Formula Rate Matters. DAA continues to examine accounting that populates formula rate recovery mechanisms used in determining billings to wholesale customers. In recent formula rate audits, DAA observed certain patterns of noncompliance in the following areas:
• Merger Goodwill – including goodwill in the equity component of the capital structure absent Commission approval;
• Depreciation Rates – using state-approved or a blended depreciation rate consisting of Commission and state-approved depreciation rates without Commission approval;
• Merger Costs – including any merger-related costs in rates (e.g., third-party advisory fees, internal labor, severance, and other general and administrative costs) without Commission approval;
• Tax Prepayments – incorrectly recording tax overpayments not applied to a future tax year’s obligation as a prepayment leading to excess recovery through working capital;
• Unused Inventory and Equipment – including the cost of materials, supplies, and equipment purchased for a construction project without removing the cost of items unused in whole or in part from the cost of a project;
• Allocated Labor – using labor cost allocators not based on a representative time study to determine the amount of indirect labor costs to distribute to construction projects;
• Asset Retirement Obligation (ARO) – including ARO amounts in formula rates, without explicit Commission approval;
• Below-the-Line Costs – including below-the-line costs in formula rates (e.g., lobbying, charitable contributions, fines and penalties, and compromise settlements arising from discriminatory employment practices) without Commission approval; and
• Improper Capitalization – seeking to include in rate base (and earn a return on) costs that should be expensed.

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

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

“This is a private investment firm that’s building a private transmission line and they want to use eminent domain on 85 percent through some of the best farm land in the world. That’s a huge deal,” Andersen said.

“As staff has set out in the position statements it filed last Friday, it is staff’s view that the evidence in this case will not show that the transmission line and converter stations are needed, economically feasible, or will promote the public interest in Missouri,” Williams tells the Commission.

Clean Line turned to the Department of Energy and Section 1222 of the Energy Policy Act of 2005. The little-known provision would enable DOE to work through a federal power marketing administration and, in certain instances, condemn property required for easements.

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

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

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

“We would look at the no and figure out a way to turn it into a yes,” he said.

"Game & Fish Commission Director Mike Knoedl said that bird deaths in the area would be 'astronomical' because of the high lines and towers, some as tall as 200 feet."

For the unrecovered the companies may account, undepreciated investment.  
Balances in the 2012 deactivated power plants (albright, rivesville, and willow.  
Island) in any manner the companies deem appropriate, with gaap in accordance.  
And regulatory accounting.  Not, the parties agree that such accounting does.  
To recover these costs or amortization expenses in future rate establish a right.  
Proceedings, and this joint stipulation shall prevent the parties from nothing in.  
To recovery of these taking whatever position they deem appropriate in relation.  
Amounts in future proceedings.  Herh herh herh.

The proposed increase to the customer charge for residential and small commercial
customers shall remain at $5.00 per month.

Despite identification of areas in which transmission capacity is limited, a “not in my backyard” (or anyone else’s, in some cases) attitude toward new transmission line siting has resulted in cancellation or delay of some new transmission lines.

For example, in 2011, PJM cancelled the proposed Potomac Appalachian Transmission Highline (PATH) project, a 275-mile transmission line that would have run through West Virginia, Virginia, and Maryland to deliver electricity into Northern Virginia. Although the line was designed to improve reliability in eastern PJM, changing forecasts of electricity demand growth and intense opposition to siting the line led to the project’s cancellation.

Beginning in the late 1920s, electric utilities began to integrate their operations to improve reliability and reduce costs. Previously, utilities had operated as “islands,” meeting the demand for electricity solely from their own generating plants. To ensure reliable service, this meant building extra generating capacity to keep in reserve, in case unexpected problems caused their plants to shut down.[2] By integrating their operations, utilities could provide more reliable service without building as much backup generating capacity. In essence, if a generating plant at Utility A suffered a forced outage, one of Utility B’s generators would be available to ensure the lights stayed on. The concept is similar to diversifying a financial portfolio. Instead of investing everything into just one company’s stock, buying multiple stocks, bonds, and other investments reduces the risk of a sudden financial loss.

The Courier & Press began investigating this issue after receiving a call from a local business owner on Friday concerned that her bill had tripled without warning.

Vectren initially said that more bills than usual were estimated over the summer because the company switched meter reading contractors, and it was changing the readers’ routes.

“Without getting into specifics, there are challenges that happen with any contractor transitions,” Hedde said Tuesday morning. She added that the anonymous caller’s high bill was likely atypical.

“I don’t want to give the impression that that is normal,” Hedde said. “She is experiencing something hopefully that is an anomaly.”

But response to a Courier & Press’ Facebook post showed the issue was widespread. Hundreds of people replied to the post with stories of bills that were several times what they expected.

But mistake or no, customers whose bills were underestimated must pay up, said the Indiana Utility Regulatory Commission.

“They are responsible for it,” said Natalie Derrickson, a spokeswoman for the Indiana Utility Regulatory Commission. “At this point, if a customer feels like their bill was estimated and they have larger bills than they were expecting, their first step should be to contact Vectren. If the customer feels like the issue is not resolved, they should contact us.”

Fear that utility companies remain vulnerable to hackers, terrorists and natural disasters has the Pentagon pushing construction of independent power grids at military bases across the U.S. ...

Increasingly, the Pentagon wants power from its own sources.

“The endgame is to be able to survive if the grid goes down,” said Paul Orzeske, who recently retired as president of Honeywell Building Solutions, the company helping build Fort Bragg’s microgrid.

For years, experts have recommended the U.S. military seek independence from commercial utilities. “Our grid is old and it’s reliant on technology that’s outdated,” said Michael Wu, energy program director for the Truman National Security Project & Center for National Policy, a Washington think tank.

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The best onshore renewable wind resources (i.e., those with the highest potential
capacity factors) tend to be located far from load and sometimes in areas with less
transmission than desired for effective resource development. The best offshore renewable wind resources, however, are often located close to load centers, as is the case with New England.

All of Clean Line’s projects originate in a Type 1 Conditional Constraint Area, identified by DOE in the 2009 National Electric Transmission Congestion Study (“2009 Congestion Study”) and illustrated in Figure 2. The 2009 Congestion Study defined a Type I Conditional Constraint Area as, “an area where large quantities of renewable resources could be developed economically using existing technology with known cost and performance characteristics – if transmission were available to serve them.” The 2009 Congestion Study also noted, “Construction of major new transmission projects would enable development of thousands of MW of new renewable generation” within these areas.

Clean Line has engaged with thousands of local stakeholders in eleven states, where its five projects are actively under development.

These are real projects, many of which have land leased for wind turbines from
farmers seeking new sources of income, as drought has made traditional farming livelihoods uncertain. Wind power represents new hope for drought-resistant income and economic development in regions of the country otherwise struggling with diminishing populations.