Just a week ago public comments on the Hollydale transmission line case closed, the week before that was the public hearing, and just before that was the bizarre meeting with the Dept. of Commerce.  And today?

TODAY WE GET THIS:

Hollydale – Petition to Withdraw Pending Certificate of Need and Route Permit Applications

EEEEEEEEE-HA!

It’ll go to the Commission to tie up the loose ends, but YES!!!  Xcel is withdrawing the application and going away… for a while… so they say:

Oh, and by withdrawing, they are not bound by the law because it specifies applications made by a certain date… then it will not apply!  So they’re getting around it, but they say they are not.  Oh well, I don’t think they’ll try the same trick again.

This past year the Hollydale Law, 2013 Minn. Laws Chapter 57 Section 2, which is
applicable to our currently pending applications, was passed. While the law, as
currently written, would not apply to the new applications, we fully intend to comply with the intention of the law by carrying forward in our new Certificate of Need application all the system alternatives, including distribution alternatives, which were developed during this proceeding. We believe this will allow a robust examination of numerous distribution alternatives and will address the concerns implicated by the Hollydale Law.

and:

Once we develop a more widely accepted solution, we intend to seek the appropriate regulatory approvals.

The down side is that by withdrawing, they are not bound by the law that is limited to applications filed by a certain date, so that law might have to be changed to fence them in.  No problem…

Now the down side is they say they’ll be baaaaaaaaack.  I’d guess they’ll be much more cautious and conscious of what they propose, and for Dog’s sake not be using 2006 information.  DOH!

DOH!  It’s worth it just for this sentence:

Markets do not automatically provide competitive and efficient outcomes.

Here it is, with the full all-in-one option or separate sections:

3Q PJM State of the Market Report Page

Here’s the full version: 2013 3Q PJM State of the Market Report

And the short version, oh, how I love it when this happens:

The market design should permit market prices to reflect underlying supply and demand fundamentals. Significant factors that result in capacity market prices failing to reflect fundamentals should be addressed, including better LDA definitions, the effectiveness of the transmission interconnection queueprocess, the 2.5 percent reduction in demand that suppresses market prices, the continued inclusion of inferior demand side products that also suppress market prices and the role of imports.

Got that: … the 2.5 percent reduction in demand that suppresses market prices…

– 2.5%

Gee, sounds like we ought to pay to build some more power plants and transmission lines…

Today we had a very well attended public hearing on the Hollydale Transmission Project.  This is important because it’s a project proposed, end to end, to ram through a residential area, precisely where transmission doesn’t belong.  Worse, this is a Certificate of Need proceeding, and there is no need, only desire.  What do I mean by that?  In transmission, there’s this legally congnizable thing called “need” where the utility has to demonstrate a specific need for the project, say 500 MW of transfer capacity, or a 500 MW line to handle an outage on Line X, or to interconnect 500 MW of big honkin’ coal plant generation.  This project, on the other hand, has demonstrated need only for some measure of distribution expansion, and that’s it.  N-O-T-H-I-N-G about ransmission, they just say they “need” it, and folks, that ain’t good enough.  There are many ways to handle the claimed “need” for distribution, both demand side and supply side:

Need Overview_November 5 2013

Commerce wanted an extension of time to file testimony (why?), and wanted to have “discussions.”  OK, fine… the evidentiary hearing scheduled for November 12-15 was postponed, with scheduling to be worked out.  Then we met on Wednesday.  Oh my… Commerce had said they wanted discussions, and that they wanted to see if there were settlement options, alternatives.  Nope, none of that, there were not discussions, no settlement options discussed, in fact, Commerce didn’t discuss as much as cross examine us, looking for “differences of opinion.”  Never talked of settlement options, though we did show them that there are areas of agreement that they’d not expected.  It was also distressing the way that Commerce’s Santo Cruz (how long has he been there?  Not long!) was framing the discussion, there’s green showing, and I don’t mean in a conservationist sense:

Why was Cruz, someone with what, maybe a week with Commerce, chosen to lead the discussion?  He’d clearly not looked at how PUC dockets that go to a statutory interpretation proceeding work, or more accurately, don’t work!  When Commerce calls a meeting because they have issues with “interpretation” (so it was said), why instead of discussing “issues,” would he cross-examine us instead?  The point?

Why was Bill Grant there?  To execute on the Gov’s orders?  Which are???  He has no experience with transmission other than to cave to utility dreams and accept money for Wind on the Wires, coordinate lobbying efforts for transmission Remember Grant’s transmission Settlement Agreement PUC Docket -2-2152 and his cohort saying about the 2005 Chapter 97 – Transmission Omnibus Bill from Hell, “it’s a deal, it’s a package deal, and it’s a good deal.”  I wasn’t there at the House caucus meeting but I got two separate reports… and anyone supporting something like that bill has no business being in the position he is in at Commerce, over both “need” and “routing” of transmission.  There’s no excuse, Dayton might as well directly appoint a key Xcel Energy lobbyist.

Oh well. Sen. Bonoff was at that meeting to “clarify” intent, which is pretty clear, the language is not complicated:

Sec. 2. TRANSMISSION LINE; CERTIFICATE OF NEED REQUIRED AND
EVIDENCE REQUIRED.

(a) A high-voltage transmission line with a capacity of 100 kilovolts or more proposed to be located within a city in the metropolitan area as defined in Minnesota Statutes, section 473.121, subdivision 2, for which a route permit application was filed between June 2011 and August 2011, and a certificate of need application was filed between June
2012 and August 2012, to rebuild approximately eight miles of 69 kilovolt transmission with a high-voltage transmission line to meet local area distribution needs, must be approved in a certificate of need proceeding conducted under Minnesota Statutes, section 216B.243. The certificate of need may be approved only if the commission finds by clear and convincing evidence that there is no feasible and available distribution level alternative
to the transmission line. In making its findings the commission shall consider the factors provided in applicable law and rules including, without limitation, cost-effectiveness, energy conservation, and the protection or enhancement of environmental quality.

(b) Further proceedings regarding the routing of a high-voltage transmission line
described in this section shall be suspended until the Public Utilities Commission has
made a determination that the transmission line is needed.

EFFECTIVE DATE.This section is effective the day following final enactment and
applies to route permits and certificate of need applications pending on or after that date.
Presented to the governor May 9, 2013
Signed by the governor May 13, 2013, 2:57 p.m.

At Thursday’s public hearing, both Sen. Bonoff and Rep. Anderson, the Plymouth area legislators, made it very clear the intent of the law…

And just before the hearing, while in transit, Commerce sent the following missive, in pertinent part:

The Department at this point has decided that it will not seek certification of remaining statutory questions, but recommends that a trial date and accompanying testimony schedule be established. Setting a January trial date, as proposed this morning by Ms. Maccabee, makes sense although the Department would request that the date be moved to the week of January 20th or the week of January 27th, in that the CenterPoint general rate case will take place on January 14-17, 2014. In this manner, the uncertainty that remains will be fleshed out in the record, to provide more information for decision-makers to determine how best to address the issues in this proceeding.

Good…

The evidentiary hearing on Hollydale is postponed, and now has been rescheduled for the week of January 6, 2014. Here we go!

What’s new?  Well, Xcel Energy has announced its 3Q results and the 2013 demand just keeps going down!

From Seeking Alpha, the 3Q call transcript (emphasis added):

Kit Konolige – BGC Partners, Inc., Research Division

On the — your sales growth outlook, I believe you said that you are expecting 0% to 0.5% in 2013. Can you discuss the breakdown by states on that and maybe any color about commercial versus industrial versus residential? And also give us a view of the longer term sales outlook that you’re seeing at this point?

Teresa S. Madden – Chief Financial Officer and Senior Vice President

Well, sure, Kit. Let’s start with the 2013 by the states. Minnesota, we’re still projecting a decline of about 1.2%. In NSP-Wisconsin, just a slight decline. And then the other 2 jurisdiction, PSCo slightly up and SPS at about 1.2% range. But all of it netting to within the — up to 0.5%. When we look to the future, we’re looking at about, as we indicated in our guidance up to 0.5%, those are narrowing, not such a great degree in terms of the decline in NSP-Minnesota. In terms of the various classes of customers, it does vary by jurisdiction. I will say that C&I, we see the most growth in Texas with the oil and gas industry boom.

CLICK HERE FOR FULL TRANSCRIPT.

Let me repeat that tidbit:

Minnesota, we’re still projecting a decline of about 1.2%. In NSP-Wisconsin, just a slight decline.

And as we know too well, the CapX 2020 transmission project taking over Minnesota is based on their wishful-thinking projections of a 2.49% annual increase.

From Xcel Energy’s own investor page (click to enlarge):

Here’s the full 10-Q (above from p. 50):

XCEL 9.30.13 10-Q

Someone remind me — why are we paying to build this CapX 2020 transmission project?

Back to transmission lines and pipelines…

Looking at the footprints, at what’s proposed, it makes sense, meaning that it fits together, the rest of the story.   But does it? There’s the Not-So-Great Northern Transmission Line (Minnesota Power’s Great Northern Transmission Line), and there’s the Enbridge Sandpiper pipeline.  But is it all connected?  Or is there even more in store?  How much do these companies want?

The Not-So-Great Northern Transmission Line:

And there’s the Enbridge Sandpiper pipeline:

And then there’s this, the Allete Energy Corridor:

There are differences… the Allete Energy Corridor is further south, headed straight east to Duluth.  But look at the map that is in their Notice Plan, the “Preferred Route.”  It’s also south:

Do they need both?  Is this all one and the same project(s)?  As we say in transmission, it’s all connected.  So do tell, what’s the connection with the two announced projects, one transmission and one pipeline, and this “energy corridor.”  Enbridge must submit more detailed maps for the Notice Plan, so we should see soon their “preference.”

Meanwhile, what’s Allete up to?  Seems it started over two years ago:

ALLETE Clean Energy Press Release   7.28.11

And yesterday:

ALLETE Energy Corridor Would Offer Efficient Movement of Multiple Products, from Flared Gas to Water to Carbon

N.D. governor supports comprehensive solution

BISMARCK, N.D.–(BUSINESS WIRE)– ALLETE (NYS: ALE) today laid out its vision for a comprehensive energy transportation corridor that could help provide solutions for the movement of natural gas, petroleum products, water and wastewater, wind energy and future sequestered carbon across a coordinated, shared right-of-way.

The energy corridor’s backbone would follow an existing 465-mile path that contains a direct current transmission line running between Center, N.D. and Duluth, Minn. This 250-kilovolt line, purchased in 2009, is used to transmit electric energy from the lignite-fired Young Generating Station in Center and the nearby Bison Wind Energy Center to Duluth, Minn., home of the nation’s busiest inland seaport. The energy corridor would expand a pathway along strategic portions of the existing right of way to minimize land use and optimize energy delivery infrastructure development within North Dakota.

A top priority of the ALLETE Energy Corridor is to develop an extension of the existing energy delivery path some 60 miles westward to the burgeoning Bakken shale oil fields of west-central North Dakota. ALLETE subsidiary ALLETE Clean Energy has been working diligently with potential partners to study the co-location of facilities and assess the capital needs for the Bakken link. It is envisioned that various lengths of the corridor would be used for different purposes.

“We see the ALLETE Energy Corridor as a comprehensive infrastructure solution in North Dakota that could serve many products and producers across the region,” said ALLETE President, Chairman and CEO Alan R. Hodnik. “We value Gov. Dalrymple’s support of our vision and appreciate him bringing it forward to other members of the state’s energy sector.”

“ALLETE has been invested in North Dakota for decades,” Hodnik added. “We are confident that our rich history of partnering with others can help forge creative solutions to today’s new challenges facing energy markets in the Upper Midwest.”

North Dakota Governor Jack Dalrymple voiced support of the ALLETE Energy Corridor today in remarks to EmPower North Dakota, a commission established to develop a comprehensive energy policy for the state. He said the energy corridor concept is a prime example of the way business can creatively tackle pressing problems like the proliferation of flare gas at oil wells dotting the Bakken field, and the traffic tie-ups caused by too many trucks and trains hauling petroleum products to market.

“The ALLETE Energy Corridor is a breakthrough opportunity to reduce flaring by locating a major natural gas pipeline from the Bakken to eastern markets,” Gov. Jack Dalrymple said. “While the corridor would support the transfer of many energy resources, it could also carry carbon dioxide from coal-fired power plants to western North Dakota for use in advanced oil recovery.”

The ALLETE Energy Corridor could accommodate several pipelines capable of transporting natural gas that would otherwise be flared, as well as wastewater and carbon sequestered from fossil fuel generation. Future wind expansions could also benefit.

“We look forward to working with project developers and government officials to implement this vision,” said Eric Norberg, president of ALLETE Clean Energy. “We have an opportunity to pursue investments that will help solve some current issues and lay the groundwork for more efficient movement of energy products, water and wastewater in the future.”

More information about the ALLETE Energy Corridor can be found www.ALLETECleanEnergy.com.

ALLETE, Inc., an energy company based in Duluth, Minn., has a well-established presence in North Dakota that includes BNI Coal, now undergoing a major expansion to extend coal delivery to its partner Minnkota Power, and the Bison Wind Energy Center, where work on a $350 million fourth phase is scheduled to begin this year. ALLETE’s energy businesses also include Minnesota Power, Superior Water, Light & Power Co. and ALLETE Clean Energy. More information about the company is available at www.allete.com.

The statements contained in this release and statements that ALLETE may make orally in connection with this release that are not historical facts, are forward-looking statements. These forward-looking statements involve risks and uncertainties and investors are directed to the risks discussed in documents filed by ALLETE with the Securities and Exchange Commission.

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