Interesting column this week from Tom Miller, who writes West Virginia legislative gossip column Under the Dome
Although he mistakenly believes that the PATH case has been tolled just because a motion to do so has been filed, Miller has a really interesting take on the way PATH is being looked at in the legislature. That's what Miller's column is all about -- a behind-the-scenes look at issues in Charleston and what is being said about them by our elected representatives.
Here's a link to Tom's take on the status of the PATH project
. And here's a quote:"MEANWHILE, the news that staff attorneys for the West Virginia Public Service Commission recommended that the long-distance PATH (Potomac Appalachian Highline) electric transmission line from Putnam County to Maryland not be authorized by the PSC suggests this project may not be the panacea many of its supporters claim.This objection last week prompted American Electric Power and Allegheny Energy--the developers of this 275-mile, $2 billion project from the John Amos Power Plant in Putnam County to a site in Maryland--to ask the PSC for a six-month delay in the formal hearings on the project.These two utility companies said the delay would allow more time to study and document the future electrical demands for the region. The hearings originally were to be in the spring of 2011 with a final PSC decision coming by July 28, 2011. Now the decision will be delayed until February of 2012. PSC attorneys claim the project to construct a 765-kilovolt line is nothing more than a "huge extension cord" to East Coast population centers that will create more pollution-causing coal-fired power plant emissions in West Virginia. And PSC approval would also provide the power company with the right of eminent domain to acquire the rights of way from landowners."
Looks like PATH's goose is also cooked in the legislature. The citizens have been doing a little lobbying of their own, and it didn't cost a thing! The efforts of the citizens of West Virginia who have taken the time to get to know their elected representatives and make their views on PATH known have been successful. If you're one of these active voters, pat yourself on the back. Mission accomplished and job well done!
As a follow-up to the manufactured swill that PATH filed as a response to WV intervenor Ali Haverty's discovery request regarding FERC USofA account 426.4 "Certain Civic and Political Activities", she filed another request for additional information on Thursday afternoon.
For whatever reason, the PSC docket clerk went off for her three-day weekend without posting the pdf files or sending out the notices for a whole plethora of new additions to the docket which were filed on Thursday. However, you can see Ali's request here
What's really interesting in Ali's request is a copy of an invoice from one of PATH's lobbyists that she included as an example of the type of detailed invoices that she's requesting for various vendors in PATH's 426.4 account detail.
Take a look at page 5 of her request to get a feel for what PATH's lobbyists are getting paid to do, paying particular attention to the line item I highlighted. "Working with Craig Glazer of PJM to determine strategy."
But, wait a minute, both PJM and PATH claim that there's nothing funny going on here... PJM is not biased or favoring the PATH project and their dealings are "transparent" and aboveboard. If that's true, then PATH isn't getting their money's worth here.
So, which is it? Is PATH's lobbyist working to influence PJM actions, or are they throwing their money away on a lobbyist who's billing for work never performed? You be the judge.
Good news! PATH has finally complied with the WV-PSC's Order and submitted responses to Ali Haverty's requests.
Now I see why it took so long. It had to be created. And I mean that in the most complete, literal sense.
What has PATH been doing with your money? And lest they attempt to tell you it's not your money, here's the truth: These particular expenses revealed in the PSC case are booked as an income deduction. PATH's only income comes from you, courtesy of the return they earn on capital expenditures in the ratebase. PATH deducts these "donation" & "civic and political activity" expenses from their income to come up with a lower total income figure for tax purposes. So, where does the actual cash they pay for these items come from? Right out of your pocket because you're paying them that return every month in your electric bill.
So, what turned up in discovery?
For account 426.1 Donations
. This account shall include all payments or donations for charitable, social or community welfare purposes.
For account 426.4 Expenditures for certain civic, political and related activities
. This account shall include expenditures for the purpose of influencing public opinion with respect to the election or appointment of public officials, referenda, legislation, or ordinances (either with respect to the possible adoption of new referenda, legislation or ordinances or repeal or modification of existing referenda, legislation or ordinances) or approval, modification, or revocation of franchises; or for the purpose of influencing the decisions of public officials, but shall not include such expenditures which are directly related to appearances before regulatory or other governmental bodies in connection with the reporting utility's existing or proposed operations.
I'm not going to comment on any of the individual entries here. I don't have that much time on my hands. If anything makes you curious, do a google search on the vendor. I'll just make the observation that it doesn't add up. So, was PATH cheating in their FERC filings, or are they cheating here?
Although I tried to give them the benefit of the doubt for much longer than I should have, it's now become quite obvious that this financial codswallop is being done on purpose in order to bolster the bottom line. This would be cheating, in my book. It's a stunning display of "error" after "error" after "error". Can the accounting staff of a regulated corporation really be this inept? No. When something doesn't make sense, it's usually not true. And Allegheny could not be that stupid and still manage to operate. Yes, I said Allegheny. It seems that's where most of the codswallop takes place. I'm not absolving AEP here though. They certainly had their finger in the pie too, although not as deep. And when the manure hits the fan at game end, they're both going to be covered in it.
Yesterday, PATH filed another
correction to their 2010 Formula Rate Annual Update
. Read the letter carefully and pretend you're FERC and this is the second correction you've received because of "errors" in PATH's accounting. Are any alarm bells going off? Although he tries to pretend that the "errors" were discovered by PATH, they were really discovered by Ali Haverty and myself and PATH was tipped off to them either through our discovery requests or our Preliminary Challenge. Unfortunately for them, they still didn't fix them all! This is a mere drop in the bucket. It's so not over yet. PATH has rather begrudgingly provided us with more than enough to hang them as we continue to move forward on the challenge to their Formula Rate filing.
We all learned in kindergarten that George Washington supposedly said "I cannot tell a lie" when his father asked if he chopped down the cherry tree. It's no coincidence that George's likeness appears on the dollar bill because, just like George himself, a dollar won't lie to you. Follow the money and it will always lead you right straight to the truth. That was always my favorite part of accounting. It's black and white -- there are no shades of gray for crooked companies to hide behind. And I get it, PATH. I completely get it now.
Remember the Frederick County Planning Commission meeting
that PATH ditched? Well, now they're trying to pretend that they didn't get an invitation to the party and therefore are entitled to another "do over".
Yes, try not to laugh at their poor, disorganized souls... they simply didn't know about the meeting and relish the opportunity to go back before the Planning Commission and beg for forgiveness. You believe them, don't you?
The Planning Commission has set another hearing for January 19, 2011 at 1:00 p.m.
Please mark your calendar to attend (yes, PATH, this means YOU!)
Funny that hundreds of citizens showed up for that "secret" meeting. It was the best kept secret in Frederick County, apparently. PATH should quit embarrassing themselves this way. It's positively EERIE!
Personally, I'm looking forward to seeing that little smirk Chairman White wears so well again. See you there! :-)
Today was the deadline for PATH to submit their substantive response to the data request submitted by WV intervenor Ali Haverty, as ordered
by the Commission on December 17. Ali didn't receive a response.
The Order states: "IT IS FURTHER ORDERED that the Haverty Motion to Compel is granted. The
Applicants will submit its substantive response to the data request within ten days of the date of this order."
It says "ten days", not "ten business days". Ten days from December 17 would be December 27, which is today. So, therefore, PATH has defied the Commission's order. Way to go, boys! I guess PATH has given up on trying to score any more brownie points with the Commission and intends to behave like a stubborn child instead.
Yes, we know how much this one hurts, trust me, but that doesn't mean PATH can or should simply ignore it.
Let's see... what will PATH's excuse be for defying the Commission? It seriously can't be the old "days vs. business days, not including holidays" argument
, can it? Really, that one isn't going to fly. It didn't work last time, and it's not going to work this time either.
Isn't it high time that PATH realizes they're no longer driving this train, and that the citizens have taken over engineer duties? Get with the program, fellas.
PATH's proposal to toll the PATH case in all three states and blame it on PJM (another doltish strategy decision that will go down in history) is already getting push back. Today, three separate motions were filed to dismiss the case in lieu of tolling. See them here
. All of these motions are well-written and rely on different valid points of law (as well as common sense -- something that PATH seems to be missing). I have a feeling there will be more. Lots more.
It's all coming crashing down in flames for PATH now. They've got so many serious problems with their project they simply can't recover. End times. Give up.
Like a giant, disease-filled boil on the posterior of society, PATH is about to be lanced.
Merry Christmas, you greedy b@stards! Don't say we didn't give you anything :-)
Good article in Frederick News Post
. Another reporter smells the lies and omissions of fact in PATH's press release! And another PATH PR flack looks like a monkey...
I've been intending to post a link to this article since this morning, but shopping, baking and Bob Rivers Twisted Christmas got in the way (want a cookie?). Bill beat me to it, so be sure to also read his take on it
A Missouri PSC Commissioner, Jeff Davis, gives his opinion of FERC's all-you-can-eat cash buffet for transmission developers
in industry rag Transmission & Distribution World (how's that for some fun reading?) He's got it exactly right and it lays bare the underlying motivation behind PATH and other unneeded transmission projects. It's all about the money, boys!
PATH is riding along on an abundant gravy train, courtesy of you! All their "prudently incurred construction and development costs" are recovered from you as they are incurred. This expense is in your electric bill every month, if you're one of the 51-million electric customers in PJM's 13-state region. They also make a hefty profit, which is where that 14.3% ROE comes in. The power companies have all their costs covered, they even make a profit on the recovered costs, and they get to sell more of their filthy coal-fired electricity to the east coast population centers. The costs are "socialized" (paid for by electric customers) while the profits are "privatized" (they go in the pockets of Allegheny Energy, AEP, their super-rich CEOs, investors and shareholders).
Davis puts it like this, "FERC's repudiation of the “beneficiaries pay” doctrine along with all the “candy” incentives they are offering have created a modern-day gold rush to the transmission sector. Unfortunately, all the gold in this mine winds up in the hands of the transmission owners who get paid handsomely to build assets they end up owning. Consumers won't even realize they have gotten “the shaft” until a few years from now when their electric bills start going up to pay for these projects. The more these projects get rolled into rates, the madder those consumers are going to get. And who can blame them? If FERC has its way, we'll all be spending the next 30 years depositing our gold into someone else's mine. All we get is the shaft."
Couple of points: this isn't happening "a few years from now" here in PJM territory, it's happening NOW, and many consumers are still blissfully unaware of why their electric bills keep going up quite mysteriously. It's courtesy of PATH, TrAIL, Susquehanna-Roseland and other gravy train "backbone" transmission projects. Also, I'm not sure where he got the figure of "30 years", but you're going to be paying for PATH forever. The land and land rights they are purchasing and stuffing in the ratebase NEVER depreciate, so you'll be paying a return (that 14.3% ROE) on them into eternity.
Think if PATH is halted we'll all get our money back? No, PATH has been awarded the ability to recover all their costs in the event that a project is abandoned due to circumstances beyond their control. It's not quite as simple as that though, and remains to be tested. I think PATH should pony-up and become the test case, don't you? There's a whole bunch of hoops they'll have to jump through at FERC, and with their accounting problems hanging off their ankles like lead weights, I don't think they'll be jumping too sprightly. What fun!
Another important quote: "More importantly, there's no accounting for what will happen to customers' bills when it comes time to calculate all of the incentives with interest, taxes, depreciation and amortization." Precisely! This is what puts lie to PATH's $2.1 billion cost estimate. Their "estimate" (which is probably as phony as a three dollar bill anyhow) doesn't take any of these costs into account. The real price tag for PATH is going to be astronomical if we don't put paid to this nonsense now.
And last, but certainly not least, there's this: "Transmission builders can get 100% of their costs capitalized, guaranteed cost recovery for pretty much all their expenses, little or no regulatory oversight on costs and cost-overruns
, as well as a hypothetical capital structure to combine with a 13% to 14% return on equity for their projects." While he's right that there is little or no regulatory oversight on costs and cost-overruns (as long as the utility fills out the forms properly and submits them on time, nobody at FERC pays attention), there is also a necessary public oversight provision in the tariff used to recover these costs. Any "interested party" (meaning you customers) can utilize an existing discovery and challenge procedure to get inside the utility's accounting and protest this unbridled spending spree. In fact, it's already happened to PATH
, and what we found when we started getting data was a stunning display of bad accounting practice and imprudent expenditures. PATH has a lot to answer for before FERC.
Familiarize yourself with the process now -- keeping these utilities honest with your money is nobody's job but your own. Sad but true.
by West Virginia Public Broadcasting.
Nitowski looks like a nincompoop. Just a little too much "coincidence" going on between the deadline for PATH to respond to the PSC staff's motion and PJM's "release of new information". You should make your lies at least somewhat
believable! What a clown!
Today, Virginia respondent (intervenor) Al Ghiorizi filed this motion
in the Virginia PATH case. He very succinctly sums up everything we have been posting on this blog and Calhoun Power Line for the past month or so about PATH's lies and PJM's complicity in the deceit.
Two great lines:
"Now, we understand PJM has another Load Forecast with a new in-service date. It’s Groundhog Day all over again."
"As the bard wrote hundreds of years ago: “There’s something rotten in the State of Denmark.”
A very fun read! Thanks, Al!
What a bunch of whiners PATH is turning into! The mom in me wants to send them to their room to contemplate those less fortunate for several hours and not return to civilized society until they can stop sniveling and crying, "poor me!"
Yesterday, PATH filed this
on the FERC docket regarding their soon to be history 14.3% ROE. Randy and Monique cry some big crocodile tears about how unfair
FERC is being by insisting that the median of their new proxy group be used to calculate their new ROE.
Let's have a quick talk about median vs. midpoint
. Yes, it's math, but I promise it won't be hard. Don't look away, it will be virtually painless and I promise you'll "get it". You're probably all familiar with "average" and how to calculate it -- you add up all the figures in your series and then divide by the number of figures to find the average or "midpoint". Median is a slightly different animal and can result in a lower figure. To calculate median, you sort your figures in numerical order and then select the middle number. If you have an even number of figures, you calculate the mean of the two middle figures to arrive at median. To see an example of this, see the link above. The link explains how median is a popular mathematical trick favored by shysters, or in this case our slippery PATH friends, Randy and Monique.
They're quite familiar with median resulting in a lower number. In the TrAILCO order
, they managed to screw a bunch of property owners out of a fair price for their property by using the median of three appraisals to determine the price to be paid to property owners within 400 feet of TrAIL, instead of the midpoint.
"Staff General Condition #2 - “The Company shall purchase any property containing residences that are within 400 feet of the centerline if the owner desires to sell their property. TrAILCo accepts this condition, provided that in each case the property owner will have until the first anniversary of the inservice date of the West Virginia Segments of TrAIL to notify TrAILCo in writing that the property owner has elected to exercise
the option to require TrAILCo to purchase the property at a fair market value based on the median
of three appraisals. One appraisal shall be prepared by a qualified appraiser selected by the property owner, another appraisal shall be prepared by a qualified
appraiser selected by TrAILCo and a third appraisal shall be prepared by a qualified appraiser selected by agreement of the two other appraisers. TrAILCo shall pay the reasonable costs of all three appraisals."
Oh, boo-hoo-hoo, cry me a river, you two. Do you really think FERC is going to fall for your skulduggery? Hypocrites.