Who Needs A $5 Cadillac?

Sign me up!  If Grain Belt Express is selling $5 Cadillacs, I need one!  I mean, I really NEED one! 

Missouri Landowners Alliance triumphs once again in their reply brief...

The MLA respectfully contends that the type of “need” created by Grain Belt in inducing MJMEUC to buy its product is not a true “need” for the service in the sense envisioned in the Tartan case. By analogy, it seems safe to say that not every family in Jefferson City truly “needs” to own a Cadillac. But if a dealer were for some reason to offer a Cadillac to everyone in the City for say $5.00, would the fact that virtually every family in the City was now driving a Cadillac suddenly prove there really was a “need” for those cars after all?

To the contrary, the MLA submits that actual “need” for any product cannot be artificially created by practically giving it away, as Grain Belt has done here. “Need” is not the same as “Want”.

Okay, maybe I'd just want one... because it was so cheap.  But when would my want turn into plain old greed?   Would my "need" actually be "greed" instead?

It's always been obvious that MJMEUC is only onboard the Grain Belt Express for pure and simple greed.  MJMEUC's analysis of how much it would "save" in this deal isn't even logical.

To begin with, the only meaningful means to determine what MJMEUC might have saved by using the Grain Belt line is to compare MJMEUC’s total cost of power from that line to MJMEUC’s next best alternative at the time it signed the contract with Grain Belt. The problem is, before MJMEUC signed the TSA with Grain Belt, it did not bother to solicit bids from any other party to replace the expiring Illinois coal contract. Therefore, neither MJMEUC nor anyone else will ever know what the best alternative would have been to signing the TSA with Grain Belt.

For the above reasons, the MLA respectfully submits that Grain Belt failed to prove that the need for the line in Missouri is anything but an illusion of its own making.

MJMEUC's greed has failed the ratepayers it supposedly serves by foregoing any real opportunities to replace the Illinois coal contract, and instead pinning its hopes on a transmission project that will never happen.  The time to get a good deal is ticking away and MJMEUC may end up paying much more when GBE never materializes and it's forced to take what it can get at the last minute.  A bird in the hand is worth two in the bush, isn't it?  At least that's the rule most of us live by.  Showing your resolve by sticking with an impossible pipe dream is for personal pursuits, not utility decisions.  MJMEUC should be making decisions based on ratepayer interests when it considers both cost and risk.  While the cost of renewable energy could be "cheaper" with GBE, the project is so fraught with risk that other viable alternatives must be explored, lest the ratepayers take it in the shorts while MJMEUC is sticking its head in the sand and mumbling greedy platitudes.

MLA also tackles the audacity of GBE, who presumes the PSC will necessarily be obligated to approve its sale to Invenergy because it has relied on the finances of Invenergy to issue a permit to GBE.

In short, all of the cases cited by Grain Belt on this issue merely support the reliance on the resources of Clean Line, and not those of a third party with no ownership in the Applicant.  Thus based on Grain Belt’s own analysis, it is asking the Commission to take a position here for which there apparently is no precedent.

A more fundamental problem with Grain Belt’s argument on this point is that it is once again taking for granted that future decisions of the Commission will be made in Grain Belt’s favor. Specifically, before the sale of Grain Belt to Invenergy may close, those parties need not only the CCN in this proceeding, but also the permission of the Commission for the sale of the Grain Belt project to Invenergy in a case which has yet to be filed. If that sale is not approved, then of course Grain Belt never gains access to the resources of Invenergy. Thus in asking the Commission to decide the two Tartan criteria on the basis of Invenergy’s expertise and stronger financial status, they are necessarily asking the Commission to assume that it will later approve the sale of Grain Belt to Invenergy. And this request is being made by Grain Belt before the Commission has even seen or heard a word of evidence in the case which will decide that issue.

This is particularly presumptuous on Grain Belt’s part, in that they have stated unequivocally that the Commission does not even have the authority to approve the proposed sale which they now take for granted will be approved.

Even if Grain Belt successfully manages to disavow its earlier position, which seems unlikely, it is totally inappropriate for Grain Belt to even suggest to the Commission that it should assume it will approve the sale of Grain Belt to Invenergy before that case is even filed.

Despite the prognoses of what the Commission will do in some unfiled case, as matters now stand there is no basis for granting a CCN to the Applicant on the basis of speculation about its possible access to Invenergy’s resources.

Chicken, egg.

The approval of the sale HAS TO come before the consideration of Invenergy's finances as the owner of the project.  Until the sale closes Invenergy owns nothing.  And it's not even as if the Commission can control all the variables here to ensure that the sale happens.  The sale is also contingent upon the approval of the Kansas Corporation Commission.  I'm pretty sure the MO PSC will have disposed of this matter long before the KCC issues a decision on the sale, even if it expedites the matter.  The Commission simply cannot rely on ownership that doesn't exist and over which it can have no control.  Monday morning quarterbacking isn't going to cut it with a court.

And then there's the issue of whether or not Grain Belt Express is economically feasible.  When it was supposed to connect with the PJM market at least there was a pretense that it could, hypothetically, be feasible if buyers in PJM wanted to pay high prices for service.  But reality is that Grain Belt Express is not going to get anywhere near PJM any longer.  It absolutely WILL NOT be approved through Illinois.  There's too much judicial history here that cannot be avoided.  The court didn't believe that an entity that did not serve all customers equally could be a public utility under state law and existing precedent.  It doesn't matter how much "utility property" GBE wants to buy in Illinois, it cannot be a public utility because of its business plan and rate scheme.  End of story.

This is an argument that Staff, GBE and its sycophants are pretending not to understand.  Either you're all as dumb as a post, or you're merely pretending not to understand in the hopes of leading the Commission astray from the real argument.  You don't have anything, anything at all, to counter MLA's argument that GBE is not a public utility, do you?

Here it is again... right here.  Read carefully.

1.  A public utility must serve all customers who request service, even if it means expanding its facilities.

2.  A public utility must charge the same rate to all similarly situated customers.  It cannot charge different rates to identical customers.

Therefore, GBE is more likely to terminate in Missouri.

Grain Belt supports its position on this issue primarily with broad generalizations about the market for wind generation. And while it contends that “the economic feasibility of the Project continues to be strong”, it does not even attempt to make a case for the economic feasibility of the Missouri segment of the line, without access to the PJM market.

As the MLA and Show Me discussed in their initial brief on remand, there is a definite possibility that the line will ultimately terminate in Missouri, thereby precluding access to the very markets which could make the project economically feasible.

As the NRDC and Sierra Club suggest, Missouri might be a “loss leader” for Grain Belt. But as they then note, according to the concurring opinion the project relies for its economic viability on the higher prices in the PJM market. But of course if the project cannot reach the PJM market, it is left only with the loss leader segment of the line in Missouri.

So, let's think about this... if GBE terminates in Missouri, it would mean an engineering change that would purportedly require another trip before the Commission, if certain conditions are ordered.  And what would the Commission do with a permitted project where the route completely changes?  Would it require re-application with notice to newly affected landowners?  Or would it merely try to alter existing permissions to fit a completely different project?  And what if the engineering change is actually a business plan/rate structure change?  Would that need to be re-examined?  What if GBE changes into a generation tie line that doesn't need Commission approval at all?  How does the Missouri PSC assert any authority over a project outside its jurisdiction?  Perhaps GBE isn't a public utility subject to PSC jurisdiction even now.  That sort of makes things, clearer, doesn't it?

I'm really finding it hard to believe that Invenergy wants to own a transmission project where it may sell capacity to its competitors and enable them to reach the more profitable PJM markets with their generation.  Invenergy would have to be completely idiotic to do that.  But yet the Commission is being asked to believe this story.  Invenergy may be called a lot of things by its opponents, but stupid has never been one of them.

So now this mess is in the hands of the Missouri PSC.  Ample support has been provided to deny the application.  The only thing approval would bring is another expensive trip through the courts.  How much are the taxpayers of Missouri supposed to spend entertaining this greedy project?  Stop the bleeding.