In this proceeding, Rock Island Clean Line LLC (“Rock Island,” “RICL” or “RI”) filed the above-referenced petition with the Illinois Commerce Commission (“Commission” or “ICC”) pursuant to Sections 8-406 and 8-503 of the Public Utilities Act (“Act”),  220 ILCS 5/1-101, et seq.

Rock Island therein requests an order granting it a certificate of public convenience and necessity (“CPCN” or “Certificate”), pursuant to Section 8-406 of the Act, authorizing it to operate as a transmission public utility in the State of Illinois and to construct, operate and maintain an electric transmission line (“Project”); and authorizing and directing it, pursuant to Section 8-503 of the Act, to construct the proposed line. 

Whenever after a hearing the Commission determines that any new construction or the transaction of any business by a public utility will promote the public convenience and is necessary thereto, it shall have the power to issue certificates of public convenience and necessity. The Commission shall determine that proposed construction will promote the public convenience and necessity only if the utility demonstrates: (1) that the proposed construction is necessary to provide adequate, reliable, and efficient service to its customers and is the least‑cost means of satisfying the service needs of its customers or that the proposed construction will promote the development of an effectively competitive electricity market that operates efficiently, is equitable to all customers, and is the least cost means of satisfying those objectives; (2) that the utility is capable of efficiently managing and supervising the construction process and has taken sufficient action to ensure adequate and efficient construction and supervision thereof; and (3) that the utility is capable of financing the proposed construction without significant adverse financial consequences for the utility or its customers.

Having reviewed the record, the Commission finds, with regard to the first alternative showing in Section 8-406(b)(1), that Rock Island has not demonstrated that the Project is necessary to provide adequate, reliable, and efficient service to customers within the meaning of Section 8-406(b)(1).

BUT, regarding the second alternative:

In conclusion, upon consideration of the record and the determinations contained above, and subject to the conditions set forth above and elsewhere in this Order, the Commission finds that the Project will provide an opportunity for the delivery of more renewable energy into Illinois, and will promote the development of an effectively competitive electricity market that operates efficiently, including with respect to renewable energy; is equitable to all customers; and is the least cost means of satisfying those objectives, within the meaning of Section 8-406(b)(2).

Prior to recovering any Project costs from Illinois retail ratepayers through PJM or MISO regional cost allocation, Rock Island will obtain the permission of the Illinois Commerce Commission in a new proceeding initiated by Rock Island. For the purposes of the prior sentence, any system upgrades set forth in an interconnection agreement with PJM or MISO and the costs of which are allocated to Rock Island will be considered “Project costs.” For the avoidance of doubt, the phrase “recovering any Project costs from Illinois retail ratepayers through PJM or MISO regional cost allocation” includes the recovery of costs though PJM and MISO transmission service charges that are paid by retail electric suppliers in respect of their electric load served in Illinois.  

AND

As a condition of this Order, Rock Island shall not attempt to effect the interconnection until it has fully complied with the applicable requirements of PJM and the other conditions in this Order, and has signed all interconnection agreements.

AND (This is a biggie!)

Rock Island will not install transmission facilities for the Rock Island Clean Line Project on easement property until such time as Rock Island has obtained commitments for funds in a total amount equal to or greater than the total project cost.  For the purposes of this condition:

 (i) “install transmission facilities” shall mean to affix permanently to the ground transmission towers or other transmission equipment, including installation of bases and footings for transmission towers, but shall not include (A) preparatory work such as surveys, soil borings, engineering and design, obtaining permits and other approvals from governmental bodies, acquisition of options and easements for right-of-way, and ordering of equipment and materials, and (B) site preparation work and procurement and installation of equipment and facilities on property owned in fee by Rock Island including the converter station sites;

(ii) “easement property” shall mean property on which Rock Island has acquired an easement to install transmission facilities;

(iii)  “has obtained commitments for funds” shall mean (A) for loans and other debt commitments, that Rock Island has entered into a loan agreement(s) with a lender(s) and has received the loan funds or has the right to draw down the loan funds on a schedule that is consistent with the need for funds to complete the Project, and (B) for equity, that Rock Island or its parent company has received the funds from the equity investors or that the equity investors have entered into a commitment to provide funds on a schedule that is consistent with the need for funds to complete the Project; and  

(iv) “total project cost” shall mean the total estimated remaining cost, at the time that Rock Island is prepared to begin to install transmission facilities, for the following Project activities: engineering, manufacturing and installation of converter stations; transmission line engineering; transmission towers; conductor; construction labor necessary to complete the Project; right of way acquisition costs; and other costs necessary to complete the Project.  For reference, the total estimated project cost as of November 1, 2012 is $2.0 billion.

To allow the Commission to verify its compliance with this condition, Rock Island shall submit the following documents to the Director of the Financial Analysis Division and the Director of the Public Safety & Reliability Division at such time as Rock Island is prepared to begin to install transmission facilities:

a) On a confidential basis, equity and loan or other debt financing agreements and commitments entered into or obtained by Rock Island or its parent company for the purpose of funding the Rock Island Clean Line Project that, in the aggregate, provide commitments for funds for the total project cost;

b) An attestation certified by an officer of Rock Island that Rock Island has not, prior to the date of the attestation, installed transmission facilities on easement property; or a notification that such installation is scheduled to begin on a specified date;

c) A statement of the total project cost, broken out by the components listed in the definition of “total project cost,” above, and certified by an officer of Rock Island, along with a reconciliation of the total project cost in the statement to the total project cost as of November 1, 2012 of $2.0 billion; and

d) A reconciliation statement, certified by an officer of Rock Island, showing that the agreements and commitments for funds provided in (a) are equal to or greater than the total project cost provided in (c).

The Commission has reviewed the evidence and arguments.  First of all, to the extent Rock Island is asserting that the criteria in Sections 8-406(b) and 8-503 are identical, and that a finding the Section 8-406(b) criteria have been met would automatically mean the Commission is required to grant the relief sought under Section 8-503, the Commission disagrees.  Such an interpretation would render Section 8-503 superfluous.    

ComEd and Staff argue that Rock Island’s request for Section 8-503 relief is premature, in that Rock Island is seeking authority that cannot be utilized given the contingencies, conditions and regulatory approvals still needed.    While the Commission is by no means suggesting that RI would have to satisfy every condition, contingency or uncertainty before Section 8-503 authorization may be granted, the Commission does agree with Staff and ComEd that under the circumstances, it would be premature to grant Section 8-503 relief to Rock Island in this proceeding.  

Rock Island claims Section 8-503 approval is needed now because it is one of the major regulatory approvals needed to satisfy potential lenders and investors; however, Rock Island does not explain how a Section 8-503 authorization is somehow more urgent or important in that regard than is the proceeding in Iowa, where the Project originates and the first 379 miles of the 500-mile line would be built.  Even Rock Island does not estimate a decision being reached in Iowa until 2015, assuming the formal proceeding has even begun there.

IT IS FURTHER ORDERED that the request for relief pursuant to Section 8-503 of the Act is not granted at this time; this determination is without prejudice to the filing of a request for such relief in the future. 

When necessary for the construction of any alterations, additions, extensions or improvements ordered or authorized under Section 8‑503 or 12‑218 of this Act, any public utility may enter upon, take or damage private property in the manner provided for by the law of eminent domain.

Land surveys. For the purpose of making land surveys, any public utility that has been granted a certificate of public convenience and necessity by, or received an order under Section 8‑503 of this Act from, the Commission may, 30 days after providing written notice to the owner thereof by registered mail, enter upon the property of any owner who has refused permission for entrance upon that property, but subject to responsibility for all damages which may be inflicted thereby.

...the issuance of the Certificate will enable Rock Island to gain access to the property to conduct surveys and related activities, which are steps characterized by Rock Island as important ones in which to engage in the near future.

Jeff Tittel, director of the New Jersey chapter of the Sierra Club, said his group "will definitely oppose" the section in that state.

Tittel said the Sierra Club's opposition is "absolutely" a challenge to the existing business model for utilities, which often rely on far-off plants to send power into populated areas.

Tittel said the PPL proposal is like "frack by wire" because the proposed route across northern Pennsylvania would encourage new power plants fueled by hydraulically fractured Marcellus Shale gas.

Tom Schuster, a regional Sierra Club representative, said the group hasn't taken a position on the entire project because there are still too many unknowns.

Environmentalists who testified said they support the [Grain Belt Express] plan. James Harmon of Kirksville, a member of the executive committee of the Sierra Club’s Missouri Chapter, said it would help Missouri and other states meet the new federal goals for reducing carbon emissions.

Jay Apt, director of the Carnegie Mellon University Electricity Industry Center, said that enormous natural gas production from the Marcellus Shale has led to significantly cheaper wholesale prices in areas of drilling. In other words, a power plant could produce electricity cheaply in Pennsylvania and a utility could transmit it to places with higher electric prices, such as Maryland, New York, and New Jersey.

PJM Interconnection of Audubon, Pennsylvania, which oversees wholesale electric demand for 61 million customers in a 13-state mid-Atlantic region, has said that the electric grid is "undergoing an extraordinary transformation" as coal-fired plants retire.

 PJM could approve all, part, or none of the PPL plan, but regulators agree that the region needs transmission upgrades to ensure reliable and affordable electric service. Allentown-based PPL said the line would take about a decade to build.

PJM spokesman Ray Dotter said it's like a huge version of the dilemma many individuals face: Is the most effective thing to buy a new car, or fix the old one you have?
The PPL plan is like the new car choice. PJM will review the proposal and is likely to vote on it in November or December, and is also considering numerous smaller projects from other utilities.

"We have better places to invest our energy money" in or near in New Jersey, Tittel said, such as offshore wind, solar, and energy efficiency projects. He added that if money was spent in those ways "you wouldn't need the power line."

As a project manager at Clean Line
Energy and someone who is passionate
about moving the wind industry
forward, I would like to address some
of the misleading statements made in
the recent article published in the
Moberly Monitor, "Line's health problems
brought to light."

I strongly urge folks to gain a full understanding of direct current technology
from nationally and internationally trusted sources. At Clean Line Energy, safety is among our chief concerns as we strive to treat landowners with the utmost respect.

The recent editorial by Adhar Johnson, Clean Line Project manager has been expected, and her bias should be obvious.  The information provided in the June 6 article,  Transmission Line Health Problems Brought to Light, by Connie Duvall, was very careful to address ONLY the types of fields produced by high voltage lines.
My reputation is on the line in the community in which I live and serve, and the information used was carefully screened for accuracy.   Since the June 6th article, additional studies have been uncovered which directly name HVDC lines as the culprit in adverse health effects.  The information  from the studies repeatedly questions the "trusted" sources quoted by Clean Line Energy's advocates. This technical information will be used in November to testify before the MO Public Service Commission in Jefferson City.
(Above Statement by Dr. Dennis Smith)  

Clean Line managers and land developers have been flooding papers in would-be affected counties with their propaganda, touting their passion for wind energy.  These power lines have little if anything to do with wind energy as they are not needed to utilize it.  Clean Line execs typically implore the public to turn to trusted sources, which is exactly what we want them to do.
 
After all, the area of education of the Grain Belt Express (GBE) pushers is business and communications; their expertise is in the art of the deal, how to manipulate statements to their advantage, and how to turn a fast buck.  Is this reason to trust them?

They have determined to discredit Dr. Smith because his research threatens their venture.  Along with discounting him, they must also take down the numerous scientists, electromagnetic experts, and doctors who have done countless studies pointing to the harms of this type of EMF exposure.

Adhar Johnson, Clean Line manager, attended the Randolph County commissioner public meeting where a gentleman emotionally testified of his wife’s oncologist’s admonition that such a power line would necessitate their relocation.  In a meeting at Rothwell Park, Adhar told me  that the doctor had no business saying that, and then she handed me Clean Line’s go-to documentation of the one out-dated statement made by the World Health Organization (WHO) that there were no known health risks.  Much more recently, the WHO has revised their statement and has classified the emissions from these lines a class 2B carcinogen, as has the Environmental Protection Agency.  HUD has ruled the lines and towers “a hazard and a nuisance”, and FHA appraisals have to be adjusted to address the effect these lines have on marketability of properties near the lines.  The highly respected, non-partisan, U.S. Government Accounting Office expressed many of the same concerns voiced by citizens regarding HVDC lines in its report to Congress in 2008.

Dr. Smith also discovered the following statute:

Exercise of eminent domain over private property for economic development purposes prohibited--definition.
523.271. 1. No condemning authority shall acquire private property through the process of eminent domain for solely economic development purposes.  2. For the purposes of this section, "economic development" shall mean a use of a specific piece of property or properties which would provide an increase in the tax base, tax revenues, employment, and general economic health, and does not include the elimination of blighted, substandard, or unsanitary conditions, or conditions rendering the property or its surrounding area a conservation area as defined in section 99.805.
Missouri Revised Statutes
Chapter 523
Condemnation Proceedings
Section 523.282
Our Randolph County Commissioners have welcomed Clean Line GBE to our county for the exact reasons that the statue prohibits and have voiced at public meetings their support for those reasons prohibited in the statute.
 
Dr. Smith is trusted in this community as he has been in all communities in which he’s lived.  I make no apologies in stating that he has had a stellar medical career, having graduated in the top 5% of his medical class and having received multiple awards and accolades for his single-minded service to his God-given mission in Public Health.  He maintains excellent rapport with former hospitals where he has been employed and would be whole-heartedly welcomed back to any of those facilities.  Consider also the editorials that have been submitted by the many respected members of the community, your long-time friends and associates who oppose this line. Shall we then trust some wealthy business people whose real passion is increasing their profits, or should we trust scientists and doctors who are devotees to public health and safety?  It’s not a difficult choice.

Sincerely,
Laurie Smith
Moberly, MO

“We think we can provide green power at an attractive, fixed-rate price for TVA and other utilities in the region,” Clean Line Energy Executive Jimmy Glotfelty told TVA last year. “Having a guaranteed price for 20 years is a great hedge against volatile natural gas prices.”

The existing three coal-fired units at ALF provide both real and reactive power for the Memphis area. To continue to reliably serve the area, generation resources must be located at or near ALF.

The strong year-to-date increase in ongoing earnings was driven in part by a combined $69 million from our domestic utilities, driven by returns on additional transmission investments in Pennsylvania...

Also this morning, we announced a PPL Electric Utilities proposal to PJM, as part of the competitive solicitation process under FERC Order 1000. As currently proposed, the 500 kV transmission line would run about 725 miles from Western Pennsylvania into New York and New Jersey, and also south into Maryland. The project is in the preliminary planning stages. The new line would improve electric service reliability, enhance grid security and enable the development of new gas-fired power plants in the shale gas regions of Northern Pennsylvania. The proposal would create savings for millions of electric customers by delivering lower cost electricity into the region and reducing grid-congesting cost. According to preliminary estimates, the cost of the project, which is not yet included in our CapEx projections, would be between $4 billion and $6 billion. Because of the magnitude of this proposal, there is a good chance we may enter into partnerships to develop and build the project. The preliminary timeline envisions completion of the project by 2023 to 2025, assuming all necessary approvals are received and construction begins in 2017. Approvals are needed from various regulatory and regional planning entities. We'll keep you posted on any further developments.

Daniel L. Eggers - Crédit Suisse AG, Research Division
Bill, can you maybe get a little bit more into this transmission project today? I guess, kind of how the process works from announcing, looking at something to where we'll see action. What kind of dollars you have to spend upfront? And then, if you look at the challenges you guys had with Roseland and other folks have had in the past, trying to build these new Pennsylvania East type of transmission lines, how you guys think you're going to approach it to make it a higher chance of success?

William H. Spence - Chairman, Chief Executive Officer, President and Chairman of Executive Committee
Sure. So the processes itself is one that's not been well traveled in the past, as you know. It's a relatively new process. So we'll continue to work with all the stakeholders to make sure that we do everything in our power to make sure that we get this approved on a -- as timely a basis as we can. Maybe I'll ask Greg to take you through kind of what we understand to be some of the key milestones and processes we have to do to make this a reality, so, Greg?

Gregory N. Dudkin - Principal Executive Officer, President and Director
Yes, thanks. So first off is the filings. So PJM had a window that just closed recently. So this project, Project Compass, was filed as part of that window. As far as the approvals are concerned, so this project not only is part of PJM, but also goes into the New York ISO, still need approvals from both entities. Also we'll need state approvals, as well as utility commission approvals. So for me, what increases the probability of success is just the compelling nature of this project. When you think about what's happened in the industry over the past year, the polar vortex, substation security being a big issue, coal retirements being a big issue. This project really pulls all those issues together and provides significant benefits to the consumers in the region. So I think it's the compelling nature of the benefits of this project that will help the project move forward. We are putting together an outreach plan. In fact, I've started this morning to get people that will be involved in the project, up to speed and be looking to work with others to make sure that this is a success.

Daniel L. Eggers - Crédit Suisse AG, Research Division
Okay. So we should -- this will be, I guess, probably a little quiet from our perspective for -- in a period of time, while you get your ducks in a row. Is that kind of how we should think about it?

Gregory N. Dudkin - Principal Executive Officer, President and Director
Yes, I would say so. Because of all the entities we have to work with my sense is that we have a better idea about the timeline as far as approvals probably by the end of this year. But it should be fairly quiet from your perspective.

Daniel L. Eggers - Crédit Suisse AG, Research Division
And then the money you guys are putting into it now, is there a route for recovery if this is not successful or is this money you guys are burying on PPL for the time being?

Gregory N. Dudkin - Principal Executive Officer, President and Director
Yes, this is something that is not recoverable. So we'll -- if it doesn't go forward, then we'll just had to eat that.

Neel Mitra - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division
Question on the transmission project. It looks like the map you provided, the starting points are really kind of where the new CCGTs, that are announced for PJM in '16 and '17, are being built. Is the -- is kind of the economic reason for the project that some of those gas plants that are going to be built right on top of the shales, they just don't have enough transmission capacity to get to where they need to, to provide reliability? Or is there another real economic benefit that I'm not seeing?

William H. Spence - Chairman, Chief Executive Officer, President and Chairman of Executive Committee
Well, there's a number of potential benefits, and I'll let Greg describe some of those. But that clearly could be one of them, but there are others as well.

Gregory N. Dudkin - Principal Executive Officer, President and Director
Got it. And so, I would say when we are -- when potential generators come to us, one of the issues is they need to obviously connect to our transmission. And in some cases, that can be very, very high cost. So part of the thinking on the economics is if we sited through the region, the cost to connect for those generators would be much less. So again with potential coal retirements, we think there's economic advantage for that on a going-forward basis. And we use pretty conservative assumptions around generation retirements. But beyond that, there are reliability benefits. Again, we talked about substation security. There are benefits that, actually, we didn't really factor in the economics. But I think there'll be a significant economic benefit there, reduced congestion. So all that, when you factor all those together, it is a significant positive economic benefit to the consumers.

Paul Patterson - Glenrock Associates LLC
A lot of my questions have been answered. But just -- and I know it's some way off in the future here, but when the transmission line is built, what do you expect it to do to the market? Is there any basis differential or any sort of impact you could sort of suggest, that sort of in the ballpark, that would happen as a result of these major projects.

William H. Spence - Chairman, Chief Executive Officer, President and Chairman of Executive Committee
Yes, as you can imagine, because it is so far out and there's so many moving pieces, coal retirements, how many new gas pipelines may be built to move shale gas away from the constrained areas, and so forth, that we really don't have a forecast that we could point you to suggest which way prices would move as a result of this transmission project.

Paul Patterson - Glenrock Associates LLC
Okay. And no part of the project is going to be really done before 2023, is that correct?

William H. Spence - Chairman, Chief Executive Officer, President and Chairman of Executive Committee
That's our target. So with it, the earliest would be 2023.

Rajeev Lalwani - Morgan Stanley, Research Division
My first question is on the transmission project that you announced. Can you provide some insight on any competing projects that PJM is also looking at?

William H. Spence - Chairman, Chief Executive Officer, President and Chairman of Executive Committee
At the moment, we're not aware of any competing projects. This is a very unique project, that I'm very proud of the team here that came up with the concept and the forward thinking to put something of this nature in front of PJM. So we're not aware of any competing projects. And the requests that PJM have had, have been smaller projects to basically address some relatively small reliability concerns. I think there 4 or 5 of them. And this project and I response to some of those, but it goes well beyond that. Again with something that we think is very unique and compelling from a stakeholder process -- perspective.

Angie Storozynski - Macquarie Research
Okay. And lastly on the transmission project, I know it's many years out, but just looking at how the Susquehanna-Roseland went and the 3-year delay to cross, what, a 3-mile stretch through the Delaware Water Gap even though there was an existing right of away. I mean, obviously, we don't see exactly how this proposed line goes, but should we expect similar issues with siting of the transmission line?

William H. Spence - Chairman, Chief Executive Officer, President and Chairman of Executive Committee
Greg, do want to take one?

Gregory N. Dudkin - Principal Executive Officer, President and Director
Sure. Thanks. So certainly, when you're talking about a 725 mile line, siting is going to be a big issue. So we will work with all the stakeholders. We've had success, actually Susquehanna-Roseland is a great example. So it took us a while, but we were building through a national park. And I think it had been very successful. I think the folks there appreciate the care we took of the park, and so I think our reputation is good in that area and that's why I think we'll be successful.

Angie Storozynski - Macquarie Research
So this proposed line doesn't go through any national parks or any environmental -- that shouldn't face any environmental issues?

Gregory N. Dudkin - Principal Executive Officer, President and Director
No national parks.

Whereas, the Association of Tennessee Valley Governments (ATVG) represents local governments within more than 200 Tennessee Valley River Region Counties which closely monitor issues associated with the
Tennessee Valley Authority (TVA); and

Whereas, TVA's mission focuses on providing low cost, reliable electricity, environmental stewardship and economic development to the people of the Tennessee Valley; and

Whereas, the TVA Act of 1933 mandates that TVA provide power to its customers at the lowest feasible cost; and

Whereas, TVA is currently evaluating a proposal to purchase a large amount of wind generated electrical power from the Oklahoma panhandle from Clean Line Energy Partners, LLC, and transport It 700 miles using a single high voltage direct current transmission line that will bypass the existing network of power
lines to Memphis, Tennessee; and

Whereas, such a partnership between Clean Line and TVA would likely transport wealth outside the Tennessee Valley to the detriment of the nine million residents of the Valley; and

Whereas, TVA has stated that electricity demand in the Tennessee Valley is not expected to return to 2007 levels until 2020; and

Whereas, the nation's power grid is a complex, interconnected network of generating plants,
transmission lines and distribution facilities; and

Whereas, bypassing the grid to purchase electricity from such a long distance away increases security threats by providing additional exposure for natural or malicious events due to the extreme distance between generation and point of use without needed network redundancy; and

Whereas, wind is an intermittent power source that lacks the dispatch capability of other resources and does not eliminate the need for base load or dispatchable power plants like other more dependable resources such as nuclear, natural gas, coal and hydropower; and

Whereas, the number of property parcels and property owners that may be negatively affected by eminent domain as a result of the construction of this proposed 700 mile transition line is unknown;

now, therefore

BE IT RESOLVED by the Association of Tennessee Valley Governments (ATVG), that we strongly encourage the Tennessee Regulatory Authority to exercise caution as it considers the application of Clean Line Energy Partners, LLC, for a certificate of public convenience and necessity to operate as a
public utility with powers of eminent domain within the State of Tennessee until it is proven that its proposal meets TVA's obligation to provide reliable power to its customers at the lowest feasible cost.