This needs no explanation. Just watch.
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It's a noun, not a verb. When Transource was faced with the reality that its Independence Energy Connection (also known as "Projects b2743 & b2752" and "Market Efficiency Project 9A" in PJM parlance) did not provide much benefit to the geographic area sacrificed for the new transmission lines, it re-wrote its project "Fact Sheet" to gloss over this shortcoming. Transource now says: Who benefits from the project? For this project, PJM projects $622 million in cost savings for consumers in 10 power zones. Those zones are listed below and displayed on the map to the right. Generally speaking, when low-cost electricity is introduced into the market, it helps drive the overall competitiveness of the electric grid for all power zones. And here is the power zone map supplied by Transource.  Transource wants the public affected by this project to believe that benefits will be spread evenly over all power zones. But that is not the case. Transource must have run out of room because it did not also supply the Cost Responsibility percentages for the power zones on its map. Or maybe they purposely didn't include it because it did not support their propaganda narrative. One of the most basic rules of assigning cost responsibility for new transmission projects is that cost must be commensurate with benefit. Therefore, the first step to assigning costs to certain zones is to determine benefit for each zone. PJM did that analysis and posted its cost responsibility assignments here.  Since cost is directly proportional to benefit, you may interpret this chart to show the percentage of benefit to each power zone.
If you add up the BGE (Baltimore Gas & Electric), Dominion (Northern Virginia) and PEPCO (Washington, DC) zones, you will get 80.52%. That means that 80.52% of the benefits of this project will be confined to those zones. Baltimore, Northern Virginia and Washington, DC, will receive more than 80% of the benefit from this project.
There will be no new transmission lines in Baltimore, Northern Virginia or Washington, DC (oh, the horrors, the horrors!). If PJM tried to build new transmission in these urban areas, even to lower prices by a few cents per year, the pushback would be enormous. Instead, PJM (and Transource) have moved the burden of new transmission lines into the APS zone (8.73% of project benefit) and Metropolitan Edison Co. zone (ZERO percent of project benefit). The APS zone will receive just 8% of the $622M benefit, but it will shoulder 100% of the project burden. In the case of MetEd, the people will shoulder 100% of project burden in exchange for... NO BENEFIT WHATSOEVER. So, when Transource says that everyone benefits, that's just not true. Some benefit more than others. And the ones receiving the lion's share of benefit from this project are people who have sacrificed absolutely nothing in exchange for saving a few pennies on their electric bill. As well, "generally speaking" providing new pathways for power exports from a constrained area serves to raise prices for the previously constrained area. If an area is flooded with cheap power that has no where else to go, competition is at work to keep prices at the lowest possible. Once the area is no longer constrained, the area must now compete for pricing with new areas where power is more expensive. If a generator can sell its power at double the price in Baltimore, it has no incentive to compete with other suppliers to keep prices low in the previously constrained area. Instead, power prices in the previously constrained area will rise, becoming competitive with prices in Baltimore. Market efficiency transmission projects perform a leveling of prices across certain regions between source (generation) and sink (power users). Transource forgot to tell you this, as well. Baltimore, Northern Virginia and Washington, DC, will receive more than 80% of the power savings from this project. Transource has lied through omission. Hmm... maybe it is a verb after all.  I keep hoping that Clean Line Energy Partners will invest in some media training for "director of development" Mark Lawlor. When this guy gets stressed out by reporters he says the dumbest things! When interviewed recently about the Illinois Supreme Court's opinion that Clean Line's RICL project is not a public utility, and how that might impact the Grain Belt Express project, Lawlor said: “Anytime you have legal clouds pending, you’re not going to spend a lot of time with that uncertainty,” said Lawlor. “We’ll see how the decisions play out before we put a lot of people to work building the project.” Legal clouds? A decision by the Illinois Supreme Court is just a "legal cloud" that could blow away any day now? Not hardly. But more interesting is Lawlor's admission that he's "not going to spend a lot of time with that uncertainty." Wack-a-mole, Waldo? No matter how many moles you whack, more are going to pop up somewhere else, you know... sort of like I've been telling you for years. So why bother spending all that money on an appeal in Missouri (not to mention your very expensive political spokespuppet, Jay Nixon), when Illinois has determined your projects cannot be public utilities until sometime down the road after they're built? Because this finally gets pretty close to the truth... it's not about simply purchasing some land. It's about Clean Line not being able to use eminent domain to condemn land for its projects in Illinois. Without eminent domain, Clean Line would have to negotiate with each and every landowner to purchase right of way. No sweat, Clean Line has been telling the public that it wasn't applying for eminent domain for years and that it planned to negotiate fairly with each and every landowner to secure right of way. So, what happens now when Clean Line has to actually do it? It's legal clouds, uncertainty, and doom and gloom for the project. That's because Clean Line wasn't being honest about eminent domain all along... what Clean Line meant was that it wanted to negotiate fairly with each and every landowners to secure right of way, but only when it was holding the sledgehammer of eminent domain behind its back. That's not fair negotiation. That's coercion. Now all of a sudden, when the sledgehammer isn't a tool, Clean Line can't negotiate at all. Clean Line only wanted to pretend to negotiate, but what it really wanted to do was threaten landowners with eminent domain condemnation if they didn't agree with Clean Line's terms and price. The Court called this one spot on! So, let's look at the last stupid thing Lawlor said...“We’ll see how the decisions play out before we put a lot of people to work building the project.” What? You were ready to "put a lot of people to work building the project" before the Illinois Supreme Court ruled? How were people going to build the Grain Belt Express without state approvals from all affected states? How were people going to build the Grain Belt Express without rights of way across the route? Without contracts? Without financing? Without money? Without customers? Sounds like you were ready to put people to work in the same way you were willing to negotiate fairly with landowners. As in... not at all. What a thoughtless and stupid thing to say! Lawlor also whines about Illinois by saying the same stupid things he said about Missouri: The ruling, Clean Line director of development Mark Lawlor said last week, would discourage renewable energy development in Illinois. Hey, guess what? Other developers aren't buying your cries of "wolf, wolf, wooooolffffff!" If no "clean lines" are ever built in Illinois, it will not affect the development of renewable energy in Illinois, because none of the Clean Line projects were ever proposed to move renewable energy produced in Illinois. No, they were just one way highways through the state for energy produced in other states, with no on or off ramps for local use. And people care even less about your investors and their signals. These filthy rich, silver spoon brats invested in your company with their eyes wide open, and besides, they'll hardly miss the millions they're going to be out when Clean Line folds. They'll probably just write it off their taxes and push the tax burden off onto working class taxpayers anyhow.
It's probably only a matter of time before the investors buy Mark his own wind farm, like they did for RICL's former development director, Hans Detweiler. Buh-bye! Rock Island Clean Line is dead. Grain Belt Express is dead. No, that's not a riddle. Maryland really is suing neighboring "upwind" states who foul its air with their fossil fuel burning electric generators. According to The Baltimore Sun: The lawsuit seeks to require 36 generating units at 19 plants in upwind states to install the same scrubbers and other air-cleaning technology that Maryland requires plants within its borders to install. Maryland produces little of the electric energy it consumes. How little? Maryland's electricity consumption exceeds its net generation. Almost half of the power consumed in the state comes from the PJM Interconnection, the Mid-Atlantic regional electricity transmission grid. ...according to the U.S. Energy Administration. Maryland is an energy leech, sucking "dirty" fossil fuel electricity from neighboring states. And now Maryland is suing those states to demand they clean up their cheap, dirty generators.
Also in the works is the Independence Energy Connection, a set of new transmission lines intended to funnel more dirty Pennsylvania electricity to Maryland. Grid planner PJM Interconnection says that the project will produce lower electric costs for Marylanders, especially in the Baltimore metro area. But what if Maryland's lawsuit is successful and those cheap and dirty Pennsylvania generators PJM is counting on are required by court order to install new scrubbers and air cleaners? The cost of that equipment is going to increase the cost to produce that dirty power to be shipped to Maryland by IEC in the future. I'm going to make a wild guess here that the increased cost of power produced in Pennsylvania is going to change the projected economics of the IEC significantly, negating any benefit at all. No benefits, no need to construct IEC. Maryland has also recently outlawed shale gas fracking. Maryland doesn't want to compromise its own environment to produce cheap shale gas, but yet it has no problem helping itself to cheap shale gas electricity produced in the fracking state of Pennsylvania. Maryland, you're a big, fat hypocrite. How about you stop depending on dirty fossil fuel generators in other states and step up to produce your own clean electricity? You've got an ocean of offshore wind opportunities just off your shore. Offshore wind is so clean it produces no emissions at all. Start walking your talk, Maryland! But wait, clean electricity is more expensive! And Maryland doesn't want to pay more for electricity. It wants to pay less by supporting the construction of new transmission lines from dirty Pennsylvania generators. You can't have both, Maryland. What's it going to be? Cheap electricity? Or clean air? Or you could just shut off the lights. Rick Perry's Notice of Proposed Rulemaking... oh, the opportunities for blog fodder. One more post before I stop (for now). So, Rick Perry thinks that we need to stop the untimely retirement of baseload generation resources, namely coal and nuclear in order to preserve "resiliency." He could start in his own backyard. The DOE's "participation" in the Plains & Eastern Clean Line project is supposed to facilitate the development of renewable energy (and therefore the closing of coal-fired generators it would displace), and the DOE's Record of Decision supporting participation in the Plains & Eastern project used this justification for its decision to support the project. The already-strong demand for imports of low-cost wind energy into the mid-South and Southeast would likely increase if and when states in the region are subject to regulations limiting greenhouse gas emissions from power plants. EPA’s Clean Power Plan, published in October 2015 and scheduled to mandate compliance beginning in 2022, aims to “continue progress already underway in the U.S. to reduce CO2 emissions from the utility power sector” and is part of a suite of air quality improvements sought by other national environmental regulations. These improvements could be accomplished through retrofitting of older generation plants, plant retirements, and an increasing reliance on local or imported low-carbon generation including renewables. The Department’s Energy Information Administration (EIA) estimates that the Clean Power Plan would result in strong growth in renewable generation, particularly in regions currently lacking robust renewable portfolio standards such as the Southeast. Implementation of the Clean Power Plan would also shift the regional fuel mix away from baseload capacity with on-site fuel supplies (such as coal, nuclear, hydroelectricity, and oil) towards capacity that tends to utilize real-time fuel delivery (wind, solar, and natural gas). Overall, wind generation is projected to play a major role and become increasingly economically competitive. Although the EIA’s analysis did not look at the degree to which such a fuel mix would be imported to the Southeast or conduct a detailed model of the transmission system, it did find that “[c]ompliance with the proposed rule could necessitate significant investment in electric transmission system infrastructure to integrate renewables from remote areas.” The Clean Power Plan is dead, smothered under its own hubris. But yet DOE is still puttering merrily down the road supporting the Clean Power Plan through legacy "decisions" made by the previous administration to participate in an impossible transmission project with no customers intended to facilitate renewable competition for baseload generators in the Southeast. In fact, the DOE was so hung up on facilitating the development of renewable energy, that it illegally added that extra-statutory factor to its RFP for Sec. 1222 projects, and used it a basis for its decision to "participate" in the project. To be sure, wind power delivered by the Project will compete with other sources of renewable energy in markets in the mid-South and Southeast. But such competition is healthy, and ultimately benefits consumers and the renewable energy sector as a whole. Indeed, new transmission links such as the Project create value through their ability to foster healthy competition among generators. As the Commission has observed: “New interconnections and transmission service generally meet the public interest by increasing power supply options and improving competition.” The Commission has also explained that “as a general matter, the availability of transmission service enhances competition in power markets by increasing power supply options of buyers and sales options of sellers, [resulting in] lower costs to consumers.” Right.... healthy competition, but renewables wouldn't be the only competitors. Baseload generation would also be competing against imported renewables, and perhaps that sort of competition could cause the closure of baseload resources in the Southeast.
In addition, DOE's Environmental Impact Statement gushed on and on about the tons of carbon a Clean Line would save from entering the atmosphere. I don't have the time and patience to dig that up, so you'll have to accept my paraphrasing here. A "clean" line couldn't remove carbon from the atmosphere by itself, therefore it could only accomplish this through displacement of existing generators that produce carbon. Therefore, Clean Line is intended as a vehicle to close existing baseload generators that produce carbon. So, get with the program, Rick! Instead of trying to put your thumb on the scale at FERC, why not start a little closer to home by extricating the DOE from its "participation" in the Plains & Eastern Clean Line? It would probably be a whole lot easier to change policy in your own department than it would be to demand an independent regulatory agency act as your minion on some impossible time line. Clean up DOE's own backyard first!  What happens when a company plants too many greed seeds and they all ripen at the same time? Dilemma! FirstEnergy has been experiencing a serious issue with low market prices in PJM making its merchant coal-fired generators unprofitable over the past few years. FirstEnergy's merchant generation company is in serious trouble, with the word "bankruptcy" being mentioned more than once. These generators operate on a market basis -- that the cost to produce power (plus a profit) is recovered in the sales they make. If it costs more to produce power than can be recovered through sales, then these generators create a loss, not a profit. Instead of simply selling these money-losers at a loss and shedding the liability though, FirstEnergy got greedy and has tried to turn them into a profit for the company. FirstEnergy has been busy trying to stash these plants into its affiliates' regulated rate base in fully regulated states like West Virginia. Once successful, the plant can earn "cost of service" rates at the state level, where FirstEnergy is fully compensated for the cost of operating the plant, plus a regulated profit, by captive ratepayers. Any excess generation produced not needed by affiliate load is sold in the unprofitable regional energy market. And affiliates don't need the generation from these plants when they can purchase cheap power in regional markets instead. Any loss from selling excess power at rates that don't cover the cost to produce it are covered by the affiliates' captive ratepayers. Such a scheme! Why it's positively brilliant to generate a profit from an asset that has been producing a loss! And so that's what FirstEnergy did. It sold its money-losing Harrison Power Station to Mon Power and Potomac Edison, which has produced a $160M loss to ratepayers in just a few short years. And it is currently deep into the process of selling its Pleasants Power Station to Mon Power and Potomac Edison as well, which will produce additional losses for ratepayers in the future. But then what happens if the energy markets recover and coal-fired plants are once again made profitable through new revenue streams meant to compensate them for "resilience" and other currently uncompensated benefits provided by baseload generators with on-site fuel supplies? Will new market rules make merchant generators profitable again? Will FirstEnergy suddenly want to own merchant baseload plants again? And, more importantly, will Mon Power and Potomac Edison suddenly want to "sell" these formerly merchant plants back to its merchant generation affiliate because they make more money as merchants than they can in a state regulated system? What's a greedy company to do? FirstEnergy, along with other merchant generators, has been pumping the political well for years trying to find some mechanism to make merchant plants profitable again by raising market prices. When that didn't happen quickly enough, FirstEnergy charted a course to dump its unprofitable merchant generators in the state regulated system. But suddenly, the political seed has sprouted! Last week, Secretary of Energy Rick Perry lobbed a curve ball at FirstEnergy. Perry issued a Notice of Proposed Rulemaking at FERC that requires: Each Commission-approved independent system operator or regional transmission organization shall establish a tariff that provides a just and reasonable rate for the (A) purchase of electric energy from an eligible reliability and resiliency resource and (B) recovery of costs and a return on equity for such resource dispatched during grid operations. The just and reasonable rate shall include pricing to ensure that each eligible resource is fully compensated for the benefits and services it provides to grid operations, including reliability, resiliency, and on-site fuel assurance, and that each eligible resource recovers its fully allocated costs and a fair return on equity. The Rulemaking also defined just which resources would not be subject to the new rule, such as those generators "subject to cost of service rate regulation by any state or local regulatory authority."
So, if FirstEnergy is successful in "selling" Pleasants to state regulated Mon Power and Potomac Edison, it cannot take advantage of any new rule to make its merchant plants profitable again. FirstEnergy must now consider a gamble. Will the new rule happen, and if it does, will it make Pleasants more profitable than it might be in the state regulated system? Or should it continue on with its plans to sell Pleasants into the state regulated system and possibly lose future profits? Or might FirstEnergy have the best of both worlds by selling Pleasants into the state regulated system now, with the intent of buying it back at a later date if the new rule happens and it proves more profitable to operate the plant as a merchant generator? After all, the West Virginia Public Service Commission is just a patsy, standing by to assist while FirstEnergy buys and sells generators into and out of the state regulated system in order to squeak the most profit out of them. Will West Virginia ratepayers be left holding the bag on FirstEnergy's losses from Pleasants forever more, unable to take advantage of any new rule? Or will FirstEnergy change its mind and decide to gamble that Pleasants will once again be profitable for them under any new rule and withdraw its request to sell Pleasants to Mon Power and Potomac Edison? Or will the WV PSC actually grow a set and deny FirstEnergy's request to sell Pleasants, forcing the company to rely on other new alternatives to bail itself out of bankruptcy, such as new rules? There's an inferno of opposition to Clean Line Energy Partners burning across the Midwest. And Clean Line is running out of resources to fight them all. Several fires are currently burning out of control. For instance, the bonfire currently alight in Missouri as Clean Line struggles to find some way forward for its Grain Belt Express project in the wake of its third rejection by the Missouri Public Service Commission. Maybe Clean Line thought it would be easy to appeal through the court system, or through legislative change. But this is only being met with increased resistance from Missourians and the making of new enemies. Missourians are not looking favorably on Clean Line's new plans to usurp local authority and manipulate Missouri's legal system for its own benefit. While the fires of opposition burn out of control, getting larger and more widespread, Clean Line tries to control the fire with ridiculous propaganda from out-of-state interests. Like this opinion piece from some yahoo named Brydon Ross of the Consumer Energy Alliance. The Consumer Energy Alliance is a well-known front for the energy industry. The CEA pretends to represent consumer interests, but the reality is that they're just a hired mouthpiece for company talking points. Just last year, CEA was described like this: The Consumer Energy Alliance, which you may know from greatest hits like “submitting a petition full of fake names” and “writing letters to federal agencies signed by people who have been dead for 18 years” is at it again. Why would Missourians be convinced by anything the CEA manufactures? If you even take the time to read this propaganda, you'll notice how the CEA guy completely skates over the real issue and creates an issue that doesn't exist. Then he demands that Missourians "show the world" that they are easily manipulated to "fix this problem" that doesn't exist in order to benefit the CEA's client. And then there's this opinion piece from Tom Kiernan, CEO of the American Wind Energy Association. Kiernan also glosses over the real issue to "return the power to approve transmission lines" to the PSC. Nobody removed power from the PSC. The county governments in Missouri have had the authority to grant assent to transmission projects for 100 years. That's the way it works! It's the law! Nothing changed. The only change here is proposed by Clean Line, who wants to take that authority away from counties, instead of aligning its plans with local government priorities to create a project that the counties can approve. Kiernan also wants Missourians to "fix" something that's not broken for the benefit of its member company, Clean Line Energy Partners. Neither of these polished PR pieces put Missouri first. But in between Clean Line setting this propaganda in motion and finally getting it published, another inferno flared up in Illinois, when the Supreme Court determined that Clean Line's Rock Island project is not a public utility. If RICL isn't a public utility in the state, neither is GBE. So here's Clean Line dumping buckets of money into a PR campaign in Missouri, when another state negates any progress that can be made on GBE. Looks like GBE's efforts in Missouri are wasted. And the snazzy propaganda campaign isn't all. GBE also hired former governor Jay Nixon to lead their appeal of the MO PSC's denial. I'm pretty sure that cost a bunch, considering Nixon appears to have gotten Grain Belt confused with Green Backs on his appeal.  I'm sure it's just a minor Freudian slip. Nothing to see here, folks, let's move on.
And remember, when in office, Governor Nixon "negotiated" with Clean Line to secure "important landowner protections" for Missourians. Since Nixon is now raking in the bucks representing GBE's interests on appeal, I do wonder how hard he really "negotiated" for the best interests of Missourians. I'm thinking that maybe that whole "landowner protections" package was pure propaganda for benefit of his future employer, Clean Line Energy Partners. And what would Clean Line "win" on appeal in Missouri if its project is denied in Illinois? Clean Line is regressing, not progressing. I guess Clean Line has money to burn. After all, it's not their money. It belongs to their deep pocketed investors. Don't you wish these investors would do something constructive and beneficial with the hundreds of millions of dollars they've dropped down the Clean Line sewer? Like humanitarian aid. Or energy efficiency. Or local clean energy. Or anything other than arrogant greed. I've often compared Clean Line Energy Partner's transmission permitting odyssey to a game of Whack-a-Mole. Clean Line, you lose.  Yesterday the Illinois Supreme Court issued a long-awaited decision upholding an appellate court opinion that the Rock Island Clean Line shell company is not a public utility. Clean Line is done in Illinois. That means Grain Belt Express, too. And it's not just a matter of exercising an option to purchase a site for a converter station. Only somebody who didn't read the entire opinion would say something that stupid. The Court simply declined to dig any further beyond the issue of the statutory requirement for a public utility to own utility property that is currently in use as a utility. Simply buying a piece of property that it may, in the future, use to construct utility infrastructure, isn't going to cut it. The Court said that Clean Line is free to construct its project without a permit and without eminent domain authority, and then apply again for public utility status from the ICC. Nothing in the Public Utilities Act prohibits new entrants such as Rock Island from commencing development of transmission lines immediately as a purely private project. So long as they do not transact business as a public utility, they will not be subject to the Public Utilities Act and will not require Commission authority to proceed. Once their projects are further underway and they have obtained the ownership, management, or control of utility-related property or equipment required to qualify as public utilities, they may then seek certification to operate as public utilities if they wish to conduct their business in a way that would make them subject to the Public Utilities Act’s regulatory framework. This is one mole that cannot stay whacked. Clean Line's only option in Illinois is to construct its projects without the use of eminent domain. Clean Line likes to pretend it will "negotiate" with landowners to reach an agreement to obtain an easement voluntarily. But eminent domain is a public utility sledgehammer, and Clean Line is not a public utility.
Give up, Clean Line. You are done for. Run out of Mayberry on a rail. There is no way forward. Hello, bankruptcy. Goodbye, Clean Line. The St. Joseph News-Press published an editorial today stating: Officials with Clean Line Energy Partners are complaining about Missouri and its set of laws, as if the company didn’t know what it was getting into when it proposed stringing a high-voltage power line across the state. The editorial went on to say: ...the problem is Clean Line has not yet done enough to allay concerns of key decision-makers — in this case, county commissioners who by law have a big say in this matter. And concluded with this: Our preference is for Clean Line to continue to negotiate with the counties where it has met opposition. Short of that, both opponents and Clean Line should expect to be governed by the web of laws and regulations — both state and federal — that govern these matters. Clean Line's insistence that Missouri law must be changed to accommodate its desire to be above the law and build its project without county assent doesn't seem very popular with Missourians. And it's not just project opponents anymore. It's now the editorial board of a large newspaper, too. The sheer arrogance of these out-of-state interlopers will be their undoing. The News-Press must realize that the only thing standing between Clean Line and its success is... well... Clean Line! During recent oral argument before the Missouri PSC, Clean Line begged the PSC to issue an advisory opinion on the merits of the project, even if the PSC denied the project. Clean Line's attorney told the PSC that it needed that advisory opinion to take to the counties in order to convince them to assent to the project. CHAIRMAN HALL: Yes, I have a few. I want to start with your alternative argument that But Clean Line has used the PSC's "concurrence" on the project's merits for everything BUT going to the county commissions. The county commissions haven't heard a peep out of Clean Line in months. Now Clean Line and its environmental friends from the big cities want to use it to change Missouri law for their own benefit. And the people of Missouri perhaps think that's a step too far for a bunch of interlopers who want to use Missouri land and resources for their own gain. Clean Line is financed by deep pocketed investors from New York, Texas and the United Kingdom. None of these investors live or work anywhere near Missouri and won't have to suffer the consequences of their own actions. These investors have knowingly funneled around $200M into a very risky investment in Clean Line Energy Partners. When Clean Line goes belly up, these investors lose their entire investment in the company. I'll assume these sophisticated investors went into this transaction with their eyes wide open, so they must not have invested more than they could stand to lose. They'll probably hardly feel it. On the other hand, the damage to Missouri would now not only be a scar on its landscape and an obstacle to its productivity, but a long-lasting surrender of its authority through legislative change. I don't think Missouri is going to lay down willingly, and instead of winning the state's cooperation, Clean Line has obliviously lit a fire in Missouri's belly. Perhaps Clean Line's executives don't really care if they ever build a project or not. Perhaps their only interest at this point is to continue their own personal gravy trains as long as possible, even though they realize this train is headed for a gorge where the bridge is out. As long as the investors keep handing them cash to engage in hopeless battles, like trying to get Missouri to legislate away its own authority, the executives continue to live high on the hog. That could be the only explanation for why Clean Line even wants to engage in Missouri when the fate of this project is currently in the hands of the Illinois Court system. Did you listen to the oral arguments at the Fifth District Court of Appeals on the Illinois Commerce Commission's grant of a permit to Grain Belt Express under the wrong statute of Illinois law? If you haven't, you should. Based on questions from the justices, it isn't looking too swell for Clean Line, although the Court has yet to issue its opinion in this case. The opinion can come at any time. As well, did you watch to the oral arguments before the Illinois Supreme Court on whether the Rock Island Clean Line can ever be considered a public utility? That didn't go so well for Clean Line either. An opinion could be issued at any time. And, if RICL isn't a utility under Illinois law, then neither is GBE. The Court's opinion can yank the rug right out from under both Clean Line's Illinois projects at any time. And speaking of the Rock Island Clean Line, did you know that the Iowa Legislature legislated it's ability to use eminent domain out of existence during its last session? May 12, 2017 And then let's take a peek at Clean Line's Plains & Eastern Clean Line that wasted more than $15M getting the U.S. DOE to "participate" in its project in order to usurp the laws of Arkansas. Despite DOE's decision to "participate" in this project 18 months ago, it's no closer to actually being built. In addition to being the subject of a lawsuit in federal court, Plains & Eastern has no customers to finance the project. No revenue, no project. Plains & Eastern is stalled out, making no progress whatsoever.
Honestly, I don't think Clean Line Energy Partners is ever going to accomplish anything, except to spend its investors' money tilting at windmills and engaging in hopeless and increasingly expensive battles at the state and federal level. How much longer must the party in Houston go on? FirstEnergy's dog showed up to listen to the local ponies whinny and chomp at the bit last night in Martinsburg. It was all so predictable. How many times have we done this in recent memory?
Utility proposes some scheme that will increase its profits. Regulators schedule the required public hearings and maybe one will show up in your locale. The regulator sits at the front of the room and "listens" to the public comments while trying not to look bored. Earnest public ponies put forth time and effort to attend and speak from the heart, hoping they can say something that gets through to the regulator. A court reporter transcribes the comments into a written record that can be read by the other commissioners, or perhaps used as evidence when a decision is issued. I seriously doubt that anyone at the WV PSC even reads the public hearing record, and I've never once seen anything from a West Virginia public hearing used as the basis for any decision. Why? Because the WV PSC is the utility's dog, captive and controlled like any good pet on a leash. The WV PSC is a captured, reactive regulator who prefers to follow a utility's lead to set policy. The WV PSC isn't a leader, it's a follower. Without a clear vision of its own regarding how utility policy should work in the best interests of the state, the WV PSC allows utilities to chart our course by merely reacting to utility proposals. While other regulators have clear policy goals and demonstrate leadership to utilities by setting the standards that shape utility proposals, West Virginia prefers to let utilities shape the regulatory landscape. It shouldn't come as any surprise, considering WV's regulatory leadership. C'mon, the WV PSC is lead by a former utility lawyer who took direction from utilities for his entire career. Why would anyone think he'd become a utility leader when sliding through the revolving door from regulated to regulator? The WV PSC believes its mission is to "balance the interests of all parties." It shouldn't be. As a fully regulated state, the WV PSC should be a utility leader. Regulation is the price utilities pay for the privilege of operating a monopoly for a necessary public service. Regulation is supposed to serve as a substitute for competition where none exists. If a utility cannot perform in the public interest, then it should lose its franchise privilege, allowing others to compete for the privilege of serving the captive customer base. Instead, the WV PSC behaves as if we must keep the utility happy and healthy, and puts the utility's interests first in any proposal before them. The captive customers the PSC is supposed to protect become nothing more than chattel, used to support utility profits. The WV PSC doesn't care what the customers want, nor what is truly best for the customers. The WV PSC has become completely detached from the public interest, only serving political interests that the utility purchases. Commissioner Brooks McCabe presided over last night's public hearing in Martinsburg, looking like a brave little puppy, absorbing public scorn over FirstEnergy's proposal to sell a failing asset into West Virginia's regulated system in order to bail out the company. He began the meeting reading a description of the case and giving an overview of the proceedings thus far. He mentioned over 900 comments in opposition to the proposal, balanced by something like 35 comments in support. The audience laughed. If it were all about balancing the interests of all parties, this case would be over. The few brave souls who made comments in support of FirstEnergy's proposal were all motivated by money, whether it was as a contractor whose income depended upon future operation of a failing power plant, or some political creature dependent on campaign contributions and quid pro quo. And then there were the unions, rightfully concerned about the future of the plant employees, however misguided they were in where funding for power plant jobs would come from in the future. FirstEnergy has owned and operated Pleasants as a source of profit. The hardworking men and women who have kept this financial asset of FirstEnergy performing for many years have done an admirable job. FirstEnergy owes them a huge debt for their faithful service. But FirstEnergy doesn't care about them, FirstEnergy only cares about profits, and Pleasants is no longer profitable. FirstEnergy owes its workers a soft landing and transition into other jobs of equal pay and responsibility. But FirstEnergy wasn't squirreling away a tiny portion of its profits over the years into a soft landing fund for benefit of its workers. FirstEnergy spent every last penny of the profit these workers created on other important things, like naming rights to a football stadium, or a corporate jet and tax planning services for its over-compensated executives. Now that Pleasants is no longer profitable, FirstEnergy and the PSC believe captive ratepayers should pick up the burden of supporting Pleasants employees and the economic contribution it makes to its community. But the ratepayers never shared in the profits from the plant when times were good, it is only after the profits evaporate that FirstEnergy wants to pass the cost burden onto captive ratepayers. There's no "balance" here either. A regulator who was a true utility leader might put an end to ratepayer-financed corporate welfare. It would make the utility responsible for the failure of its asset, including the economic impact to its workers and the surrounding community. A true utility leader would chart a clear course for a solid energy future in the public interest for our state, and require franchised utilities to adhere to it or forfeit their franchise privilege. But we don't have a true utility leader. We have a corrupted and captive utility follower. Thankfully, there are stronger, smarter, policy leaders in other regulatory venues who also have authority over FirstEnergy's proposal, because the WV PSC is a lost cause. Neigh. |
About the Author Keryn Newman blogs here at StopPATH WV about energy issues, transmission policy, misguided regulation, our greedy energy companies and their corporate spin.
In 2008, AEP & Allegheny Energy's PATH joint venture used their transmission line routing etch-a-sketch to draw a 765kV line across the street from her house. Oooops! And the rest is history. About
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