When it first proposed creating a process to carry out new authority to designate National Interest Electric Transmission Corridors as enabled by changes to Sec. 216 of the Federal Power Act contained in the 2021 Bipartisan Infrastructure Bill, the DOE envisioned this:
DOE is considering this process for designating NIETCs in recognition of the fact that such designations would occur in areas experiencing the greatest need for immediate transmission development and would unlock new financing and regulatory tools to spur investment in those areas. The recently enacted Infrastructure Investment and Jobs Act (“IIJA”) and Inflation Reduction Act (“IRA”) contain new public-private partnership and loan authorities that DOE can use to spur construction of transmission projects in NIETCs. In addition, section 216(b) of the FPA, as amended by the IIJA, allows the Federal Energy Regulatory Commission (“FERC”) to issue permits to site transmission facilities within NIETCs when certain statutory conditions are met.
At that time, DOE thought NIETCs were the key to everything transmission. DOE got so enamored of keys and locks that it began claiming that in order to feed at the tax money buffet Congress had created, a transmission project needed to be in an NIETC. Then DOE created "guidance" (aka quasi-rules that have no legal effect) that said:
In many cases the solution will be constructing new transmission facilities, and the NIETC designation can unlock key federal financing and permitting tools to facilitate such transmission infrastructure.
A clear message was sent to greedy transmission developers by the DOE -- request a NIETC or you're not getting into our buffet. So, they did. They requested 10 NEITCs that covered a hundred thousand acres of private property across the country. When it released its preliminary list, DOE reiterated the necessity of NIETC designation as a ticket to the buffet:
A NIETC designation unlocks critical federal financing and permitting tools to spur transmission development, including direct loans through the TFF program, public-private partnerships through the Transmission Facilitation Program, and Federal siting and permitting authority of the Federal Energy Regulatory Commission (FERC) in certain limited circumstances. Developers and state and local siting authorities may also be able to leverage the environmental analysis conducted by DOE as part of the NIETC designation process to complete local siting and permitting processes, which could ultimately accelerate siting and permitting for transmission projects in these targeted, high-priority areas.
Transmission developers took DOE at their word and admitted their only purpose in seeking NIETC designation was to get in line at the buffet.
Invenergy’s primary interest in securing NIETC designation for the Midwest-Plains corridor is for Grain Belt Express to be able to access additional federal financing options that support competitive rates for energy end users. Efficient and attractive financing sources are important as Grain Belt Express is a merchant transmission project principally funded via bilateral negotiated contracts with willing offtakers and not automatically via RTO, ISO or transmission owner cost allocation to ratepayers. As such, access to competitive financing supports the provision of lower-cost, competitive rates to prospective customers.
The DOE’s Loan Programs Office is currently conducting federal loan guarantee and environmental reviews for Grain Belt Express Phase 1. Invenergy’s interest in accessing the Transmission Facility Financing program, enabled by NIETC, is to support Grain Belt Express Phase 2. However, given the inherent uncertainty in any regulatory permitting process, Invenergy supports designation of the full Midwest-Plains corridor to secure additional financing pathways for both Grain Belt Express Phase 1 and Phase 2.
Grain Belt Express admitted that it needed that NIETC to be able to unlock the buffet.
But then the DOE cancelled GBE's NIETC, along with 6 others that were never needed but had been pursued in order to get a seat at the buffet.
Why is DOE still continuing GBE's "conditional" loan guarantee now that the NIETC has been cancelled? I thought the NIETC was the key to unlock the buffet? Missouri Senator Josh Hawley asked DOE to cancel that guarantee recently. Hawley mentioned that GBE doesn't have any customers. Without customers, GBE doesn't have any means to repay a $4.9B DOE loan. And why is the government giving a low cost loan to a privately owned electric toll road that will charge its voluntary customers a market-based fee to use its line? A DOE loan won't lower the costs that customers would pay to use the line, it only increases Invenergy's profits that go into uber-rich owner Michael Polsky's pockets. The electric transmission market that would set the market based rates for voluntary customers isn't going to change because Grain Belt Express paid less interest on its loan. For a different kind of transmission project that is paid for by captive ratepayers, paying less interest goes back into the regulated rates the transmission company charges. But for a market-based project like Grain Belt Express, paying less interest means the project is cheaper to construct, although the rates the market will allow GBE to charge won't change. The amount of profit Grain Belt Express can create for its owner is the delta between what the project costs to build and the market rate for transmission. DOE might as well put that $4.9B directly into Polsky's pocket.
Grain Belt Express has to provide a more economic option for transmission capacity than our existing public electric grid, or it won't attract any customers. And that's just the problem... Grain Belt Express never has attracted any customers, aside from a gaggle of uninformed Missouri municipalities who signed a non-binding contract to purchase "up to" about 4% of GBE's total capacity. If GBE was actually an economic option, a good idea, a needed project, it would have customers lining up to use it. Instead... crickets. And the DOE thought that was a good candidate for a $4.9B construction loan?
Perhaps that's because the DOE is fraught with corruption and most of its employees are scattered and goofing off. A recent Inspector General report found that DOE does not enforce the rules against conflict of interest and treats taxpayer money like "monopoly money".
But then the DOE cancelled GBE's NIETC, along with 6 others that were never needed but had been pursued in order to get a seat at the buffet.
Why is DOE still continuing GBE's "conditional" loan guarantee now that the NIETC has been cancelled? I thought the NIETC was the key to unlock the buffet? Missouri Senator Josh Hawley asked DOE to cancel that guarantee recently. Hawley mentioned that GBE doesn't have any customers. Without customers, GBE doesn't have any means to repay a $4.9B DOE loan. And why is the government giving a low cost loan to a privately owned electric toll road that will charge its voluntary customers a market-based fee to use its line? A DOE loan won't lower the costs that customers would pay to use the line, it only increases Invenergy's profits that go into uber-rich owner Michael Polsky's pockets. The electric transmission market that would set the market based rates for voluntary customers isn't going to change because Grain Belt Express paid less interest on its loan. For a different kind of transmission project that is paid for by captive ratepayers, paying less interest goes back into the regulated rates the transmission company charges. But for a market-based project like Grain Belt Express, paying less interest means the project is cheaper to construct, although the rates the market will allow GBE to charge won't change. The amount of profit Grain Belt Express can create for its owner is the delta between what the project costs to build and the market rate for transmission. DOE might as well put that $4.9B directly into Polsky's pocket.
Grain Belt Express has to provide a more economic option for transmission capacity than our existing public electric grid, or it won't attract any customers. And that's just the problem... Grain Belt Express never has attracted any customers, aside from a gaggle of uninformed Missouri municipalities who signed a non-binding contract to purchase "up to" about 4% of GBE's total capacity. If GBE was actually an economic option, a good idea, a needed project, it would have customers lining up to use it. Instead... crickets. And the DOE thought that was a good candidate for a $4.9B construction loan?
Perhaps that's because the DOE is fraught with corruption and most of its employees are scattered and goofing off. A recent Inspector General report found that DOE does not enforce the rules against conflict of interest and treats taxpayer money like "monopoly money".
The Federal Government prohibits conflicts of interest to safeguard the taxpayers against selfdealing, collusion, and fraud by Government officials and Government contractors. In the private sector, each party has a “baked in” economic incentive to watch, track, and account for its own dollars. That economic incentive does not exist in the public sector, where Federal dollars are more likely to be treated as “monopoly money.”
The report reveals that DOE is very lax about preventing conflicts and that it exercises absolutely no oversight over the third party "experts" that provide much of the documentation that becomes the basis for a decision to proceed with a loan. Since the applicant for the loan (the company) pays for these third party experts that do the DOE's work to investigate the loan application, the DOE thinks it is prohibited from looking for conflicts of interest there. Let me get this straight... the applicant is paying the salaries of the DOE contractors who process their own loan application? Why doesn't DOE have impartial employees to carry out such an important task as safeguarding the hard-earned dollars of American taxpayers? Why is it all farmed out to third party contractors who may have conflicts of interest? This is outrageous! Remember when Josh Hawley questioned Loan Program Office director Jigar Shaw in a committee hearing? Seems like another session is desperately needed!
And if the NIETCs are supposed to "unlock" federal financing tools, it seems like Invenergy has another problem. Invenergy's Cimarron Link merchant transmission line across Oklahoma filled its plate at the DOE financial incentives buffet. Cimarron Link was awarded a $306M capacity contract just a few short months ago. A capacity contract is just what Grain Belt Express is missing... a customer who will pay to use the merchant transmission line. If a merchant transmission project doesn't attract any voluntary customers, that means it is not needed! End of story! But Congress gave the DOE authority to serve up our tax money in the form of a fake contract with Cimarron Link. Oh, the money is real... Cimarron Link will receive $306M for use of its line over a period of up to 40 years, but DOE won't actually *use* the project. It's paying for a contract it won't use so that Cimarron Link doesn't have to actually provide any service at all. It's getting federal welfare paid for by all of us to construct a project that has no customers. So, if Cimarron Link's NIETC has also been cancelled, does that mean it takes the capacity contract with it? Someone needs to demand some answers!
The DOE is a corrupt political agency that has no business messing around in the reliable delivery of electricity. We have plenty of regulators already whose actions actually do make sure the lights come on when we flip the switch. DOE is a politically motivated chef, using our tax dollars to serve up a buffet of free Monopoly money to favored energy corporations. And DOE isn't even very good at it... it makes up the rules as it goes, wastes an incredible amount of tax money, and in the end has nothing to show for it. I dare you to name just one DOE transmission program that has successfully produced some benefit for the American people over the last four years. Can't do it, can you?
DOE is engaged in the business of giving your money to energy corporations, it's not engaged in doing anything that actually helps you.
And if the NIETCs are supposed to "unlock" federal financing tools, it seems like Invenergy has another problem. Invenergy's Cimarron Link merchant transmission line across Oklahoma filled its plate at the DOE financial incentives buffet. Cimarron Link was awarded a $306M capacity contract just a few short months ago. A capacity contract is just what Grain Belt Express is missing... a customer who will pay to use the merchant transmission line. If a merchant transmission project doesn't attract any voluntary customers, that means it is not needed! End of story! But Congress gave the DOE authority to serve up our tax money in the form of a fake contract with Cimarron Link. Oh, the money is real... Cimarron Link will receive $306M for use of its line over a period of up to 40 years, but DOE won't actually *use* the project. It's paying for a contract it won't use so that Cimarron Link doesn't have to actually provide any service at all. It's getting federal welfare paid for by all of us to construct a project that has no customers. So, if Cimarron Link's NIETC has also been cancelled, does that mean it takes the capacity contract with it? Someone needs to demand some answers!
The DOE is a corrupt political agency that has no business messing around in the reliable delivery of electricity. We have plenty of regulators already whose actions actually do make sure the lights come on when we flip the switch. DOE is a politically motivated chef, using our tax dollars to serve up a buffet of free Monopoly money to favored energy corporations. And DOE isn't even very good at it... it makes up the rules as it goes, wastes an incredible amount of tax money, and in the end has nothing to show for it. I dare you to name just one DOE transmission program that has successfully produced some benefit for the American people over the last four years. Can't do it, can you?
DOE is engaged in the business of giving your money to energy corporations, it's not engaged in doing anything that actually helps you.
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