FERC Complaint Changes Everything You Thought You Knew About Grain Belt Express

Isn't it high time to stop Invenergy's posturing about how "advanced" Grain Belt Express is, or how much of a "sure thing" it is.  Here's the reality I've been continually serving up for years, now bolstered by both MISO and MISO transmission owners:  Grain Belt Express is a speculative project that can't be completed because it doesn't have enough customers.  Here, I even created a fresh one!

Invenergy is so full of themselves lately that maybe now they even believe their own exaggerations about how "needed" they are?  What else could explain the recent Complaint Invenergy filed against Midcontinent Independent System Operator (MISO) at the Federal Energy Regulatory Commission (FERC)?  At any rate, filing that complaint could begin a new section of Invenergy's Grain Belt Express scrapbook entitled "The Beginning of the End."  Well, if Invenergy is keeping a scrapbook, that is....

Invenergy filed its complaint in the beginning of August, claiming that MISO wrongly excluded GBE from its recent Long Range Transmission Plan (LRTP).  Invenergy said that although MISO's rules require a merchant transmission project to have a signed interconnection agreement (IA) or to be included in a utility's state-approved integrated resource plan in order to be a part of the plan, Grain Belt should also be included because it is an "advanced stage merchant transmission" project.  Invenergy said that by failing to include a completed and operating GBE in the model of the MISO transmission system that is used to identify new projects, MISO was hurting ratepayers by making them pay for projects that might not be necessary if GBE was included.  In plain English -- some of the projects that MISO approved in its LRTP may be a better deal for GBE's prospective customers!!!

Here's a map of MISO's recently approved Tranche 1 LRTP.

As MISO confirmed in its Answer to the Complaint, Invenergy's problem is the series of lines beginning at "Orient" Iowa (its the name of a substation, not necessarily a town) connecting to Fairport, Missouri, connecting to Zachary, Thomas and Maywood, Missouri, and ending at Meredosia, Illinois as shown on the above map.

On March 17, 2021, MISO laid out its initial roadmap for LRTP transmission solutions based on the Futures analysis. The initial roadmap included a proposed line from central Iowa, through northern Missouri, with two offshoots further south into Missouri with one in a similar area as the proposed Point(s) of Connection for the GBX Line, and finally into central Illinois.
 
It was announced during that meeting that the analysis had been completed on the proposed Transmission Solutions linking central Iowa to Northern Missouri to central Illinois and that those upgrades would be included in the LRTP portfolio. It was only after this announcement that Invenergy approached MISO to express its views regarding the GBX Line and how it interacted with LRTP.

Or, as Missourian Norman Fishel said in his Comments on Invenergy's complaint filed at FERC:

In comments to MISO, Invenergy claimed that “[f]ailure to account for the GBX Line may cause economic harm to GBX.”

Grain Belt Express acknowledges how it intends to edge out new MISO projects by taking their place:

“Across the Midwest and Great Plains, several potential transmission projects have been proposed over the next decade to address regional reliability needs, enable the delivery of power to load centers, reduce congestion, and unlock renewables potential. While there still may be a need for localized upgrades, given that the Project addresses these broader goals, it stands to logically reason that the Project could plausibly defer/eliminate the need for certain future major transmission developments."

Well, talk about overestimating your own importance!  Invenergy must think that it can control MISO's planning the same way it has grabbed various state politicians by the scruff of their neck and owned them.

A merchant transmission project cannot just horn into a regional transmission plan and claim it's accomplishing the same goals and therefore make the regional transmission organization cancel its own projects.  It just doesn't work that way.  MISO plans its own system.  MISO also manages generator connections like GBE to make sure they don't compromise the system.

Invenergy also compares the expected timeline of its proposed projects to the expected timelines of the LRTP Tranche 1 projects, but that comparison does not help Invenergy’s argument, even if taken on its face value. Under the Tariff, the MTEP is “developed to facilitate the timely and orderly expansion of and/or modification to the [MISO] Transmission System.

Including projects without sufficient certainty, regardless of timeline, does not advance system reliability.

In other words, MISO cannot count on speculative merchant transmission projects to ensure reliability.

Couple other things MISO said in its Answer, which I urge you to read carefully:

1. GBE kept changing its interconnection requests in both size and location.
2. GBE still has an interconnection position in Ralls County.  MISO doesn't know what its intention is with this.
3. GBE's interconnections are all unidirectional -- they have asked for permission to inject energy into MISO, not withdraw it.  Beware any entity that has been promised service from MISO to PJM (MJMEUC).  Or any entity that has been told how GBE could reverse directions and move power from east to west in an emergency.  It just can't happen.
4. "Invenergy has only requested to operate the GBX Line as a long generator lead line."  That's a quote.
5. "Adopting Invenergy’s proposals will reduce the precision of MISO’s planning models by making them subject to an MHVDC [merchant] Connection Customer’s changes or withdrawals." and "Invenergy’s proposals may inappropriately assign costs driven by the GBX Line to MISO load. The Commission should not allow Invenergy to unilaterally mold MISO’s MHVDC connection and planning processes to fit its commercial proposals."
6. No load serving entity (electric utility) in MISO said it was "planning on the GBX Line as a resource to meet their plans/goals."
7. Invenergy told MISO that Ameren was ordered to include GBE in its Integrated Resource Plan by the MO PSC, but "Ameren’s 2022 IRP update does appear to not mention the inclusion of the GBX Line."  Sounds like another case of Invenergy using stale information to misleadingly bolster its project.  Be sure to verify everything Invenergy says from now on (more on why in the section of this post about Norm Fishel's comments).
   
8. MISO's rules "protect MISO customers from unjust and unreasonable rates that could result from the incorporation of premature or incorrect assumptions about future projects without sufficient certainty."  Here's the thing... GBE can be cancelled at any time due to lack of customers.  If MISO counts on it and that happens, MISO would have to quickly plan projects to take its place that may be less efficient and more expensive.
9. "The reality, however, is that projects and business plans change and the GBX Line proposal is a prime example..."
10. "[Invenergy's] proposed definition of “Advanced Stage Merchant Transmission” is completely unsupported."  Read Norm's comments to see why "Advanced-stage merchant transmission has no definition, and even seems to change depending upon the venue in which Invenergy finds itself.  In its recent Missouri Application, Invenergy claims that its project has not yet reached an advanced stage..."
    
11. MISO explains how adding a speculative merchant transmission project to the models before the interconnections are approved causes new lines to support those interconnections to appear in the plan earlier, where they are paid for by captive ratepayers, instead of the merchant that caused them... "...relieving Invenergy of its obligations to pay for upgrades needed to accommodate its interconnection." 
12. "MISO is concerned that the Complaint is merely a vehicle to address one entity’s commercial preferences or use MISO’s processes to enable a specific project rather than an identification of a genuine need."  And if Invenergy was looking for MISO to support building GBE, it can now be sadly disappointed.  All the malarkey about reliability, need, lower prices can now be chucked out the window.  Reliability, need and cheaper electricity prices are what MISO does.  MISO says GBE is not needed for any of those purposes.  Who are you going to believe?  An impartial grid planner or a self-interested profit-seeking corporation?

And if you think the MISO Answer is derisive towards GBE, don't miss the Protest of MISO Transmission Owners (TO).  This entity consists of a large group of utilities that own transmission lines that serve MISO and who have fully participated in MISO's planning process which came up with the new lines Invenergy objects to, including Ameren.  The TOs don't mince words.  You should probably read this to yourself using a sneering voice:

Invenergy also fails to show that the GBX Line should receive special treatment and circumvent the MISO planning process. As a project that is not yet certain, MISO properly excluded the GBX Line from the planning studies for LRTP projects.

The TOs go on to point out why GBE is speculative.

Invenergy claims that its GBX Line, a merchant high voltage direct current (“MHVDC”) transmission project designed to carry up to 5,000 megawatts (“MW”) of energy, should have been accounted for in MISO’s transmission planning analyses even though it has not yet obtained all necessary approvals and interconnection agreements, and its prospects for achieving such statuses are not at all certain.

The TOs make other points too righteous to ignore:

1. "In the instant proceeding, Invenergy asks the Commission to render MISO’s transmission planning process null by compelling MISO—after MISO’s Board approved LRTP Tranche 1 Portfolio on July 25, 2022—to conduct a sensitivity of the Tranche 1 projects that accesses the potential impact of the GBX Line assuming it is ever finished, based solely on an unsubstantiated allegation that the Tranche 1 benefits metrics may be flawed because they did not account for this speculative project."
2. Invenergy's attempt to disrupt MISO's planning is "particularly egregious."
3. "Unless and until the firm generation and load customers are identified by Invenergy, the GBX Line cannot be modeled..."
4. "Invenergy had multiple opportunities to participate in the numerous stages of the process whose outcome it now seeks to upend."  But it did not until it thought the process might hurt its project.
5. "Invenergy repeatedly describes how much money it has expended toward completion of the GBX Line as evidence that the line is at an advanced stage near completion. However, a developer can spend many years in development and millions of dollars on an MHVDC project that will never be completed. For example, the Rock Island Clean Line project (“Clean Line”) failed to reach completion despite its half-decade and multi-million dollar efforts.  Had MISO assumed the Clean Line project would be constructed in its long-term planning processes based simply on the time and money that had been invested in the project, there is no telling how many changes and new plans would have been needed once it became clear the project would not go forward."
   

This quote deserves to be highlighted:

While Invenergy explains the status of the GBX Line noting the number of approvals and permits it has obtained, the prospects for the project are far from certain. For example, as Invenergy concedes, permits are still required in one state. In addition, on August 24, 2022, Invenergy submitted an amended Certificate of Convenience and Necessity Application in Missouri to request significant changes in the GBX Line.   Invenergy also has not yet executed interconnection agreements with half of the transmission systems it proposes to interconnect—MISO and PJM.

Speculative... far from certain... not advanced enough to be included in regional transmission planning.  So, you might ask youself, what the living spit is the Missouri Public Service Commission doing allowing such a project to CONDEMN and take land from the good people of Missouri?

And, let's end this section with the following quote from the TOs:

The Commission should deny Invenergy’s attempt to obtain preferred treatment for the GBX line.

Don't miss the Comments of Missouri's own Norman Fishel asking that FERC deny Invenergy's complaint.  They were written for "real people" and are perfectly understandable.  Norm gathers information from Invenergy's various applications, comments, and permits to show, "Grain Belt Express seems to be like a chameleon, its description changing depending upon the venue it finds itself in, and the goal of its filing." 

Norm says that GBE doesn't even consider itself to be an "advanced-stage" project.  He also points out that GBE  has NO state approvals, since all the state permits will have to be re-approved due to changes in the project.  He points out that GBE only has one valid interconnection, since it has proposed changes to its SPP interconnection in Kansas that have not yet been approved.  And, perhaps my favorite part is where Norm baldly demonstrates that Invenergy might be a... well... a liar.

In its Complaint, Invenergy claims “Grain Belt Express has secured voluntary easements for over 75% of the necessary right-of-way in Kansas and Missouri.” However, in its Application in Missouri, Grain Belt claims it has “[a]cquired 72% of all easements required for the Kansas and Missouri portion of the Project.” While only a difference of 3%, it is notable that the percentage of easements acquired went down in the two weeks between the filing of this Complaint and the filing of the Missouri application.

So Invenergy told FERC on August 8 that it had secured over 75% of the easements, and then on August 24 told the MO PSC that it has 72% of the easements.  Did a bunch of easements get unsigned in that 2 week period?  If not, Invenergy is a flat out liar.  You can't believe anything a liar tells you.  Word to the wise.

Another section of Norm's comments deals with all the inconsistencies in GBE's Negotiated Rate Authority from the Commission and questions whether Invenergy has invalidated the Commission's approval to negotiate rates with potential customers.  Without Negotiated Rate Authority, Grain Belt Express cannot sign contracts with customers.

And maybe that's what Invenergy intends?  Norm clips this quote from GBE's Illinois application:

“Subject to additional oversight and approval by the Federal Energy Regulatory Commission (“FERC”), Grain Belt Express may sell and/or lease an undivided interest in the project to potential buyers and/or lessees, and Grain Belt Express and those buyers/lessees may seek to provide transmission service over the line to eligible customers as defined by FERC on a non-discriminatory basis under a FERC-approved open access transmission tariff (“OATT”). Any co-owner or lessee of Grain Belt Express that seeks to provide transmission service will be required to operate pursuant to an OATT on file with FERC that will meet the requirements of the Federal Power Act and FERC’s regulations. Grain Belt Express may also sell a cotenancy interest or lease a long-term leasehold interest in the transmission line, in which case it is not providing transmission service to such buyer/lessee because the buyer/lessee has control over that undivided interest”.

Invenergy says it may sell "interests" in the projects to other private parties for their own private use.  Those parties who buy an "interest" may sell service to other parties for public use, but they may also keep all the transmission service for themselves.  If they kept it to themselves, it would be nothing more than a private-use generation lead line, which is a private electric roadway for a generator to connect to the transmission system.  The BIG HUGE problem with this is that without offering its transmission service to all entities through a public offering, Grain Belt Express is no longer "for public use."  And if GBE is not for "public use" then it is not entitled to use eminent domain to condemn and take property.

It sure looks to me like GBE is only using FERC's Negotiated Rate Authority as a fig leaf to cover its real plan to use the project for private use without opening it up to public bidding.  Looks like it's going to take land now under false pretenses, and then privatize its project later once it has all the land it needs.  This is a GIANT stopper for both the Missouri PSC and the Illinois Commerce Commission (and the Illinois Supreme Court, who had serious questions about RICL's "public use" that were never addressed in that case).  Without being for "public use" the project CANNOT USE EMINENT DOMAIN.

So, to sum up this exceedingly long blog...  We've got a whole new ball game, folks! 

MISO has approved new projects that will bring Iowa wind electricity to Missouri and Illinois, most likely for a much cheaper price that GBE has been offering.  This happened because GBE has failed to be built when it said it would be built.  A stone rolling downhill, or a grid with hungry customers, waits for no man/project.  MISO says that GBE is not "needed" for reliability, economics, or any other reason.  MISO and its TOs think GBE is far from certain to be built.  This is quite refreshing because for so long Invenergy has been trying to gaslight regulators, legislators and landowners about how it is needed for reliability and economic purposes and is ready to be built.  Turns out none of that is true.  It's all been a house of cards.  Reject everything you thought was true about Grain Belt Express and embrace the new reality this complaint demonstrates.  Grain Belt Express's reign of terror across the Midwest is about to end.  The sooner Michael Polsky realizes this, the less money he will lose at the end.  Let's hope he's not as stupid as Michael Skelly was... dumping his last penny into projects that never become reality.

When you poke a stick into the lion's cage, sometimes the lion bites your head off.

The End.