Back in 2005, Congress decided that not enough investment was being made in the transmission system, and this lack of investment was subsequently causing a decline in electric reliability.  They ordered FERC to concoct rules to provide for transmission investment incentives.  One of FERC's qualifications for incentives is based on the project's "challenges or risks," with the thought being that by making transmission investment less risky, it would become more attractive and result in increased investment.

What is the "risk" in building transmission?  The greatest risk is faced by new transmission projects that require new rights-of-way and new corridors through virgin territory, which will always be met with opposition from affected landowners and communities.  Replacement or upgrading of existing transmission faces much less risk and opposition, and should always be considered first before planning new builds.  However, industry continually fails to follow the path of least resistance because transmission incentives have made building and owning new assets a corporate profit-center in itself.  Investor owned utilities choose to take on riskier projects because they reap bigger financial rewards.  In addition, FERC has redirected all responsibility for financial risk from investors and transmission owners to consumers.

FERC defines risk this way:  "the challenges or risks faced by a project, e.g., siting, long lead times, regulatory and political risks, and financing challenges."  FERC attempts to financially reward investors and transmission owners for undertaking this risk, which has the effect of rewarding them for finding ways to overcome the risk.  Instead of removing risk, FERC attempts to financially compensate for it, and that increases consumers' ultimate cost of electricity.

The methods the industry has developed to overcome risk do not work and actually serve to increase the risk of successful opposition and the cost of the project.  Opposition fuels the siting, political, regulatory, long lead time (delay) and financial (cost allocation) risks.  The more opposition a project garners, the riskier and costlier it becomes.  A more costly project increases profit for investors and transmission owners.  They have no incentive to reduce risk.  As a result, we've reached a standoff where nothing of any substance is ever going to get built, even projects that are needed and economical.

The crux of this problem lies with transmission planning and siting "best practices" that rely on dishonesty, subversion of due process and dissemination of propaganda as a means to control "the public."  These self-defeating practices actually fuel more public anger, delay, political unpopularity and opposition entrenchment.  The solution is to change the transmission planning and siting processes undertaken by project owners, and to some extent by regulators, in order to prevent opposition and incite the support of the public as an equal partner in accomplishing a common goal.

The only way to accomplish this sea change is to throw everything the industry currently thinks they know about successful siting strategies out the window and start fresh with new perspectives.  The solutions have been right under the noses (and barking at the heels!) of transmission owners for quite a while, but they refuse to take the mental leap that would enable them to learn from experience.  Like a stubborn animal, transmission owners just keep butting their head into the same, old brick wall, and expecting different results.  It will never happen with the current "us vs. them" mindset that gives transmission owners a wholly unwarranted feeling of intellectual superiority over project opposition that allows them to incorrectly conclude that opposition can, or should, be dispersed through bullying, trickery or bribery tactics.  There is a complete lack of trust from square one when the root of a project lies in corporate or investor profit.

If you're a regular blog reader here, you might have seen an earlier post that featured the work of a couple of Brits who are nothing short of brilliant.  Patrick Devine-Wright and Matthew Cotton from the University of Exeter have continued their excellent research into the phenomenon of opposition to high-voltage electric transmission siting and, once again, they come to apt and stunning (to the industry, not to us opponents) conclusions.  What makes these guys so brilliant is that they spend time with the opposition and approach the problem honestly in search of a mutually acceptable solution.

Putting pylons into place: a UK case study of public beliefs about the impacts of electricity transmission-line-siting is the result of their work with a group of transmission line opponents.  I think it would be interesting to see their conclusions if they studied a successful opposition group, such as the tri-state PATH opposition, and the ways in which we manipulated, out-smarted and out-maneuvered PATH at every turn, but that's not particularly germane here, although there would undoubtedly be quite a lot of laughter and not a few pints of Raging Bitch ale consumed in the process...

The study comes to the conclusion that the industry and regulators are approaching the problem all wrong in the very beginning.  Transmission planning decisions are currently made at a level that is quite mysterious to the average citizen and subsequently presented to them as a front-loaded fait accompli where the community's only input is framed in an inaccurate "NIMBY" context that reduces their input to a choice between two evils that utilizes a "divide and conquer" methodology. The tone is dismissive and arrogant, whether intended or not. This approach breeds immediate mistrust of a self-interested "authority," and forces them into the hopeless position of attempting to justify and defend a previous decision, instead of a true community consultation process.  Trust, once lost, can never be regained. 

Once the industry has so kindly gathered affected individuals with common cause for these community exhibitions (referred to by PATH opponents as "dog & pony shows") opposition breeds and gathers steam.  The opposition groups satisfy the public's search for a trust-worthy, open and inclusive source of information and a plan for action that empowers and encourages the David vs. Goliath battle that will ensue.  The industry doesn't stand a chance here and have, in fact, already lost the battle at the first engagement.

By broadly painting any opposition with the selfish "NIMBY" brush, the industry is simply lying to themselves and ensuring their own defeat.  What the researchers found was that opposition is intellectually capable of, and indeed demands, a thorough discussion and debate of alternatives.  However, this discussion and debate has already taken place at a higher planning level where the interests of the public have been represented by disconnected and uninformed regulators and government-funded consumer advocates who are out of touch with the real world they supposedly represent.  The only mutually satisfactory conclusion at this point is an acceptable alternative (such as the Mt. Storm - Doubs rebuild in the case of the PATH Project).

Current industry "best practices" lack procedural fairness, effective consultation with affected individuals and consideration of acceptable alternatives.  Until that is remedied, transmission will continue to be "risky" and unduly costly and the stalemate will continue.

 


Comments

Wondering
06/18/2012 4:11pm

They also lack honesty. When the house of cards is built on greed and dishonesty, it cannot withstand even the slightest breeze. The industry refuses to approach the problem honestly but would be more likely to approach this research as a tool to find new ways to trick the NIMBYs. The industry continues to dismiss and disparage the public and refuses to work WITH them. They prefer to cook up schemes intended to control them. They don't listen to what the NIMBYs have to say. They don't care. They just want to make money and continue to perform their social sacrifices.

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Concerned ratepayer
06/19/2012 3:36pm

You mean property owners may actually know something about their property and the area/region surrounding it?

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Keryn
06/19/2012 10:49pm

Property owners know a lot more than they're given credit for.

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06/29/2012 8:21am

This is such a great resource that you are providing and you give it away for free. I love seeing websites that understand the value of providing a quality resource.

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