The perturbed parade of stakeholders who believe PJM and the Market Monitor were engaged in secret scheming to revise the MOPR to their detriment continues to grow.

There's a whole new crop of angry letters on PJM's website that generally urge PJM to toss out the current proposal and start again from scratch, this time including ALL stakeholders.

OPSI Resolution (Organization of PJM States)

Joint letter from MD-PSC and MD-OPC

U.S. Rep. Van Hollen letter (now you've gone and ticked off Congress with your secret scheming, PJM, tsk, tsk!)

PA-PUC letter opining that secret scheming isn't such a big deal (if you're from a state that has a bunch of expensive coal-fired generation that now has no market).

Ut-oh, PJM, Ut-oh!  Next thing you know, they're going to be labeling you a cartel.  Go figure.

One of PJM Interconnection's purposes is to provide reliable power at the lowest possible price.  As part of its attempt to accomplish this goal, PJM plans for transmission "enhancement" and administers an artificial market construct that is supposed to foster competitiveness that will ensure market prices for electricity are "the lowest possible."

Although PJM can order new transmission to artificially adjust electricity markets, they cannot order new generation to shape the market.  This unbalanced "market" is what set up the investor owned incumbent utility transmission feeding frenzy we've had to put up with over the past few years.  Instead of ordering new economic generation near load, PJM orders expensive new transmission lines that source from existing generation farther from load.  PJM believes that "the market" (that is the REAL economic market, not PJM's artificially constructed and controlled market) will stimulate new generation without interference.  However, PJM will not rely on "the market" to drive transmission expansion.  If they did, would the lights go out while we wait for "the market" to catch up?  PJM thinks so.

Because PJM cannot order new generation, the states of New Jersey and Maryland took matters into their own hands and ordered new generation in their own states.  This upset PJM, the Market Monitor, and the incumbent generators, who have been scheming to actually prevent new generation.  So much for allowing "the market" to encourage new generation.

PJM "ordered" four new high capacity long distance transmission lines between 2006 and 2008 in order to increase the use of coal-fired resources.  These lines were supposed to bring lower cost electricity to the east coast, instead of waiting for "the market" to encourage new east coast generation.

The lines were economic projects, designed to decrease the "congestion" on existing lines that prevented the import of additional coal fired generation to the east coast during peak load.  However, PJM also floated these projects as reliability projects, insisting that eastern load would continue to attempt to draw cheap coal fired power from the west over congested lines until the lines simply overheated and failed, pitching the entire region into the dark.  That would never have happened because the east coast had plenty of their own generation, albeit more expensive (at the time) gas fired generation, that would increase prices when relied on to support peak load.

In order to decrease prices on the east coast through the building of these new lines, the cost of the lines is shared by all consumers in the entire PJM region.  The east coast only paid a fraction of the cost of the lines that lowered their prices.  And, in fact, the lowering of prices on the east coast by building new transmission actually increased prices in the western region by providing new markets for previously constrained generation.  Eliminating "congestion" serves to levelize prices between different markets.

But, something amazing happened between 2006 and 2012.  Demand for electricity on the east coast tanked due to increased energy efficiency and demand side management.  By shaving peak load, the east coast made great strides to solving the "problem" of not having access to cheaper, western coal fired generation.  Something else happened during that time as well.  Shale gas flooded the market, opening up a cheap, plentiful, new supply of natural gas that lowered the cost of previously expensive gas fired generation on the east coast and motivated new gas fired generation builds near east coast load.

The combination of decreased load and more economic east coast generation completely obviated PJM's "need" for the four new transmission lines.  Unfortunately, TrAIL had already been built at enormous cost and personal sacrifice by the people of West Virginia.  However, two other projects, PATH and MAPP, have finally been abandoned by PJM and won't be built.  But, the PJM consumers will still pay for these abandoned projects they never wanted and no longer need.  PJM's transmission planning has failed on a massively expensive scale.

But I've only accounted for three of the four projects thus far.  The last one is PSEG & PPL's struggling Susquehanna Roseland project in Pennsylvania and New Jersey.  Although there is no economic or reliability need for this project anymore either, the project owners and PJM continue to insist on constructing it at enormous cost to consumers, landowners and the citizens who own the Delaware Water Gap National Recreation Area.

PSEG & PPL read the economic writing on the wall over the past few years and stepped up their efforts to ramrod their project into reality by making it "too big to fail" even though the economic justification for it had evaporated.  The companies still claim that S-R "will save consumers $200M per year in congestion costs," therefore it is urgently needed and justifies enormous cost that will raise electric prices, take land from property owners, force those living in close proximity to risk their health being bathed in the line's continuous EMF soup, and destroy a priceless and irreplaceable national park.

In order to do so, PSEG & PPL bribed towns and landowners with "mitigation" payments and began a lobbying program that reached all the way to the White House with the goal of obtaining the approval of the National Park Service.  The cost of all this, of course, will be borne by all consumers in PJM.

Last week, I watched FERC Commissioner Moeller extoll the virtues of new transmission while disparaging the efforts to hinder Susquehanna Roseland, a project that "would save consumers $200M a year in congestion costs," according to Commissioner Moeller.

So, where did that congestion figure come from?  PJM and the project owners floated it at the time the project was approved, many years ago.  Does that figure still bear any resemblance to reality?  No. The "congestion" driving S-R has evaporated.  The building of S-R will actually cost consumers more than any subset of consumers will ever save on their electric bills.  Whether or not there is a "reliability" need for this project I really can't say, but if there is one, a simple rebuild of the existing line may suffice to fill that void.  S-R as planned is overkill.

Every quarter PJM's Market Monitor publishes a "State of the Market" report.  The one for the third quarter of 2012 was released the other day.  The report has a section about "congestion."  If S-R was still going to save consumers "$200M per year" that information would show up in the report.  It does not.

The SOM report says, "The AP South interface was the largest contributor to congestion costs in the first nine months of 2012. With $50.9 million in total congestion costs, it accounted for 12.0 percent of the total PJM congestion costs in the first nine months of 2012.
The top five constraints in terms of congestion costs together contributed $112.5 million, or 26.5 percent, of the total PJM congestion costs in the first nine months of 2012. The top five constraints were the AP South interface, Graceton – Raphael Road transmission line, Woodstock flowgate, Belvidere – Woodstock line and Clover transformer."

None of these congestion contributors is located anywhere near the Susquehanna Roseland project area.  And the biggest contributor to congestion costs is $50.9M per year, not $200M.

The SOM report also provides a nifty map on page 221 that shows congestion points.  There's no congestion showing up in the geographic area where S-R is being constructed.

Need and justification for Susquehanna-Roseland have completely evaporated.  If the project is abandoned now, or reconfigured to more closely align with any actual need, the cost to consumers will be dramatically lowered.  Stop constructing this project now.  Just stop.  Consumers can't afford PJM's artificial markets and planning failures any longer.  Stop it.

Yesterday, FERC issued a Policy Statement intended to further refine their policy for awarding financial incentives to transmission projects.  The Policy Statement was the Commission's response to the extensive, 42-page, 74-question Notice of Inquiry it issued in May of 2011.

The financial feeding frenzy has been scaled back for now and transmission owners have had their bag limits on consumer wallets reduced.

If you want the quick and dirty summary, here's FERC's press release.

If you want to know exactly what was in the Policy Statement, read on.

"In particular, the Commission: reframes its nexus test to focus more directly on the requirements of Order No. 679; expects applicants to take all reasonable steps to
mitigate the risks of a project, including requesting those incentives designed to reduce the risk of a project, before seeking an incentive return on equity (ROE) based on a project’s risks and challenges; provides general guidance that may inform applications for an incentive ROE based on a project’s risks and challenges; and promotes additional transparency with respect to the impacts of the Commission’s incentives policies."

1.  "The Commission will no longer rely on the routine/non-routine analysis adopted in BG&E as
a proxy for the nexus test."

What this means:  The nexus test requires an applicant for incentives to demonstrate a connection between the incentive(s) requested and the risks and challenges that a project faces.  Previously, once an applicant demonstrated that a project was not routine, the nexus test was satisfied and the project was deemed to face risks and challenges that merit incentives.  In the refined policy, FERC tosses out the routine/non-routine analysis and will require project applicants seeking incentives to demonstrate how the total package of incentives requested is tailored to address  demonstrable risks and challenges and must provide sufficient explanation and support to allow the  Commission to evaluate each element of the package and the interrelationship of all elements of the package. If some of the incentives would reduce the risks of the project, that fact will be taken into account in any
request for an enhanced ROE.  In short, applicants will have to do more to demonstrate risks and challenges that merit incentives.

2.  "The Commission expects incentives applicants to seek to reduce the risk of transmission investment not otherwise accounted for in its base ROE by using risk-reducing incentives before seeking an incentive ROE based on a project’s risks and challenges."

What this means:  A transmission's base ROE (the interest a project earns on its investment) is already set to account for the riskiness of transmission investment.  However, when a transmission project is riskier than a "normal" transmission project, it can be granted additional incentives to compensate for additional risk.  However, a project must request and utilize risk-reducing incentives before requesting an incentive ROE (extra interest) on a particular project.  A project owner must show how their project is riskier than "normal" and then how certain risk-reducing incentives will compensate for or reduce risk.  If the project is still so risky that risk has not adequately been reduced through the base ROE and risk reducing incentives, it may also request further risk compensation in the form of an enhanced ROE (extra interest).  The Commission is getting tougher judging risk and the need for a full spectrum of every available incentive.  No more using the same risk as the basis for every incentive.  Each incentive granted will reduce risk and a company would have to prove further risk that has not already been compensated for with other incentives in order to be awarded an incentive ROE.

3.   "Investments in the following types of transmission projects may face the types of risks and challenges that may warrant an incentive ROE based on the project’s risks and challenges that are not either already  accounted for in the applicant’s base ROE or could be addressed through risk-reducing incentives:

1. projects to relieve chronic or severe grid congestion that has had demonstrated cost impacts to consumers;
2. projects that unlock location constrained generation resources that previously had limited or no access to the wholesale electricity markets;
3. projects that apply new technologies to facilitate more efficient and reliable usage and operation of existing or new facilities."

What this means:  I think it's pretty self-explanatory.

4.  "The Commission will no longer consider requests under Order No. 679 for a stand-alone incentive ROE based on an applicant’s utilization of an advanced technology."

What this means:  No more incentive ROEs based solely on advanced technology, this will be considered as part of a project's risks and challenges (see 3 above).

5.    "Risks may be reduced through the risk-reducing incentives described in section II.B, or through mitigating costs by implementing best practices in their project management and procurement procedures. Applicants should consider taking measures tailored to mitigate the various risks associated with their transmission projects and to identify such measures
in their applications."

What this means:  Transmission Owners need to stop creating risks through poor management or bad choices and then asking to be compensated for it.

6.   "The Commission expects applicants for an incentive ROE based on a project’s risks and challenges to demonstrate that alternatives to the project have been, or will be, considered in either a relevant transmission planning process or another appropriate
forum. Such a showing should help identify the  demonstrable consumer benefits of the proposed project and its role in promoting a more efficient, reliable and cost-effective transmission system."

What this means:  No more PATHetic projects!  An applicant must demonstrate to the Commission how its project was compared to alternatives and found to be the most cost-effective solution.  Of course, a showing could be that an RTO/ISO has made this determination.  And since RTO/ISOs are nothing but industry cartels that will choose the projects of their favored incumbents and then make up a justification to support their choice afterward, this really doesn't solve the problem.  However, the transmission owner now has to convince the Commission that it was done properly.

7.   "The Commission expects applicants for an incentive ROE based on a project’s risks and challenges to commit to limiting the application of the incentive ROE based on a project’s risks and challenges to a cost estimate."

What this means:  Any incentive ROE will only be applied to a project cost amount that was used to determine the project's cost effectiveness as evaluated by an RTO/ISO.  So, say a project is found to be superior to other alternatives at a certain price when evaluated by an RTO/ISO, and then is awarded an incentive ROE by FERC.  The project can no longer apply the incentive to amounts that go over budget.  Historically, projects have floated bogus cost estimates at RTOs in order to get projects approved, and then spent a lot more actually building the project, and collected extra interest on the overspend.  This situation perpetuated the "the more you spend, the more you make" scenario that has plagued transmission projects and is breaking consumers while unjustly enriching transmission owners and contractors.  The Commission also gives a nod to SPP's cost containment proposal submitted in comments as a reasonable example.

While these are generally positive changes, they don't go nearly far enough and completely fail to tackle the underlying problems with FERC's transmission incentives policy.  FERC has merely set the stage for another long, slow decline toward lazy rubber stamp approval of ridiculous incentive packages that cause consumer concern.  The PATH project was the impetus for the NOI and the refinement handed down yesterday.  How long before another PATH happens?

I'm not sure what happened between FERC's rather auspicious and ambitious beginning in issuing such a great NOI, and this Policy Statement that feels like a punt.  It could be that there was too much controversy among the Commissioners.  It could be that there was too much political pushback from a greedy industry.  And don't forget those personal visits to the Commissioners from transmission owning CEOs.  Whatever happened, it looks like the Commission lost their nerve and took what they feel is the easy way out.

See statements of Commissioners Norris and LaFleur here.  It's interesting that they didn't publish a statement from Commissioner Moeller, since he had plenty to say yesterday.  Maybe he's part of the problem.  Wellinghoff didn't have much to say about it, and Clark was not participating.

It seems like the Commission was afraid if they came down too hard on transmission incentives that they would stifle investment.  However, they have quite effectively managed to do just that with their Policy Statement.  Which transmission owner do you think is going to be brave enough to step into the void and be the first to apply for incentives under the refinement (which was effective yesterday, btw)?  Not a one of them.  They're all going to hang back and wait for someone else to poke the first stick into the lion's cage so they can begin the process of finding ways to work around well-intended changes in order to continue to unjustly enrich themselves building unnecessary transmission.

I guess if Congress really wants transmission incentive policy reform, they're going to have to do it themselves through amendments to the Energy Policy Act.  I can only wish them luck.

Wow, talk about your scare tactic headlines... 

"Thousands Seen Dying If Terrorists Attack U.S. Power Grid" was the headline Bloomberg used on an article about cyber security and the electric grid yesterday.

Too much drama?  Maybe not.  Read the article and find a new worry to keep you up at night.

"Cyber attackers “could magnify the damage of a physical attack” by disabling computerized security systems or blocking signals to grid operators, the report said.

Other threats to the grid may include terrorist groups, disgruntled or bored individuals, or energy companies seeking to thwart competitors, it said. A 2011 report from the Electric Power Research Institute said that about $3.7 billion in investment is needed to protect the grid from cyber attacks."

So, while FERC tries not to be so helpless about cyber attacks, who's minding the store?

Is it NERC, who is supposed to enforce grid reliability standards?  NERC, whose standards are drafted and approved by the industry they are supposed to regulate, is a tool of the industry. 

NERC recently fined three related subsidiaries of some anonymous electric utility $725,000 for for failing to have a good cyber security protection system in place.  $725,000 is a big deal fine for NERC, but what if this was your electric service provider, and their entire system had been taken out by "disgruntled or bored individuals" before NERC got around to collecting such a paltry fine and instituting a compliance program?  I guess that's a gamble anonymous electric utility is willing to take with your life (according to Bloomberg).

Don't sit around waiting for the government entities, or worse yet the utilities themselves, to save you if some pimply teenage hacker brings their anarchy dream to fruition. 

Don't listen to these same entities telling you that we need to build a bigger, cleaner, stronger grid.

Don't listen to these same entities telling you that you are and always will be a stupid animal feeding at the corporate energy trough to survive.

How many Sandys do we need to demonstrate that the traditional electric delivery system is broken and can't be fixed?

So, what's the solution?  Self-reliance.  Smaller systems that can be isolated.  Power generation located closer to where the power is used.  Distributed generation.  The Power Line brings us two stories of microgrids in New York that survived a direct hit by Sandy, while all the traditional utilities shrugged their shoulders at massive failure.  Read the stories here and here.

I hope we don't have to wait for pimply teen to grow out of his anarchy phase before our grid "authorities" wake up.

PATH never could resist having the last word in any argument, even if doing so burned PATH like a moth circling too close to an enticing flame.

PATH didn't disappoint today and filed a second "response" to the answer of one of the other parties to PATH's answer to protests of its abandonment filing at FERC.

Old Dominion Electric Cooperative filed an answer to PATH's answer last week pointing out that PATH was only remaining a "member" of PJM in order to collect an extra half a percentage point of interest over the amortization period.  Since PATH does not plan to own any transmission that would receive benefit from a PJM membership, the extra interest to be derived from this "membership" is just another way to gouge consumers without any corresponding benefit.  ODEC also pointed to PATH's ridiculous contention that its parent companies' memberships in PJM entitled PATH to receive this benefit.

What is it that PATH fails to understand here?  Sec. 219 of the Energy Policy Act directs FERC to "provide for incentives to each transmission utility or electric utility that joins a Transmission Organization."  Now that PATH's project is abandoned and PATH has no plans to own any other transmission, ever, PATH is no longer a "transmission utility or electric utility."  Therefore, PATH is no longer eligible to retain this incentive.  Does someone need to draw PATH a picture?  Any further answers or responses should include artwork, preferably in crayon.

In their "response" today, PATH rambles on accusing ODEC of conflating and confusing PATH's answer.  Fail!  Considering that I read the same thing in PATH's answer that ODEC did, chances are that the Commission will also read it that way, despite PATH's suicidal attempt today to rehabilitate its own bleary legal work.  And speaking of bleary legal work... who is the "Virginia Service Corporation Commission" that PATH mentioned in their "response" today?  Any parties here by that name?  Didn't think so.  Thanks for the laugh, PATH!  Watch out for that fire, it's hot!

That's the three foot tall slogan emblazoned on a bunch of new billboard ads in Ohio.

Sierra Club's Beyond Coal Campaign has initiated the advertising campaign to make Ohio's FirstEnergy customers aware of how FirstEnergy is ripping them off by failing to pass on energy efficiency benefits and to generate consumer comments at the Public Utilities Commission.  Check out the campaign's website here.  The very observant may even get a deja vu feeling while reading ;-)

Read an article about the billboards where our lil' Coalfella whines about how unfair the campaign is.  Really?  FirstEnergy wants to whine about unfair right about now?  Ha ha ha ha.  Karma's a real bitch, boys!  Now sit back and watch how generating comments at PUCO is done.  You might want to take notes to use during your next little public tiff with AEP.

Ooops!  PJM's Terry Boston let the wind industry's scheming out of the bag yesterday at some "event" on fostering transmission investment and clean energy resources in the Southeast.

"The Bipartisan Policy Center is working with power industry representatives and plans to send recommendations early next year to President Barack Obama on transmission and electricity policy, the head of PJM Interconnection said Wednesday."

Say what?

According to this article in Platts, Boston said, "FERC's current rule on cost allocation of new transmission lines is to assign costs to those who benefit from the lines, but for interstate projects to move renewable resources through several states, some states may feel left out and that is a big challenge for the industry to address."

Left out?  Is that how the industry that stands to profit from long-distance transmission lines "for midwest wind" is going to color those states being used as a pass-through for these lines?  You're darn right we're going to feel "left out" when other states' renewable portfolio standards require us to give up our land for new rights-of-way and pay for construction of a transmission line that only benefits citizens of another state.  It's not going to happen, even if the lobbyists do whisper sweet nothings in Obama's ear while writing campaign contribution checks.  Bi-partisan, my eye!

Let's take a look at the people involved here.  While they may be politically bi-partisan, there's an even scarier partisanship going on here than anything the Democrats or Republicans could dream up.  It's all about the money, boys!  It's big business vs. the consumers they plan to rob blind.

John Jimison, a former US House of Representatives staffer and current managing director of Americans for a Clean Energy Grid:  Americans for a Clean Energy Grid is nothing but a front group for industry that stands to rake in the cash by turning the midwest into "the Saudi Arabia of wind" and shipping it to both coasts via $300B of new high-voltage transmission lines that we don't need, can't afford, and that will only serve to render the grid more fragile and vulnerable.  This front group is a transmission owner's dream$come$true because they've reined in the big environmental organizations to act as their lackeys to promote transmission development for "clean energy."  The environmental fantasy these patsys see fails to recognize that once this "green" grid is built (with consumer funds, remember that) it's going to transport fossil fueled energy because the grid is open access and "wind" won't be able to compete on a price basis.  Only through government subsidies and state mandates will costly "wind" power be viable.  This front group has been busy holding real old fashioned kool aid socials around the country.  In fact, we may have infiltrated one earlier this year ;-)  Just remember, there ain't no such thing as a free lunch, check out the "sponsors" of these propaganda fests.

Former Congressman Rich Boucher:  Now employed as the "head" of energy lobbying firm Sidley Austin's "government strategies group."  Lobbyist.  Not "bi-partisan" but protecting the interests of his well-heeled energy company clients.

Former Federal Energy Regulatory Commission Chairman Curt Hebert:  Currently the Chief Executive Officer of Lexicon Strategy Group, LLC.  Lexicon Strategy Group " specializes in risk assessment and developing appropriate business strategies to mitigate the impact of adverse legislative and regulatory policies. Our legal team provides regulatory expertise to electric and gas clients for issues including exploration/production, generation, transmission, distribution and securities."  How do they do that?  "Coalition Building, Third Party Advocacy, Constituent Recruitment, Governmental Management (Federal and State), Federal and State Energy Policy Development,
Advocacy Campaigns."  You know, all the best front group propaganda techniques.

And, of course, the partisanship to the energy companies that own him of our dear friend Terry Boston from the PJM Cartel is already legendary.

Well, guess what, lobbyist friends?  The consumers who make up the 99% aren't on board with your money making schemes, and the states who currently control transmission siting approvals aren't on board with your attempts to usurp their authority, and guess what?  There's more of us than there are of you.  See you at the White House!

StopPATH WV, Inc. presented gifts of $1,000 each to two local churches at a ceremony in Charles Town on November 7.  The payments represent a distribution of remaining assets as the organization prepares to wrap up its business affairs.

“We strongly believe in ‘paying it forward’ to the communities that supported our organization to achieve its goal of stopping the PATH Project,” said Robin Huyett Thomas, President of StopPATH WV, Inc.

The gifts were presented to Chestnut Hill United Methodist Church of Harpers Ferry and Summit Point United Methodist Church of Summit Point.

Accepting the check on behalf of Chestnut Hill UMC, Pam Gearhart said, “Because many members of our congregation would have been affected by PATH, we were happy to do whatever we could to help fight the battle and we appreciated all the hard work and dedication of everyone involved in the effort.”

Dianna Dick from Summit Point UMC expressed the Summit Point community’s appreciation for the dedication and countless hours organization members contributed to the successful effort.

The PATH Project was a 765kV, 275-mile, high voltage electric transmission line that was proposed to cut through 16 miles of Jefferson County on its route from St. Albans, West Virginia to Mt. Airy, Maryland.  The $2.1B project, proposed in 2007, was recently removed from regional transmission expansion plans and cancelled for good.

“The churches recognized that the project posed grave threats to their communities,” said Keryn Newman, Treasurer of StopPATH WV, “and they supported our efforts by fostering community discussions and donating the use of their facilities as meeting venues.”

L to R:  Dianna Dick, Summit Point UMC and Pam Gearhart, Chestnut Hill UMC, receive checks from StopPATH WV President Robin Huyett Thomas while StopPATH WV Board members Sharon Wilson, Bob Montgomery, Patience Wait and Debbie Royalty look on.

It's been so long you've probably forgotten all about FERC's Notice of Inquiry on Promoting Transmission Investment Through Pricing Reform.  Thankfully FERC hasn't.

The NOI, issued in May 2011, solicited public comment on FERC's policies for awarding financial incentives to transmission projects.  And the public responded.  FERC was deluged with hundreds of comments from elected officials, corporate beneficiaries of the incentives, trade groups, and most importantly an avalanche of comments from the most significant "stakeholders" of all -- you, the consumer who pays for the incentives.

Yesterday, FERC issued the agenda for its November 15 public meeting.  Item E-3 is expected to be the first word from the Commission on how incentives policy will be reformed.

If you submitted a comment, you will be served with a copy of the Commission's order after the meeting concludes.

The Commission may comment on the order during the meeting.  You may watch a webcast of the meeting here.  Look under "News and Commission Meetings" to find the link to the video.

And pat yourself on the back... it's time to harvest the fruit of citizen action!

Although FERC rules prohibit an answer to a protest, PATH has 121 million reasons to ignore the rule and waste everyone's time simply rehashing and reiterating its original section 205 filing to collect its stranded $121M investment in its failed PATH project.  Exceptions can be made by the Commission if the answer provides new information that informs the Commission's decision.  Did PATH bother to provide any new information in its answer?  Perhaps they should have highlighted any actual "new" information to make it more easily detected among all the flimsy excuses and incorrect information.

PATH tells the Commission that although it has the ability to suspend proposed changes to existing rates, that PATH's changes to the Formula Rate (which is PATH's rate) aren't changes to its rate after all.  PATH also urges the Commission to hurry up and approve the changes to its Formula Rate without hearing because PATH has submitted a fraudulent 2013 Projected Transmission Revenue Requirement that they need to revise before January 1, 2013.

PATH believes the Commission should summarily reject protests that the company had control over the abandonment of its project, otherwise, PJM's authority will be undermined!  Would that be a bad thing, really?  PJM's imprudent actions brought about by its Project Mountaineer initiative to build new transmission to increase the use of coal-fired resources, and intended to provide significant profit to its favored incumbents, has just cost millions of consumers in its region a quarter billion dollars for the failed PATH project alone, not to mention the additional amount wasted on the also-cancelled MAPP project.  How much more will PJM's erroneous and failed initiatives be permitted to steal from struggling electric consumers if this costly failure is swept under the rug and not examined?

PATH believes that it is entitled to receive an extra half of a percent interest on its abandoned plant during the amortization period.  The extra interest is a reward for membership in PJM.  PATH states that it intends to remain a member until the consumers finish paying for its project, although it does not intend to own any transmission during that time.  PATH is simply maintaining its membership to receive the extra interest.  Is this really prudent?  PATH whines that the Commission should not discriminate against it for the business structure it voluntarily constructed.  "Revisiting the 50 basis point ROE adder would deny AEP and FirstEnergy an opportunity to apply the ROE-based incentive adder to their abandoned plant investment in the PATH Project merely because of the business structure they chose as a vehicle for fulfilling the construction obligations assigned to them by PJM."  Bingo!  Ya know what, PATH?  Life ain't fair.  You set up that business structure voluntarily because it benefited you and now you're stuck with it.  Quit your sniveling and take your lumps.  Your parent company memberships in PJM do not make PATH eligible to receive this incentive either.  That was really PATH-etic!

PATH has 121 million excuses for why its spending wasn't imprudent.  After asking the Commission to set the issue of prudence for a hearing wherein the prudence of its expenses can be debated, PATH wastes page after page trying to justify its spending on things like property and option purchases.  So, PATH, do you want a hearing or do you want the Commission to rule here?  It's hard to tell.  PATH falsely accuses protestors of not providing any "basis or support" for prudence challenges and proceeds to neglect to provide any "support or basis" for its own contentions that the spending was prudent, except for the ridiculous assertion that AEP and FE routinely buy property before a permit is received.  PATH holds its parent companies up as the industry standard in the face of evidence showing that one of these same parents doesn't buy land prior to the issuance of a permit.  So, was AEP lying to the Department of Energy earlier this year or are they lying to FERC now?  Inquiring minds want to know.

PATH attempts to color all its property purchases the same.  The reality is that PATH was split into two different companies, PATH-West Virginia (owned 50-50 by AEP and FE) and PATH-Allegheny (owned 100% by FE).  PATH-WV made minimal land purchases for substation sites and was slower to option property.  However PATH-Allegheny purchased lots of property that had nothing to do with substations and was quick to option property long before the permit process had even begun rolling.  This is a distinction that most likely has roots in the two different corporate philosophies behind the PATH project.  Now AEP gets to help FE hold its little doggie bag of imprudence, however.  Didn't your mommy ever tell you that you will be known by the company you keep, AEP?

PATH goes out of its way to admit that its property purchases in River's Edge were for the purposes of forcing the release of a conservation easement.  PATH goes into a long diatribe attempting to justify its imprudent property purchases as cost saving measures.  Yes, that's right, if PATH had not attempted to nullify a conservation easement in which Loudoun County had invested taxpayer funding, it would have cost more to re-route the line around it (using the most destructive route possible in an attempt to make releasing the conservation easement and allowing PATH's preferred route look preferable).  This same theme continues in flimsy justifications for other purchases.  PATH claims if it had not bought certain properties, it would have had to route its line around them in order to avoid homes or other obstacles.  Is this what PATH told landowners?  That if they didn't prefer to voluntarily sell their property that PATH would simply route their line around the property?  No, of course not.  PATH told landowners that if they didn't sell voluntarily that the company would take the property by eminent domain or simply "run the line right over the top of your house."  So, now PATH wants to test its word against that of thousands of landowners?  Isn't this going to be fun?

PATH also points out to the Commission that other abandoned projects that requested much, much smaller recoveries were not RTO-ordered projects.  So, I guess PATH's point must be that when there is some risk to the transmission owner that spending is prudently curtailed.  However, in PATH's case it was a giant, bleeding spend-a-thon because PATH believed that ratepayers were on the hook for all of it.  Now when the specter of shareholders being responsible for some or all of PATH's spending spree rears its ugly head, all of a sudden the amount of spending becomes a big deal.  Don't you just love karma?

So, now it's up to the FERC Commissioners to wade through the facts presented and make a decision that ensures that PATH's rates are just and reasonable.