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U.S. DOE Spends Billions of Your Tax Dollars Carrying Water for Big Business

7/6/2016

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Mainstream media reports that the U.S. Department of Energy has paid out $5B in legal claims to the energy industry in the last decade.
...the DOE is among the most prominent defendants requiring payment from the Judgment Fund, which pays for claims against the government. The department paid out more in legal claims than any other agency last year and the year before, according to the fund's records — more than $5 billion over the last decade.

And according to the department itself, the bloodletting as far from over. The DOE has failed to make good on some of its most important contractual obligations for years, and its private partners have been collecting billions in damages.
And where does the DOE's billions come from?  Your pocket, little taxpayer, your pocket.

So, how did the DOE get you into this predicament?
The Nuclear Waste Policy Act of 1982 requires that the DOE dispose of nuclear waste being produced at civilian energy plants around the country, which in turn pay fees for a long-term storage facility. The department's contracts with dozens of energy companies said it would start disposing of the waste in 1998.

The companies held up their end, feeding about $750 million into the Nuclear Waste Fund each year. But the department did not manage to set up any facility to receive the waste, forcing energy companies to store it themselves on-site.
Why was the DOE carrying the nuclear industry's water to set up a facility for nuclear waste?  Is it because the nuclear industry hasn't made enough money from consumers over the years to dispose of its own waste?  Or is it because the nuclear industry can't be trusted to properly dispose of its own waste safely?  After all, look at what the coal-fired power industry has done with its waste and how many times that has turned into disaster.  No, it's because
The hang-up has been in finding a location for the centralized storage facility. For decades, Yucca Mountain in Nevada was the only location that could legally be considered, despite fierce opposition from state and local groups. The Obama administration eventually abandoned the site as "unworkable" in 2011.
Who wants a nuclear waste dump in their neighborhood?  Nobody.  So the DOE was tasked to carry the industry's water by using its federal power to force a dump on an unlucky community.

Sound familiar to any of you regular blog readers?  That's exactly what the DOE is doing "partnering" with filthy rich investors to dump a humongous electric transmission line across Midwestern states that receive no benefit from it.  When the affected states said "no," DOE hefted the industry's water and ran with it to forcefully dump the project on communities fiercely opposed.

Why?  Because the U.S. DOE is a politically influenced entity run by a political appointee.  And political agencies are controlled by lobbyists for industry.  DOE has no business trying to regulate the energy industry in the public interest.  It's not about what's best for consumers and citizens, it's about bought and paid for political influence.

But here they are, trying "to transform America's electrical grid to handle much larger quantities of renewable energy" at a taxpayer cost of $220M.  DOE is not a grid planner, it's a political water carrier and there's buckets of money to be made building renewable energy generators and a special, separate electrical grid to serve them.  But only if the DOE uses federal muscle to force it to happen.

How does DOE square this
How will a grid that provides a two-way street to carry and store more renewable energy help resolve this situation? DOE's Hannegan responds with a sports analogy. On a mesh-like grid, the problem, whether it is a computer hacker, a big forest fire or a battery failure, is a threat that can be quickly isolated, allowing the rest of the surrounding grid to operate normally using better controls and quickly dispatched stored electricity.
with "partnering" on a 750-mile DC transmission line that requires obscenely expensive converter stations to connect into the existing grid?  Because the converters are so expensive there are very few of them.  It can't "allow the rest of the surrounding grid" to operate normally and recover.  Because it's not connected to the grid that surrounds it.  It's an entirely separate grid, only connected at a few points.  The surrounding grid continues to operate normally without any help from the DC line bypassing it.  And if this DC transmission line "closes coal-fired power plants" like the Sierra Club idiots believe, the surrounding grid cannot recover.

The "two-way energy street mesh-like grid" of the future is dependent upon many small, local energy sources that can back each other up to "allow the rest of the surrounding grid to operate normally" when trouble happens.  That's distributed generation, the complete opposite of centralized generation and long distance transmission.  When there's no energy source in your community and a major, imported, centralized generation source fails, there's nothing there to pick up the slack.

DOE needs to quit carrying the industry's water.  We can't afford it anymore.
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When It Is About The Eminent Domain

7/2/2016

9 Comments

 
Clean Line Grain Belt Express spokesman Mark Lawlor, when discussing his company's recent re-application to the Missouri Public Service Commission, told KMBZ:
Lawlor says this "isn't about eminent domain," which is one of the worries of many who live along the proposed route.  

"We will sit down with every single landowner and negotiate with them on the unique nature of their property. In fact we've been doing that for a couple years now."
If that were true, then there would be no need for eminent domain authority. 

Except the application GBE filed on Thursday stated:
What happens if a landowner doesn’t want to negotiate with Grain Belt Express?

The Company is allowing sufficient time for negotiations with each individual landowner along the route. Grain Belt Express is committed to conducting easement negotiations in a manner that respects the private property rights of landowners and achieves a voluntary easement acquisition. The Company is also committed to working with landowners to minimize the impacts of the Project upon their property. In order to ensure that infrastructure projects in the public interest can be completed, the entities building them need the right to condemn certain easements, particularly in cases of parcels that have title issues, parcels with missing or unlocatable landowners or heirs, or parcels where landowners refuse all reasonable attempts at contact or negotiation. Grain Belt Express views the use of eminent domain as a last resort that is appropriate only after exhausting all reasonable attempts at voluntary easement acquisition and title curative work. In all cases, landowners are entitled to due process and payment of fair market value for any easement acquired, and will retain ownership of their land.


So, no matter how many "landowner protections" Clean Line pretends to dream up, there's only one landowner protection that actually protects the landowner.

THE RIGHT TO SAY NO.

And IT IS ABOUT THE EMINENT DOMAIN to the landowners.

In fact, the eminent domain is at the heart of the opposition to this project.

Without eminent domain, Clean Line would have to:
...sit down with every single landowner and negotiate with them on the unique nature of their property.
But Clean Line doesn't even want to attempt that without having the right to condemn to use as leverage.

None of Clean Line's "landowner protections" will protect you.
9 Comments

Can You Trust the Government, Missouri?

6/30/2016

7 Comments

 
Missouri Governor Jay Nixon announced yesterday that he had negotiated "landowner protections" with a Texas-based company on behalf of Missourians affected by its for-profit transmission project.
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Except none of the affected landowners participated in the Governor's negotiations with the company.  In fact, the landowners were not consulted in any way.  Nor were they even notified about these "protections," except to read it in their morning newspapers.  You'd think that if the "protections" were for benefit of landowners, that they would reflect actual landowner concerns, right?

Something stinks here...

Governor Nixon's "protections" are nothing more than smoke and mirrors.  They don't protect you.  Let's take a look:
Specifically, Clean Line has agreed to:

Offer the option of binding arbitration to resolve any compensation disputes.

Establish a Missouri Agriculture Protocol. Clean Line will follow strict guidelines to avoid, minimize and mitigate any impacts to agricultural fields or activities. The Missouri Agriculture Protocol should implement utility best practices and establishes an Agriculture Inspector to monitor construction activities. The Agriculture Inspector has the power to immediately stop construction when best practices are not being followed or when contractors are in violation of any negotiated obligation with landowners.

Establishment of a fund to decommission the project when it is determined to be near the end of its useful life.

Have a local firm update land value assessments. In the event land values have decreased since the last assessment because of commodity prices or any other reason, the Grain Belt Express will honor the higher of the values. Also, compensation will not be reduced after an Order has been issued approving the project by the Missouri Public Service Commission.
Oh, binding arbitration?  What is that, exactly?  "If the arbitration is mandatory and binding, the parties waive their rights to access the courts and to have a judge or jury decide the case."  Binding arbitration is quicker.  Binding arbitration is cheaper.  Binding arbitration may be free from public scrutiny.  Binding arbitration is giving up your rights to have a similarly situated landowner determine your value in a public, appealable court proceeding.  Now who would have an interest in making eminent domain takings of hundreds of land parcels across Missouri quicker, cheaper and quieter?  It's not landowners.  It's Clean Line and Governor Nixon!  Protecting you?  Not so much.  These people must think you're really stupid.

As well, financial compensation may be the least of a landowner's worries when presented with an easement agreement written by Clean Line's lawyers.  Who's representing the landowner's interests in this situation?  Not Clean Line.  Not the arbitrator, he only wants to talk about land value.  It's up to the landowner to retain his own counsel to review any easement agreement.

Missouri Agriculture Protocol?  How many actual farmers were consulted to develop this "protocol," and why does the Missouri Farm Bureau still oppose the project if this "protocol" ameliorates agricultural concerns?  Buyer beware on this one!   Ya know the best way to avoid impacts to agricultural activities?  Don't build the project.

Establishment of a decommissioning fund?  How much will that be?  Since Clean Line has the idea that the scrap value of the project's physical components will be more than enough to pay for its decommissioning, this "fund" might contain nothing more than pocket change and a couple of gum wrappers.  Where's the guarantee?  Where's the oversight?  Where's the money?

Update land value assessments?  When was the last "land value assessment" performed, and where can landowners access this information?  Will landowners be able to access the information in the new assessment, or are they just supposed to take Clean Line's word for it?  A transmission company never reveals any professional assessment of what your land is worth before approaching you to sign an easement or purchase agreement.  That's because your property is represented by a range of values that comes from land sales data in your county or region.  It's all very generic and created by some company in another state that never visits your property.  Because it's a range of general value, the company will start by offering you the lowest amount in range.  As you negotiate, the offer will increase within the pre-designated range.  Get to the top of the range, and suddenly any offers need to be approved by supervisors and managers.  How IS a landowner supposed to know whether their "land value assessment" increased or decreased under Governor Nixon's "protections?"  Is he going to come to your house to help in the negotiations and "protect" you?  Of course not.

Compensation will not be reduced after approval?  Again, who is going to police that?  Are you just supposed to trust Clean Line to honor this, when their profits are directly tied to the amount of money they must pay for your easement?  This is another worthless "protection."

So, what is going on here?  Political gamesmanship.  Clean Line and the Governor have now turned this into a political process.  They hope that the Missouri Public Service Commission can be politically influenced to approve the project the second time around, since Clean Line's first attempt was rejected on its technical merits.

Public Service Commission decisions are supposed to "provide an efficient regulatory process that is responsive to all parties, and perform our duties ethically and professionally."  They are not supposed to be politically motivated.  Commissioners are supposed to be free from political influence so that they may make independent decisions based on the law.  They're supposed to be ethical.  They're supposed to have integrity.  Will the Commissioners be brave enough to remain true to their own personal code of ethics when making their decision, or will they fall before political pressure from lame duck Governor Nixon?  And what good is Nixon's political pressure, when he'll be long gone before any decision is made?  Be careful who you vote for, Missouri!  Your Governor is not protecting you.  In fact, he's giving your private property rights to an out-of-state company to use for their own profit.  With a leader like that, nobody's property in Missouri is safe.  It's all for sale to the highest bidder.
7 Comments

Martha Peine:  Artist or Retired Hippie?

6/28/2016

5 Comments

 
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Only a community of "artists and retired hippies" would laugh about being characterized as such in a news story.  I asked Martha which one she was last night, and she said she was a "wannabe" of both.

It must have been the retired hippie who became an activist for a town threatened by a transmission project that was later determined to be unnecessary.  But it was definitely the artist who negotiated a $4.2M transmission rate refund from "behemoth" energy company American Electric Power.

RTO Insider is running a story today that may be the finish line for Martha's media victory lap.

Against All Odds: Ratepayer Wins $4.2M Refund from AEP chronicles Martha as remarkable, and I'd have to agree.  She waded through hell and high water, and jumped every hurdle erected in her path, to right the wrongs in AEP's transmission rate filings.  And she persevered to victory.  She's one in more than 18 million... the only ratepayer in the Southwest Power Pool who took the time and invested the effort to challenge AEP's rates.

While RTO Insider's coverage may be the final story, it's not my favorite.  While attempting to wade into the technical weeds, the reporter got some things wrong (but, hey, at least Ali's name got spelled right this time!)

A story in a retired hippie and artist newspaper, The Eureka Springs Independent, did a great job with accurate coverage.  Local woman wins $4.2 million settlement for power users says Martha will now "relax into the Eureka Springs tempo for the time being."

Looking forward to joining her later this summer!  I'll bring my tie-dye duds and my sketch pad... and a case of Raging Bitch!

Congratulations, Martha, it's been a gift to meet you and call you friend.
5 Comments

Broadly Deficient Interventions

6/24/2016

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The dreaded BDI!

A gas company has created a new FERCenese* acronym (as if there aren't enough already!)

Gas companies Rio Grande LNG, LLC and Rio Bravo Pipeline Company, LLC, were so befuddled by environmental group nonsense that they filed an Answer and Oppositions to the Motions to Intervene [etc.] yesterday at FERC.

According to the companies, their docket has been plagued by numerous Broadly Deficient Interventions and they want the Commission to reject the identified motions to Intervene.
Motions to intervene, when granted, provide intervenors with certain additional rights beyond being heard by the Commission. In particular, an intervenor has the right to seek rehearing from the Commission and, in the event that an intervenor properly and timely files a Request for Rehearing that is ultimately denied by the Commission, such intervenor has the right to appeal through the Federal courts the denial of such request.
Thus, the granting or denial of intervenor status has important implications for the wouldbe intervenor, the Applicant, the Commission, the Commission’s processes, and
potentially the Federal court system and its processes.
The RG Developers recognize that the Commission takes a modern approach to
pleadings and emphasizes substance over form, often granting intervenor status to novice participants that do not fully comply with the letter of FERC’s regulations governing
interventions. The RG Developers generally endorse such an approach. However, over
the past year or more, there has been evidence of growing disrespect for the
Commission’s processes marked, not just by disruption outside of the Commission’s
Washington, DC headquarters, but also within the Commission’s meeting room while the
Commission is in session. Unlike entities seeking to intervene in good faith but who
inadvertently fail in their efforts to comply with the Commission’s rules, entities that
show absolutely no regard for the Commission’s rules do not deserve to be rewarded with intervenor status. The Commission has started taking deliberate steps to restore order to its own processes and preserve its ability to conduct its affairs and ensure those making a good faith effort to participate in an order fashion within the rules would not be prejudiced by actions of those who find it more convenient or effective to ignore the Commission’s rules.
In the Pre-filing docket (PF15-20) preceding the current, formal, application proceedings, the Commission also took innovative action to ensure stakeholders could be heard, while excluding disruptive elements. Specifically, those wishing to be heard (at the scoping meeting for this project and two other projects held in Port Isabel, TX on August 11, 2015) were required to present oral comments individually, in an orderly fashion, rather than speaking in front of everyone assembled at the scoping meeting in a manner that would have encouraged out-of-turn remarks from the crowd.
Now, the Commission is faced with another threat of disruption to its processes –
albeit via written filings. Specifically, the vast majority of the current submissions
purporting to be motions to intervene demonstrate an utter lack of a good faith effort to meet any of the Commission’s regulations setting forth the requirements for petitions to intervene...
That's right... the folks who brought you camping outside the FERC Commissioner's homes has now brought you BDI's.  From the filing, it looks like these pro se citizens were advised that intervening was a way to keep up to date on the proceedings by receiving a copy of all filings.  !!News Flash!!  If that's the only reason you're intervening, you can accomplish the same thing by subscribing to the particular FERC docket you're interested in.  It's free.  And doesn't come with any legal requirements or obligations.  And nobody can object to your subscription.

This is what happens when a bunch of layperson environmental group "leaders" end up with a bright idea they don't understand.  Intervention!  Everyone must intervene!  We have no idea what that really means, but it sounds like a good idea.  Let's do that!

Unfortunately, the Commission has rules for intervening:
Specifically, those requirements include:
1.  Any person filing a petition to intervene or notice of intervention shall state specifically whether he seeks formal hearing on the application.
2.   A motion must contain a clear and concise statement of (1) the facts and law which support the motion; and (2) the specific relief or ruling requested.
3.  A motion to intervene must state the position taken by the movant and the basis in fact and law for that position.
4.  A motion to intervene must also state the movant’s interest in sufficient factual detail to demonstrate that (i) the movant has a right to participate which is expressly conferred by statute or by Commission rule, order, or other action; (ii) the movant has or represents an interest which may be directly affected by the outcome of the proceeding, including any interest as a consumer, customer, competitor, or security holder; or (iii) movant’s participation is in the public interest.
5.  A filing must begin with a caption that sets forth the docket designation, title of the proceedings if a proceeding has been designated, a heading which describes the filing, and the name of the participant for whom the filing is made.
6.  Any filing with the Commission must be: (1) [t]ypewritten, printed, reproduced, or prepared using a computer or other word or data processing equipment; (2) [h]ave double-spaced lines with left margins not less than 11/2 inch wide, except that any tariff or rate filing may be single-spaced; (3) [h]ave indented and single-spaced any quotation that exceeds 50 words; and (4) [u]se not less than 10 point font.
7.  Any participant filing a document in a proceeding must serve a copy of the document on each person whose name is on the official service list, and any other person required to be served under Commission rule or order or
under law and a certificate of service must be attached to the document and have the proper language.

The Commission’s May 19, 2016 Notice of Application in the RG Developers’ Dockets expressly called attention to these  requirements stating:
[A]ny person wishing to obtain legal status by becoming a party to the proceedings for this project should, on or before the comment date stated below, file with the Federal Energy Regulatory Commission, 888 First Street, NE, Washington, DC 20426, a motion to intervene in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the NGA (18 CFR 157.10).

The Commission’s Notice went on to explicitly note: “A party … must mail a copy to the applicant and to every other party in the proceeding.”
But none of these petitions did that.  One even listed an "unincorporated association" with no cognizable existence!  (I do hope this gas company isn't going to fund any fake grassroots "citizens groups" to publicly support its project in the future, because that would be hypocritical).

The company supposes that these BDIs are just an opposition tactic to delay the proceedings.  Please, you give these folks too much credit!  It's just a bunch of ignorant monkeys throwing poop on the wall to see if any pieces stick.  These environmental groups are intending to selfishly disrupt the Commission's proceedings any way they can.  And if there's any intelligent thought at all, it's a hope that the Commission will further tighten its public participation policies to make it harder for folks who actually want to participate in a civil manner to do so.  Then the environmental groups will stage a public tantrum claiming that FERC doesn't allow them to participate (even though they have been directed to do so according to the rules at every opportunity).  These environmental whackos don't care if every citizen is prohibited from participating at FERC at all (such as forcing the monthly meetings to be closed to everyone).  They just want some attention.

Here's some attention:  An industry publication this morning headlined this story, "Keep Barbarians Off The Docket, LNG Project's Lawyers Tell FERC."

Barbarians.  There, are you guys happy now?  You're barbarians.  And rather rude.  And I think you may also be stupid.

Knock it off!  If you want to intervene, then fully and legally participate according to the rules.  If you just want to act like a monkey, go to the zoo.
*FERCenese  |ferk in knees| noun:  The incomprehensible, acronym-laden gibberish spoken at FERC that is hard for common folks to understand.  Origin:  Electric ratepayer Scott Thorsen, standing in a field in Illinois.
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Potomac Edison Says No One Was Harmed by its Failure to Read Electric Meters in Maryland

6/24/2016

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Wahhhhhhhh.

I could end this blog post there, but I won't.

In May, a Maryland PSC administrative law judge proposed ordering Potomac Edison to change its meter reading frequency to monthly and fined the company a piddly $25K.

That followed an earlier proposed order issued in April, in which the same ALJ said no harm, no foul, and did nothing to punish the company for its transgressions.  The Commission pulled that proposed order and said it was "inadvertently issued."  I guess the judge didn't check with his boss before filing it.  Therefore, the revised order was issued a month later.

Now Potomac Edison and the Maryland Office of People's Counsel are appealing that decision, and basing it on the illegality of the ALJ's sudden change of heart.  The OPC doesn't think monthly meter reading is a solution to a problem that has since solved itself, and that ratepayers shouldn't have to shoulder the financial burden of this company's despicable actions (or lack of action, as the case may be).

You can find all the above filings here.

I guess OPC has a point, why should ratepayers pay to fix Potomac Edison's failure?  That's what happened in West Virginia, where meters are now read every single month.  Buh-bye incorrect estimated bills and huge "catch-up" bills.  Hello wacky bill schedule!  Since a reading must be done before a bill is issued, bills are never issued and due on the same day each month.  This presents a problem for folks who are only paid monthly, such as social security recipients, where they may receive two bills due within the same pay period.

But the anger is nowhere near that displayed across three states in the wake of Allegheny Energy's merger with Ohio dimwits FirstEnergy.  Perhaps if Maryland's Staff and OPC had paid attention to the West Virginia proceeding several years ago, they'd know that the meter reading failure was directly tied to the company's post-merger actions.  FirstEnergy insisted that Allegheny Energy toss out its perfectly good bill estimation methods designed to mesh with its alternate month reading schedule.  It had been working in WV for 30 years.  Instead, FirstEnergy insisted Allegheny adopt its own estimation routine, which was designed for missed reads in a system based on monthly reads.  That's right, while it may have worked fine for FirstEnergy subsidiaries that read meters monthly, it did NOT work for Allegheny's bi-monthly read system.  Combine that with FirstEnergy's "reorganization" of Allegheny's meter reading department and switch to "contract" meter readers who are paid less and must use their own vehicles, instead of a company-maintained motor pool, and disaster ensued. 

Whose fault was this?  FirstEnergy's!!

Only because of the scrutiny received in West Virginia (and to a lesser extent in Maryland, since the MD PSC was quite effective in preventing the customers from being heard during the heat of the moment) did the company take action to fix their mess.  Because Maryland waited so long to actually DO anything, the problems are long since over.

Now Potomac Edison says their actions didn't actually hurt anyone in Maryland because there's nothing in the record.  And there's nothing in the record because the MD PSC cancelled the public hearing it initially scheduled on this matter.  Then shoved the case off to mediation for years.  Then held a hearing.  Then issued two orders FIVE YEARS after the damage was done.  Justice delayed is justice denied, in this instance.

Potomac Edison also whines about the measly $25K fine the ALJ imposed.  $25K probably wouldn't even pay for two seats in the FirstEnergy CEO's special "luxury suite" at FirstEnergy stadium.  And yet this company has the nerve to cry like a baby over $25K.

So, hot potato passes to the MD PSC Commissioners, who seem to be responsible for the amended proposed order, so we'll assume it's to their liking.  Who knows, maybe Chatty Chuck will invite the Commissioners to watch a game in his luxury suite!  Woo Hoo!
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Iowa Utilities Board Wants Clean Line To Get On With Things

6/24/2016

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In an Order issued yesterday, the Iowa Utilities Board set a scheduling conference and intervention date for Clean Line's applications for electric transmission franchises in 16 counties.  The IUB wants to discuss "the likely time requirements for this proceeding," and presumably set a procedural schedule.  The conference is scheduled for July 11.

The IUB explains its actions are the result of recent new law in Iowa that sets a strict time standard for merchant transmission applications.
On May 27, 2016, House File 2459 was signed into law, adding § 478.6A “Merchant line franchises – requirements – limitations” to the Iowa Code. This newly- enacted statute creates a new class of electric transmission lines, called “merchant lines,” and sets time limits for processing franchise petitions for merchant lines. Clean Line’s proposed electric transmission line is a merchant line as defined in the new statute. Going forward, all petitions for a franchise for a merchant line that involves the taking of property under eminent domain will be subject to § 478.6A, which establishes a three-year deadline for Board action on those petitions.  If that deadline is not met then the petition shall be rejected and the petitioner may not file a petition for the same or similar project within sixty months following the date of rejection.
Section 39 of House File 2459 sets out slightly different time requirements for merchant line petitions filed on or after November 1, 2014, that have not yet been approved by the Board as of May 27, 2016. The three-year approval period is not applicable to these petitions; instead, the Board must act on these petitions within two years. The Clean Line petitions fall into this classification and therefore a decision on these petitions must be issued by the Board no later than May 27, 2018.
The Board recognizes that such proceedings can take significant time to conduct.  Therefore, a schedule must be set.

Clean Line can no longer hold Iowa landowners hostage by refusing to move its applications forward.  The company has failed to complete its applications by submitting what is known as "Exhibit E" material.  Instead, Clean Line has repeatedly attempted to bifurcate the permitting process to avoid submitting Exhibit E.  Exhibit E is a package of materials particular to each property upon which the applicant expects to exercise eminent domain, if granted.  Because Clean Line has been so ridiculously ineffective in obtaining easements in Iowa, Exhibit E's will be required for up to 80 - 85% of properties crossed.

Clean Line has repeatedly whined that creating Exhibit E material is too time consuming and too expensive.  Its whining has fallen on deaf ears.  Now it's time to put up or shut up.  The clock is ticking.

Could this be the end of the Rock Island Clean Line project?  Check mate!
0 Comments

Can State Utility Commissions Be Free From Political Influence?

6/21/2016

1 Comment

 
Last week, outgoing FERC Commissioner Tony Clark said there is a "need to insulate state utility regulators from political pressure."

I agree.

But what's really interesting is that Clark actually said those words out loud.  If you were to ask any state regulatory commission whether their decisions were politically influenced, you'd most likely get a denial.

But how could their decisions NOT be politically influenced, when the Commissioners themselves are political appointees?  In the majority of states, regulatory commissioners are appointed by the Governor, or "elected" by the state's legislature.  In twelve states, regulatory commissioners are elected by the voters in a general election.  In all instances, politics loom large in a Commissioner stepping into the job, and,  more importantly, keeping that job for additional terms.

In West Virginia, appointments to the Public Service Commission are treated like political favors, and the Governor has been known to let Commissioners continue to sit for years after their appointment expires, without naming a successor.  In that instance, the Commissioner's day-to-day employment is subject to the whims of the Governor, who can appoint a successor at any time the sitting Commissioner displeases him.

Political influence over commission decisions is the norm, and utilities have become expert at shaping and using that political influence to get their projects approved.  Utilities spend big bucks to shape political dialogue, and buy the support of the right political influences, to smooth project approvals.

Baldly stated, a utility commission currently makes its decision to approve or deny a project based on politics.  It then picks and chooses evidence from the record that best supports its decision.  This is a complete reversal of how it's supposed to work:  The Commission should examine and weigh evidence to reach an impartial decision based on facts.  The evidentiary record is supposed to shape the decision, not the other way around.

I'm not sure that Clark provided a suggestion on how to reform state commissions to foster independence, but he had plenty to say about why our current model isn't working.
Another challenge facing the industry is the need to insulate state utility regulators from political pressure.

In instances around the country, he said, "you're seeing the confluence of politics challenging that independent regulatory model."

It's a reason the California Public Utilities Commission was located in San Francisco instead of Sacramento back in the 1800s when it was the California Railroad Commission, to protect regulators from the political influence of the powerful monopoly railroads.

Clark cited the Nevada Public Utilities Commission decision late last year in which regulators posted fixed charges for NV Energy customers with solar energy systems and slashed rates for compensation for excess energy put back on the grid (ClimateWire, Jan. 11).

He quoted a solar industry executive who told reporters that Republican Gov. Brian Sandoval should "get control of his appointees."

The comment, Clark said, "drives home that large segments of the public -- and sometimes fairly sophisticated people that operate in this space -- view regulatory commissions as just another extension of politics."
But at least he's acknowledged the elephant in the room.

How do we assure that political appointees (or elected officials) are actually able to act independently once they assume their seats?  Limit them to one term, so that future appointments or elections become irrelevant?  If commissioners were limited to one term, would quality regulators even show an interest in the positions?  What are other possible solutions?
1 Comment

Mark Twain's Ghost Thinks You're Ridiculous, Bob

6/20/2016

1 Comment

 
Peppering every thought and process with quotes from Mark Twain.  Is that really a thing in Hannibal, Missouri?  Apparently so, judging by this article in the Hannibal Courier-Post.  I guess I've been derelict in my communications efforts directed toward good ol' Bob and his friends at the Hannibal Board of Public Works by not including a trite quote from Twain as a preamble to my opinion.  My bad.  I hereby remedy that failing.

Reporter Danny Henley surely knows
The very ink with which all history is written is merely fluid prejudice.

MARK TWAIN, Following the Equator
Because he obviously didn't look at the actual "contract" between MJMEUC and Grain Belt Express before writing his article.  He relied on Bob Stevenson's sly "memo" to simply report incorrect facts and opinion as "news."
To string incongruities and absurdities together in a wandering and sometimes purposeless way, and seem innocently unaware that they are absurdities, is the basis of the American art, if my position is correct.

MARK TWAIN, "How to Tell a Story"
The contract clearly states it is for transmission capacity ONLY.  Henley needs to quit reporting lies such as this:  "Hannibal was also given the chance to buy electricity for as little as 2 cents per kilowatt hour (kwh)..."  No, they weren't given the opportunity to buy electricity.  They were given the opportunity to buy transmission capacity.  That would be like buying an extension cord, Danny, not signing up for a new account with the electric company.  One provides a means to move electricity from one location to another, and the other actually supplies the electricity.  Without electricity, the extension cord is useless.  And there have been no quotes offered from electricity suppliers.  None.

Henley reports that Bob Stevenson read a "memo" he had written to the BPW at the June meeting of the Board, lamenting that Hannibal had missed out on Grain Belt Express "opportunities."
In order to make a man or a boy covet a thing, it is only necessary to make the thing difficult to obtain.

MARK TWAIN, The Adventures of Tom Sawyer
Picture
Grain Belt Express has a fence that needs whitewashing at the Missouri Public Service Commission.  Someone took away Bob's paintbrush.  Wahhhhhhhhhhhhhhhh!!!!

Bob thinks the project is "moving forward without Hannibal."  It's okay, Bob, the project isn't moving anywhere.  It can't go anywhere without eminent domain authority from the MO Public Service Commission, and that contract isn't a guarantee of success.  In fact, if you would actually read it yourself, Bob, you'd see that it's not even a firm contract, but sort of like a pre-contract, where MJMEUC can back out at any time up to 60 days before Grain Belt Express energizes its line.

Bob also expects to receive an offer from MJMEUC to join its useless pre-contract, even though he chose to wax poetic about missed opportunities at the Board's June meeting.  Of course Hannibal is not precluded from buying a paint brush and joining in the whitewashing.  It just made better theater to pretend Hannibal has missed some rare opportunity.

Hannibal should beware unsubstantiated claims that Grain Belt Express will save Hannibal (or any other municipality) money.  It's clear from GBE's "offer" to MJMEUC that the purported $10M/year savings aren't the result of any "study" by MJMEUC (as falsely reported in the press) but a summary of Clean Line's "preliminary calculations." 
Preliminary calculations, assuming existing production tax credits for wind project participation in the project, could reduce costs by as much as $10M/year or $10 per  megawatt hour compared to delivery of other wind projects from SPP to MISO.
It's nothing but Clean Line's made up "preliminary calculations!"  None of the figures in this "calculation" has any validity.
There are three kinds of lies: lies, damned lies, and statistics.

MARK TWAIN, Autobiography
Despite his fretful report that other cities are scheduling council action long before they sign a contract, and urging Hannibal to do so quickly in order not to miss out on this great opportunity, Bob needs to remember that he is merely a servant of the people.
Government is merely a servant – merely a temporary servant; it cannot be its prerogative to determine what is right and what is wrong, and decide who is a patriot and who isn’t. Its function is to obey orders, not originate them.

MARK TWAIN, The Bible According to Mark Twain
There's no danger "up to 200 MW" of transmission capacity is going to disappear like hot Krispy Kreme donuts.  There's plenty of fence for everyone to paint!

The harder Bob tries to sell GBE, like the world's worst circus sideshow barker, the more suspicious he looks to the people of Hannibal.  Here's what Twain would tell him about his failure:
Its name is Public Opinion. It is held in reverence. It settles everything. Some think it is the voice of God.

MARK TWAIN, Europe and Elsewhere
Trust your ratepayers, Bob.  After you see what happens at the Public Service Commission, you're going to be thanking your lucky stars that it didn't happen to you.
1 Comment

How Much Does a "Clean" Line Cost?

6/19/2016

1 Comment

 
At the beginning of the month, Clean Line issued a press release touting a "contract," or "agreement" with some Missouri municipal electric providers.  But Clean Line neglected to share this wonderful agreement.

Here it is.

What's in the agreement?

Up to 200 MW of transmission service from Clean Line's proposed southwestern Kansas converter station to a proposed DC/AC converter station in Ralls County, Missouri, available in 2 separate, differently priced 100 MW tranches.  Or even any other amount of transmission between 0 and 200 MW.  That's right, zero.  Because this isn't a firm contract at all.  Customer (MJMEUC) can change its mind at any time up to 60 days before "the date on which the Project begins commercial
operations and is capable of providing [...] Transmission Service" and elect not to purchase any transmission at all.  None.  Zero.

Price for transmission service from Kansas to Ralls County, MO: 
$1,167 per MW/month, escalating at 2 percent (2%) annually beginning as of the  Commencement Date for the first 100 MW tranche.

$1,667 per MW/month, escalating at 2 percent (2%) annually beginning as of the Commencement Date for the second 100 MW tranche.
That's $1.167 per kwh, and $1.667 per kwh.  Per month.  With a guaranteed 2% price increase each year.

But that's not all the contract proposes to sell to MJMEUC, if its future "Notice of Decision" is to proceed with the contract.

The contract also proposes that MJMEUC will purchase up to 50 MW of transmission service between Ralls County, Missouri, and Clean Line's proposed converter station in Sullivan, Indiana (in the PJM RTO electricity market).  What is MJMEUC going to be loading onto this "clean" line to sell to customers in PJM?  Will it be "clean" electrons? 

Price for transmission service from Ralls County, MO to PJM:
$2,500 per MW /month.  For the first two years, after which time the contract may be extended for a period up to 26 years.
The contract also requires MJMEUC "to file an
intervention and comments supporting FERC's acceptance of Transmission Provider's FERC [compliance] filing without modification or condition."

As well
the Parties shall cooperate with
each other to obtain all Governmental Approvals that are required for Transmission Provider to construct and operate the Project and put this Agreement fully into effect, including making any filing in support of another Party's application for any such approval as requested by the Party
seeking such approval. From and after the Execution Date, the Parties shall not take any action, or seek any relief, before any other Governmental Authority that is inconsistent with the terms and conditions of this Agreement.
Be a good witness.

So how much would it cost to transmit electricity all the way from Kansas to PJM on a "clean" line?

Add it up.

There is no actual electricity priced in this contract.  Customer shall enter into a separate power purchase agreement with a third party vendor at some future date.  Clean Line cannot sell electricity.
1 Comment
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    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
    StopPATH Blog

    StopPATH Blog began as a forum for information and opinion about the PATH transmission project.  The PATH project was abandoned in 2012, however, this blog was not.

    StopPATH Blog continues to bring you energy policy news and opinion from a consumer's point of view.  If it's sometimes snarky and oftentimes irreverent, just remember that the truth isn't pretty.  People come here because they want the truth, instead of the usual dreadful lies this industry continues to tell itself.  If you keep reading, I'll keep writing.


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