The State Journal tells us that PSC Chairman Michael Albert "appointed" a new Consumer Advocate today.

The Consumer Advocate is supposed to represent YOUR interests, little ratepayer.  The Consumer Advocate is supposed to be an "independent" division of the West Virginia Public Service Commission, created back in the 1980s.  The advocate's duties are set out under WV Code.

However, there's no actual language regarding any "appointment" in the code.  After all, what kind of an idiot would allow a guy who used to represent utility interests (some argue that he still does) to appoint someone to represent the interests of consumers?  The PSC has been advertising the job of Director of the Consumer Advocate Division all summer.  And now Chairman Albert has "appointed" someone under authority granted in some obscure PSC Orders from 1980/81. 

This begs the question... how is the Consumer Advocate Division "independent" from the PSC, when the PSC controls the Director's employment?

And does this mean that the Governor's Office is soon going to be advertising for the job of Public Service Commissioner?  Sweet!

Anyhow, let's hope our new "advocate" starts representing our interests real soon.... and fixes that ridiculously unprofessional website.  Maybe she has her own chili recipe that will help consumers.

The Power Line tells us that the WV PSC has scheduled a hearing on FirstEnergy's proposed Harrison settlement for 9:30 a.m. on Friday, September 13.  Ooooh!  Scarily auspicious for FirstEnergy, don't you think?

After months of back and forth legal wrangling and a full-blown, three-day hearing at the PSC, FirstEnergy and all other parties to the case, EXCEPT West Virginia Citizens Action Group (WVCAG), agreed to a settlement.  However, a settlement is still subject to the approval of the WV PSC, and our Commissioners have said... not so fast, FirstEnergy.  Therefore,

"The Commission stated that it would require all parties to this case appear at a hearing with a witness to state whether, and why, the Joint Stipulation is, or is not, in the public interest."

Do you think the settlement is in the public interest?  Do you think it's in YOUR best interests?  If not, you need to let the Commissioners know.  Intense public scrutiny is what has caused this additional hearing, instead of the routine rubber-stamping of a contested settlement.  Only continued scrutiny will ensure justice!

So, how can you participate?  Our friends at the Coalition for Reliable Power have made it so easy that it will only take you 2 minutes!  Check out their "Take Action" section for suggested text and a link for submitting your comments online.  Do it now!

If you're too busy to spend two minutes now, you'll only have the next 27 years to regret it!

Quote from a Kansas citizen, voter and landowner whose farm and business will be destroyed by Clean Line Energy's Grain Belt Express:  "I know this is not the first trail of tears.  And because we have not learned from the taking of the native Americans' land, we see again history repeating itself.  BUT this time, maybe, just maybe, we are not as naive as the Native Americans and this time we can rally the troops and rise up together and fight the taking of land."

Words of warning to out-of-state billionaires looking to strike it rich on Kansas soil, and also to the Kansas Corporation Commission, who has so far bent over backwards to allow it to happen.

In 2011, a Texas-based (but Delaware-registered) corporation applied to the Kansas Corporation Commission for a "Limited Certificate of Public Convenience and Necessity to Site, Construct, Own, Operate and Maintain Bulk Electric Transmission Facilities located in the State of Kansas."  At a lawful hearing, the company presented a contested settlement (S&A) to the Commission, and the Commission eventually approved it, after determining that it was in the public interest.  In order to make such a determination, the KCC evaluated the following factors:

1. Has each party had an opportunity to be heard on its reasons for opposing the settlement?
2. Whether the S&A is supported by substantial competent evidence?
3. Whether the S&A conforms with applicable law?
4. Whether the S&A results in just and reasonable rates?
5. Whether the results of the S&A are in the public interest, including the interest of those parties not consenting to the agreement?
6.  Whether the S&A will result in unnecessary duplication of utility service?
7.  The impact on wholesale competition?
8.  The effect of the S&A on the Commission's jurisdiction to effectively regulate and audit public utility operations and transmission operations, including the effect of the S&A on ongoing authority to regulate, review, and oversee the Applicants' transmission operations in Kansas?
9.  Whether the proposed transaction will be beneficial on an overall basis to state and local economies and to communities in the area affected by the resulting public utility operations in the state?
10.  The effect of the transaction on reliability of service?
11.  Whether the S&A will promote adequate and efficient service?
12.  Whether the S&A reduces the possibility of
economic waste?
13.  What impact, if any, the S&A has on the public safety?
14.  The effect of the transaction on customers?
15.  The effect of the transaction on the environment?  16.  The effect of the transaction on public utility  shareholders?
17.  Whether the transaction maximizes the use of Kansas energy resources?

Parties to the settlement included:

1.  Citizens' Utility Ratepayer Board (CURB) - representing the financial interests of ratepayers
2.  Westar Energy, Inc. and Kansas Gas and Electric
Company (Westar)
3.  lTC Great Plains, LLC (lTC Great Plains)
4.  Mid-Kansas Electric Company, LLC (MKEC)
5.  Sunflower Electric Power Corporation (Sunflower)
6.  Energy for Generations, LLC (E4G) - representing the interests of wind developers

Who was representing the interests of the landowners who would be asked to sacrifice their land and their livelihood to provide a new 200 foot wide right-of-way for this monstrous, new transmission line across their homes and businesses?  Nobody.

This is because the "community outreach" business model of Grain Belt Express relies on secret, closed door meetings with elected officials, economic interests, and others in non-public venues far in advance of notification of affected landowners.  In this way, Grain Belt Express hopes to buy the loyalty of local officials and business interests with pie-in-the-sky promises of economic riches that will never materialize.  Grain Belt Express hopes that their private schmoozing will be enough to cause these officials to run roughshod over the citizens who elected them.  As well, when Grain Belt Express is allowed to frame the argument, opposition must work twice as hard to dispel misinformation and bring truth to the forefront.

Even though it did not consider the impact of the transmission line on landowners in its own state, the KCC so kindly considered the needs of other states and allowed their rights to trump those of its own citizens:

"The Commission has also stated that it should consider the impact of a transmission line on neighboring states, due to the regional nature of the transmission system."

In finding that Grain Belt Express should be granted a certificate, the KCC found the following "benefits" flowing from the project, but failed to consider any costs to its citizens:

"...there are significant and substantial economic benefits that the project will provide to Kansas. As  noted, the benefits include royalties to landowners who contract with generators, new jobs associated with construction and operation of both the lines and wind generating facilities, and additional tax revenue.  As laid out fully in Clean Line's Application and supporting testimony, these economic benefits will provide a tremendous stimulus to the United States economy by facilitating a great deal of new investment in renewable energy projects that would not be possible if the Project did not occur."

The KCC simply rubber-stamped the claims Grain Belt Express made in its application, without examining them too closely.  After all, no one was objecting or providing the KCC with any contradictory information, and that's simply because no one who might object knew about the project!

The only "public" comments provided to the KCC were those harvested by Grain Belt Express during its closed door meetings with elected officials and business interests, therefore:

"The Commission finds that the need for long-distance, multi-state transmission projects such as the Grain Belt Express proposed by Clean Line in this proceeding will promote the development of wind generation facilities in Kansas, which will provide benefits to Kansas and other areas of the country. These benefits are certainly in the public's interest and Kansas' interest, especially since Clean Line's merchant model for cost recovery does not charge Kansas ratepayers to execute the proposed Project. Public comments indicate significant support for the approval of Clean Line's Application, to help connect Kansas' wind energy to larger markets farther east, to generate more jobs and greater revenues to local jurisdictions, and to strengthen Kansas' reputation as an attractive place to do business."

However, those "other areas of the country" don't want what Kansas is selling.  East coast load centers are developing their own renewables, and keeping the economic benefits of doing so within their borders.  Offshore wind is proceeding rapidly to reality.  In addition, the bottom has dropped out of PJM's electricity market, making expensive, imported wind from Kansas uncompetitive.  Kansas may very well be supporting the "line to nowhere" by the time this winds its way through approvals, and those responsible for supporting GBE and
denying the property rights of Kansans are long since voted out of office.

After receiving their Certificate, GBE spent the next year continuing to build its political and business contacts in Kansas.  Finally, in early 2013, the company held a few public meetings to gather public feedback.  This was the first glimpse any affected landowner had of the project. In July, GBE filed an application to site its project with the KCC.  Only at this time was legal notice to landowners effected.

And what did the GBE-written and KCC approved notice to landowners say about an affected landowner's right to participate? 

"State law requires the Commission to conduct a public hearing on siting applications and that landowners of record be notified by certified mail of the filing of such applications and the related public hearing."

GBE also told landowners:

"The Commission will conduct a technical hearing concerning the proposed transmission project.  The technical hearing is open to the public and scheduled to begin October 8, 2013, at 9:00 a.m. in the first floor hearing room at the Commission, 1500 SW Arrowhead Road, Topeka, KS. At this hearing the Commission Staff, Grain Belt Express representatives, and other official intervenors will present their respective positions to the Commission."

Landowners were led to believe that their only avenue to protect their property interests was through a public hearing and that the technical hearing was for Grain Belt Express representatives and "other official intervenors."  Nowhere were landowners informed that they had a right to intervene and become an "official intervenor" themselves, with the right to legally protect their property interests.  The KCC also set a deadline for petitions to intervene of August 30.  While KCC is legally permitted to do this, it is not a usual occurrence and interested parties may normally intervene up to 3 days before a hearing begins.

When a landowner questioned KCC staff about pro se (without an attorney, "on that party's own behalf") intervention, she was told "An attorney must represent an intervener and file the petition to intervene on their behalf."

When the landowner further questioned KCC staff about filing pro se, and asked to see relevant sections of Kansas code prohibiting pro se participation in a siting case, the landowner was informed that she had been previously misinformed, given relevant code sections, and dismissed to figure it out on her own.

With a looming deadline and spreading misinformation from the KCC, many landowners were simply shut out of the case.  Now their right to own property is in the hands of KCC.  Will the Commissioners do the right thing?

Already, Grain Belt Express is unhappy with KCC staff's proposed restrictions on the granting of the proposed route. 

In the rebuttal testimony of Mark Lawlor, Grain Belt Express asks to have three conditions modified.  First, they ask that they be permitted 5 years to begin their project, instead of the 4 recommended by staff.  Apparently it's going to take longer to get this thing approved in the other three states (Missouri, Illinois & Indiana) than originally planned. 

And speaking of those other approvals, KCC staff recommends that its own permit be contingent upon GBE receiving approvals from the public utility commissions in the other states.  GBE says it has other plans for preempting the permitting process in other states:

"First, there is a possibility that approvals from all three states will not be necessary. Although receiving siting approvals from those states is the most likely scenario for the Project to move forward to construction and operation, transmission line siting regulations or policy could evolve at the state or federal level, or through multi-state siting collaboration, or Grain Belt Express could use other transmission siting authority currently in place for other states through which the transmission line crosses. We do not want to rule out the possibility that the construction of the line in some areas might be allowed based on a law, regulation or approval that is
distinct from what is currently proposed by Grain Belt Express or available today."

And last, but by all means not least, GBE wants the KCC staff to change the wording of the cost allocation stipulation so that it may seek cost allocation for its project from ratepayers in other states.  The staff recommended that the permit issued to Grain Belt Express be conditioned on the Project being "a merchant transmission line only and not subject to funding under the SPP Open Access Transmission Tariff."  Apparently Grain Belt Express no longer plans to do business as a merchant transmission line (100% privately funded), and requests that the staff's condition be modified to read:  "the cost of the Project and any AC Collector System owned by Clean Line will not be recovered through the SPP cost allocation process or from Kansas ratepayers."

Obviously, Clean Line intends to abandon its merchant transmission model and seek cost recovery for Grain Belt Express from ratepayers in other states in other regions.  Chances of this being approved are slim to none, therefore, where is the money to complete this project going to come from?  Will Kansas ratepayers be asked to pony up on a half-completed project, or will the project simply be abandoned when the money runs out?

The KCC should be stepping up to protect Kansans right now, not bowing to the political machinations of the Governor or the Texas wildcatters wooing his favor.  The duty of the KCC is to protect the public interest.  Let's hope they begin now.

...Karma came a'knocking yesterday.

The Plain Dealer reports that FirstEnergy failed a Nuclear Regulatory Commission "force on force" exercise at its Beaver Valley nuke.

FirstEnergy says that its failure was a result of the way the NRC inspectors conducted the exercise.

In other news,  a group of local residents filed a lawsuit alleging that FirstEnergy's Hatfield's Ferry coal-fired generator was damaging their health and their property.  Hatfield's Ferry is one of two plants that FirstEnergy has slated for closure in October.  Political hijinks have ensued, attempting to keep the plants open.  PJM has determined that the plants are necessary for reliability, but FirstEnergy is pretending to proceed with closure, hoping it might get a better deal if it continues this silly game of chicken.

And, closer to home, a Potomac Edison publicity stunt went wrong yesterday when spokesflack Crapaud Meyers got cornered about how the WV PSC General Investigation was going.

Unfortunately, the wanna be journalists at WHAG's summer training camp turned it into a one-sided infomercial, but that didn't dampen Crapaud's enthusiasm for twitching his way through making crap up.  Crapaud now says Potomac Edison is working on solving the problem, when just a few months ago, the company told the PSC that there was no problem to be solved.

Watch the video to enjoy Crapaud's newly-evident twitch.  What it is that FirstEnergy does to its employees that makes them twitch like that when they lie?

Well, you know what they say, necessity is the mother of invention, and one creative individual has come up with a new (if illegal) way to pay his outrageous Potomac Edison electric bill.

According to this article in the Herald-Mail: 

So, how many copycat crimes will this cause?  And would it be a crime if you stood on a street corner with a bucket and a sign "Help Me Pay My Inaccurate and Outrageous Potomac Edison Electric Bill!"?  Probably not.  And it would probably be even more lucrative.  You can't mention the words "Potomac Edison" out in public around here without having bystanders chime into the conversation.  While out having coffee with a friend yesterday morning, those words were said and next thing you know we're in conversation with a gentleman who was simply standing nearby fixing his coffee.  Who hasn't gotten an outrageous bill or knows someone who has?  Would you feel sorry for someone stuck with an outrageous, inaccurate bill who was having their service shut off?  Would you toss in a few bucks?

Thanks, Potomac Edison!  Dishonest panhandlers!  Just one more service you provide!

FirstEnergy has been defending its rate-increasing Harrison plant settlement by telling the media, "...the agreement includes a commitment to "bring more jobs" to West Virginia, and provides financial contributions for economic development, weatherization programs, low-income utility payment assistance and an education program to promote energy efficiency initiatives in the state's public schools."

And not one reporter was smart enough to ask Toad Meyers who would be paying for all these wonderful benefits?

1.  50 more jobs -  The cost of those jobs, just like the cost of all the other FirstEnergy employees, is recovered from consumers through electric rates.

2.  Financial contributions for economic development - As we've found in other cases, these rate credits for industrial users (like Century Aluminum) are merely deferred for later collection in a future rate case... where consumers will pick up the $2.3M cost.

3.  Weatherization programs - The settlement stipulates that this contribution is in addition to the $250,000
amount currently included in rates as a result of the Joint Stipulation in Case No. 09-1352-E-42T.  "Included in rates" means that consumers are paying for it.

4.  Low-income utility payment assistance - The settlement stipulates that this amount will be funded by customers.

5.  An education program to promote energy efficiency initiatives in the state's public schools - No mention of how this is going to be paid for.

6.  Additional energy efficiency programs - Paid for though consumer rate increases, just like the current programs.

So, what did FirstEnergy "give" West Virginia consumers in exchange for accepting the financial liability of a 40 year old coal plant?  The bill for its concessions!  Ridiculous!  The best FirstEnergy can do is to point to additional cost for consumers as a "benefit" of this transaction.

And if you think that's stupid, FirstEnergy did it one better!  Toad Meyers was his usual brilliant self... when asked about WVCAG's Objection to the settlement, Toad told the press:

"Just like any settlement agreement, there's a lot of negotiating, a lot of back and forth, give and take," said Todd Meyers, a FirstEnergy spokesman. "We all came to an agreement that people were comfortable enough with to sign and forward along to the PSC for recommendation."

Well, obviously if WVCAG refused to sign on to the settlement and has now filed an Objection to it, then ALL parties didn't come to an agreement.  Or maybe WVCAG was ostracized from participating in the settlement?  Or maybe WVCAG is just not "people?" 

Qu'est-ce que c'est, Crapaud, qu'est-ce que c'est?

Risk.  The word has many meanings in the utility industry, but it all boils down to undertaking risk in order to provide a dividend for shareholders. Sometimes the riskiest exploits produce the biggest return.  An investor owned utility's loyalty to the shareholders who continue to fund management's lavish lifestyle overrules any loyalty to the customers being provided a necessary service at a reasonable price.

The competition for investor dollars fuels a ratcheting up of risk in order to provide bigger and bigger returns.

Where does it all end?

From a regulatory perspective, risk means not being permitted to undertake certain actions that will increase income of the regulated company.  The purpose of regulation is to police the actions of private entities operating in a monopoly construct to ensure that customers are provided fair service at a reasonable cost.  Regulators are the final decision-makers on utility proposals, and also serve as creator and enforcer of the rules regulated utilities must follow.  Regulators are supposed to be protecting consumers, while also allowing the utility to make a reasonable profit in order to continue to operate the system.

Everything an investor owned utility does in a regulated environment is viewed through the lens of financial risk. 

Should the company file a rate case?  What's the risk that the return will be lowered?  What's the risk that some costs may be disallowed?

Should the company sell assets to itself?  What's the risk that the price will be adjusted downward?  What's the risk that the transaction will not be approved?

Should the company break the rules?  What's the risk that the company will be caught?  If caught, what's the risk that the company will have to pay out more than it made while breaking the rules?

Regulatory risk really isn't risky at all.

Investor owned utilities make huge investments in buying the favor of their regulators.  It's just one great, big utility club, where the regulators and the regulated interact daily, convincing each other that their actions benefit consumers.  Consumers are not allowed to join.  Regulators and regulated will find themselves together again and again, therefore they develop a cozy working relationship.

But it's an unbalanced relationship.  While the regulator may think they're all sitting at the same table, they're not.  The investor owned utility has nothing to lose.  And the regulator's gun is loaded with blanks.  An investor owned utility has access to a bottomless pool of consumer funding to appeal any regulatory decision it doesn't like, endlessly.  Regulators have access to a very limited supply of money for such things, therefore, a utility can simply outspend them until the desired result is achieved.  In many instances, it's not even worth trying enforce the rules for the regulator, and they may cave in before it even gets to this point.

This is a settlement.  Ideally, in settlement, each party gives up something in order to create a balanced outcome.  However, an investor owned utility will never enter a settlement with an equal number of eggs in its trading basket.  Its rate case or asset transfer is thickly padded with things to give away that the utility doesn't really care about.  The regulator's basket has less eggs at the beginning, therefore, each egg that's given away by a regulator means someone goes hungry.  The regulator comes out with one egg, and the utility comes out with a dozen.  This isn't a fair or balanced outcome.

And it's even more skewed when a utility gets caught breaking the rules.  Rules are meant to be followed, not partially followed, or mostly followed, but completely followed.  There should be simply no eggs in the regulator's basket to give away.  It's impossible to break half a rule.  When a utility breaks the rules for profit and gets caught, it's egg basket is full.  A utility can give away some of the profits it made breaking the rule, while the regulator can only give away the rule and violate the trust of consumers, who expect that regulators enforce rules.

When a regulator begins negotiating a settlement in a rule breaking case, they are giving away the ability to break the rules without consequence.

How do you think the investor owned utility views this?

1.  Chances are we won't get caught and we'll get to keep all the profits we made breaking the rule!

2.  Even if we do get caught, we'll only have to give back part of the profits we made breaking the rule!

3.  For every illegal action regulators catch, there are hundreds more where we'll never get caught!

4.  Following the rule - zero profit.  Breaking the rule - priceless!

Breaking the rules is very profitable for investor owned utilities, therefore they will keep doing so until the cost of punishment is higher than the retained profit of breaking the rules.  Breaking the rules is low to no risk.

Filing a rate case, or proposing a ridiculous, overpriced sale of assets to itself, is also low risk these days.  Lazy, captured regulators and ineffectual consumer advocates, who are more interested in maintaining relationships with utilities and their lawyers than with the consumers they are supposed to represent, are failing you.

Those who stand for nothing, will fall for anything.

Enough is enough.

West Virginia Citizens Action Group, the only party to refuse to sign FirstEnergy's Harrison settlement, filed an Objection to the settlement with the PSC this afternoon.  The Objection asks that the Commission "...disapprove the proposed settlement and that the Companies’ petition be denied in its entirety."

WVCAG is the only party that didn't cave in and go along with that sugarcoated flashing blue light special settlement the others were pressured into signing.

What?  Pressured?  That's what I think.  Some people accuse me of having too much imagination, but if you pick up a crayon and start connecting the dots, a perplexing picture begins to form.

The public has been increasingly dissatisfied with the actions of the WV PSC over the past several years.  It's not just some obscure agency nobody has ever heard of anymore.  High profile rate cases, the PATH project, and now the intra-company coal plant sale cases have promoted the WV PSC to common dinner table talk.  As well, public anger over the FirstEnergy/Potomac Edison billing investigation has raised the ire of legislators.  The WV PSC, with one expired Commissioner and another re-appointed but not yet confirmed by the Senate, does not want any nasty utility public relations poo stuck to its shoe.  Any decision it would have made on FirstEnergy's Harrison transfer (other than a denial) would have produced more citizen and legislative scorn, possibly turning into the straw that broke the camel's back.  So, the Commission slunk out of the emergency exit by not having to make a real decision.  Because the case was "settled," blame for what went wrong can be foisted off on the settling parties.

The Consumer Advocate will be retiring at the end of next month.  A new one will be appointed by the Chairman of the PSC (let's not even worry about what a very stupid idea this is right now!)  Any consumer advocate division employees who may be hopeful of moving up to the top spot and filling the vacancy would be beholden to pleasing the Chairman right now.  Perhaps one way to cement the Chairman's approval would be a willingness to divert public anger from the Chairman (who doesn't need anymore public disapproval before his re-appointment is confirmed).

Once the PSC staff and Consumer Advocate rolled over for FirstEnergy, the rest of the parties just went on a feeding frenzy to pick up what stray crumbs they could (with the exception of WVCAG, who exhibited good, old fashioned ethics).

Maybe I just think too much... or maybe I just know too much.  Anyhow, that's my theory of why this happened.

But... here's something else to think about!

How did a proposal that FirstEnergy said would raise your electric rates 6% settle for a 1.5% decrease in your rates?

The settlement changed the amount of the $1.1B purchase price consumers will pay by requiring Mon Power to book a $300M+ impairment for a portion of the purchase price.  The cost ratepayers will have to pay is $795M.  An impairment is an amount that comes out of shareholder dividends, instead of out of your pocket.

In addition, the $25M credit for the included sale of Pleasants will be amortized over the first 16 months of new rates, which causes an artificial and temporary rate reduction that will expire at the end of 2014.  Without this Magic Math, there would be no "decrease." 

This resulted in a yearly surcharge (rate increase) of $113.4M.

However, this rate increase was offset by a $129.5M yearly credit that FirstEnergy will include in their projected rates through the end of 2014.  This $129.5M is based on projections, not reality.  At the end of 2014, this projection will be trued up with actual expenditures and the resulting shortfall will turn into a rate increase.  From the look of FirstEnergy's unrealistic projections (cooked for the transaction proposal to show what FirstEnergy wanted them to show), it's going to be a BIG rate increase of a magnitude never before experienced.

The difference between $129.5M and 113.4M is only $16M.  While $16M sounds like a lot of money, it's a very small margin for error at a company whose annual coal costs are estimated at well over $500M and whose annual revenue from off-system sales of Harrison's excess electricity are nearly $300M.  If FirstEnergy's calculations are off just $16M, then your rate decrease completely disappears.  If they're off by more than $16M, the rate increase starts.

In addition, as the proud new owner of a creaking, old coal plant, you're now fully responsible for the expected $244M cost of retrofits to comply with EPA rules.  FirstEnergy opted to close other coal plants rather than spend their own money to retrofit, but in this case, they're spending YOUR money.  This $244M cost will also translate to more rate increases. 

So, enjoy your temporary "rate decrease," because the rate increase you're going to receive on January 1, 2015 is going to be a shocker.  But, Chairman Albert hopes his re-appointment will be safely in the bag by that time and that you all will have forgotten all about this crappy deal he handed you.

FirstEnergy filed a proposed settlement with the WV PSC today.  The settlement requests approval of the internal sale of Harrison between two FirstEnergy subsidiaries at full asking price, and includes a few cheap parting gifts for some of the other parties in order to thank them for playing the FirstEnergy Corporate Separation Issues Game.

The settlement must still be approved by the WV PSC, but as I told a reporter this afternoon, chances of the PSC not approving a settlement in this case are slim to none.  But, if you'd like to vent about this crazy miscarriage of justice and the PSC's lack of leadership and vision for West Virginia and how it continues to cost ratepayers money, feel free to let them have it (select case number 12-1571 from the drop down list).

So, let's jump in here, shall we?  The parties to this case included FirstEnergy, PSC staff, the Consumer Advocate ("your" representative), the West Virginia Energy Users Group (representing the interests of a group of industrial electric customers, such as Essroc Cement), different union groups representing labor, the Sierra Club, the WV Coal Association (representing our friend coal), a couple of West Virginia natural gas trade associations and the West Virginia Citizens Action Group.  All parties either agreed to this appallingly bad settlement, or took no position (the gas groups).  The only hold out was West Virginia Citizens Action Group, who opposes the settlement.  Good for you, WV CAG!  At least some organization is sticking up for the public interest.  The rest of the parties?  Yeah, they all went creeping off with their tail between their legs after FirstEnergy threw them a cheap, carnival prize.  Let's take a look at who got what:

1.    West Virginia Coal Association - got this limp, meaningless statement inserted in the settlement:
"The Companies will maximize the amount of West
Virginia coal to be burned at Harrison consistent with the obligation to procure reliable sources of coal at the lowest available cost and other relevant West Virginia statutory provisions."  It does nothing.  Congratulations, coal!  For this, you sold ratepayers down river!

2.    Labor - got the promise that FirstEnergy will create 50 new jobs in West Virginia.  You will pay for these jobs in your electric bill, of course.  The jobs cannot be related to the Potomac Edison billing General Investigation (no new meter readers!) and cannot be legal, accounting, finance or rate jobs (no white collars -- blue only!) and should be in the distribution sector as directed by PSC staff.  This probably means more linemen, which really can't be a bad thing, however, it does nothing to ameliorate the billion dollar cost of owning Harrison.  Congratulations, labor!  For this, you sold ratepayers down river!

3.    WV Energy Users Group - got an "Economic Stability Credit" that will total around $2.3M in electric rate credits to industrial rate classes K & PP.  Congratulations, WVEUG!  For a crappy $2.3M in your own pocket, you sold ratepayers down river!

4.    Sierra Club - got a promise from FirstEnergy to retire $100K of Renewable Energy Credits so that someone else is required to buy them.  The credits will not be available for trade in WV's ineffectual Alternative & Renewable Portfolio Standard.  But since that was such a crappy gift, Sierra Club also got the promise of a plan to create a program to increase energy efficiency by reducing electricity usage by .5% (yes, that's one-half of one percent) of 2013 sales by 2018.  You will pay extra for that though, little ratepayer, although those industrial users may opt out of paying their share as long as they don't use the program.  Congratulations, Sierra Club!  You probably were never really interested in having the WV PSC deny the transaction, you just wanted to get your free gifts (at ratepayer expense)!  For this, you sold ratepayers down river!

5.    Governor Earl Ray Tomblin (wait, he's not a party!) - got a $500K contribution to his "Kids First" program over the next five years.  This program will "support" energy efficiency in schools.  But, wait, that's not all the trinkets that were rained down on our state government!  There was also $500K over the next five years to state low-income energy assistance programs, and an additional $500K over five years to the WV Office of Economic Opportunity Weatherization Program (yes, the program that was investigated for mismanaging funds by giving preference to program employee relatives, paying contractors who hardly worked, etc.).  This contribution is in addition to the $250,000
amount currently included in rates as a result of the Joint Stipulation in Case No. 09-1352-E-42T.  !PLUS! Another $250,000 per year, funded by customers, paid toward WV's low-income assistance Dollar Energy Fund.  It's awful nice of FirstEnergy to give away our money to get the assistance of the state in screwing its electric consumers out of over a billion dollars.  Congratulations, Governor Tomblin!  For this, you sold ratepayers down river!

6.    WV PSC Staff and Consumer Advocate - got some really masterful corporate bookkeeping hocus pocus that will keep the financial magnitude of this transaction from becoming a reality for struggling consumers for the next 16 months.  Because this transaction includes not only the purchase of Harrison, but also the sale of Pleasants, there are actual credits that will reduce ratepayer liability.  However, our thoughtful regulators have included the $25M in credits upfront over the first 16 months of ownership, instead of applying the credit over the useful life of Harrison (life of Harrison - 27 years, life of Pleasants credits - 1.33 years).  It only makes it look like the transaction doesn't cost as much as it did.  In addition, our regulators arranged to allow FirstEnergy to create a regulatory asset (or holding account) for deferred costs to include a whole bunch of little charges and actual amounts spent so you won't see them in your bill today (but eventually you will pay the charges, with interest!)  The best part, though, is the $129M yearly credit to rates that will supposedly come from Harrison's sales revenue and cost reductions.  This magical money machine will completely obviate any rate increases and actually result in a 1.5% decrease in your rates (unless you're an industrial customer, then you get a 5% decrease because you had a lawyer at the table).  Now stop and take a moment to reflect on this:  If this transaction was always going to reduce rates over the long run, do you think all these parties would have wasted time and money opposing it?  Of course not, FirstEnergy and the settling parties are lying to you with a sugar-coated, alternative version of reality, hoping you don't get too angry at the way they have failed you, the ratepayer. The Consumer Advocate has so thoughtfully swept the nasty bits under the rug, instead of protecting your interests for a change.  Some advocate.  What a joke!  For this, you sold ratepayers down river?

There's also something really funky going on with accounting for a reduction to the full purchase price that is to be written off (or is it?  only the phantom knows!).  The amount added to rate base that you'll be paying off over the next 27 years is $795,851,333.   Isn't that funny?  Looks like someone wanted to "split the difference" with FirstEnergy and assume half of the inflated merger book value that should never be recovered from ratepayers.  Half-a-Loaf Harris strikes again!  Depending on which section of the settlement, or which Exhibit you're reading, FirstEnergy is going to book an impairment of anywhere between $256 to 351M.  Yes, FirstEnergy's accounting leaves much to be desired, but our representatives have historically proven themselves completely clueless about regulatory accounting and inept at recognizing when they are being cheated, so this is probably just one of those "regulatory got'chas," this time directed at ratepayers.  It's a regular little (Gary) Jack-in-the-Box that's going to pop out eventually as time continues to crank the handle of this box of balefulness.

Apparently WV's Director of Energy, Jeff Herholt, showed up at legislative interims yesterday to talk about WV's 5-Year Energy Plan.  Hilarity ensued.

A story in The Journal says:

Coal production has fallen by about 25 percent since 2001. The closing of coal-fired power plants has played a significant role in this decrease, Herdolt said.

"We don't struggle over whether our state should use coal or not," Herdolt said. "Other states, that's not the case."

Coal's inability to compete with the price of natural gas has also affected production; however, Herdolt added, there is not a "compelling drive" for utilities to completely abandon coal for natural gas.

And then a clown car roared into the meeting and several legislators poured out:

Sen. Ron Stolling, D-Boone, questioned why coal isn't lucrative enough for even power plants inside West Virginia to use the state's product. Herdolt said price is the problem. About 50 percent of the coal-fired power plants in the state use coal from other places, according to Stolling.

"It's all price," Herdolt said. "We had a lot of coal in storage. We had a mild winter last year, (and) we had a storage buildup."

Some lawmakers were concerned by what they heard at the meeting. Sen. Craig Blair, R-Berkeley, said he wanted to hear more about utilizing coal for energy by way of liquification. Referring to a TransGas coal-to-liquid plant in Mingo County, Blair said he wonders why the state isn't promoting it more.

"We're talking about a lot of jobs in West Virginia, but we're also talking about lower energy prices," Blair said. "Low energy prices give opportunity for the ability to attract businesses to the state."

Sen. Art Kirkendoll, D-Logan, said the state should be more proactive with projects like the coal-to-liquid plant.

"We're sitting on our thumbs waiting for these investors to come in with $2 billion," Kirkendoll said. "Why don't we go get the investors?"

In the next act, a daring trapeze act was attempted by someone with a brain:

The commission also heard from John Christensen, a member of the Berkeley County Economic Development Authority and employee at Mountain View Solar in Berkeley Springs. Christensen was there to make a case for fostering of the solar industry in West Virginia.

Christensen referred to HB3080, which would provide a 1 to 1.5 percent carve-out for solar technology in the state's energy portfolio.

"All the states that have this carve-out are doing great," Christensen said. "We want to be big. ... We want to be involved bringing more jobs to West Virginia."

But it wasn't enough to deflect attention away from the continual capering of the clowns:

But lawmakers questioned the worth of solar with its lower energy production in the state and its cost. Blair, who said he is supportive of renewable energy, said there should be a significant return on investment from the state, and he said it's just not there with solar.

"When government gets involved, and they start issuing tax credits ... you're subsidizing something," Blair said. "It should be cost-effective to start with."

While the Eastern Panhandle doesn't have a direct role in much of the state's energy production, Delegate Paul Espinosa, R-Jefferson, said he believes residents should know about energy issues.

"It's certainly something I think we need to be informed about and be supportive of an energy industry that can be profitable for our state," Espinosa said.

And the music played on...