StopPATH WV

Pam Kasey did a great article about the PATH Formal Challenge in today's State Journal.  Easily one of the brightest and most knowledgeable reporters I have been interviewed by regarding the Challenge, Pam also asked the most pointed questions.  She spent a little time reading some of the background documents and investigating before calling.  She's a shining example of true investigative journalism.

I love the way she ended with my favorite quote from PATH's Answer.  Yeah, Randy, we'll see just who "fails to grasp the distinction between efforts to influence decision makers during the process of obtaining approval to construct a transmission project, and broad-based activities and distribution of information intended to educate government officials, business and community leaders, and the public at large...," won't we?

The Wall Street Journal reports that FirstEnergy could profit more than $200M from the closure of 6 of its old, coal-fired plants announced last week.

As reported earlier, this is a business decision intended to make more money for FE's stockholders.  Too bad, so sad for the 500 employees who will be in the unemployment line, and also for the towns who depended on these plants as as economic engine.

You'd think that a few of those millions could be parted with to set up programs to ensure that affected employees were given opportunities for equivalent jobs elsewhere, or given the benefit of retraining for equal jobs in another area of the energy industry, such as the booming renewable energy sector.  Transition programs for the affected localities could also be instituted.  Instead, FE is absconding with all that happy cash.

One word.  Karma.

AEP subsidiaries are "selling" assets to each other in another corporate shell game.  This article says that AEP-Ohio will be selling generation it owns in WV to fellow subsidiary Appalachian Power.  Meanwhile, they fired up their new gas-fired plant located in Ohio, which will be paid for, at least in part, by Appalachian Power customers in WV.  Confused yet?  AEP hopes so!

In this article, the reporter was treated to an explanation of AEP's "power pool" (probably because she asked tougher questions).

What's in neither article is the promised merging of AEP WV sudsidiaries Appalachian Power and Wheeling Power, which was promised to the WV-PSC in AEP's last rate case.

Why all this confusion?  Because Ohio is deregulating generation and AEP is trying to keep their costly generation behemoths in a regulated environment.  In a deregulated, or market-based, market, costly upgrades and other costs of running these plants are wrapped into the cost of the generation bid into market.  In a regulated state, these "extra" costs are covered by ratepayers of subsidiaries who "own" these assets.

Bottom line:  It's all about AEP making even MORE money at your expense!

If you've been wondering about the identity of the "mystery" administrator that has already been spending money that's being added to your electric bill, wonder no more.

Susquehanna-Roseland transmission line partners PSE&G and PPL announced in their comments on the National Park Service's Draft Environmental Impact Statement earlier this week that they will "mitigate" for the permanent damage their new transmission line causes to the Delaware Water Gap National Recreation Area and the Appalachian Trail by way of a $30 - 40M "endowment" to "a not-for-profit organization with demonstrated expertise in land and resource conservation and successful collaboration with the Department of the Interior."  They also share that they "have engaged and provided funds to a nationally respected land conservation organization to begin acquiring interests in private properties of high value to the Department of the Interior’s conservation mission in the area around DEWA, MDSR, APPA and Cherry Valley National Wildlife Refuge."

It looks like PSE&G and PPL have quite a perverted definition of the word "respected".

According to this NPS document, Internal Scoping Meeting Report. Susquehanna to Roseland Transmission Line Proposal And Right-of-Way Request. Environmental Impact Statement from October 2009, one of the "Action" (as opposed to "No Action", or denial) alternatives to be considered was an "Alternative that outlines the proposal with a framework for mitigation based on a conservation plan being developed in conjunction with The Nature Conservancy."

Despite PSE&G & PPL's attempts to be coy, it's obvious that their purported "respected land conservation organization" is the infamous corporate greenwasher, The Nature Conservancy.

Who is The Nature Conservancy, other than one of America's most prolific junk mailers?  (Thanks for all those free address labels your contributors pay for -- I like to write nasty comments about The Nature Conservancy next to their logo before use.)

The Nature Conservancy describes themselves as "sleeping with the enemy" (well, someone is certainly getting screwed here, and it's not The Nature Conservancy), or as practicing "Development by Design".  Others opine that, "Perhaps TNC should turn itself into a for-profit, environmental mitigation company. Then again, perhaps it already has." 

The Nature Conservancy receives mediocre ratings from charity watchdog groups, with 14% of annual income spent on "administrative costs".  Let's see, 14% of $40M is $5.6M of additional costs you will pay in your electric bill to fund The Nature Conservancy's fat cats like CEO Mark Tercek, who pulled in $493,993 in compensation in 2009.  You'll also be supporting the other 22 officers, directors, trustees and key employees who make up their highest compensated employees.  On this list are 3 individuals making between $400 - 500K, 6 making between $300 - 400K, 12 making between $200 - 300K and 2 bringing home between $100 - 200K. See The Nature Conservancy's 2009 IRS Form 990 here.

But that's chump change in comparison to the real swindle going on here.  What The Nature Conservancy does is buy up private land "for conservation" at a reasonable price, then resell it at a much higher price to the federal, state or local government for use as a park, nature preserve, recreation area, etc.  That's where they make their real money.  So, if we look at the Susquehanna-Roseland bribe through this lens, it is also the taxpaying citizens of the United States who get screwed in this deal because The Nature Conservancy is playing the part of the well-heeled front man, or real estate broker, for the power companies and the National Park Service, who will eventually buy this land from The Nature Conservancy to complete the "mitigation."  How much will the federal government eventually spend as the ultimate purchaser of the $40M of "mitigation" land from The Nature Conservancy, in order to complete the deal to expand the Delaware Water Gap National Recreation Area?  Or will this land, paid for in your electric bill, be "donated" to the NPS by The Nature Conservancy?  That part isn't clear, but my guess is that The Nature Conservancy doesn't do anything for free.  But, of course, PSE&G and PPL are still keeping the details of this "deal" under wraps.  If it was such a great deal for the public, they'd be so proud of it that they'd be anxious to show it off, don't you think?

As a comparison, a truly "nationally respected" conservation organization would be The Sierra Club, but then again, The Sierra Club would never accept corporate blood money.  Although some have told me my opinion is "wrong," I have yet to be persuaded to change it.  However, in an effort to provide for the free flow of different opinions, here's a link to a Time magazine blog post about the recent brouhaha regarding Sierra Club's past acceptance of millions from Chesapeake.  Further, I'm really not a fan of how this is being spun to portray the WV Coal Association as a poor, downtrodden victim. If this outs me as "not a true environmentalist," so be it.  As well, I am opposed to fracking, but this isn't a fracking blog, so let's get back on topic.  If you want to continue this off-topic conversation, you're free to email me.

The National Park Service employees are being turned into stooges and their EIS process is being utilized as cover for a big money swindle of electric consumers taking place between the politically appointed Director of the Interior, Ken Salazar, and Susquehanna-Roseland project sponsors PSE&G and PPL, with the assistance of corporate greenwasher, The Nature Conservancy.  The Nature Conservancy's part in this charade involves "administration" of PSE&G and PPL's "mitigation" purchase of inferior quality parcels of land on the fringes of the current parks as a consolation prize to the citizens of the United States, who will lose the most scenic vistas of their park to an unnecessary electric transmission line.  For 61 million of these citizens in the PJM Region, insult will be added to injury by having the cost of the $40M bribe (plus 12.93% interest) added to their electric bill for the next 50 years.  This is outrageous!

Almost 10 years ago, The Washington Post did an expose of the corruption going on at The Nature Conservancy, which triggered a Senate investigation and caused them to pretend to clean up their act for a short time.

Range magazine also did a piece about The Nature Conservancy, with the opinion, "Unless we as a people are willing to accept the continued loss of not only private property and individual rights, but of large portions of our national culture and customs as well, the Nature Conservancy must be brought to heel. Right now, it is a well-fed and generally admired beast leading us in a wild run that is as destructive in its seemingly friendly character as it is in its seldom-seen attacks. This is no errant clumsy puppy we can finally calm. It is a runaway predator that will turn on us in defense of its territory. The Nature Conservancy is the wolf we raised ourselves, the grizzly we fed from the table. The monster we made with indifference. If it is left to go on growing, it will be the master and we the obedient slaves."  And again, I'm told I'm "wrong" for including this link.  I do realize there is an agenda at work in this article, however, it does a nice job of unmasking The Nature Conservancy's scam and their continued attack on private property rights.  I am a fierce defender of private property rights, but if you believe in the taking of private property to serve some other party's idea of a higher purpose, you're certainly entitled to that opinion.  Just don't try taking my property on that basis, because you'll have a fight on your hands.

The excellent Range piece talks about The Nature Conservancy's board and trustees, comprised of corporate bigwigs, like Anne E. Hoskins, PSE&G's federal and state governmental affairs director (i.e., political schmoozer).

The Nature Conservancy is like a toilet:  Every now and then it needs to be thoroughly scrubbed and flushed.

Grab your brush!

Despite their recent public posturing, Susquehanna-Roseland project owner PPL has absolutely no respect for the National Park Service or the federal Environmental Impact Statement process.  A December 2011 school project prepared by a Lehigh University student who spent some time at PPL with program director Patrick McMackin contains this quote:  "The park service has responded by filibustering the request by apportioning a 42-month period where they will accept and analyze public comments. Afterwards, public sentiment will factor into the creation of a preferred alternate route and a finalized EIS."

Filibustering?  Is that what PPL calls the NEPA process?  Just an unnecessary obstruction to their get rich quick scheme?  It seems to me that many hardworking, dedicated, ethical NPS personnel have put many, many hours into doing their jobs conscientiously.  Filibustering?

I'm sure PPL will be quick to point fingers at the student and accuse him of taking liberties or making this stuff up, but the truest way to see your own self is always through the eyes of an innocent.  This report is the impression PPL project managers left on this kid.  I guess they mixed a little too much reality into the koolaid they gave him to drink.

Here's a couple of other gems from the report:

1. "The subject was covered in the North American Electric Reliability report, which concluded a major investment in electric transmission would be essential to “keep pace” with the expected 18% growth in demand."  How old were the statistics they fed this kid anyhow?
2. "Because the situation will become increasingly
   volatile the longer the delays hold, PPL has stressed the perfection of its Preparedness, Prevention and Contingency (PPC) plan.  Although PPL is responsible for all aspects of permitting, the company cannot ensure total compliance once the instructions reach the contractor.  However, the existence of a well-defined plan covers any responsibility PPL shares in case of litigation."  What does that mean?  The company cannot ensure total compliance?  It means that any violations will be blamed on the contractor and responsible individuals at the contractor level will be "reprimanded," but PPL avoids legal responsibility.  This is exactly how these power companies operate.  We've seen this same behavior with their land agent contractors, who violate all laws and codes of conduct in the interest of getting the job done and the purchase and option agreements signed.  When a violation is reported, the power company pretends to slap the contractor on the wrist, *wink* and avoids all responsibility for the bad behavior, although this same bad behavior has been ordered by the power company.  They put a legal separation between themselves and the contractor in order to avoid responsibility for their own orders to take certain actions.  For its part in this charade, the contractor is paid well.  Is this the kind of for-profit corporation the NPS should allow to perform construction in one of our national parks? 
   
3. "Having a well-organized permitting portfolio that is readily accessible lubricates the project and keeps compliance agencies at bay."  So, it's all about showing those rabid compliance agencies that you have all the instructions (not that you necessarily follow them).  It's not about following the rules, but about not getting caught and held responsible for breaking them.
4. "The biggest concern the SRTP faces (outside of obtaining the overhead construction contract) is people. NIMBY protesters, environmentalists and politicians alike have rallied against the project.  Some have accused PPL and PSEG of being motivated to expand infrastructure and increase transfer capacity in order to increase their market values.  Organizations such as the Sierra Club and Stop the Lines! warn of the health hazards associated with high EMF levels and remind the public of the grotesque size of the towers. The electric commission determines the minimum cable height based on voltage and possible interference. In some instances, the existing line is over 90 years old and does not meet present codes. The public is often unaware of these mandates, and naturally condemns any attempt to increase the tower height. Ironically, all of the pictures comparing
   the size of the proposed monopoles to existing lattice structures do not come from cited sources, and are generally homemade.  The common theme throughout these opinions and complaints is their failure to acknowledge the work PPL has put in to see that the chosen route has a minimal impact on the environment and the community. Route B was chosen because 90% of the route was covered by existing easements. The snowstorm of October 2011 devastated the northeast, leading to 1.6 million power outages.  It took some utility companies over a week to return power to customers. If these blackouts were to become commonplace due to electrical overloading, I would expect the opinions of many of these protesters to reverse."  Those "homemade pictures comparing the size of the proposed towers to the existing" is illustrated by a piece of Sierra Club literature that looks like it was taken from a project Line Routing Evaluation.  Sierra Club didn't make this stuff up!  Kid, spit out that koolaid they gave you to drink, it's poison!
5. "The industry knew this project was coming for fifteen years. Now one organization (NPS) holds the SRTP back from success. If PPL’s project  management team succeeds in obtaining a
   construction and ROW permit, construction will begin in August 2012. Too much time and money has been consumed to acknowledge any other option."  Fifteen years?  Gee... we've only been able to trace it back to the 2005 Project Mountaineer scam.  The NPS is not "an organization," it's a federal governmental agency tasked with stewarding publicly owned resources and protecting parks from profiteering pirates like PPL.  They aren't "holding PPL back from success," they are doing their jobs under federal law!  And don't bet on that "too big to fail" thing, that's so last decade.

These are the things that PPL told a college student who spent some time with them.  The student didn't make all this stuff up, or "misunderstand" what he was told.  This is the TRUE face of PPL.  Pretty revolting, don't you think?

And... PPL had better NOT take this out on the student or it's going to get worse for them.  Students are like sponges, and this report is what this particular student absorbed at PPL.  The truth hurts!

The power companies behind the Susquehanna-Roseland transmission line made some skimpy details of their "mitigation package" public today in their comments on the NPS Draft Environmental Impact Statement.  Today was the deadline for comments (hope you got your comments in!).

Their comment letter goes on for pages and pages and refers to Exhibits that are nowhere to be found.  If anyone knows where Exhibit 9 is, let me know, that's the one that supposedly contains the "methodology" for their madness.

The letter contains some of the most outrageous lies I've ever heard, and just in case the NPS doesn't believe them, the power companies unleash a couple of veiled threats.  Nice.  And I haven't even read the whole thing yet.

Anyhow, here's what's available on the power company's proffered bribe:

1. The price is now somewhere between $30 - 40M, but the NPS can just fill in the amount with whatever they think is reasonable.  You know, name their price for the $ale of the parks.  Price doesn't matter to PSE&G and PPL, they're using YOUR money for this bribe and collecting interest on the amount they spend.  The more they spend, the more they make!
   
2. The power companies will set up an "endowment" with your money, the Middle Delaware Mitigation Fund.  The "endowment" is supposed to be administered by "a not-for-profit organization with demonstrated expertise in land and resource conservation and successful collaboration with the Department of the Interior."  The "endowment" would be used by the Administrator for the purposes of preserving, restoring and enhancing Delaware Water Gap National Recreation Area, Cherry Valley National Wildlife Refuge, the Middle Delaware Wild & Scenic River segment, and the Appalachian National Scenic Trail within the Delaware River basin, including reasonable costs associated with administration of the Fund.  In other words, this "administrator" is going to be able to take a big chunk of this endowment for salaries and expenses.  Now, who in the heck is going to monitor that for fraud?  "The Administrator would commit Endowment funds solely to projects or activities reviewed and recommended by the Secretary of the Interior, acting directly or through a designee, following appropriate consultation with representatives of the Commonwealth of Pennsylvania and State of New Jersey, and Delaware River basin-oriented conservation organizations and recreational interests."  Oh, I see, Ken Salazar, the person with the loose morals that engineered this bribe, is going to oversee the morals of the "not-for-profit organization" who manages the "endowment."  Ever heard that phrase, "the blind leading the blind"?
   
3. 50% of the bribe would be paid when all permits are issued and land clearing begins, and the other 50% would be paid when construction is complete and the line goes into service.
   
4. So, whose land are they planning to steal?  "We have focused on parcels previously identified by land management agencies and conservation groups as important potential additions to the DEWA-area parks and refuges-- lands with natural values that would be of great value to the public.  We have identified lands potentially for sale (because everything's FOR $ALE), most* already on the market in some fashion, that offer great potential to benefit the public."  *most = qualifying weasel word -- this means that only a very small portion of this land is actually "on the market in some fashion" (another qualifying mush phrase).
   
5. So, who is this "administrator"?  "The Applicants have engaged and provided funds to a nationally respected* land conservation organization to begin acquiring interests in private properties of high value to the Department of the Interior’s conservation mission in the area around DEWA, MDSR, APPA and Cherry Valley National Wildlife Refuge."  *Not anymore, as soon as this crooked bribe is made public, this will be the LEAST RESPECTED land conservation organization in the nation... and that's why the power companies aren't giving out the name of this organization that's already taken your money to start acquiring land for a project and bribe that is completely undecided... or is it?
   
6. The details of the land grab?  Well, that's "proprietary," don't ya know... "The Applicants and their consultants have collected a great deal of very specific information about lands that are for sale (in fee or pursuant to conservation easement) in the DEWA area. Most of the information is confidential and proprietary; all of it is sensitive. The potential to acquire the land for conservation purposes likely would be frustrated if the information were to be publicized.  (here's your cue, project opponents -- go fetch and publicize, publicize, publicize -- hope your neighbor grapevine in PA & NJ works as well as ours in WV, VA & MD does)  To meet the requirements of current owners, a substantial portion of the information has been obtained with the understanding that the Applicants would keep the information confidential. Based on our outreach to conservation partners and other investigations and analyses, we have identified, at this time, an overall universe of 650 parcels or interests in land that merit further consideration for use as compensatory mitigation including 425 tracts (39,500 acres) in Pennsylvania and 225 tracts (20,500 acres) in New Jersey. Of these, there is dialogue with landowners for the following parcels/acreage: 150 tracts (13,500 acres) in Pennsylvania, and 10 tracts (500 acres) in New Jersey. Of the parcels under dialogue at this time the following parcels/acreage are either under option, option pending or active negotiation: 12 tracts (10,700 acres) in Pennsylvania ($34,000,000 fmv est.), and 5 tracts (410 acres) ($2,600,000 fmv est.) in New Jersey.  (that's $36.6M already, with only 17 of 650 tracts of land acquired.)
   
7. I saved the best laugh for last:  "The Applicants are prepared to commit funds in an amount that will fully recognize and show respect for the public value of the resources potentially affected by the Project."  These guys have absolutely no respect for themselves, much less any respect for the public.  What a joke!  And they "will ensure that there can be no basis for any reasonable party to conclude that the benefit to the resources at issue is anything other than substantially greater than the impacts of the Project."  What part of THE PARK IS NOT FOR SALE AT ANY PRICE don't they get?

PATH has been so busy painting a pretty picture of their bookkeeping prowess for FERC that they neglected to look over their shoulder and see where they were headed -- right into a corner.

See Keryn & Ali's Response to PATH's latest Answer (answer to an answer to an answer to an answer).  The exhibit to the Response can be found here.

Unfortunately, it gets pretty far afield into the technical, accounting weeds, but if you've been following along, it might just click.  In summation, if PATH's previous X = Y equation is true, they've got a lot of explaining to do, and continuing to file Answers before the Commission is the wrong procedure to reveal and correct PATH's continual errors.  Challengers end with another request for FERC to audit PATH's "books and records."

Now let's see what happens when PATH tries to tippy-toe out of that corner they have painted themselves into...

The Susquehanna Roseland opposition groups did a great job at the National Park Service public hearings held last week.  This link even has a recording of the public comments.

And a representative of PPL has now joined his counterpart at PSE&G in admitting that the $30M "mitigation package" will become the responsibility of the 60 million ratepayers in the PJM region.  However, the only beneficiary of the "mitigation" and the power line itself will be PPL and PSE&G, who will earn a 12.93% profit on the cost of the project every year for the 50 - 70 life of the line.  Both individuals quoted in the article aren't quite accurate though.  The PPL guy claims that the return on equity is part of the state ratemaking process, but this line is under FERC jurisdiction.  The Sierra Club representative only calculates one year's interest in his $4M profit estimate.  Profit is calculated on the remaining balance EVERY year, and the companies also receive a percentage of their investment back every year as well through depreciation.

PPL claims that they haven't "identified precise locations" of the land they propose to purchase for their "mitigation package" yet.  So, PPL, what happens when the owners don't want to sell?  Do you offer them more money, or do you use your state-granted eminent domain powers to take the land from a private individual and give it to the NPS or other conservation group?  I don't see anyone addressing this question yet.

But, this editorial in the Pocono Record is by far the most revealing.  The editor (who drives me NUTS with his poor writing skills -- please, let one of your copy editors edit your editorials!) has had at least one sit-down with Delaware Water Gap National Recreation Area Superintendent John Donahue.  Donahue told the editor, "We've been working with the power company for some time for a mitigation package and are reaching the point where they might come to the public and offer something huge for what they want."

The "mitigation package" is all about Donahue's personal vision for the park.  His vision includes linking the park with state parks and turning Rt. 209 into a "parkway." Maybe someone should tell Donahue the story of the Lenape Indians of Manhattan who entered into what they thought of as a land-sharing pact with the European settlers.  It didn't work out so well for the Indians.

PATH filed an Answer to Ali & Keryn's Response to PATH's Answer to the Formal Challenge on Friday (if you're keeping score this is an answer to an answer to an answer).

In this Answer, PATH explains that they (purportedly) cheated themselves out of $12K in 2010.

Subtlety is lost on these ninnies.  I guess someone is going to have to clobber them over the head with it.  How embarrassing for PATH!  Color me exasperated.

But, I'm sure you'll all be thrilled to know that Ali has been elevated to one-name celebrity status with this filing!  That's right, she's now to be known simply as "Alison."

More to come...

Back in October, the Congressional Research Service wrote a report summarizing FERC's Transmission Incentives NOI and analyzing the law and policy behind the transmission incentives themselves.

They make some interesting observations:

When FERC codified the EPAct language, they made a minor wording change that makes a huge difference, costs consumers billions, and perverts the original intent of the Act.  The EPAct language states "...the Commission shall establish, by rule, incentive-based (including performance-based) rate treatments for the transmission of electric energy in interstate commerce by public utilities for the purpose of benefitting consumers by ensuring reliability and reducing the cost of delivered power by reducing transmission congestion."  FERC's Order No. 679 changed this language to read, "... either ensure reliability or reduce the cost...".  Right away, consumer rates take a jump because reliability projects that only increase costs are allowed under Order No. 679.

The history of the EPAct supposedly trickled down from this 2003 blackout task force report recommendation:

Clarify that prudent expenditures and investments for bulk system reliability (including investments in new technologies) will be recoverable through transmission rates.

Do you see anything in there that recommends incentives for the construction of a whole bunch of new transmission lines running parallel to existing, outdated, inefficient transmission lines?  Me neither.  It recommends that we improve transmission without specifying how.

But, Congress specified exactly how this would be accomplished in the EPAct, Sec. 219 (b) (1) & (3):

(b) CONTENTS.—The rule shall--
(1) promote reliable and economically efficient transmission and generation of electricity by promoting capital investment in the enlargement, improvement, maintenance, and operation of all facilities for the transmission of electric energy in interstate commerce, regardless of the ownership of the facilities;
(3) encourage deployment of transmission technologies and other measures to increase the capacity and efficiency of existing transmission facilities and improve the operation of the facilities; and

This is a point that StopPATH made in their NOI comments last year.  FERC has interpreted and codified Sec. 219(b) as (1) applying to new facilities only; and (3) applying to existing facilities.  This is also a perversion of interpretation on FERC's part.  In the NOI, FERC expressed their puzzlement that no one had applied for incentives on existing facilities.  Really?  It's quite simple, Sherlock, improving existing facilities doesn't require as large a capital investment on the part of the transmission owner as building new facilities does.  That capital investment is what earns outrageous ROE rates as high as 14.3%.  The more they invest, the more equity profit they make.  As well, FERC policy says that "routine" project and upgrades are not eligible for incentives.  That wasn't the intent of Congress in the EPAct.  In addition, FERC uses the price tag of a project as one of the factors in the nexus test.  FERC's policy is geared toward enriching transmission owners to the detriment of consumers.

Building new transmission while allowing interconnected, existing infrastructure to continue to deteriorate, fail and cause blackouts is not what Congress had in mind.  FERC's approach is like putting a piece of cardboard over a broken window and then cutting a hole and installing a new window right next to the broken one.

The CRS report opines that transmission investment over the next 20 years will be in the neighborhood of $298B.  It also states that FERC may opt to do nothing about its incentives policy.  Perhaps it's time for Congress to step back in and assert its authority to ensure its orders are being properly carried out before electricity costs completely bankrupt struggling consumers.