On May 19, FERC issued a Notice of Inquiry on Promoting Transmission Investment Through Pricing Reform. It's been 5 years since the incentives were outlined in Order 679, and FERC would like to receive comments from stakeholders regarding how the incentives have worked out for them and ways in which the practice of incentivizing transmission can be improved. What this is NOT is an invitation to do away with FERC incentives all together, because FERC is quick to point out that in the EPAct 2005, Congress directed them, "to establish by rule incentive-based, including performance-based, rate treatments for the transmission of electric energy in interstate commerce by public utilities for the purpose of benefiting consumers by ensuring reliability and reducing the cost of delivered power by reducing transmission congestion." If you want to do away with the all-you-can-eat dessert bar that the energy companies have been feasting on for the last 5 years, your efforts are more properly directed to your Congressional representatives.
Your elected representatives were the ones who passed the EPAct 2005 (Cheney's "Secret Energy Taskforce") under the influence of a hugely expensive lobbying effort on the part of the energy companies. While you were living your life, flipping switches and plugging things in, and paying a monthly electric bill to some energy corporation, these same corporations were hard at work creating their dream come true behind your back. I think we have all learned that blissful ignorance is a very sharp sword and it's much harder to undo damage than it is to prevent it in the first place. In the PJM region, the energy companies, PJM, state government and FERC were busy conspiring on plans like, "PROMOTING REGIONAL TRANSMISSION : PLANNING AND EXPANSION TO FACILITATE FUEL DIVERSITY INCLUDING EXPANDED USES OF COAL-FIRED RESOURCES", which was the start of PJM's Project Mountaineer. Project Mountaineer, a plan to increase west to east transfer of 5,000 MW of coal-fired power across the PJM region, brought us the TrAIL project, the Susquehanna-Roseland project, the MAPP project, and the PATH project. All of these projects represent energy company grabs at the opportunities for increased profit yielded by Project Mountaineer and FERC's all-you-can-eat transmission incentives buffet. In other parts of the country, there were similar schemes in the works that have resulted in, "...over 75 applications for transmission incentives. Collectively, the applicants in those cases sought incentives for investment in over $50 billion in proposed transmission infrastructure...", in the words of FERC.
The EPAct 2005 and subsequent FERC orders have created an unbelievable feast for energy companies, at the expense of all electric ratepayers. With incentives like incentive adders to base ROE that total as high as 14 - 16%; recovery of 100% of CWIP in ratebase, accelerated depreciation and pre-commercial costs; hypothetical capital structures; and recovery of 100% of abandoned plant, the energy company shareholders cannot lose when proposing new transmission projects, whether these projects are actually needed or not. Even a loser is a winner under FERC policies. This has created a gold rush to transmission, and has proven increasingly more expensive to the ultimate stakeholder -- the ratepayer, who is responsible for funding the whole thing. Shareholders win, consumers lose.
FERC, PJM, and the states have a perverted definition of the word, "stakeholder." They believe it includes the energy companies, the regional transmission organization cartels, the state bureaucrats and organized lobbying groups. They don't think it includes individual consumers. But, we're going to ask you to take control of your own destiny and submit comments.
In order to be effective, you've got to understand this stuff. You need to do some reading.
Brief news article about the NOI
The Notice of Inquiry
Statement of Commissioner Moeller
Statement of Commissioner Norris
It's not a lot of reading, and it's not confusing. Consider it a starting point. I'll be posting more in the near future about the specific incentives and how to submit your comments, so bookmark this blog section and come back after you've done your homework.
The 60-day comment period will not begin until the NOI is published in the Federal Register and that has not happened yet. We will be advising you of the deadline as soon as we know it. There is no rush to get your comments in, you have plenty of time to do it properly. Quality counts here, not speed or quantity. Do not squander this golden opportunity by feeling rushed and giving up. PATH opponents should properly be focused right now on a more pressing need, submitting their comments regarding PATH's requested abeyance on their EIS application. Do that first, and then come back and work on this.
If you think you already know enough to submit your comments, we recommend that you submit them via FERC's e-filing system. "Snail mail" comments are often faced with long federal agency mail delays and many consumer comments on other recent FERC dockets have been reported "lost in transit" by their authors.
Please DO NOT send form letters to FERC! It's inappropriate. If you agree with another comment on the docket, it's okay to say so, but repetition of identical comments is not encouraged.
And here's the most important part: Spread the word!
Please share this with your contacts who are fighting other transmission line applications, environmental and activist groups, your elected representatives and others who you think should take an interest. This NOI is of interest to every person who pays an electric bill.
If you found this helpful in crafting your comments, you are encouraged to browse the entire FERC Transmission NOI category at StopPATHwv.com for other useful material. You don't have to comment on all aspects of the NOI if that's too burdensome. In fact, if you want to concentrate in detail on just one aspect that interests you and about which you have strong feelings, that's a perfectly acceptable approach to producing effective comments.
Your elected representatives were the ones who passed the EPAct 2005 (Cheney's "Secret Energy Taskforce") under the influence of a hugely expensive lobbying effort on the part of the energy companies. While you were living your life, flipping switches and plugging things in, and paying a monthly electric bill to some energy corporation, these same corporations were hard at work creating their dream come true behind your back. I think we have all learned that blissful ignorance is a very sharp sword and it's much harder to undo damage than it is to prevent it in the first place. In the PJM region, the energy companies, PJM, state government and FERC were busy conspiring on plans like, "PROMOTING REGIONAL TRANSMISSION : PLANNING AND EXPANSION TO FACILITATE FUEL DIVERSITY INCLUDING EXPANDED USES OF COAL-FIRED RESOURCES", which was the start of PJM's Project Mountaineer. Project Mountaineer, a plan to increase west to east transfer of 5,000 MW of coal-fired power across the PJM region, brought us the TrAIL project, the Susquehanna-Roseland project, the MAPP project, and the PATH project. All of these projects represent energy company grabs at the opportunities for increased profit yielded by Project Mountaineer and FERC's all-you-can-eat transmission incentives buffet. In other parts of the country, there were similar schemes in the works that have resulted in, "...over 75 applications for transmission incentives. Collectively, the applicants in those cases sought incentives for investment in over $50 billion in proposed transmission infrastructure...", in the words of FERC.
The EPAct 2005 and subsequent FERC orders have created an unbelievable feast for energy companies, at the expense of all electric ratepayers. With incentives like incentive adders to base ROE that total as high as 14 - 16%; recovery of 100% of CWIP in ratebase, accelerated depreciation and pre-commercial costs; hypothetical capital structures; and recovery of 100% of abandoned plant, the energy company shareholders cannot lose when proposing new transmission projects, whether these projects are actually needed or not. Even a loser is a winner under FERC policies. This has created a gold rush to transmission, and has proven increasingly more expensive to the ultimate stakeholder -- the ratepayer, who is responsible for funding the whole thing. Shareholders win, consumers lose.
FERC, PJM, and the states have a perverted definition of the word, "stakeholder." They believe it includes the energy companies, the regional transmission organization cartels, the state bureaucrats and organized lobbying groups. They don't think it includes individual consumers. But, we're going to ask you to take control of your own destiny and submit comments.
In order to be effective, you've got to understand this stuff. You need to do some reading.
Brief news article about the NOI
The Notice of Inquiry
Statement of Commissioner Moeller
Statement of Commissioner Norris
It's not a lot of reading, and it's not confusing. Consider it a starting point. I'll be posting more in the near future about the specific incentives and how to submit your comments, so bookmark this blog section and come back after you've done your homework.
The 60-day comment period will not begin until the NOI is published in the Federal Register and that has not happened yet. We will be advising you of the deadline as soon as we know it. There is no rush to get your comments in, you have plenty of time to do it properly. Quality counts here, not speed or quantity. Do not squander this golden opportunity by feeling rushed and giving up. PATH opponents should properly be focused right now on a more pressing need, submitting their comments regarding PATH's requested abeyance on their EIS application. Do that first, and then come back and work on this.
If you think you already know enough to submit your comments, we recommend that you submit them via FERC's e-filing system. "Snail mail" comments are often faced with long federal agency mail delays and many consumer comments on other recent FERC dockets have been reported "lost in transit" by their authors.
Please DO NOT send form letters to FERC! It's inappropriate. If you agree with another comment on the docket, it's okay to say so, but repetition of identical comments is not encouraged.
And here's the most important part: Spread the word!
Please share this with your contacts who are fighting other transmission line applications, environmental and activist groups, your elected representatives and others who you think should take an interest. This NOI is of interest to every person who pays an electric bill.
If you found this helpful in crafting your comments, you are encouraged to browse the entire FERC Transmission NOI category at StopPATHwv.com for other useful material. You don't have to comment on all aspects of the NOI if that's too burdensome. In fact, if you want to concentrate in detail on just one aspect that interests you and about which you have strong feelings, that's a perfectly acceptable approach to producing effective comments.
RSS Feed