Cost allocation for PJM's 2022 Window 3 projects has now officially turned into a long-running soap opera at FERC, and eventually through the courts.

Last year, PJM solicited new transmission to solve future issues with the retirement of 11,000 MW of existing generation in the eastern part of its region due to state "clean energy" policies, and the addition of 7,500 MW of new data center load concentrated in Northern Virginia.  In December, PJM selected and approved a huge portfolio of new transmission that looks like this.

You don't need to be a transmission engineer to notice that the majority of the new lines have a concentrated end point -- data center alley in Loudoun County, Virginia.  Power from southeast and southwest Pennsylvania (feeding from huge coal-fired plants in West Virginia) and power from central Virginia is being piped into data center alley on new transmission extension cords.  In the eastern portion of the map, power from southeastern Pennsylvania is being piped into the Baltimore area via new transmission extension cords.  The destinations for the new power is directly tied to PJM's statement of need -- new power for data centers and to replace closing coal-fired plants in the Baltimore area.  These are the causers of the new transmission.

In January, PJM made a filing at the Federal Energy Regulatory Commission (FERC) to allocate the more than $5B cost of this new transmission according to its regional cost allocation formula for big, regional lines.  Lines needed for regional reliability are allocated 50% to all load-serving utility zones across the region based on each zone's share of peak load for the preceding year.  The zones with the largest load receive a bigger share of this 50% of the cost of the lines.  The other 50% of the cost is allocated based on zones who will use the new lines.  Here's a map of PJM's utility zones.

PJM's territory is vast and stretches from the east coast as far west as Chicago, and as far south as North Carolina.  Under the 50% to load allocation, the ComEd zone around Chicago uses the most power so therefore it receives the largest share of these costs.  What benefit is Chicago getting from data centers in Virginia or "clean energy" in Maryland?  The correct answer is... zippety do dah!  However, the old thinking goes that since PJM is a connected region, any threat to reliability anywhere in the region could black out the entire region.  Therefore, everyone "needs" transmission to ensure reliability.

The old thinking also went that load increased incrementally around the entire region, with it being impossible to finger just one region for increased load, therefore everyone paid for regional increases in load.  It was too hard to measure exactly where load was increasing over time, and no new user created an outsized increase in load that could be isolated and allocated to the cost causer.  PJM cannot be changing its cost allocations constantly every time a new industrial plant asks for a connection, and these new users didn't cause a huge jump in power use when compared to the amount of power flowing across the region.

Toss that old thinking out the window!  PJM's latest portfolio of projects CAN be tied to just two things... closing baseload generators in eastern PJM and increased data center load concentrated in a tiny spot on PJM's vast map.  And what is causing that?  State "clean energy" policies that require the closing of existing fossil fuel baseload generators and prohibit their replacement with similar generators that can produce hundreds of megawatts of electricity when needed.  Replacement with renewables is a fairy tale.  Renewables take too much land for the amount of power they produce, and the power they produce is not reliable.  It takes many more megawatts of renewable power to equal one megawatt of fossil fuel power because renewables are such weak generators and they are intermittent and cannot be relied on to produce power when needed.  If we rely on renewables to keep the lights on, we're only kidding ourselves.  We cannot build enough renewables to take the place of all the fossil fuel generators in PJM that keep the lights on.  Here's a graph showing the source of PJM's power this morning that is powering this computer, and everything that's making your Saturday happy.

Without coal, gas and nuclear, we wouldn't have electricity.  This isn't a one-off, PJM's graph looks like this on a daily basis.  If we are ever going to get to zero carbon, we need to start building lots of nuclear power... yesterday.  Wind and solar and "other renewables" are not going to get there... EVER.  PJM has no control over power generation.  It only has control over transmission to get available power to load.  Generation is a state issue... except we deregulated it years ago so the states have no control over it either.  Generation is controlled by market, that is when it's profitable to build new generators, the market will inspire new builds.  However, PJM steps in long before the market can actually work and builds transmission to ensure reliability.  In certain states with "clean energy" policies, it is impossible to build new fossil fuel generators.  And it doesn't help that Big Green is putting pressure on existing generators to retire early with threats of lawsuits.  It's accelerating, and we are so screwed!  When The Sierra Club is in charge of your power supply you should be frightened.  They have but one goal... to shut down fossil fuels.  They have no responsibility to keep the lights on.

Now that I've set the table (or maybe it was just a rant), let's get back to PJM's cost allocation filing.  PJM makes numerous filings like this every year, and other regional grid operators do as well.  It's usually routine... filing is made and FERC rubber stamps it.  Sometimes a few entities will file objections, but they are rarely sustained.  Once, about 20 years ago, numerous states objected to PJM's cost allocation for its Project Mountaineer transmission projects.  These 500kV projects were for the purpose of increasing the use of coal-fired electricity in eastern PJM by 5,000 MW, and states in the other parts of PJM objected to paying for them.  That case (Illinois Commerce Commission v. FERC) ended up at the 7th Circuit Court of Appeals... twice... before PJM adopted its current cost allocation methodology.  The Court said that FERC had to demonstrate that the costs of those projects were allocated to the cost causers.  Since then, things have settled down.

However, PJM's latest projects have lit another fire that is probably going to burn as bright as the last one.  Something extraordinary is happening in PJM's cost allocation FERC docket.  In addition to the comments filed by consumers, and the protest of the Maryland Office of People's Counsel that more of the cost should be allocated to Virginia than Maryland, last week the Virginia State Corporation Commission filed comments basically calling Maryland a hypocrite and stating that Maryland is equally to blame for these new transmission lines.  I tend to agree... that both Maryland and Virginia are hypocrites!  These are the two states causing all the "need" for new transmission lines that will be paid for by other states.

But it's not going to end there... a giant parade of entities have intervened in this case at FERC.  Being an intervenor means you are a party to the case.   Only parties have standing to request rehearing at FERC and eventually appeal the case in federal court.

Intervenors include:

That's a lot of intervenors!  Many more than a normal FERC docket.  You may even be able to sort them into "camps" based on whether they are entities that will pay these costs, or whether they are entities that will benefit financially from building these projects.  It really sucks when they can be placed in BOTH camps, such as the utilities assigned costs that also benefit from building new projects.  Do you think these entities will side with their ratepayers against being assigned costs for these projects, or will they side on gladly accepting costs because their financial interests are greater than their public utility responsibilities to their customers?

So, what happens next?  There may be more intervenors and more comments, but eventually FERC will issue an order.  No matter what FERC decides, one "camp" or the other isn't going to like it.  That camp will file for rehearing.  FERC will reconsider the matter and issue another order.  One camp won't like that and will file an appeal in the federal circuit court(s) of appeal.  The Court will decide the matter and remand it to FERC with instructions to issue a new order that comports with the Court's instructions.  Once FERC issues the new order, it may be appealed again, and back to the courts it goes.  One camp may decide to appeal the federal court's order to SCOTUS.  It's going to drag on for years, like a bad soap opera.

Meanwhile, PJM will continue to pursue its projects.  If any cost allocation adjustment are made due to the appeals, that's a money issue that will be taken care of through rates.  The utilities assigned to build these projects will file applications for permits to construct with some of the intervening states.  Think about how that will go...  If a state denies a permit, permitting may be bumped up to FERC under new backstop permitting laws created by the Infrastructure Investment and Jobs Act in 2021.  The longer the permitting process for these projects, the higher their costs climb.

And what about those costs?  Will the possibility that zones in Virginia and Maryland are eventually assigned more of the costs become a risk factor that will impact the need for these projects in the first place?  Will data centers want to continue to build in Virginia and accept the risk that the cost of their electricity is going to skyrocket in the future when the legal cases are finally settled?  Or will they decamp to cheaper pastures without the risk?  (Don't let the door hit you in the ass on the way out!). And what about Maryland?  Will skyhigh electricity costs cause Maryland to re-think its clean energy policies that prohibit the building of new fossil fuel plants?  Will Maryland begin a nuclear generation renaissance that could be equally expensive?

Those are the only changes that will make a difference in PJM's load forecast, but getting there will be rough.  PJM never changes its mind, once it is made up.  FERC should require PJM to create a new cost allocation method for new transmission due to state "clean energy" policies that is involuntarily allocated to the states whose policies cause the new transmission.  PJM should also create a new cost allocation policy dealing specifically with data centers.  This relatively new electric user stands out as a huge load that must be separated from normal, incremental load increases.  Data centers use so much power, they are in a class by themselves.  While FERC cannot allocate costs directly to data centers, it can allocate costs to the zones in states where the building is causing need for new transmission.  It would then be up to the state whether to spread the costs of the transmission among all users, or allocate it to data centers directly.  Whatever happens, it won't be an easy decision, and someone isn't going to like it.

Probably you.  Your electric bill is going to skyrocket.

Be sure to tune in to our next episode when FERC issues an order on PJM's cost allocation filing... this is going to be the longest running soap opera in history!

Someone sent me this article earlier this week.  It tries to pretend that Grain Belt Express has made some sort of regulatory or procedural progress... like it got things *approved*.  But the reality is that the only things GBE recently got was a well-deserved kick in the behind from the Federal Energy Regulatory Commission and a big nothing from the U.S. Department of Energy.  Big deal.  Must have been a slow news day... or just one ripe for propaganda and fake news.

​Let's go to the DOE thing first.

That's right... zero plus zero is still zero.  GBE is still a big, fat zero.  FAST-41 is supposed to be a government run program that "speeds up" the environmental review for selected projects.  Except, the government getting involved has never sped up anything!  Government slows everything because of its pendulous rules and process.  GBE's Environmental Impact Statement has already been underway for more than a year, and it's already at least 6 months behind schedule.  And there's no end in sight.  How would anyone even know if FAST-41 speeds up the GBE EIS, since it's already behind the non-FAST schedule?  This is just a waste of time and tax dollars, let's move on to FERC.

The article says

Say what?  Did this silly reporter even READ the FERC Order he's reporting on?  I'm thinking no, because no sane person would have read that Order and decided it was favorable to GBE.  What GBE got from FERC was nothing but a scolding.

We've known for quite a while that GBE was going to connect to MISO and AECI in Callaway County at the existing McCreedie subtation and also at a new substation it is sharing with Ranger Power's immense solar farm.  The new substation is called Burns.  Burns will be owned and built by incumbent utility Ameren (however I hear that Ranger Power bought the land and scraped all the topsoil off it before handing it over to Ameren).  Ameren has been ordered to build this substation and connect both Ranger Power and GBE by regional grid operator MISO.  Ameren cannot refuse to build it.   In addition, MISO's studies determined that there needs to be two new 345kV high-voltage transmission lines from the new Burns substation to the existing Montgomery substation (in Montgomery Co.) in order for GBE to connect.  The existing line cannot carry enough power and new ones must be built.  Ameren has also been ordered to build these new transmission lines, although GBE must pay for them.

GBE's interconnection to MISO was subject to a Transmission Connection Agreement between the parties.  The TCA is a pretty standard thing that relies in large part on MISO's filed tariff with FERC.  TCAs can be negotiated somewhat and once they are complete, they are filed with FERC for approval.  Except GBE could not agree with MISO on a number of issues so MISO filed the TCA with FERC unexecuted (unsigned).  FERC approved that unsigned TCA.  GBE had asked FERC to make several changes to the TCA and force MISO to do certain things, and for FERC to make Ameren hurry up and build the new transmission lines that GBE needs to make its connection at Burns.  FERC declined to make any of GBE's suggested changes and told GBE it was not necessary to tell Ameren to hurry up.  GBE got NOTHING it asked for here.  GBE was legally smacked upside the head.  FERC has sided with its regional transmission organization, MISO, on all issues.  This really isn't novel or different.  FERC always sides with its pet RTOs.  GBE is just stupid if it thinks it can challenge MISO and get a different result.  Maybe now Polsky will get a clue about why they "don't hear from them" on all the complaints Invenergy has filed against MISO?

Although the TCA was approved by FERC, it doesn't do anything to make GBE's connection happen faster.  It's still scheduled for, maybe, 2030.  GBE had asked FERC to force MISO to connect some smaller portion of capacity in 2027.  Not happening.

Why is this such an issue for GBE?  Here's a quote from the Order:

That's right, folks!  MISO ordered Ameren to build new transmission lines to be in service in 2028 and 2030 for the purpose of importing wind and solar energy from Iowa to Missouri and Illinois.  These regionally planned lines are cost allocated to all ratepayers in MISO.  This means that the cost to use them is going to be considerably LESS than the bloated $7B merchant transmission Grain Belt Express.  In fact, ratepayers are going to be paying for the new Ameren lines, even if they choose to use GBE instead.  Let's see... renewable energy on new lines you pay for OR renewable energy on the GBE, which costs a lot more, and then you STILL have to pay for the Ameren lines anyhow.  Doesn't take an energy trader to figure out that problem.

The Ameren lines will be cheaper.  Therefore, GBE is in a big hurry to try to get its bloated behemoth online before Ameren gets those lines built.  Looks like that's not going to be possible.

GBE is stripped bare... it's too expensive and obsolete.  Who would want to be a customer?  And, speaking of customers, GBE still does not have negotiated rate authority to try to find any.  No matter though... GBE can't connect its project until at least 2030, when there will be better options for renewable energy transmission service in MISO.

I don't think Grain Belt Express got a lot of love during its Valentine's Day oral argument at the Illinois Fifth District Court of Appeals.  You can (and should!) listen to the Oral Argument for yourself.  It's less than 40 minutes and I liked it so much I listened to it twice.  I wanted to think about and enjoy what I was hearing.  The Court has posted audio of the argument here.  Page down to find the case called "Concerned Citizens and Property Owners vs. Illinois Commerce Commission and then click on the speaker icon on the right side of the page.

Trying to predict how a Court may rule based on Oral Argument is a tricky business.  The judges are rarely obvious about how they feel, but if you listen to their questions you may pick up some clues.  It's not so much who gets more questions, but the nature of the questions and what they reveal about what the judges want to know to help them decide the case.

I do want to say that all the lawyers were well prepared and on top of their game.  At the end, one of the judges tells them so, and that their briefs were all very well done.  However, he didn't stop there.  He called out the brief of appellant attorney Paul Neilan (for Zotos) as particularly well done and informative.  Afterwards, I simply had to read that one for myself and I agree that he did a top notch job explaining things as briefly as possible.  That's often the key... appeals rely heavily on the briefs submitted by the parties to the case.  Judges are not experts on every topic, especially ones as complicated as electric transmission.  Giving them the information they need to decide the case, without adding a bunch of information that is not useful, is the goal.  Transmission is so complicated and layered it's a monumental task indeed.  Neilan is master of the brief!  And several of the questions the judges asked seemed to come right out of his brief. He set the knowledge base and that's a very good place to be at Oral Argument.

The case for the appellants was argued by Chuck Davis from Illinois Farm Bureau and Brian Kalb for the landowners.  The arguments centered on the constitutionality of GBE's special purpose legislation to enable GBE and compel the ICC to approve it (and only it) by usurping the ICC's normal process.  I especially liked Davis's opening statement that Grain Belt Express 2.0 is back after its sale to a new owner that changed Illinois law in an attempt to permit a project that was not successful under its last owner.  The Courts determined that it and sister project Rock Island Clean Line were not a public use.  Grain Belt's "build it and they will come" plan is a cloud on landowner titles and a quest for eminent domain.  GBE would not subject itself to state permitting if it was not seeking eminent domain authority.  The ICC's argument is that GBE is not seeking eminent domain, but that fails because GBE made it clear that it is seeking eminent domain in the letters it sent to landowners.  The new law provides an automatic grant of public use only to GBE and is therefore special purpose legislation for benefit of only one company.

Questions the judges asked:
1.   Is the windfarm in Kansas already built?
2.  If GBE has been sold to Invenergy, has RICL also been sold to them?
3.  Don't the letters to landowners threaten eminent domain?
4.  If the windmills produce alternating current, what's the reason for a transmission line to turn it into direct current, if it could have been transmitted as alternating current?
These questions don't appear to me to be hostile to the landowners.  In fact, they may actually be hostile to GBE.

Landowner attorney Brian Kalb told the Court that the enabling legislation is unconstitutional  special legislation that discriminates in favor of a select group (GBE) without a reasonable basis of equal protection and is arbitrary.  The legislation is bespoke legislation only for Grain Belt Express and the legislative transcripts indicate as much.  The legislation requires the ICC to find it in the public interest if it delivers energy to MISO or PJM.  That is not a determination of public interest.  (Bravo!  That's exactly right!). There is no showing that GBE benefits the citizens of Illinois.

Questions the judges asked:
1.  Didn't the ICC have to make a finding that there was benefit to the citizens of Illinois?
Kalb answered that under the statute that benefit is deemed by fiat and the Commission's role has been usurped as long as GBE connects to MISO or PJM.
The Judge asked if the connection points aren't governed by FERC?
2.  At what point does GBE cross the river?
Again... questions not hostile to landowners position.

Next, Brian Dodds argued the ICC's position that the legislation is constitutional.  He says the landowners challenges fail because they have not shown that some other transmission company has been denied a permit to do something other than what GBE is doing enabled by its special legislation.  He says there is a converter station in Ralls County, Missouri (except there is not... interconnection has been changed to Callaway County and a new 40-mile spur to enable it has been added to GBE... if the ICC attorney doesn't even know where it connects, how accurate is the rest of his information?).

Judge questions:

1.  If the goal of the legislature is 100% clean energy, why limit the legislation to just 9 counties, and why have a time limit on applicable projects? (this was actually never answered in the gush of responding words).
2.  The ICC Order says the transmission project must be fully funded before construction starts.  How can the ICC defer that finding?
3.  Explain the financial benefit for the citizens of Illinois from this project.
4.  Doesn't the benefit rely mainly on price drop and credits and things up in the wind that nobody knows if they will take place in the future or not?
These questions don't seem particularly friendly to GBE.  In fact, they may be hostile questions.

Last attorney was David Streicker for GBE.  He told the Court that even though the legislation requires a finding of public benefit, GBE submitted evidence that it did anyhow.

Judge questions:

1.  How was it determined that GBE lowers costs for Illinois consumers?
2.  Does expert testimony say that our national security is dependent upon a wind farm?
I'm going to leave this up to the reader to decide whether there were hostile questions for GBE.  I think you are probably getting the hang of it by now.

The landowners were allowed to present a brief rebuttal at the end that begins with Brian Kalb.  He said that the ICC and GBE had failed to support their argument that the legislation was simply for clean energy because they didn't explain how the 9 specific counties and the deadline promoted clean energy in general, not just GBE.  It's an opportunity for GBE, but a wall for any other utility.  The ICC makes a finding of the best route for a transmission project, not the legislature.  He is followed by Chuck Davis who makes the point that ICC has set itself up to make a finding of GBE's financial capability all by itself without input of the parties, which is an ex parte no-no.  ICC is required to make its findings with the knowledge and participation of all the parties.  Its Order must be overturned until it does this.  It cannot reserve some determinations to be made without participation at a later date.  He also points out that an ICC certificate is only good for 2 years, but the ICC has given GBE 5 years to to begin its project.

I am greatly encouraged after listening to the Oral Argument.  You should be, too.  The attorneys for Farm Bureau and the landowners did what they needed to do.  They answered all questions posed and made great arguments.  Say a prayer, cross your fingers, hold your breath... and never stop hoping that justice will prevail.

Dear FirstEnergy,

​Right now you are down and out and feeling really crappy....

And when I see how sad you are it sort of makes me.... 

HAPPY!

I have been singing this tune since I read about the latest indictments of former FirstEnergy executives Chatty Chuck Jones and Michael Dowling, along with their paid off regulator Sam Randazzo.

FirstEnergy criminals "on the loose". (Headline has since been changed to something less sensational, but it was fun while it lasted.)

Chatty Chuck and friends finally surrendered and got their mug shots taken.  I wonder if someone will create some fake $2 bills with their mug shots on them?  Maybe the wives can get together and find a way to continue their fortunate lifestyles without these guys? The $2 bills would be the perfect currency for bribing regulators in the future.

Chatty Chuck is no longer smiling.  I bet he's no longer chatty, either.  Why do I call him Chatty Chuck?  It's because of the absurd press he generated back in 2013 when doing a deal to plaster FirstEnergy's name on Cleveland Brown's stadium.  It was one of the biggest PR fails I have ever seen.  (The Browns ditched FirstEnergy after the scandals started).

Chatty Chuck (so named because of his arrogant confidences shared with the reporter) demonstrated his mastery of "the deal" by telling the reporter:

I guess he couldn't figure out how to keep his bribery of the Chairman of the Public Utility Commission of Ohio under wraps.  This is an even more epic fail for Chatty Chuck.

Even more, this is a good look at all the things that go on behind the scenes between regulators and regulated.  Think FirstEnergy is the only utility doing it, or that Ohio is the only place utilities do it?  I'm thinking no.

I guess I'll play that tune again... "CEOs in shackles."  Yes, indeed!  That makes me happy.  Karma is a bitch, Chuck!

Illinois energy attorney Paul Neilan outlined the merchant transmission "benefits" scam in recent comments to the Illinois Power Agency.  Back in January the IPA published its draft 2024 Policy Study and invited comments.

In his comments, Neilan pointed out how IPA's idea of the finances of merchant transmission is wrong.  Government ideas about merchant transmission are almost always wrong.  Nobody seems to understand how it works, so they make things up and pretend they understand.  Because governments don't understand how merchant transmission works and how it differs from regionally planned and cost allocated transmission needed for reliability, merchant transmission developers often have a field day making up need and benefits for their projects to make ignorant regulators believe they somehow provide "public benefit" that will enable eminent domain authority for private profit.

First Neilan takes issue with IPA's claim that merchant transmission makes money through power price arbitrage:

This is something a vast majority of landowners impacted by Grain Belt Express know well.  Why doesn't IPA know this?  GBE doesn't own power generators, and it doesn't sell power.  It only sells transmission.  Sellers and buyers on either end are not supposed to be affiliated with the transmission line.  Therefore, if there was any money to be had buying low at Point A and selling high at Point B, it would not be GBE realizing the income and using it to pay for construction and operation of its transmission line.

Neilan points out that the price difference between seller and buyer must be more than the cost of GBE.  This is the reason GBE doesn't yet have enough customers to finance and build its project.  The price differential between seller and buyer is so small that it doesn't allow the addition of the bloated $7B GBE project and still allow an arbitrage profit.  He attaches a portion of a transcript from the ICC hearing that demonstrates how GBE witnesses dodge and weave when asked questions they would rather not answer because a truthful answer isn't helpful.

Merchant transmission claims of electricity cost reductions are magic math.

In other words, if GBE really reduced power prices for consumers that are not served by its project ("public benefit") it would actually be shooting itself in the foot because it is closing the arbitrage gap between seller and buyer that allows for the price of using GBE to be added in and still allow the seller to make a profit.  GBE wants the seller to sell at a low price, and the buyer to buy at a high price, the higher the better.  A high price would allow the low price of generation plus the cost of GBE to remain lower than the buy price at the other end of the line.  Lower the buy price, and suddenly GBE is not economical.  Knowing this... how many times has GBE lied to regulators, the media, and the people?

The magic math GBE used at the ICC to create $6.6B of savings for electric consumers is a story unto itself.  You should read Neilan's explanation of GBE's non-existent carbon tax and failure to adjust the time value of money.  Geeky topic, easy explanation.

Perhaps IPA's biggest flaw is its presumption that eminent domain is appropriate for merchant transmission projects:

That strikes at one of my biggest pet peeves about merchant transmission -- considering it a public use.  In order to be a public use, it must provide public benefit.  A merchant transmission project only provides benefit to its signed customers (assuming they actually found some benefit from using the line).  There is no public benefit.  Merchant transmission companies (and their enabling state utility commissioners) attempt to *create* a public benefit with claims of lower power prices for everyone.  Missouri even went so far as to claim that because GBE signed a contract to sell its private service to a municipal power agency, that somehow transferred the public benefit provided by the power agency to GBE and allowed GBE to wield the power of eminent domain.  It's a ridiculous interpretation of the law.  Merchant transmission owners sell transmission service to willing buyers at the highest price it can negotiate.  Merchant projects are not necessary for reliability, economics, or public policy.  They are simply a private profit scheme laid on top of our current electric transmission system.  They should have to negotiate easements in the same kind of market where they negotiate their contracts with companies who purchase their capacity -- a free market with a willing buyer and a willing seller.  Merchant transmission should never be granted eminent domain authority.  We need to fix that.

Hopefully Neilan can straighten out the IPA's screwy thinking.  It's a vital first step!

Regional utility FirstEnergy announced on Friday that it was abandoning its  interim 2030 climate goal.

And why is that, exactly?  Well, here's as close to the truth as FirstEnergy wants to get:

The climate goal has been eliminated because FirstEnergy cannot reduce emissions at its Fort Martin and Harrison coal-fired power plants in West Virginia.  And why did FirstEnergy think it could reduce emissions in 2020, only to backpedal less than 4 years later and abandon its interim goal?  What changed in late 2023?  What are the PJM "resource adequacy" and "state energy policy initiatives" that made FirstEnergy abandon its 2030 goal?

​This!

PJM's new transmission project designed to help import 7,500 MW of energy to Loudoun County Virginia's "Data Center Alley."  Virginia keeps approving new data centers and local utilities do not have enough electricity available to power them.  PJM designed a new long-distance extension cord that plugs the data centers into new sources of power beginning at the 502 Junction substation in southwestern Pennsylvania.  

Of course, substations do not generate electricity.  They serve as traffic circles to direct energy in different directions via high-voltage transmission lines.  PJM's new transmission snarl, err I meant to say MARL (MidAtlantic Resiliency Link), begins at 502 Junction substation and ends at the new Aspen substation in Data Center Alley.  But what generation sources are connected to 502 Junction that can be directed to Data Center Alley?  I'll give you two guesses...

That's right... the two generators at which FirstEnergy can no longer reduce emissions are directly connected to 502 Junction.

The red lines on the map are existing 500kV transmission lines that connect Harrison and Ft. Martin directly to 502 Junction.  The new MARL project will take it from there, right to data centers in Loudoun County.

This is the reason FirstEnergy has abandoned its 2030 interim greenhouse gas goal.  In late 2023, PJM approved MARL.  PJM approved the project due to 7500 MW of new data center load and the retirement of 11,000 MW of fossil fuel generation in its eastern region.  Resource adequacy and state energy policy initiatives at work.

So, what does this mean?  It means that instead of reducing the greenhouse gas spewed into the West Virginia air from FirstEnergy's Ft. Martin and Harrison power stations, FirstEnergy is going to be increasing their carbon emissions.  All for benefit of No. Va.'s data centers and the selfish and destructive state energy policies of Virginia and its neighbors.

Northern Virginians who keep approving data centers despite knowing there is no way to power them without imports from West Virginia are directly responsible *COMPLICIT* in increased air pollution, health and environmental impacts caused by continued mining and burning of coal in West Virginia.

Why is this okay?

Don't turn away from this.  OWN IT.  Don't blame your elected officials or throw up your hands in despair.  Make your elected officials OWN IT.  Make them publicly say that it's okay to increase carbon emissions to power the data centers they approve.  Of course they won't.  FirstEnergy has just handed you a sledgehammer to stop data center sprawl.  Use it.

Every time you turn on a light switch in Northern Virginia, you are increasing carbon emissions.  That's right... the coal-fired power from West Virginia won't just power the data centers... it will power all of Northern Virginia.  Give your climate guilt a great big hug, it's going to be your constant companion for years.

PJM's new transmission plans to power data centers in Northern Virginia are going to increase carbon emissions.  End of story.

Virginia has a problem with data centers.  It created tax exemptions to draw them in.  Northern Virginia is situated near a bloated federal government that needs a place to store all its data.  And "data center alley" was born.  It has since reached outlandish proportions, and more data centers are being approved every day.  Data center sprawl is a serious problem.

Perhaps the biggest problem for the largest concentration of data centers in the world is powering them all.  Data centers use huge amounts of electricity, and as new technology created more ways for data centers to burn electricity, it soon became impossible to power them with the electricity available.  Couple this with state "clean energy" policy that prohibits the building of any new fossil fuel generation, and you've created a recipe for disaster.

This disaster recently manifested as PJM's 2022 Window 3 transmission plan.  Regional grid operator and planner PJM Interconnection was tasked with finding a solution to the closing of 11,000 MW of existing fossil fuel generation in Virginia and Maryland combined with 7,500 MW of new data center load in Northern Virginia.  PJM did the only thing it knows how to do... create new electric extension cords across the region that will import electricity to data center alley from fossil fuel generators in other states.  The only two states in PJM that export electricity are Pennsylvania and West Virginia, where coal is still king.  Pennsylvania produces electricity mainly from natural gas and nuclear, with a significant amount of coal still in its mix.  West Virginia's electricity mix is over 90% coal.

The new extension cords are 3 new 500kV transmission lines pumping electricity to data center alley from Pennsylvania and West Virginia.  It's bad enough that the new extension cords will plow through communities in other states, expanding transmission easements and cutting new ones, but PJM also expects electric customers in other states to pay for a significant share of the cost of these new extension cords.  What do Pennsylvania and West Virginia get from this?  New transmission lines, property destruction and devaluation.  They don't get any electricity... that's all going to Northern Virginia.

When approving this destructive (and unlikely to actually happen) transmission plan, PJM selected the cost allocation scheme that spreads the costs of the projects as widely as possible across its region.  The thinking there is that spreading the $6B cost among as many people as possible won't be noticed by individual electric consumers.  If PJM allocated the costs solely to the causers of the new transmission lines (the state of Virginia) then the rate increases they cause will be very noticeable.  In fact, it may be so noticeable that businesses and residents may begin to leave Virginia for neighboring states where electricity is more affordable.

PJM is complicit with the State of Virginia to cover up its data center disaster by inflicting new transmission on other states instead of the state that caused it.  Sure, Virginia is being allocated a huge chunk, but not all.  Another huge chunk is still being spread among all PJM consumers as far away as Illinois, Indiana, Ohio, New Jersey, Kentucky, Tennessee, North Carolina, Maryland, Pennsylvania and West Virginia.  This is because PJM selected the cost allocation scheme that allocates 50% of the cost of the new projects to everyone in the region based on their peak load percentage from the prior year.  An area that uses a lot of electricity gets a bigger share, for instance electric customers in Northern Illinois are paying a larger share of this 50% than electric customers in Virginia that will actually use the electricity piped in on the new extension cords.  Why is anyone in any state other than Virginia paying for this new data center transmission?

The other 50% of the costs are allocated based on cost causation, with load areas at or near the data centers paying a higher percentage.  However, the load areas near the data center are enormous.  The Dominion zone where the data centers are being built also consists of customers in all parts of Virginia, plus some in North Carolina.  The Allegheny Power zone contains customers at/near the data centers, but it also spreads to cover a huge chunk of West Virginia and Pennsylvania.  Why are consumers hundreds of miles from the data centers paying so much money to build extension cords for Virginia's new data centers?  This isn't fair.

PJM's cost allocation schemes are part of its FERC-approved tariff.  However, PJM must receive FERC approval for each individual collection of transmission projects to ensure they have chosen the correct cost allocation scheme for the projects.  PJM filed to spread the costs across the region back in January, which opened a 30-day comment period.

While lots of entities intervened in the FERC docket for this cost allocation, only 3 comments were received.  That's right... only 3 entities thought this was unfair.  Two of them are residential ratepayers, and the other is the Maryland Office of People's Counsel.

I filed these comments.  I asked FERC to open an investigation into the justness and reasonableness of PJM's cost allocation and took the position that the "clean energy" policies of Virginia and Maryland caused the retirement of 11,000 MW of baseload generation in their states.  Also, only Virginia is responsible for the 7,500 MW of new data center load.  West Virginians should not be paying for these new transmission lines.  Being the "power house" for the electric supply for Virginia's data centers ties West Virginia into many more years of coal-fired electricity production.  Even if West Virginia wanted to close those old, dirty plants, they cannot because Virginia needs the power for their data centers.

Pennsylvania electric consumer Barron Shaw filed these comments.  Barron's comments are similar and underscore the way Pennsylvania and West Virginia are being used to power some of the wealthiest companies in the world.  People in Pennsylvania and West Virginia get little to no benefit from these companies or their new extension cords and will actually end up paying higher power prices in their own states as all the "cheap" electricity is sucked out of their own states to power a wealthier economy in Northern Virginia.  It's basic supply/demand.  Plenty of power makes cheap electricity prices.  When so much power is exported that electricity becomes scarce, prices rise.

Those two comments are probably understandable to the average reader.  However, the Maryland Office of People's Counsel also filed comments and expert testimony purporting that PJM picked the wrong allocation scheme and should have used the one that allocates all the costs to the state responsible.  PJM's other cost allocation scheme is called the "State Agreement Approach" and is used when a state agrees to shoulder the entire cost of transmission made necessary by its public policies.  SAA has been used for New Jersey's offshore wind planning.  PJM planned new transmission to support NJ offshore wind, and NJ agreed to pay for it.  Maryland OPC believes PJM must break down the suite of transmission projects to determine which ones are for other reasons, and which ones are for the data centers.  Once this breakdown is made, Virginia should be charged for the entirety of the data center portion.  Maryland's filing is probably a hard read if you don't speak FERC though, so read at your own risk.  It may seem like you're reading a foreign language.

Now it's up to FERC to decide... should electric consumers in other states be charged for Virginia's data center extension cords?  Maybe if Virginia had to shoulder the entire cost of its data center debacle it would have to realize that approving a whole bunch of new data centers comes at a cost.  Outrageous electricity prices in Virginia are the consequence of out-of-control development.  PJM is helping Virginia avoid the true cost of its policies and shuffling costs off onto other states that had no part in approving the data centers and certainly will not see any benefit from them.  PJM also selected new transmission projects that put most of the burden on other states.  PJM could have selected the proposal that kept new transmission lines in Virginia by connecting to AEP's 765kV transmission system west of Richmond.  But it did not.  PJM is complicit in Virginia's irresponsible energy policies and therefore responsible for the energy crisis that is the logical result of continued data center development.  Why, PJM, why?  

PJM won't be successful in getting all these new transmission lines built in other states, and certainly not by their projected "need" dates in 2027.  What then?  Will the lights go out?  PJM made the wrong choice and we're all going to have to pay.