM Staff to perform such analysis thereafter is not yet
known."

You're not really surprised, are you?  This is exactly what I expected would happen after Order No. 1000 was issued, delaying the retooling of PJM's planning process, and after PATH painted themselves into a corner in Virginia.

On April 12, 2011, Virginia State Corporation Commission Hearing Examiner Alexander Skirpan issued his report and recommendations on the March 17 hearing regarding PATH's withdrawal of its application in that state.  In his report, Skirpan recommended that certain conditions be placed on the filing of a new application for the project in Virginia.  One of these conditions was that the application must be based on a completed 2012 RTEP, which won't be issued until first quarter 2013.  The Virginia Commission's Order included this stipulation.

Word is that the NPS/NFS are considering PATH's request.  No decision date has been indicated.

The only "certainty" being provided here is that every year this drags on, PATH makes another $13M in pure profit, courtesy of their FERC formula rate and incentives.  There is no motivation for them to ever restart this project -- they've got $130M tucked safely away in an account that earns 12.4% profit every year.  What a sweet deal! 

All PATH's profits come directly from your pocket in the form of higher and higher electric bills.

Your orchestra has begun composing a new tune... so check back later for more on this subject.

Yesterday was the deadline for PATH to try to defend itself and answer the Formal Challenge of $2.5M of their claimed $24.6M 2010 revenue requirement at FERC.
Here's what PATH filed.  (Note:  3.9MB file -- give it time to load.  It's the best I could do to clean up the 10MB file PATH submitted, but that's another story.)

If you've read and understand the Formal Challenge that was filed on December 23, get ready to laugh.  PATH counsel insults the Commission's intelligence by pretending:  1) the Commission didn't read the Challenge; 2) the Commission didn't understand the legal basis of the Challenge; and 3) the Commission didn't see or understand any of the evidence submitted as exhibits to the Challenge.  PATH's attempt at performing a Vulcan mind meld on FERC's Commissioners fails miserably.  This is PATH.

It's almost like PATH is embarrassed by their "Answer" and doesn't want anyone to see it.  Why else would they have turned a 20 page word document and a two page spreadsheet exhibit into a 10MB pdf image file that chokes FERC's e-library and takes forever to download?  PATH printed paper copies of the files and then ran them through a copy machine to result in a humongous, unweildy 10MB file that was uploaded to FERC.  At least they didn't go so far as to "serve" it on the 80+ parties on the docket's service list and choke up everyone's email, but one could question whether "service" was actually effected ("I hereby certify that I have this day served the foregoing document by electronic service a copy of this filing...") by "serving" parties with a link to FERC's e-library that didn't work.

I'm not going to get into an analysis of just how bad PATH's "answer" is, but I will point out the funniest line in the whole document:

"In the wake of highly orchestrated and vocal opposition to the Project, PATH had a responsibility as the Project's developer to educate government officials, civic, community and business leaders, and the public at large, about the reliability benefits of improved transmission infrastructure in general, and the PATH Project in particular."

To fully appreciate the humor here, you've got to consider how PATH uses the term "highly orchestrated."
Orchestrate:  arrange or direct the elements of (a situation) to produce a desired effect, esp. surreptitiously.  Now isn't that the pot calling the kettle black?

And with that, we'll leave it in FERC's capable hands...
 

I know there's another topic started for this list, but it's slipped quite a ways down the page, thanks to TrAILCo's shenanigans, so let's start another one because the weeklies are publishing now.

Here's an article in The Shepherdstown Chronicle.  Reporter Kelly Cambrel does a great job with a difficult subject, but contrary to what's stated in the article, the January 2011 Challenge detailed 2009 expenses, and the December 2011 Challenge detailed PATH's 2010 expenses.  We haven't gotten to their 2011 expenses yet.

Here's an article in The Spirit of Jefferson.

"An official with American Electric Power said the company is entitled to recover reasonable
expenses of the PATH project.
"It is certainly their right to intervene. They have a different view on recoverable expenses," said Geri Matheney, a director of corporate communications for Appalachian Power, a subsidiary of American Electric Power. "It is certainly their right to question the expenses.  FERC will decide whether there is merit in their complaints or not. We are entitled to recover
the reasonable and prudent expenses of the PATH project.'"

Well, that certainly blows a few holes in all Randy's legal efforts at FERC over the past 3 months, insisting that we don't have standing and are not interested parties.  Now we find out that AEP doesn't agree with Randy and PATH's legal team.  Isn't that refreshing news?  Maybe Jeri should take a few notes from Todd "the school girl" Meyers and adopt the "no comment" thing.  But then again, she's probably not likely to get stuck in an elevator or accidentally meet up in the Men's Room with Mr. Personality either.  Jeri just doesn't know when to shut up.  :-)

More to come...

So, what triggered the TrAILCo audit?  That's what a reporter from The Energy Daily is trying to figure out.  Unfortunately only subscribers can access complete content, so if you're really curious, sign up for your "free trial" (no clue if this will actually let you see the article or not), or email me and I might be able to help you out. ;-)

He circles around TrAILCo's recent FERC filing (EL12-14) regarding a $130M capital dividend payout to its sole stockholder -- parent FirstEnergy, formerly Allegheny Energy.  This is necessary to reduce TrAILCo's $179M 2011 Revenue Requirement by $7M to prevent "rate shock" for all of you.  This "rate shock" is caused by the actual equity/debt structure when the project went into service.  Instead of the hypothetical 50/50 split FERC had granted them as an incentive, the actual ended up at 63% equity.  This payout is intended to reduce equity to 59% and lower the amount of return (or interest) ratepayers will have to pay TrAILCo for tying up their capital in "our" transmission line.  The problem was exacerbated by some accounting that was done as a part of the Allegheny Energy/FirstEnergy merger.  How come none of the authorities reviewing the merger saw that one coming and accounted for it in the crappy $2.5M of "synergy savings" we were oh so generously granted in West Virginia?  Yeah, this merger continues to cost you... dearly.

Anyhow, after gushing on and on about this, the reporter concludes that FERC rubber stamped TrAILCo's request, so that isn't necessarily the reason for the audit.  Yeah, we know.  FERC granted their declaratory order on Dec. 29 and the audit was commenced on Jan. 3.  FERC couldn't move that fast if the building was on fire.  Their clocks don't run in the same time warp as the rest of ours.

Looks like the TrAILCo audit is going to continue to drive reporters crazy for a while yet because no one is talking and clues are hard to find.  Yeah, we know  :-)

According to this "information" hand out from Allegheny Energy created, managed and funded (with YOUR monthly electric bill) astroturf front group, The Marylanders for Reliable Power, the "rolling blackouts" were to begin in Maryland in 2011.  This was because "Maryland is running out of electricity!"

Now here we are on the other side in 2012 and none of Allegheny Energy's cries of "wolf" have come true.  There never was any wolf, just an investor-owned utility who set out to make a bunch of money.

And they did it in a duplicitous fashion.

If Allegheny Energy had publicly owned all their fear-mongering, ridiculous claims of predicted future "rolling blackouts" and "frequent and extended loss of power in less than three years," while applying for approval of their for profit endeavor, they would have been in a lot of regulatory hot water.  So, they created "... a coalition of businesses and organizations working to ensure that Maryland's future electricity needs are met through conservation, additional generation of electricity from traditional and renewable energy sources, and improvement of transmission capacity," so that blame for the lies and unnecessary public panic would be pinned on some phantasmic, "grassroots" group completely lacking in verisimilitude.

And they used millions of dollars of ratepayer funding to perpetrate their consumer fraud.

But, it looks like the Sierra Club's experts and the citizen opponents were right way back in 2008... dropping demand, conservation and demand side management obviated any "need" for Allegheny Energy's great transmission rip-off.  There have been no "rolling blackouts," Maryland has not "run out of electricity," and no shortages are predicted for the near future.  In fact, Dominion has recently shut down their Mt. Storm-Doubs 500kV transmission line, one of two major 500kV lines transporting dirty coal-fired electricity to east coast load centers, while they rebuild it to increase its capacity, but no current electricity crisis in Maryland has resulted.

However, electric customers are never going to get their millions back.  That money is gone for good, into the pockets of perfidious public relations companies, charlatan former public service commissioners and other paid "experts" who parroted Allegheny Energy's lies in exchange for personal gain, industry and trade groups such as Chambers of Commerce and the WV Coal Association that joined in perpetrating Allegheny Energy's "grassroots" fraud and helped them spin it, and into the pockets of lobbyists like WV Democratic Party Chairman Larry Puccio, whose support is for sale to the highest bidder.

The claims of "rolling blackouts" were nothing but a lie.

Once again, the FERC Challenge of PATH's over collection of expenses from electric consumers in 13 states and the District of Columbia has been picked up by the Associated Press.

The same basic article is breaking in news outlets all over the country.  Here's a version of it that just popped up on The Washington Post:

Power line foes in W.Va. file new challenge of PATH charges for ads, PR campaigns

For a longer story, see today's article in the Frederick News-Post.

Story in the Hur Herald featuring Ali Haverty.  Yes, she does look like Julia Roberts (and now you're thinking "Erin Brokovich" and how she doggedly fought for a bunch of ordinary folks and brought a huge energy corporation to justice, right?  Is there really any such thing as coincidence?)

This one's a giggle:  See this article and this article in the ultra-exciting "Transmission Hub."

Lots more to come...

Tune in tomorrow morning at 9:30 (January 4) when Keryn will be a guest on WEPM's Panhandle Live discussing the Formal Challenge of PATH's 2010 Revenue Requirement recently filed at FERC.

You can listen via the web by going here and clicking on the "Listen Live" button on the right hand side of the page.

Two West Virginia citizens have filed a new complaint with the Federal Energy Regulatory Commission (FERC), alleging that the PATH Transmission Company subsidiaries of FirstEnergy (formerly Allegheny Energy) and American Electric Power have continued to improperly charge millions of dollars in promotional expenditures to ratepayers in 13 states and the District of Columbia.  With this complaint, PATH’s overcharges total nearly $5.8 million over the past two years, when combined with the first complaint filed in January 2011.

Keryn Newman, a Shepherdstown resident, and Alison Haverty, of Chloe, filed their second Formal Challenge to the Potomac-Appalachian Transmission Highline, LLC 2010 Annual Transmission Revenue Requirement, on December 23 with FERC. Their review of 2010 project costs reveals a propaganda pattern, using funds inappropriately recovered from ratepayers, to influence state regulators, as well as a large number of simple accounting errors.  The complaint asks that FERC reject PATH’s Annual Update filing and begin a broader investigation of more overcharges by the power companies.

“We contend that the Commission never intended to hand PATH a blank check signed by electric ratepayers in 13 states to use as they see fit to promote their for-profit endeavor,” said Newman.

The PATH Companies recovered expenses of nearly $1 million for an advertising campaign utilizing recognized propaganda techniques and more than $1 million to create and manage fraudulent “grassroots” groups and an advocacy program carried out with private groups and inappropriately billed as “public education.”  The recovery of these costs from electric ratepayers violates FERC regulations.

Bill Howley, of The Power Line blog, has been covering PATH for the last three years.  “The fact that ratepayers in PJM Interconnection are being charged for a dead PATH project is bad enough.  The PATH companies should not be allowed to get away with sloppy accounting and dishonest representation of their promotional costs as 'public education,'” Howley said.

The citizen complainants discovered improperly recovered expenses related to lobbying by West Virginia Democratic Party Chairman Larry Puccio, and attempts to exert influence on the Loudoun County, Va., Board of Supervisors to release a conservation easement along PATH’s proposed route – by creating a more destructive route around the easement and pitting neighbor against neighbor. 

Also detailed in the complaint are efforts by PATH lobbyists to interfere in the Maryland Public Service Commission’s consideration of PATH’s application through the intervention of the Maryland Chamber of Commerce, which received a $20,000 “platinum sponsorship” from PATH that was charged to ratepayers’ electric bills.  The Challenge also details generous payments to former state regulators and prominent local businessmen along PATH’s proposed route in exchange for their support of the project, as well as over $100,000 spent on public opinion surveys and focus groups. 

“This Challenge is not about the contemptible acts which PATH performed as they were trying to get approvals for their project.  This Challenge is about who should pay for those acts.  The electric bill which my family works to pay every month should not include these charges, and neither should yours,” said Haverty.

Newman and Haverty have been examining PATH’s costs for the past two years using rules designed to provide public transparency.  Despite PATH’s attempts this year to suppress the release of information, the women have persisted in examining the company’s accounting practices, and support for their efforts was recently expressed in comments filed by regulators from both Illinois and Maryland, and an amicus letter from the Sierra Club, EarthJustice, Piedmont Environmental Council and National Resources Defense Council.  On December 30, FERC issued a decision finding that, “…the consumers have demonstrated that they have a direct interest in the PATH Companies’ rates that will be flowed through to them.”

The PATH Companies have 20 days from the filing date to produce their answer to the Commission. Exhibits to the Formal Challenge can be found here.

Background

The Potomac-Appalachian Transmission Highline (PATH) project originally was to run 275 miles from the John Amos coal-fired generation plant in St. Albans, WV, to a new 42-acre substation in Frederick County, Md., passing through Loudoun and Frederick counties in Virginia. After more than two years and multiple hearings in three states, the project was “suspended” in 2011 by regional grid operator PJM Interconnection after opponents demonstrated it was not needed.  The utility companies then withdrew their applications before state regulatory agencies.

Despite PATH's suspension, AEP and FirstEnergy are allowed to recover project costs, collected since 2008 from the 54 million ratepayers in the PJM region – all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. This cost recovery will continue at a level “necessary to maintain the project in its current state” until the project is officially abandoned at FERC.  PATH also was guaranteed the right to apply for 100% recovery of abandoned project costs as part of an incentives package they were granted by FERC in 2008.

A copy of the recent complaint and related filings can be viewed on FERC dockets ER08-386 and ER12-269.

Effective tomorrow, all West Virginia electric customers of Potomac Edison and Mon Power will pay more for electricity.

A press release from the PSC says: 

"The ENEC process does not involve the recovery of profit, rate of return on investment, or salaries and wages."

This is a lie.  The ENEC process involves power company recovery of transmission costs billed to them by PJM Interconnection, the operator of the regional electric grid.  In those transmission charges from PJM are West Virginians share of all transmission projects 500kV and above anywhere in the 13-state region, as well as 100% of the the cost of any transmission lines below 500kV owned by FirstEnergy.  Within the costs of these transmission lines are profit (12.4% for PATH, 12.7% for TrAIL, 12.8% for MAPP and 12.9% for Susquehanna-Roseland) which is the calculated return on investment for their power company owners.  These charges also include salaries and wages of power company employees working on these projects... and if you've read the recently filed Formal Challenge, you know there's much, much more wrapped into these charges.

These charges also include costs for the TrAIL project that were allocated to the PATH project's FERC revenue requirement and recovered from West Virginia electric consumers in violation of TrAILCo settlement stipulations.  Also mixed in your increased bill are the costs of the Allegheny Energy and FirstEnergy merger, despite the fact that the companies promised the WV and MD PSCs and FERC that they would not recover any of these costs from electric consumers.

Is the WV PSC that dumb that they don't know what's included in the cost of transmission?  Perhaps that's because the only ones watchdogging transmission owners at FERC are two private citizens...

When are we going to see some true reform at our PSC whereby the agency realizes that their first responsibility is to the public, and not to their out-of-state corporate masters and their pet West Virginia politicians whose pockets are lined with some of that ill-gotten gain that comes from your pocket in the form of more electric rate increases.