FERC cost-apportionment docket heats up
February 24th, 2010
The cost apportionment remand at FERC is heating up. It’s that case where the 7th Circuit threw out the PJM cost apportionment scheme:
It went back to FERC and so FERC issued an Order requiring PJM to produce things that… well… things that will demonstrate that there’s no need for this project, things that will demonstrate the benefactor of these transmission lines, things that PJM doesn’t really want the world to know, like how they’ve incorporated O-P-T-I-M-I-Z-A-T-I-O-N, things going directly to N-E-E-D!
Seeing that, well, Stop the Lines had to join in, as did the Municipal Intervenors:
PJM begged for more time, an extension of 45 days!
And for some bizarre reason, FERC gave it to them:
Meanwhile, Exelon wants to bring in the kitchen sink, including 345kV transmission:
And parties they are a freakin’ and filing:
And then the weirdest of all – the American Wind Energy Ass (AWEA) wants to intervene, citing “the current significance of this issue in the context of efforts to build transmission to bring location-constrained, renewable resources to load…” Ummmm… SAY WHAT??
OK, I give up… in what parallel or alternate universe is the PATH or Susquehanna-Roseland line for wind? WHERE DO THEY GET THESE IDEAS? I want to see the basis for that statement. PRODUCE!
Earth to AWEA — can you spell P-R-O-J-E-C-T M-O-U-N-T-A-I-N-E-E-R?
If you need a hint, go to FERC eLibrary and search for A05-03. Happy reading!
7th Circuit tosses out FERC & PJM cost apportionment
August 13th, 2009
I was a big Posner fan in law school, mostly because he was so much fun to pick on, I so hate the “Chicago school.” But here’s another Posner, doing good! It’s a hilarious opinion, all the better because it so clearly tells FERC and PJM what to do with their rate shifting cost apportionment. GO POSNER!
Here’s the decision:
Two issues in this case:
1) PJM/FERC pricing based on marginal cost v. pricing including sunk costs. That one went for PJM/FERC, and American Electric and others lost in just a few paragraphs.
2) Where the action is — Ohio and Illinois Commissions objected to the 500+kV cost allocation on a pro rata basis, that “their rats should be raised by a uniform amount sufficient to defray the facilities’ costs.”
What’s particularly interesting to me is that this is all about “Project Mountaineer,” which PJM doesn’t even want to acknowledge exists! the Susquehanna-Roseland line that I’m working against is the NE part of line 1, and the MAPP line through now “just” a part of Delaware is the NE part of the southern line, line 4. Here’s the magnitude of Project Mountaineer – the Susquehanna-Roseland line is QUAD 500kV plus double circuiting the existing 230kV line, that’s one big project:
FYI, in the Cudahy dissent, he did some digging, and there is a Project Mountaineer tootnote quoting PJM stating that Project Mountaineer “would bring about substantial congestion relief and reliability improvements increasing Midwest-to-east transfers by 5,000 MW.” See Ventyx, Major Transmission Constraints in PJM (2007).
A quick sidebar… FYI, from Delaware Electric Cooperative 2009 Energy Plan – “CONFIDENTIAL”, arguing for the MAPP transmission project…
… and they report that transmission congestion is down 75% to 275 hours ANNUALLY! Really… so for that 275 hours we should build the $1.2 MAPP project? HOW STUPID DO YOU THINK WE ARE?
OK, back to Posners 7th Circuit decision. It was PJM’s idea, approved by FERC, to hit up all the utilities, and Illinois, a BIG example of the problem, would have had to pay out some $480 million while not receiving one dime of benefit. PJM used the theory that, well, PJM used to do it this way all the time before in massive infrastructure buildouts, but as Posner reminded them, that was then and this is now, PJM is a lot different now, Illinois wasn’t even part of the picture.
Posner was pissed off that there was no data at all to support their desired allocation, no data, no specifics about difficulties in assessing benefits, no lawsuits about inequities, no particulars, “[n]ot even the roughest estimate of likely benefits to the objecting utilities… oh yes, he let them have it… for page after page… and notes that FERC “brief devotes only five pages to the 500kV pricing issue.” FERC seems to presume a similar brainwashing in the courts that they and utilities presume of Commissions and legislatures, one that I see to often, that frantic claim of URGENT need, ‘WE’RE GOING TO FREEZE IN THE DARK IN AN INCUBATOR WITHOUT A JOB” theory, presented despite documented long term decrease in demand across the country. Once more with feeling, HOW STUPID DO YOU THINK WE ARE?
Oh, these guys irritate me. Anyway, check out this decision and consider the impact on all the 500kV and above projects applied for or waiting in the wings.