The federal government has no authority over electric generators, except for hydroelectric facilities.  Instead, authority over building new generators is an affair of state and local governments.  But the Federal Energy Regulatory Commission wants to interfere by designating "resource zones"  for building renewable generators (industrial scale wind and solar installations).  FERC has no legal authority to do so -- it's overreach of the most egregious kind.

Over the last couple of years, FERC has issued several notices of a proposed rulemaking entitled "Building for the Future Through Electric Regional Transmission Planning and Cost Allocation and Generator Interconnection".  That's word salad for building a whole bunch of new transmission for the purpose of connecting renewable energy installations around the country.  Who says we need a whole bunch of new generation and transmission?  There isn't a real reason, it's just about pushing the green agenda.  Build it and they will come.

Except they won't.  Who is going to buy all this renewable energy?  Is it the utilities whose current generation has been shut down and may be facing blackouts?  That's a false narrative.  Current generation shortages stem from the intermittent nature of wind and solar.  It cannot be depended on to generate when needed.  Wind and solar only generate when nature produces their fuel.  Build a lot of wind and solar, price fossil fuel generators out of the market so they shut down, and suddenly you have shortages at the most inopportune times... like during extreme heat or cold.  Some geniuses believe they can import electricity from other regions when that happens.  Except those regions with excess generation are fossil fuel heavy.  What happens when all regions overbuild renewables and we're at "net zero"?  There's nobody to borrow from.  Then the lights go out.  This is a future train wreck from which we may never recover.

FERC is ignoring the train whistle in the distance, preferring to believe that if they force the building of enough new electric transmission, all the borrowing can happen between renewable generators.  To this end, FERC wants to encourage the building of new renewable generators by building new transmission to newly designated "resource zones".

What are "resource zones"?  In FERCenese, they are "geographic zones that have the potential for the development of large amounts of new generation, particularly renewable resources."  The designation is to be made by a FERC-jurisdictional regional transmission planner, after considering the following:

Where do you come in, little zonal landowner?  The planner is going to seek "stakeholder comment" where you will be able to voice your opinion.  FERC proposes to require "public utility transmission providers in each transmission planning region post on their OASIS or other public websites maps of the designated geographic zones and information related to the designation of those zones." 

OASIS?

No, not those guys.

Maybe this?

No, not that either. 

OASIS is an acronym that stands for Open Access Same-Time Information Systems used by the electric industry that provide information about available transmission capability for point-to-point service and a process for requesting transmission service on a non-discriminatory basis. OASIS enables transmission providers and transmission customers to communicate requests and responses to buy and sell available transmission capacity offered under the Open Access Transmission Tariff.

Say what?  You've never been to this oasis, and you're likely to spend years wandering through the desert before you find it, if ever.

FERC thinks "relevant federal and state siting authorities" and transmission and generation builders are the only "stakeholders" who shall be involved in commenting on a proposed zone.  You landowners at ground zero are not invited to the party.  Neither are your local governments, who have authority over zoning restrictions for siting new industrial electric generation facilities.  As folks on the ground have found over the years, zoning restrictions are what makes or breaks the siting of new generators. 

So, what happens when FERC and its preferred "stakeholders" designate a zone that the local government shuts down through restrictions or moratoriums?  There is no authority for these entities to override local government siting requirements, however, the zone designation requires regional transmission planners to plan and build new electric transmission to the zone in order to enable the generators that cannot be sited or built.  In that instance, the zone will be the desert where no generation oasis can be located.  We will have paid to build a literal road to nowhere.

Poor planning, FERC.  Get your head out of the sand.  Building transmission to zones that do not want to live in industrial energy generation facilities is pure fantasy.

Do you want the federal government to designate a "zone" to build industrial electric generation plants in your neighborhood?  Feel free to comment.  Comment deadline has been extended through August 17, although Federal Register has not yet caught up with that.  You may also upload your comments to FERC directly.  Instructions are here.

Tell FERC you don't want a zone in your backyard, community, or county.

Sunlight is the best disinfectant.  This quote's origin is murky, but its meaning is not.  A democratic government cannot operate in secret.  A government must be transparent to its citizens.  A government works for its citizens.  A government has no money of its own but collects the money it spends from its citizens.  There is never a good reason for a government to withhold information from the citizens it governs.

But yet the U.S. Department of Energy took a week to make a decision whether or not to publicly publish the more than 80 comments it received on its proposed rules/requirements for its new, taxpayer-funded Transmission Facilitation Program.

If you thought allowing the government to give 2.5 billion of your tax dollars to for-profit corporations owned by the political elite could be a bad idea... it's about to get a whole lot worse.

Noting that the DOE docket for TFP comments did not have the feature to browse submitted comments turned on, and being notified that

I emailed [email protected] to ask when comments would be publicly available.  I initially was told that they did not know if comments would be posted.  What?  What reason would there be to hide them?

Just today I was told that DOE had decided to make the comments available on the regulations.gov website.  However (there's always a fly in DOE's ointment) the comments would first have to be "reviewed" for personally identifiable information and "they need to be made 508 compliant."  DOE has no idea how long this may take.  I'm still waiting to see comments from a webinar last month that DOE promised would be posted.  *crickets*  It seems that this "review" and "compliance" is just an excuse to avoid posting comments while appearing to be open to the idea.

Don't tell me that the federal government's slicky regulations.gov website cannot perform this function but that the task must be manually performed by agency employees.  I'm not buying it.  This is nothing more than a bogus excuse to avoid transparency.

Even though DOE can't manage to publicly post comments, some of the commenters can manage to post their own comments on the web without all this bogus "review."

Such as RTO/ISO comments available here.
And PJM's specific comments available here.

The online comment receptacle says 86 comments were submitted before the deadline last night.  But yet you can't read any of them on regulations.gov, even your own.

Considering that DOE is poised to give away $2.5B of your hard-earned dollars to connected rich people to "facilitate" a bunch of new transmission we don't want or need, you'd think there should be a little sunshine within the program.  You'd think that the proposed application requirements and review criteria would be public information requiring independent evaluation.  Remember Solyndra?

Instead, DOE is keeping the comments of the potential recipients of your tax dollars hidden.  It's just the transmission merchants and the DOE employees.  No taxpayers or other commenters need to be involved.  In fact, if they don't post the comments, they could just delete yours with one click.

The inmates are running the asylum.

Drain the swamp.

Drag Dracula into the sunshine.

Who do these entitled little bureaucrats think they are?

If you want to help drag DOE Dracula into the sunshine, let them know you want to see the comments by emailing [email protected].

DOE’s Transmission Facilitation Program is a ship adrift without a compass. In its NOI/RFI, DOE makes several references to the “objectives” of the program with reference to the IIJA (Section 40106(j)(8)). This is a list of “considerations” for selecting projects, not a list of objectives for the TFP. Some of the “considerations”
are nothing more than meaningless word salad, such as: 1) will improve the resiliency and reliability of an electric power transmission system; 2) facilitate interregional transfer capacity that supports strong and equitable economic growth; and (3) contribute to national or subnational goals to lower electricity sector greenhouse gas emissions. There’s no way for DOE to accurately and objectively determine whether projects meet these considerations. What is “strong and equitable economic growth” and what expertise does DOE have evaluating the economy? It appears that the whole program is subjective, made-up, discombobulated meddling in the transmission planning and rates authority of the
Federal Energy Regulatory Commission.
If FERC is in charge of electric transmission planning through its jurisdictional planning authorities, what authority or expertise does DOE have to plan “economic”
transmission, and how might DOE’s actions interfere or conflict with FERC’s authority to control transmission planning? Likewise, how do DOE’s financial giveaways to merchant transmission companies interfere or conflict with FERC’s negotiated rate authority for merchant transmission, which depends on market forces to keep rates in check in exchange for little regulation? At its webinar, DOE personnel claimed they were consulting with FERC, however that consultation is not being done in a transparent manner. At the very least, DOE needs to explore how its actions affect planning and rates under FERC’s jurisdiction through a transparent, official rulemaking. We need to know who is in charge of what, and how the “whole of government” process will work.
It was chilling to hear over and over again during the webinar how closely DOE is already working with transmission developers to design the system whereby it will hand over taxpayer funds to these for-profit companies. DOE must pull itself out of the swamp to ensure that its actions under this program are transparent and aboveboard.    Remember Solyndra? DOE’s current approach to this program does not serve electric consumers. The electric consumer taxpayers DOE is supposed to be serving have been completely ignored in favor of playing political footsie with elite, connected, commercial developers.
In Question 2, DOE asks what information it should seek from applicants to evaluate host community benefits, environmental justice, and also makes reference elsewhere in the RFI to community engagement and outreach. DOE states, “The description of community and stakeholder engagement should include concerns
raises (sic), issues resolved in writing, and issues outstanding.” However, DOE proposes getting all its information about community benefits, outreach, engagement, and issues from the developer in the application process. The developer is NOT an unbiased source of information and DOES NOT speak for affected communities. DOE must perform public “listening tours” and/or public hearings in host communities, where project information is presented and the public itself can inform DOE about its concerns. This is the only way DOE is going to get the truth about community engagement: by engaging with the community.
Anything less than true community engagement is self-serving fabrication. DOE must meaningfully consult with communities and landowners affected by its actions
before the project receives TFP benefits. Justice begins when every person has a voice.
Also in Question 2, DOE asks: “To what extent should DOE consider additionality of outcome on these dimensions?” This word salad makes no sense to real people outside the D.C. political bubble. “Additionality” is not a word in my dictionary. I hereby request that DOE revise and reissue the portions of its RFI that are written in millennial trendy-speak so that the rest of America can understand what it is asking.
DOE can do much better using plain language, but creating cryptic and subjective word puzzles is being used to avoid clear rules and definition. For instance, what does this statement mean? “Facilitate interregional transfer capacity that supports strong and equitable economic growth.” Where has it been determined that
expanded interregional transfer capacity grows the economy? While it may boost the economy of a location that exports energy, it harms the economy of a location
that imports energy, instead of producing its own. This is an unproven statement turned into an “objective”. It is building transmission for the sake of building transmission and then pretending that it provides some benefit.
Transmission planning is not a DOE responsibility. FERC’s regional planning entities are the only experts. Asking a transmission developer to provide “evidence demonstrating that the proposed project is consistent with regional transmission plans and priorities” without consulting the actual regional planning authorities is more self-serving wordsmithing. DOE must require a review and independent report of the jurisdictional planning authority to make this determination.
DOE also proposes that the developer provide it with an estimate of the project’s timeline when it files an application. DOE says that projects for its first solicitation
must “be in commercial operation by December 31, 2027.” Five years or less to complete a transmission project is extremely unrealistic and the developer’s time
line is nothing more than hopes and dreams. All above-ground, greenfield transmission projects will be vehemently opposed by affected landowners and host
communities and will therefore face regulatory and legal delays. DOE must cancel its agreements and payments to a transmission project that does not meet its
operational deadline, or there’s no point in having one in the first instance. Perhaps DOE should set more realistic deadlines. 2027 is not going to happen.
Question 8 is another application requirement that is likely to be completely concocted by the applicant. Determining that “the eligible project is unlikely to be
constructed in as timely a manner or with as much transmission capacity in the absence of facilitation” provided by the TFP is like asking what color tails unicorns would have if they were real. It is impossible to determine how, or even if, TFP participation would be effective in forcing construction of unneeded transmission projects, or if it would simply act as a burr under the saddle of state utility commissions to deny approval of a TFP project. It doesn’t seem like DOE has done anything to consult with the state regulators who decide whether transmission projects are beneficial for consumers.
DOE proposes that it will receive all information on which it bases its decision from the entity that will receive the benefit. This is an open invitation for the applicant to
mislead DOE, such as occurred with Solyndra. DOE absolutely must get more of its required information from impartial sources.
Question 12 asks: “What equity, energy and environmental justice concerns or priorities are most relevant for the TFP? How can these concerns or priorities be addressed in TFP implementation?” If the TFP is truly about facilitating the timely construction of needed transmission, the DOE’s biggest concern should be requiring program projects to eliminate burdensome impacts on host landowners and surrounding communities. Rebuilding existing lines to increase their capacity, and siting new lines on existing rail and road rights of way is an innovative and workable plan to effectively mitigate impacts and neutralize opposition. Buried transmission also eliminates impacts. A buried transmission line on existing rail rights of way would not inspire delaying opposition. All of this is now technologically and financially feasible and is being used by merchant transmission developers. Landowners and communities are not fooled by platitudes and fake
mitigation, much less bribes to local elected officials to look the other way. The only way to prevent costly, delaying opposition is to not cause any impacts at all. DOE should require TFP projects to be sited on existing rights of way and buried, eliminating a need for eminent domain. Otherwise, DOE is simply spinning its wheels and wasting taxpayer funds.
It appears that DOE has learned absolutely nothing from its failed Section 1222 Clean Line Energy Partners “participation”. After many years, and many millions,
spent trying to assist a merchant transmission developer to obtain private property using federal eminent domain, the project collapsed under its own weight when it
couldn’t find any customers. Even if DOE takes the additional step of becoming the missing “customer” this time around, it won’t solve the merchant transmission
problem. The only successful merchant transmission projects are the ones that have committed customers before being built. Speculative merchant transmission
without committed customers is a demonstrated failure. Load-serving entities do not want to import generation from other states or regions when they could use
local resources just as cheaply. As regulated entities, it is about cost. It’s also about buying the milk instead of owning the cow. Regulated public utilities would rather
build and own their own transmission and generation assets that earn a return than
pay to use the assets of other companies. There is simply no incentive here for new customers to sign merchant transmission capacity contracts.
During the May 26 webinar, DOE personnel claimed that capacity contracts were not just for merchant transmission. Except that’s not true at all. Only merchant
transmission uses capacity contracts. Traditional transmission is cost-allocated to captive ratepayers.
Although not in DOE’s area of expertise or jurisdiction, it is imperative that DOE educate itself on the concept of utility regulation if it is going to be successful administering this program. Regulation takes the place of competitive markets to ensure just and reasonable rates in a monopoly environment. Regulated public utilities building traditional, cost-allocated, regionally-planned, transmission projects are unlikely to participate in the TFP. It is clear to anyone in the industry that the TFP was designed to give unfair advantage to unregulated, unplanned, unneeded, unfunded merchant transmission projects.
What is merchant transmission? It is a market-based concept, where instead of cost-of-service rates set by regulators in a monopoly situation, the project competes
with others to attract voluntary customers who negotiate market-based rates with the project owner. There can be no captive customers for merchant transmission,
and competition between customers is the mechanism that keeps the rates just and reasonable. The merchant can only charge as much as the market for its product
allows.
Merchant transmission must receive negotiated rate authority from FERC in order to negotiate with voluntary customers to sell its capacity. In evaluating negotiated
rate applications, FERC employs a four-factor analysis to examine: (1) the justness and reasonableness of the rates; (2) the potential for undue discrimination; (3) the
potential for undue preference, including affiliate preference; and (4) regional reliability and operational efficiency requirements. In examining the justness and
reasonableness of the rates, FERC considers whether the merchant transmission developer has assumed the full market risk for the cost of constructing its proposed project and is not building within the footprint of the developer’s (or an affiliate’s) traditionally-regulated system. In such a case, there are no captive customers who would be required to pay the costs of the project. The Commission also considers whether the developer or an affiliate already owns transmission facilities in the
region where the project is to be located, what alternatives customers have, whether the developer is capable of erecting any barriers to entry among competitors, and whether the developer would have any incentive to withhold capacity. The IIJA requires DOE to purchase up to 50% of the capacity of a qualifying merchant project, even though DOE will not use the capacity to transmit energy. DOE is not a voluntary customer, but a customer of last resort, who is captive to assume the market risk of the project. Participating TFP transmission projects are neither traditional cost-of-service projects, nor market-based merchant projects, but something else entirely that must be regulated to ensure just and reasonable rates under the FPA. After the IIJA removed the market-based framework by requiring DOE to fund merchant projects, there is no longer a mechanism to keep rates in check. The merchant can charge whatever it wants, and if DOE is the only customer it must pay the rate demanded. DOE will certainly pay a higher rate than a voluntary customer competing with others for service. Therefore, the merchant projects funded by DOE do not qualify for negotiated rate authority from FERC, but must be regulated in some fashion. In response to RFI question 11, this requires a formal rulemaking at the Commission.
DOE must also consider market power when evaluating TFP applicants. This requires an independent analysis, or report, and should be verified by regional transmission organizations and/or market monitors. Also, DOE should prohibit private, generation tie line projects from participating in the TFP program. All eligible projects must offer their full capacity to all using negotiated rates.
In response to question 13, a “market analysis” prepared by a transmission developer seeking to receive funding so that it doesn’t have to compete in an actual market is inherently suspect. Instead, DOE must do its own research in actual markets to determine whether the expected customers actually need the generation and transmission service DOE would be “facilitating.” It’s not enough to recite political platitudes about interregional transmission and decreasing greenhouse gases, it’s about matching offered generation with customer need. If there are no customers, then the transmission is not needed. Just because generation is offered does not mean remote customers are forced to buy it. Load-serving entities are perfectly capable of doing their own analysis to decide which generation and transmission capacity would be economic and needed by their customers. Even the TFP cannot force customers to buy unwanted generation or transmission capacity.
If there was an actual, competitive market for the capacity of a TFP project, then it wouldn’t need funding in the first place. Only a merchant transmission project
without customers would find the program useful to build transmission for which there is no market, and no customers. The project would be a literal road to nowhere, used by no one, not delivering power anywhere, but funded by American taxpayers. It’s a mind-bogglingly bad idea!
The IIJA and DOE seem to believe that the TFP will “encourage” voluntary customers for merchant transmission. We’re not painting Tom Sawyer’s fence here. Just because DOE purchases transmission capacity that no one else wants does not mean that everyone will suddenly want it due to some weird, new form of government peer pressure. If customers want to purchase capacity on a merchant transmission project, they will purchase it directly from the developer after determining that the service is financially beneficial to their customers. The financial equation for the customer will not change because of DOE’s purchase, unless DOE plans to sell the service for less than it paid in order to subsidize customers who take unwanted, unused capacity off its hands. It does not appear that such a plan would meet the statutory obligations of the IIJA, which requires DOE to replenish the TFP fund on a rolling basis. Selling capacity at a loss will eventually deplete the fund in its entirety.
In response to question 19, there is no way to “encourage” someone to buy something they passed up the first time it was offered unless it is offered at a lower
price or given away for free, neither of which fits the statute in question.
In response to question 25, yes, DOE should require a TFP project to already have signed contracts equivalent to the percentage of capacity it is seeking to have the
DOE purchase. Under no circumstances should DOE be the only customer, or the customer purchasing the most capacity of a project. When a developer resorts to
having DOE fund its project with capacity contracts that indicates that there is no market interest in the project and DOE will be unlikely to unload its capacity on voluntary customers in the future.
When DOE signs a capacity contract for up to 40 years of non-service “service”, it must reserve the full contract price to be set aside from the TFP fund so that DOE
does not later renege on its contract if it signs multiple contracts it does not have the funds to support. Signing multiple contracts under the presumption that one or
more would sell to others and replenish the fund before future capacity payments are due on other projects is, at its most basic level, a pyramid scheme. DOE should not use taxpayer funds to run a pyramid scheme.
In response to question 26, the TFP project must pay back DOE first before enriching itself with other capacity contracts. Any contracts signed after DOE commits should sell DOE’s capacity first.
In response to question 27, DOE could include a timeline in its capacity contract that requires the TFP project to sell a certain percentage of DOE’s capacity per year in
order to continue the contract. If a project is unable to sell any additional capacity after contracting with DOE, this would provide an exit provision for DOE instead of
depleting the fund for 40 years paying for a road to nowhere.
In response to question 28, how would DOE even know if it was receiving a more favorable rate than other customers if it was the first (and only) mover? Without any other contracts negotiated to use as comparison, it is impossible to determine. In addition, requiring all other customers to pay a higher rate than DOE could doom the project to never finding additional customers if DOE likely contracted at a rate that was too high in the first place. There is no way for DOE to determine that the rate it negotiates is competitive, and this is why these merchant-variants must be regulated.
DOE is a contract patsy that will be used to prop up unneeded merchant transmission. DOE’s TFP is set up for failure by sticking the taxpayers with the bill for a 40-year contract because DOE is a poor, captive, politically-motivated negotiator. The fund will quickly be depreciated and never replenished.
Question 22 contemplates that DOE will be signing capacity contracts before a merchant transmission project begins commercial operation. In that instance,
payment should not commence until the project is in service. Nobody would pay for service it is not receiving. In addition, the contract should contain an escape clause
for DOE if the project fails to receive state or other permits in a timely fashion. DOE must not be obligated to making payments for 40 years on a transmission project that is never constructed.
Knowing that the TFP program is nothing more than a gift to merchant transmission developers who want to monetize gold plated (but unneeded) projects, DOE should be wary of funding the lifestyles of the rich and famous, well-connected elite who lobbied for this program, instead of facilitating used and useful transmission. In the interest of equity and justice, projects should be evaluated on the basis of financial need and funds awarded first to deserving minority-owned businesses. The TFP is not to provide funds for the elite to live high on the hog while “developing” unneeded merchant transmission. An investigation of the finances of the company and its investors should be carried out as part of DOE’s evaluation. DOE may have forgotten the largess of Solyndra, but the American taxpayers have not. We don’t need a repeat of robots that whistled Disney tunes, spa-like showers with liquidcrystal displays of the water temperature, and glass-walled conference rooms. How is the company spending taxpayer dollars, and more importantly, who is spending taxpayer dollars? Initial investigation shall be followed by yearly audits.
Speaking of Solyndra, DOE is headed to a new Solyndra of five fold proportions. The unverified, applicant supplied information DOE proposes it will use as the basis for its evaluation is ripe for false and misleading statements. In fact, DOE’s RFI actively encourages applicant companies to embellish and create a world of fantasy. DOE completely failed to use due diligence to verify information on Solyndra’s application and was politically influenced to look the other way while rubber
stamping the applications of connected individuals. When comparing the lessons of Solyndra to the way DOE has handled the TFP program so far, the parallels are stunning. DOE should absolutely re-study the lessons of Solyndra so that the same mistakes don’t get made a second time.
DOE’s Transmission Facilitation Program is a merchant transmission developer buffet of epic proportions that enables certain connected individuals to fill their pockets with taxpayer funds. I don’t believe any beneficial transmission will come of it. It’s just another gigantic waste of hardworking Americans’ tax dollars.
Quote from DOE’s Solyndra investigation:
“While not the focus of the investigation, we were mindful of the concerns that had been raised regarding possible political pressure applied in the Solyndra decisionmaking process. Employees acknowledged that they felt tremendous pressure, in general, to process loan guarantee applications. They suggested the pressure was based on the significant interest in the program from Department leadership, the Administration, Congress, and the applicants.”
https://www.energy.gov/sites/default/files/2015/08/f26/11-0078-I.pdf
DOE must design the TFP so that this does not happen again. So far, DOE has failed the American taxpayer completely.

Build it and they will come only works in Hollywood.

Remember the good old days when Clean Line Energy Partners promised the state regulatory commissions that it would not recover its costs from Kansans and Missourians?  CLEP thought it was a negotiated rate merchant transmission project where only its voluntary, contracted customers would pay for the project.

Those days are over.  New owner Invenergy has been begging the Federal Energy Regulatory Commission to create a new revenue stream for GBE from captive regional electric ratepayers.  This means that electric customers that will receive no benefit from GBE would end up paying for a portion of it.

Why?  Apparently Invenergy "needs" this additional revenue because it doesn't have anywhere near enough customers for GBE to support the financing of the project.  Invenergy wants FERC to create new "products" that GBE can supply, such as "standby" emergency service to supply energy in an emergency.  By "standby" they mean they need to be paid to stand by in case of emergency and promise to commandeer capacity from their paying customers to serve some future "emergency" that may or may not occur.  GBE proposes:

In other words, GBE wants to sell capacity attached to a string so that it can pull back when it wants to. 

Gosh, I wonder who would reap the rewards of emergency use?  Would it be the contracted customers, or would it be Invenergy?  What customer would sign up to use this line with the knowledge that it can be shut off at any point in time?  Grain Belt Express cannot be relied upon to meet customer energy needs.  What happens if two "emergencies" (or just one wide-spread one) occur at the same time?  Who has priority over capacity?  Which emergency is more severe?  Which one pays the most to Invenergy?  Yup, this is all just crazy talk.

GBE also tells FERC that it needs these things:

Translation:
1)  Pay GBE for "reliability and resilience" benefits that it provides but that the paying ratepayers don't actually need (because if they were needed, the regional planners would order the upgrades and the costs would be paid by everyone in the region).  GBE proposes that all ratepayers in up to three planning regions (SPP, MISO and PJM) that span 2/3 of the continental U.S. pay these charges although they aren't GBE customers and don't get any benefit from the project.
2)  Find a way to create a regional rate scheme for GBE.
3)  Allow GBE to take over control of the grid when there's an emergency in order to inject more power.  Safety limits be damned.
4)  Include GBE in regional transmission plans, even though the regional planning authority doesn't find a need for the project.  If they can shoehorn it in the plan, next they'll claim regional ratepayers have to pay for it, too.
5)  Don't make GBE pay to interconnect its project to the transmission system.  Instead, make captive regional electric consumers foot the bill for GBE's connections.  When a new generator or merchant transmission line wants to connect to the existing grid, studies must be done to ensure that the new connection won't overload the grid and cause outages.  Any upgrades necessary to the grid to support the new connection become the financial responsibility of the interconnection customer (GBE).  GBE wants to upset that now and make captive customers pay those upgrades, claiming they somehow get some "benefit" although they are not customers of the project.

The long and short of it is that GBE is trying to get captive electric consumers in Kansas and Missouri to pay for a portion of its merchant transmission project that will benefit voluntary customers in other states or regions.  All promises to state utility commissions that GBE won't charge its project to in-state consumers are now void.  But why should the consumers of Kansas and Missouri pay for an electric transmission line that does nothing but burden them?

But wait... there's more!  In a different recent FERC comment, Invenergy shares the latest news on GBE:

So while GBE is moseying around Kansas, Missouri and Illinois telling people it is "wrapping up" its pre-construction activities and needs to condemn and take private property in a big ol' hurry so it can get started, the truth is that Invenergy can't connect its project.  Its development is "complicated" by interconnection requirements.  It is literally a road to nowhere right now.

Have a good long look, everyone, at the stuff that Invenergy hoped you wouldn't see.

Remember Solyndra?  I mean really remember... how the U.S. Department of Energy gave away more than half a billion of your taxpayer dollars to a for-profit company that lived large for several years before defaulting on the "loan" it had received?    Perhaps we could all use a refresher, now that the DOE is poised to give away another 2.5 billion of your hard-earned taxpayer dollars to a handful of elite rich guys who want to live large on it while it lasts... perhaps for the next 40 years.

Here's a good refresher article....

But it turned out that the company had puffed itself up on its DOE loan application and that it didn't have enough future revenue to pay off the loan.  It declared bankruptcy and its owners whistled Disney tunes off into the sunset.  No harm, no foul.  Worse than that, the government functionaries who furthered this scam also received no punishment.  The DOE Inspector General's report revealed just how much malarkey was going on, but ultimately nothing was done about it.

So why wasn't there due diligence at the DOE?

Well, guess what?  That same pressure is being used again to push new loans and revenue guarantees for speculative merchant transmission projects.  DOE has apparently learned NOTHING from Solyndra and its employees are having a grand time playing footsie with merchant transmission developers while sitting on a fresh pile of taxpayer money.  Your money!

The Infrastructure Investment and Jobs Act, passed by a bipartisan vote last year is now being implemented by the good political drones at DOE.  The IIJA gave DOE $2.5 Billion for its new Transmission Facilitation Program.  The "program" makes available new loans, public-private partnerships where the government kicks in some of your money to fund for-profit merchant transmission, and capacity contracts for new merchant transmission.  DOE seemed pretend surprised at a recent webinar that the only provision of the program that anyone is interested in is the capacity contracts.

The DOE has authority to sign capacity contracts with new transmission projects.  The capacity contract will purchase room on the transmission project to transmit electricity, however DOE doesn't serve any electric customers and has no use for it.  It will simply pay for something it will never use.  This purchase is supposed to inspire others to also buy capacity on the transmission project.  However, if these others had any use for the capacity, they could purchase it themselves without DOE involvement.  The problem is that nobody wants to purchase capacity on speculative merchant transmission projects.  DOE is likely to be the only "customer" propping up an unused and unneeded road to nowhere... through your backyard and productive agricultural property.

A merchant transmission project, first and foremost, must accept all financial risk for its unneeded, speculative project.  There can be no captive customers.  A successful merchant may negotiate rates with voluntary customers who may find its project useful.  But what if nobody finds it useful?  Then it fails, and the merchant loses his investment.  But, not anymore.... the federal government is going to step in to financially prop it up using your money.  This means we're going to suffer a lot more greedy merchants, stuffed egos with childish hairdos who belong to the elite political party in power.  These new elite rulers will spend their capacity contract money however they like... ugly orange offices with pictures of dead rock stars, renovated fire houses, and a lavish lifestyle on a fat salary playing transmission make-believe.

Does all this make you furious?  It should.  Michael Skelly's next transmission brain fart will be perpetrated on your dime.  Fortunately, you can tell DOE what you think about their new Transmission Facilitation Program during a public comment period that only runs until June 13.  Submitting a comment is quick and easy using this online form (click the little blue "comment" box at the top).  You can even make your comment anonymous. 

Have at it, folks!  Maybe Skelly's new robots will come programmed with a funeral dirge for his new ideas.

That's what St. Joseph, Missouri's News-Press called what happened at the Missouri legislature this year regarding Grain Belt Express.  The editorial was very clear that what happened should not be called a success story.

But did it REALLY reform eminent domain law in a meaningful way for future transmission projects?  Or did it just throw wide the door and roll out the welcome mat for future "fly over" merchant transmission projects?  I guess we'll have to see what those "grateful" landowners think the next time their legislators "not quite" sell them out in favor of an out-of-state company taking property to benefit its own profits.

The editorial says:

Several misconceptions here.  There are no customers "further east."  Only wholesale electricity suppliers who have signed contracts with Grain Belt Express can be customers.  The only customers GBE has at the moment are the Missouri municipalities.  No power-buying entity "further east" wants to buy power shipped on GBE.  There are no takers.  And since this is a market-based merchant transmission project, lack of voluntary customers demonstrates that there is no need for GBE.  Without customers to buy power shipped on the line GBE fails because it has no revenue stream to pay back any borrowed funds for construction.  There are no beneficiaries for GBE right now, except for a couple of Missouri municipalities who have signed up to use around 5% of the project's capacity.

And let's talk about capacity... that's the only thing GBE is selling.  It's selling room on its transmission line, it's not selling power.  Any power that may flow over GBE must be purchased separately from another entity than GBE.  GBE is not selling power!

Although, News-Press maybe accidentally gets pretty close to the truth, "Invenergy could benefit nicely when it starts selling power".  That's right... Invenergy could sell power from its own generators, and only its own generators, and ship it "further east" on GBE, making the transmission line an exclusive, private driveway for only Invenergy to use.  Would the Missouri PSC and the Missouri legislature be okay granting eminent domain for that?  It wouldn't be a public use.  It would be a private use.

I dunno... maybe they'll pull their head out of their vanilla panna cotta and begin pondering?

At any rate... News-Press needs to quit sounding so fatalistic.  This is not the end of opposition to GBE, it's just the beginning of Missouri landowners finding out who their elected officials really are.

Despite Invenergy's cheerful chirping, however, GBE still has a number of insurmountable hurdles in its path, not the least of which is that it does not have enough customers to finance the building of the project.

Perhaps it's not coming after all...

The federal grid reliability watchdog issued a dire report last week that warned of a potentially severe electric generation shortage this summer.  That is, we may not have enough electricity to serve everyone if there are any weather extremes, fuel shortages, or equipment failure.  Mainly, these problems are likely in the Midwest, Texas, and the west (California).

It's no coincidence that these are the places where a lot of renewable energy generators (wind and solar) have been built in recent years.  The cause of that is political goals, availability of "cheap" land, and federal tax incentive windfalls for the companies who construct them. 

This coming shortage of electricity should come as no surprise to regular readers of this blog.  I've been talking about it for years as government subsidies for renewable generators effectively price baseload generators, that can run when called because they can simply add fuel and generate when the need arises, out of the market.  Renewables are intermittent resources, they only run when mother nature supplies their fuel.  She's a fickle mistress.

The problem spilled over into a Federal Energy Regulatory Commission monthly meeting last week when staff presented a report on summer grid performance.  At the new, politicized FERC disagreements cropped up.  Commission Chairman Glick blamed the problem on extreme weather caused by climate change and suggested that we all need to adjust to "the new normal."

His "new normal" includes fewer baseload generators and more intermittent renewables.  Instead of recognizing the real problem, he chooses to blame the weather for creating shortages.  The weather hasn't been a problem, until just recently, so his approach makes no sense at all.  Relying on transmission to solve the problem is no solution at all.  The report pointed to one shortage being caused by a transmission line that has been out of service for months due to tornado damage.  Building more transmission in tornado alley is hardly a solution to this problem, unless it is built underground, perhaps on existing highway or railroad rights of way.  However, FERC has chosen to ignore new technology that can accomplish this, complaining that it's "too expensive."  How expensive will that one transmission outage be when it causes blackouts?  It would have been cheaper to bury it in the first place so that this outage never occurred.  The report also highlighted above-ground transmission causing wildfires in the west, as well as transmission lines that were blocked by wildfires and couldn't deliver energy.  More transmission is not the solution.

Chairman Glick got push back from a couple of other Commissioners, who made a lot more sense.

Me too, Commissioner!  It is simply unrealistic to believe that we can power our country reliably with intermittent renewables in far off places that would depend on above-ground transmission lines hundreds or thousands of miles long that would deliver the power to urban areas.  It's simply fantasy... an equation that only works on paper.

But it was Commissioner Christie who succinctly nailed the problem with today's double time march toward zero carbon.

That's it, exactly.  The forced closure of baseload plants is ignoring the fact that we don't have the right technology to replace them.

Many years ago, I opined that we shouldn't allow a bunch of environmentalist policy wonks to plan our electricity supply because they did not have the working knowledge to do so, simply a desire to meet their impossible goals.  Keeping the lights on and keeping power affordable is simply not one of them.

Plunging headlong into a carbon-free energy future without the resources to support it is simply foolish!

FERC's Notice of Proposed Rulemaking on Transmission Planning, officially known as  Building for the Future Through Electric Regional Transmission Planning and Cost Allocation and Generator Interconnection, contains some pretty questionable proposals.  But the one that is making the most people scratch their heads is the proposal that new "long-term" transmission plan projects be prohibited from asking for and receiving FERC's current CWIP in ratebase incentive.  Instead, these new projects planned to be used and useful 20 years in the future must instead use AFUDC.  Sounds like complete gibberish, doesn't it?  Pull up a chair... you're going to understand this when we're done.

FERC proclaims that using AFUDC will "protect" ratepayers.  But, is that really true?  No, it's not.  Ratepayers will end up paying more for these transmission projects, even when they are subsequently cancelled and never provide any service whatsoever.

When a utility builds new infrastructure, it must front up the full cost of constructing the project before it goes into service.  There are two different rate methods to account for the use of this money to build things that end up being useful for the consumer.

CWIP, which stands for Construction Work in Progress, is a method whereby a utility collects its capital construction costs for a new project into a special account, which is then added to the ratebase.  The utility earns its awarded return on the amount in ratebase each year, and in the case of CWIP in ratebase, it earns a return on the money it has invested in the project before the project goes into service.  The benefits of this is that it creates cash flow for the utility to pay interest on the money it borrows for the project.  Having that cash flow also bolsters the utility's credit rating and lowers the utility's cost of capital, allowing it to borrow at reduced rates.  Lower interest costs to the utility flow through to customers, who always end up paying the utility's borrowing costs.  In addition, CWIP in ratebase has the benefit of increasing the rates due to the new addition gradually, in real time, instead of all at once when the new infrastructure goes into service.  The consumer will see their bill go up gradually, and will notice these increases over time and may plan accordingly.

AFUDC, which stands for Allowance of Funds Used During Construction, is a method whereby the utility still collects its construction costs into a special account, but it is not added to the ratebase until the project goes in service.  The project costs keep building in this account, plus interest, and the utility collects nothing until the project goes in service.  There is no cash flow for the utility during planning and construction, therefore it must find money elsewhere to pay interest on the money it has borrowed.  This can affect the financial health of the utility with a large AFUDC burden, and increase its cost of borrowing, which is flowed through to customers.  Customers will pay more to finance a project using AFUDC.  When a project using AFUDC goes into service, the customer will see a huge spike in their rates to pay for the total cost of the project, plus all the accumulated interest.  The consumer will be completely flummoxed (and ticked off) about this huge spike it his electric bill.  He won't see it coming and has no opportunity to plan his usage accordingly.

But there can be advantages to AFUDC, if a proposed project is cancelled before it is put into service because the utility will have not collected any of its costs from ratepayers before then.  In that instance, the utility absorbs the loss and ratepayers are off the hook.

HOWEVER (because here's where the real rub comes in) FERC has also routinely granted an abandonment incentive to all regionally planned projects, like the future long-term planning projects.  The thinking is that the utility is being "forced" to attempt to construct the project by regional planners and therefore has no fault if the planner subsequently cancels the project after the utility has spent money on it.  FERC wants to make these utilities whole by giving them back all the money they have spent, plus interest, if the project is cancelled through no fault of the utility.  Ratepayers are the bank here and are required to shoulder all the risk and cost of planned projects that end up being cancelled before being completed. 

So, it wouldn't matter if the project used CWIP in ratebase or AFUDC to account for its costs if the project was subsequently abandoned.  Ratepayers would still be on the hook to cover the costs, and the AFUDC project would end up costing them more.

AFUDC does not protect consumers as long as FERC continues to use its abandonment incentive to place all risk for project abandonment on consumers.  Consumers have asked FERC several times to take a deep dive into its abandonment incentive to collect the data necessary to evaluate the wisdom of continuing it.  How many regionally planned projects with this incentive have been abandoned?  How much have ratepayers paid for projects that have never become used and useful to them?  (Hint:  It's easily more than a billion dollars.)  How can FERC take action to ameliorate this burden on consumers?  Can it place some burden on the utilities where abandoned project costs are shared between utilities and consumers?  Should it place stricter requirements on regional planners to engage in more due diligence when planning projects, such as more effort to evaluate the likeliness that the project will not be delayed or denied important permits because of opposition in affected communities?  What surety can FERC impose on regional planners to discourage the wasting of ratepayer funds on pipe dream projects that have no realistic expectation to ever be built?  You know, that sort of sounds like these long-term planning projects of which FERC is so enamored.

As Commissioner Christie said in his concurrence:

But yet he thinks AFUDC will fix everything.

But it can still collect its costs from customers using FERC's abandonment incentive.  It's like locking the barn door after the horse escapes!

I'm not fooled by this, and you shouldn't be either.  AFUDC only works if the abandonment incentive is... well... abandoned, and it doesn't look like FERC has any intention of doing so.

And here's the second big fool for consumers... using AFUDC actually hides the huge electric rate increases consumers will face due to the euphemistic "changes in the resource mix" (read more wind and solar and less coal, gas and nukes) until it's way too late to do something about it.  If the costs of the trillions of dollars of new transmission the Commission is trying to encourage with this action don't find their way into your bill until they have either been built or abandoned, you will have no chance to adjust your power consumption behavior, or even to speak out, before the damage is done and your power bill ends up doubling (or more).  The money will have already been spent, and consumers are already on the hook.

If FERC gets away with this... heads utilities win, tails you lose.

Sharpen your pencils, transmission warriors!  The DOE is in the process of making good on the part of the "Bipartisan Energy Bill" that allows the federal government to prop up failed and unneeded transmission projects with your tax dollars.  It's quick and easy to drop them an electronic comment via the internet.  You can submit your comment here by clicking on the blue "comment" button at the top left of the notice and filling out the form that pops up.  It's really just that simple!  You'll be glad you did when an unneeded transmission line without any customers is planned to cross your property, and the federal government signs up to be a "customer" in order to make the project "needed" so that it may be financed and built.

As I wrote about extensively last year, greedy merchant transmission developers (hello, Clean Line) whose projects failed because they could not find any customers to sign up for service have set their bought and paid for Congress critters in motion to create fake "customers" for their unneeded projects so that they can be "needed", financed and built.

The DOE is seeking comment on how to implement this ridiculous, new "program" set in motion by the passing of the Bipartisan Infrastructure Bill.  They have written a rather short (in regulatory terms) plan on how they are going to carry it out.

What should you say?  There are certain questions asked in this RFI that you may want to address, such as:

This has to be my personal favorite question, based on the stupidity of the presumption alone.  If the government buys something with your tax dollars, will you then be inspired to buy the same thing?  Or maybe buy the thing from the government, who isn't really using it?

Maybe Tom Sawyer persuaded a bunch of little boys to white wash Aunt Polly's fence, but if electric companies want to purchase capacity on new merchant transmission projects, it's a business proposition based on need and cost, not an emotional moment where electric companies just want to keep up with the federal government's activities.  If there was a need for the service, the electric companies would purchase it from the transmission developer directly.  When they don't, it means the merchant transmission project isn't needed.  DOE is going to be stuck with that unneeded transmission capacity that it can't use because it doesn't serve any electric customers forever (or 40 years, as written in the law).  How do you think the government can persuade others to buy something they don't need just because the government bought it first?  This concept is going to end in complete failure... just a complete give away of our tax dollars to speculative merchant transmission developers.

Here's another you may like:

And here's something that's not really a question, but feel free to comment on it anyhow.

Yup, they really wrote that into the law, even though they have no authority to circumvent the National Environmental Policy Act, which triggers a review every time an action of the federal government affects our environment.  Since this "program" is being carried out for the purpose of "facilitating" (financially propping up) transmission projects that would otherwise not be built, DOE IS affecting the environment with its decisions to shower tax dollars on unneeded merchant transmission projects.  Expect this to be challenged in court, but nothing says you can't get your licks in now and be right from the start.

And here's another topic that DOE pretty much ignores.  Merchant transmission is market based.  That is, there must be a market need for it.  Customers must be willing to pay to use it.  Merchant transmission has no captive customers who must pay for the project as part of their electric bill.  Merchant transmission is a completely optional, money-making endeavor and never necessary for you to get economic, reliable electric service.  Those kinds of projects are ordered by grid planners and recovered involuntarily as part of your bill.  Merchant Transmission is lightly regulated by the Federal Energy Regulatory Commission because it does not have involuntary customers who must be protected.  FERC may grant what's known as "Negotiated Rate Authority", which allows the merchant transmission developer to advertise its service and negotiate rate contracts with voluntary customers.  FERC regulates whether this process is fair to all customers.  But if the DOE is required to purchase capacity on merchant transmission projects, then it no longer qualifies as merchant transmission because DOE is a captive customer who must be protected with regulated cost of service rates.  When a merchant with Negotiated Rate Authority advertises and sells available capacity, there are strict guidelines the merchant must follow.  But what about DOE?  Who's going to be regulating them to make sure their sale of transmission capacity to all those future fence painters, who just gotta have what the government already bought, is fair?  Is one branch of the government going to be regulating the other?  DOE and FERC need to address how this will be handled, even though the merchant transmission lobbyists who wrote the law did not address it (probably because... well... stupid... they don't know how rates work).

And for those readers who successfully battled the Plains and Eastern Clean Line at great expense of time and money, perhaps you'd like to share a little wisdom you gained from the experience of DOE "participating" in that project for the express purpose of using federal eminent domain when Arkansas said "no"?  In that instance, DOE required Clean Line to have capacity contract customers before building, and Clean Line never could find any, which was the ultimate reason DOE cancelled its "participation agreement."  With that knowledge, how could DOE do better this time around in order to avoid years of misery?

The commenting form is quick and easy.  Please use it.  Time is short.  Sometimes the best defense is a good offense.  And DOE's new program is about as offensive as it gets.  Don't wait to act until a transmission road to nowhere that doesn't actually deliver electricity anywhere because there are no real customers taking service is sited outside your front door.