by Keryn

The Sierra Club submitted this letter to the WV PSC regarding the Commission's scrutiny of FirstEnergy's decision to close the Albright, Rivesville and Willow Island coal-fired generation plants in West Virginia on September 1, 2012.  Regular readers will remember an earlier post about the meeting Sierra Club mentions in their letter. 

So, what's Sierra Club's purpose here?  A successful transition from economic dependence on coal-fired power plants to a cleaner, more prosperous future for the affected West Virginia communities.  Read Sierra Club's success story about closure of a coal-fired plant in Centralia, Washington, that gave new hope to the community, instead of leaving them high and dry, as FirstEnergy intends to do to the West Virginia communities.   A similar story is playing out in other states affected by FirstEnergy's plant closure plans. 

FirstEnergy's abandonment of these communities that have supported their highly profitable coal-fired generation plants over the years raises the larger question of corporate social responsibility.  Some of these plants date back to the 1920s -- nearly 100 years of profits for FirstEnergy and its predecessors!  It also means nearly 100 years of these communities depending on the economic livelihood these plants have provided.  Now FirstEnergy has made the decision to close these plants during difficult economic times without giving anything back to the communities that have supported them and stoically accepted the pollution of their local environment by these plants in exchange for the good-paying jobs they provided.  To add insult to injury, FirstEnergy points the finger of blame at the EPA, when the reality is that FirstEnergy's closure decision is in their own pecuniary interest.

What social responsibility does FirstEnergy have to these communities?  Sierra Club tried nicely to get FirstEnergy to the table to talk about their responsibility, but was unsuccessful.  Now the WV PSC is dragging them to the table, kicking and screaming all the way.

FirstEnergy talks a big game about their "community involvement"

"Public service is a privilege and our obligation to serve goes beyond providing energy services to our neighbors. In partnership with other businesses, government and the nonprofit sector, we've pledged our resources and the FirstEnergy Foundation to help make our neighborhoods and communities attractive places to live, work and do business."

but when it comes time to put their money where their mouth is, FirstEnergy doesn't deliver.

Perhaps that's because, in reality, FirstEnergy's "corporate stewardship" consists of payments (subsequently recovered from electric ratepayers) to entities like the Maryland Chamber of Commerce ($20,000) for the self-serving purposes of: "Sponsorship related to corporate stewardship and the education of business leaders about PATH (proposed high-voltage transmission line). The Maryland Chamber of Commerce provides PATH with the opportunity to provide educational materials along with personal discussions of the PATH project and issues relating to the project to municipal, county and state elected officials and staff as well as the general public. Corporate monitoring of organizations activities." 

Another example is their $20,000 "membership" in the Westmoreland (PA) Museum, where former Allegheny Energy CEO Paul Evanson sits on the Board of Trustees.  (see Attachment A of this publicly filed document for compete listing of some of FirstEnergy's self-serving "corporate stewardship" in 2010).

FirstEnergy seems to have plenty of money for "corporate stewardship" when it furthers their own interests, but not when it's truly about corporate social responsibility and paying it forward.  How about it, FirstEnergy, can you walk your talk and do the right thing for the communities affected by your plant closures?  According to this article, you're soon going to have an extra $216M to play with as a direct result of these plant closures.  Helping communities affected by your business decision would be a step toward true corporate social responsibility.

by Keryn

CleanTechnica, who prides itself on being "the most-visited clean energy or cleantech news site in the world" that "share[s], and inspire[s] others to share, correct information on cleantech and its dirty competitors (there’s a lot of misinformation out there)," got ironically fished in by one of the biggest energy industry scams in Washington.  Yesterday, they published an analysis of PJM's 2011 State of the Market Report, to show gains in renewables and demand side management, and a drop in coal-fired resources.  While that part of the article could certainly be fairly argued with (and is, by many flat earth cavemen), CleanTechnica loses all credibility when it finishes up by quoting The COMPETE Coalition as a "group of 622 U.S. electricity industry stakeholders advocat[ing] for competitive electricity markets," and refers to one of COMPETE's PR spin opinion pieces as a "report."  So much for "correct information."

The COMPETE scam isn't even that hard to figure out.  The truth is readily available for any reporter who wants to spend a few minutes doing something more than copying & pasting text from a website.

Here's what the COMPETE Coalition is really all about:  It is a corporate-funded lobbying group intended to protect its Board of Director's generation revenue monopolies, including revenue derived from Reliability Must Run (old, dirty, generation) contracts and new coal-by-wire transmission projects.  I'm sure it's perfectly legal to pretend the coalition is a 501(c)6 trade association with a membership that pays "dues," and not an organization whose sole purpose is lobbying for their own financial interests.  The coalition accomplishes this under the guise of supporting competition in electricity markets, which is the exact opposite of their true goal.  While the APPA article linked below has more general information about COMPETE's overall scam, a recent example of coalition chicanery would be COMPETE's deployment of shills to interfere in New Jersey's LCAPP hearings.  COMPETE claims that RMR contracts and transmission lines produce cheaper electric rates than building new, competitive generation in high-priced markets, like New Jersey's.  This isn't true at all.  In the case of new transmission lines, for instance, the cost of the project is subsidized by ratepayers in 13 other states, making New Jersey's cost of new transmission to satisfy load deceptively "cheaper" only through creative accounting.

The COMPETE Coalition fairy tale was deconstructed in the publicly-filed Formal Challenge to Potomac-Appalachian Transmission Highline's 2010 Transmission Revenue Requirement.  The Challenge (complaint), which was filed by two concerned ratepayers with the Federal Energy Regulatory Commission in December 2011, had this to say about COMPETE:

"Still other memberships represent costs incurred through participation in lobbying groups that benefit PATH’s parent companies and should be properly classified as lobbying expenses in Account 426.4.
For example, Allegheny Energy’s membership in COMPETE, which was allocated in part to the PATH companies, was explained as a fee for having an Allegheny Energy employee sit on the COMPETE Board of Directors:
“The PATH Companies incurred $200 (PATH-AYE) and $202.50 (PATH-WV) of the total $25,000 paid to COMPETE in 2010. The fees paid were for board member dues. An employee was on the board of directors and paid dues for that privilege.”
However, COMPETE’s website states that “COMPETE membership is free.” It is unclear why Allegheny Energy paid $25,000 for a membership that is “free” and then recovered the amount from ratepayers.
A look at COMPETE’s “leadership” and their 2010 IRS Form 990 shows that COMPETE is managed by individuals from lobbying firms paid to represent the coalition and that the activity of the coalition consists mainly of lobbying activities. The American Public Power Association, a nonprofit, non-partisan, service organization for the nation's more than 2,000 community-owned electric utilities, claims that COMPETE is a disingenuous industry group whose true agenda is to protect the monopoly revenues of their members:
"So, while cloaking themselves in righteous assertions of competition, Compete’s real agenda is to protect the monopoly revenues received by the existing generator members of their group."
It is highly speculative whether Allegheny Energy’s privilege fees paid to COMPETE provide any tangible benefit to ratepayers. The fees are alleged to provide financial benefit to PATH’s parent company by protecting Allegheny Energy’s monopoly revenues through lobbying, therefore this membership should be properly classified in Account 426.4."

The Challenge detailed only a very brief snapshot of COMPETE's scam because COMPETE was merely one example among many instances of alleged Allegheny Energy bookkeeping fraud itemized in the complaint.  Let's expand a bit on the COMPETE fiction, shall we?

COMPETE's publicly-filed 2010 IRS Form 990 is a treasure trove of truth.  Page 7 lists COMPETE's 12-member Board of Directors.  Many of these 12 individuals are Vice Presidents of corporate "Governmental Affairs" (or equivalent) of some of the biggest (and dirtiest) market controlling generators, such as:  Allegheny Energy, FirstEnergy, BP Energy, Direct Energy, PPL, TXU Energy, Constellation, Exelon and PSE&G.  A couple of others represent huge corporations who use a lot of electricity (and likely have discount deals with their generating board compatriots), such as Wal-Mart, Safeway and Leggett & Platt.

COMPETE's total 2010 expenditures were $2,721,092.  Of that amount, $2,571,142 went to only four companies and one individual.  Page 8 details where COMPETE spent the bulk of their cash in 2010:

Wexler & Walker Public Policy, Lobbying Consultant, $677,043
Covington & Burling, Legal Counsel, $570,077
The Nickles Group, Legislative Advisor, $368,494
Federico Pena, Legislative Advisor, $315,000
Fleishman-Hillard, Marketing Consultant, $640,528

Wexler & Walker, Covington & Burling, Nickles Group and Federico Pena are the team who "put laws in place" that are said to stifle competition and protect the monopoly generation revenue of the coalition's "Board of Directors" companies.  Fleishman-Hillard is their public relations spin doctor who perpetuates the charade that the coalition is advocating "competition."  Now, let's look at COMPETE's "Leadership."  The "leadership" is the coalition's public face:  A representative from Wexler & Walker, a representative from Covington & Burling, a representative from The Nickles Group, and Federico Pena -- which is where the bulk of the coalition's money went in 2010.  Like any good corporate front group, the corporations who bankroll the coalition and their real agenda remain "hidden" from public view... except on the coalition's tax filing.  After the coalition was done paying their front men in 2010, there were only $149,950 of other expenditures for the year (page 10).  Out of that total, they spent $50,000 on a "white paper study" so they could slice and dice data and lie with statistics.  That leaves just $92K for other miscellaneous expenses.  I guess that would include the coalition's political contributions such as those listed here.

Page 15 shows that 90%, or more, of COMPETE's "dues" were non-deductible lobbying and political expenditures.  Unfortunately, "Board of Director" company Allegheny Energy decided to practice some creative accounting of their own and recover these lobbying expenses from ratepayers, which is not allowed under FERC's Uniform System of Accounts. The coalition set up Allegheny's big mistake by labeling their self-interested corporate bankrollers as "members."  COMPETE has three different classes of "members" (page 20).  One class (the "free" memberships offered on the website) are simply "allowed to participate" and cannot vote.  These are their shills.  A second class of "members" pay dues as determined by the third class of "members," and are allowed to vote on limited matters (though nothing of great importance), and serve on the Board of Directors.  I will speculate that this class includes the retailers and manufacturers.  The third class of "members" pay "full dues" and includes only certain Board of Directors and "Executive Committee" members, who are the only ones allowed to vote on the important stuff.  I would wager that these "members" are the corporate energy bankrollers whose financial interests are being served by stifling competition in electric generation markets.

I almost wouldn't mind so much that COMPETE is lying to the public, regulators and the media about their true agenda, however, when "member" Allegheny Energy thought they could get away with recovering their $25,000 "membership" from ratepayers (those same ratepayers the Coalition is supposedly benefiting with their advocacy for "competitive markets"), they compounded the scam by stealing the company's self-serving lobbying expenses from consumers.  That truly offends me.

All of this public information is the "correct information" that CleanTechnica neglected to share, and, unfortunately, brings the veracity of all their published content into question.  I will no longer consider CleanTechnica a reliable source.

by Keryn

Think more electric rate increases by AEP subsidiary power companies are really unavoidable costs of doing business for AEP?  That's what AEP wants you to think, but it's simply not true.

In addition to AEP's Appalachian Power subsidiary recently playing political games with the West Virginia legislature by killing a good bill requiring the company to do least cost planning, while simultaneously feeding the legislature a line of crap about "avoiding rate increases" with its consumer debt bonds bill, there is also a political and regulatory scam going on just over the border in Kentucky involving their Kentucky Power subsidiary.

In June of 2011, AEP had a huge, public tantrum about new EPA regulations and released plans for closing and converting some of its oldest, dirtiest coal-fired plants, saying that the EPA was causing higher rates, loss of jobs and scary blackouts.

AEP's press release said: 

AEP would retire generating units at the following locations but continue operating some generation at the sites:

Big Sandy Plant, Louisa, Ky. – Units 1 and 2 (1,078 MW) retired by Dec. 31, 2014;
Big Sandy Unit 1 would be rebuilt as a 640-MW natural gas plant by Dec. 31, 2015;

Unless AEP is so completely mismanaged that the company did absolutely no financial analysis before coming up with their list of which plants would close, which ones would be upgraded with scrubbers, and which ones would be converted to gas, we have to assume that repowering Big Sandy Unit 1 to gas was the most economic choice.

However, in December 2011, AEP reversed themselves and decided that spending $1M installing scrubbers at Big Sandy was more economical.  A spokesman detailed the reason for this about-face:

“Kentucky Power looked long and hard at the best way to meet its environmental obligations at Big Sandy Plant and after much study and analysis, the scrubber system emerged as our least-cost option,” said Greg Pauley, president and chief operating officer of Kentucky Power.  “By investing in the plant and the new scrubber system, we will be able to comply with environmental regulations as well as retain local jobs. It will also enable Big Sandy Plant to continue burning millions of tons of coal each year and ensure that Kentucky Power remains a large part of the area’s economy for years to come.”

Oh, so there's the political reason... AEP needs to continue burning lots and lots of coal.  It's not about what's most economical for Kentucky's ratepayers, it's about subsidizing the coal industry.  The scrubber's nearly $1M cost will translate into rate increases of 31%.  Is there a magical economic transformation that happens when you cross a bridge over the Ohio which makes Kentucky's ratepayers able to afford a 30% rate increase that West Virginia's can't?  Appalachian Power's excuse for issuing consumer debt bonds in West Virginia was that their ratepayers couldn't afford another 30% rate increase to pay off APCo's coal debt.  (Hmm... there's that word coal again.)  However, AEP thinks Kentucky's ratepayers have no problem with a 31% coal-subsidy rate increase.

I guess all these contradictions didn't add up for The Sierra Club and EarthJustice, either.  When Kentucky Power filed a rate case to recover the costs of the scrubbers, the organizations hired an expert to look at the company's financial analysis:

Jeremy Fisher, who describes himself as a scientist with Synapse Energy Economics, a research and consulting firm based in Cambridge, Mass., was one of three expert witnesses retained by the Sierra Club to argue against scrubbing smokestack gases at Big Sandy.

"I have found numerous errors, inconsistencies, and flaws within the workbooks supporting the application rendering the application inadequate and incomplete. The application does not support the company's contention that the environmental retrofits at Big Sandy 2 are the least-cost solution for ratepayers," Fisher said in his affidavit.

"In attempting to reconstruct the company's analysis supporting its contention, I have found multiple circumstances where specific errors or flaws in the analysis or underlying assumptions have biased the results towards favoring the retrofits. Correcting these sometimes simple errors leads to the conclusion that retrofitting Big Sandy 2 is, by a fairly wide margin, the least economical choice for Kentucky Power Co.'s ratepayers."

So the next time the power company tells you that raising rates is unavoidable, check their math... and their politics.

by Keryn

On December 21, the Maryland Public Service Commission fined Pepco in the amount of $1M as punishment for their unreliable electric service.  They were also voted by consumers as the most hated company in America last June.  In response, Pepco mucks their public relations barn and the b.s. starts to fly.

Does Pepco think that they can buy a semblance of "reliability" and consumer approval, instead of actually earning one, with the purchase of the PATH Project's hand-me-down astroturf front group?  Bad plan, Pepco, don't do it!!  The "Marylanders for Reliable Power" is nothing but a flaming bag of headaches that will cause their next corporate benefactor to end up with even more egg on its face.

This fraudulent "grassroots" group was created by a public relations firm to build advocacy for FirstEnergy's (formerly Allegheny Energy) and American Electric Power's ill-fated PATH transmission project.  It was not a spontaneous effort by anxious consumers to join together to improve electric reliability.  Allegheny Energy's purchase orders and contracts with The Artemis Group were made public last year at FERC as part of the Formal Challenge to PATH's 2009 ATRR.  In addition, the "coalition" and its expenses (which were wrongly recovered from ratepayers) is mentioned again in the recently filed Formal Challenge to PATH's 2010 ATRR.  This "coalition" has long since been exposed to the public as the fraud it is and the public relations firm that was its Dr. Frankenstein lost a big chunk of monthly income when the PATH Project was suspended by PJM (just like they did with Pepco's MAPP Project several months later).  Of course they would like to try to squeeze a little more blood out of this particular turnip by selling the pieces to some corporate stooge like Pepco as the solution to their reliability and reputation problems, but the Marylanders for Reliable Power are POISON!  Run, Pepco, runnnnnnnnnn!

Here's a novel (and free!) idea for Pepco that will go much further to assist them in rebuilding their reputation -- actually earning the respect of its customers through honest effort and sweat equity that will provide a reliable product for the public that Pepco is supposed to serve.  You cannot purchase respect!

Where has the Charleston Daily Mail been since August?  Or are they just trying to keep up the coal industry propaganda drumbeat against the EPA?

And yes, Ken Ward, they actually used the word "brownout" as part of the scare editorial.

The Daily Mail apparently just discovered the issue that was in the national press (as well as here on The Power Line, StopPATH WV and Coal Tattoo) back in late August and early September.

The Daily Mail's editors would have done well to actually read the report that our regional grid manager, PJM Interconnection, released last summer about the situation.  It is far from this claim in the Daily Mail editorial:

"But the president and his allies disapprove of coal and want Americans to rely on natural gas, wind and solar power instead. They are clearly willing to risk brownouts and economic harm to get what they want."

Change is hard, but these EPA rules are not coming out of the blue, or at the last minute, as the Mail claims.  The timetable for the development of these rules and limits has been in the works for decades.  If the coal-fired electric power industry wanted to ignore them until the last minute and hope that political blackmail would save their necks (and their power plants) then that is not the EPA's fault.

But one thing should be clear:  the adjustments required by the retirement of the oldest, highest cost coal fired power plants can be accommodated by our current electrical grid managers without any "brownouts and economic harm."  If the Daily Mail's motives had been to honestly report the news, then they should have done so back when this issue was news.  Today's editorial indicates that their real motivations lie elsewhere.

Cross posted from The Power Line

by Keryn

I wasn't around more than 100 years ago to hear what out of state corporate raiders told West Virginians when they blew into West Virginia with tales of mining a black rock that would provide the citizens of West Virginia with riches beyond their wildest dreams, but I imagine it went something like last night's Marcellus public "education" meeting in Martinsburg.  After all, propaganda wasn't invented by today's energy industry, they have merely honed what's been around forever.

Energize West Virginia, which of course is funded by the natural gas industry, put on a humdinger of a kool aid social.  The only fly in the ointment was that nobody in the audience drank any of their free kool aid.  You'd never know it from The Journal's article, but "Energize West Virginia" and their spokespuppets and corporate lobbyists didn't seem to have any fans in the audience.  I will give them credit for being good sports and not running screaming from the room while being peppered with questions from an informed, cynical public who was already "educated" to the reality of Marcellus extraction exploitation of West Virginia's environment and people.  But, of course, they didn't really answer any questions.

I lost count of how many of the seven common propaganda techniques the audience was slapped with in the first 10 minutes of the presentation, but I think they hit all seven.  I got a little sidetracked with a sudden urge to draw American flags on my free Chesapeake literature and hum The Star Spangled Banner.

We were told that frac fluid is made from coffee; that fish could live in it; and a couple of the panelists said it was so safe, they would drink it.  Note to self:  Bring thermos of benzene, methanol, 2-butoxyethanol, ethylene glycol, diesel, naphthalene and xylene mixed with a grande Starbucks salted caramel mocha to next Chesapeake propaganda session so I can pour them a drink!

After listening to the lobbyists whine about how expensive permits would hurt their business in West Virginia, Chesapeake was invited by an audience member to go drill in other states that are short-sighted enough to allow drilling with little to no regulation and cheap permits.  West Virginia's Marcellus gas isn't going anywhere.  If Chesapeake can go snap up cheap permits elsewhere, they're welcome to them.  They can come back here when all the cheap and easy gas is gone in other states, who will be left with a polluted environment, a poor economy, and a gas well in every backyard.  Corky (what? a grown man who calls himself "Corky"?) DeMarco, executive director of the West Virginia Oil and Natural Gas Association thought he could answer that question.  And hilarity ensued.  A more inarticulate and intellectually challenged "answer" would be hard to find.  One word:  "deregulize."  No, he really said that. 

Nice try, fellas, but your propaganda session intended to scare up a few supporters to "sign" (not write) letters to the editor, call talk radio stations, attend rallies, and urge their Eastern Panhandle legislators to vote against stringent gas drilling legislation and $10,000 permits (the real reason they subjected themselves to the scrutiny of the only area in West Virginia without any Marcellus shale) was a total rout.  Although the Chesapeake representatives found the Eastern Panhandle to be "rude," we prefer the term "cynical."  And we won't be fooled again.

by Keryn

This article in Forbes says AEP spent $2.75M on lobbying in the second quarter of 2011.  That "train wreck" sure has gotten expensive.  So now we can add $2.75M to the estimated $2M cost of the TrAIN Act to the taxpayers, for a grand total of nearly $5M Mikey has wasted on useless talk to delay the inevitable, instead just cleaning up AEP's coal problems.

What issues did AEP lobby?  (warning this site is addictive, look up all your favorite friends and corporations and you'll be there for hours)

H.R. 1705, the "Transparency in Regulatory Analysis of Impacts on the Nation (Train) Act of 2011, to require analyses of the cumulative and incremental impacts of certain rules and actions of the Environmental Protection Agency;

And who were they lobbying?

Environmental Protection Agency (EPA), U.S. HOUSE OF REPRESENTATIVES, U.S. SENATE

And what else was AEP up to that generated such a huge bill?

H.R. 1405, Prohibit EPA from regulating coal ash as hazardous
S.400, To amend the Federal Power Act to ensure that rates and charges for electric energy are assessed in proportion to measurable reliability or economic benefit, and for other purposes;
H.R.910, the "Energy Tax Prevention Act of 2011", (to prohibit EPA greenhouse gas regulations under the Clean Air Act);
Legislation to extend the compliance period for various regulations of the Environmental Protection agency (EPA) applicable to coal-fired generation.
Clean Energy Standard; Transmission issues generally. Seeking additional time to comply with EPA regulations
Addressing the need for transmission and the adverse effects of narrowly defining/restricting the way cost are allocated for the construction of transmission.

And

Transmission policy including rulemaking on transmission planning and cost allocation Energy Industry in general
at
Federal Energy Regulatory Commission (FERC)

This illustrates how lobbying of regulators at FERC has gotten completely out of control.  FERC should be split into two agencies, a promotional arm and an unapproachable regulatory arm, as suggested by Citizens Against Kemptown Electric Substation, Inc. in their Transmission Incentives NOI comments.

by Keryn

The investor owned utilities and the State of Delaware are making a mockery out of the huge distributed generation potential of the Bloom Box.  In order to entice construction of a Bloom Box manufacturing facility in Delaware, state officials and Pepco Holdings subsidiary Delmarva Power have come up with a ratepayer-funded scheme to centralize clusters of Bloom Boxes and transport the power generated to end users via transmission lines.

According to the article, the Bloom Box isn't intended for this kind of deployment:

"One of the main benefits to customers is that the power is generated by units placed on their property, not delivered to them over power lines winding back to a coal- or gas- or oil-fired power plant. Bloom touts its generators as pioneer technology in the field of "distributed power."

In essence, customers get to go "off the grid," lessening exposure to rising costs for electricity tied to the volatile prices of fossil fuels, and vulnerability to grid outages."

Of course the utility conglomerates don't like that scenario because they lose control over previously captive customers, and that means they lose revenue.  One way to prevent that from happening is to pervert the technology into centralized generation:

"The Delaware plan to cluster Bloom Boxes on two sites in New Castle County turns that strategy on its head.

The two Bloom clusters adjacent to Delmarva substations would be centralized, generating 30 megawatts of power for sale onto the grid. That's enough electricity for 20,000 to 30,000 homes. By comparison, Calpine's natural-gas plant at Hay Road generates 1,130 megawatts."

This "strategy" is a really stupid plan that was most likely cooked up by Delaware's economic development and Chamber of Commerce-types, who are always in bed with big business.  Under this plan, instead of state or local economic development programs providing business-enticing incentives, a large portion of the cost of providing incentives to Bloom is going to be borne by electric ratepayers, as if electricity isn't already expensive enough. 

"The Bloom clusters actually would shut down if the grid fails, according to Delmarva testimony filed with the PSC, which is considering Delmarva's proposed tariff to pass along $4 million to $5 million annually in costs.

Delaware officials tout the Delmarva tariff, saying the incentive the Bloom cluster deal provides was necessary for an incentive package that landed the company here. The state also is providing $16 million in financial incentives from money set aside to promote economic development."

PJM Interconnection says the new generation is not needed.

"PJM Interconnection spokesman Ray Dotter said the two Delmarva substation sites near Red Lion and Brookside are not in congested areas in need of a supplemental power source, nor do they suffer from reliability problems."

Bloom supposedly had no comment, however:

"...any such business would be secondary for Bloom, a California startup that has looked to capitalize on anxiety about the nation's power system of big plants and power lines.

On its website, Bloom prominently defines its product as "a new class of distributed power generator, producing clean, reliable, affordable electricity at the customer site."

"Distributed power" can be anything, said Richard Hirsch, director of Virginia Tech's Consortium on Energy Restructuring. It can be solar panels, a wind turbine, fuel cells or even a dirty gasoline-powered generator. All forms locate a power generator on the site where current is consumed."

Delaware needs to come up with a better plan that doesn't involve Pepco's centralized generation ideology.  Their "incentives" only destroy Bloom's business model and foist the costs of economic development onto electric customers.  What a joke.

by Keryn

If you've been following the EPA/AEP battle over the new Clean Air rules here, I hope you caught the testimony before the House Energy and Commerce Committee today.  Two panels of experts testified and were subsequently questioned by Congress.  This was in consideration of AEP CEO Michael Morris's TRAIN Act (you know, clean air will cause a TRAIN WRECK of monumental proportions with mass unemployment, sky high electric bills and blackouts).  The TRAIN Act calls for a delay in implementation of the rules in order for Congress to study their effect, and will cost the taxpayers a couple million bucks to complete.  The study isn't important, just the delay in implementation it will cause.  Can't we just give AEP that two million to clean up their plants instead?  When you add the cost of the TRAIN Act to the amount of money AEP has poured into a spin campaign to delay the rules, you could make some serious headway into cleaner air for everyone.

Someone sent me a link to the video feed of the hearing.  I just couldn't resist watching this spectacle live!

The first panel consisted of the five FERC Commissioners, who said expected retirements were not going to cause a major, widespread reliability crisis (excepting Commissioner Moeller, a Bush-era appointee).  They said a "reliability safety valve" that has been requested by RTOs to temporarily except certain plants from the rules that are needed for reliability reasons would take care of any small-scale, localized issues.

The second panel consisted of four state PSC Commissioners, the head of ERCOT (the Texas RTO), and a couple of scientific consultants, one of whom formerly worked at the Pennsylvania DEP (or something similar).  Among the state Commissioners testifying was WV's Jon McKinney.  You can read his testimony here.  As Clean Air Watch said a few months ago, it looks like it came right out of the old AEP word processor.

The partisan circus was definitely in town today when it came to questioning the panel.  Depending on the party of the Congressperson asking the question, and bias of the witness answering it (and yes, they all leaned heavily one way or the other), questioning was either harsh and slanted, or soft and leading.  Reminded me of a junior high school lunchroom on mystery meat day -- I expected the food to start flying at any second.

Here are some of the thoughts our Commissioner McKinney expressed in response to questions:

1. The deadlines can't be met without reliability issues.  The industry just doesn't have time to make changes necessary.
2. On jobs:  He quoted a study paid for by the American Coalition for Clean Coal Electricity (not a reliable source - heh!) - 1.4 million jobs will be lost.
3. Question:  PJM's forward capacity market auction for 2014-15 had more than enough capacity to maintain reliability - 19.6% over needed capacity.  Does the WV-PSC have any analysis that disputes this?  Answer:  There may be local impacts, then he starts referring to coal plant shutdowns in DC.  Even if you have adequate capacity, if you can't get it to load, it's useless.  The "reliability safety valve" is needed.  So, in short, McKinney's answer was.... No.
4. He was asked if the EPA had reached out to him to understand his local issues.  His answer was no.
5. He was asked to respond to the points made by Dr. Tierney, one of the scientific consultants.  He disagreed with all but one point, which turned into 2 by the end of his answer.  He said that there weren't "years of notice" that these rules were coming because until the rules were finalized, no action at all could be taken.  He touted how much money West Virginia utilities had already put into cleaning up their plants and passed onto ratepayers, and it still wasn't enough to meet these rules.  He talked about his background in generation for the chemical industry and stated that when he compared converting coal generators to gas, it was too expensive and the conversion caused a 4:1 job loss ratio.
6. The Congressman from Colorado stated that the EPA issue wasn't a partisan thing, and to prove it he asked McKinney to share his party registration.  McKinney is a Democrat (in name only?).

This is our Public Service Commission improving our standard of living and quality of life.

Have you called or emailed Governor Tomblin yet to share your preferred candidate for his appointment of the next Commissioner to fill the expired seat of Jon McKinney?

by Keryn

The lights went out for 4 million people in Southern California this week.  FERC and NERC are launching an investigation into the cause.  Preliminary reports point to maintenance work being done at a substation in Yuma, AZ, that knocked a 500kV line that supplied power to San Diego off line.  This caused a cascading failure.  Just like the 2003 blackout in the Northeast, the fault seems to be human error, lack of maintenance, and the failure of systems that are supposed to kick in and prevent a cascading failure.  Here's a LA Times article that explains the situation.

The investor owned utilities and their industry front groups were quick to blame the problem on an outdated, antique grid that is "strained" or "fragile," in an effort to promote the building of new long distance transmission lines.  New long distance transmission lines aren't going to fix the problem, just compound it.  Building more transmission lines does nothing to improve the condition of existing lines.  These "outdated" lines will continue to operate, fail, and cause problems, however they will now be connected with new lines with a wider geographic reach, so when a problem occurs, the resulting blackout is larger.  The most reliable system is one where generation is produced close to load and doesn't rely on an interconnected transmission system vulnerable to faults and system failures hundreds of miles from where power is being used. 

Building new transmission lines diverts capital investment from maintenance of existing transmission lines.  Because new transmission is incentivized by national energy policies, it is a more lucrative investment for the utilities and that's where they invest their capital, while existing transmission lines deteriorate and fail.  New transmission lines also require new rights-of-way and that means that private property owners along the route will have their property taken through eminent domain.  The cost of new transmission projects, estimated to be at least three times the cost of rebuilding and modernizing existing transmission lines completely within existing rights-of-way, is paid for by electric consumers.  This increases the cost of electricity.

One solution would be to modernize existing infrastructure.  It's cheaper and requires no new land and therefore is not subject to a contentious permitting process.  Another solution is distributed generation, the siting of many smaller generating sources near load.  We do not need a new network of expensive, redundant high voltage transmission lines.

However, as I mentioned in the beginning of this article, the IOUs and their front groups were quick to use the California blackout to crank out the propaganda pushing for new transmission lines.  Perhaps the most egregious of all is this article from IEEE, the Institute of Electrical and Electronics Engineers, who uses the blackout as an opportunity to push a conspiracy between FERC and industry lobbyists to usurp state authority to site transmission lines and force a bunch of new transmission projects through federal permitting and federal eminent domain powers.

There are so many things wrong in that article, I'm only going to point out a few.  I'm sure blog readers can point out even more.  Let's begin with that map of the "congestion zone" in California.  That "zone" and the National Interest Electric Transmission Corridor designated by the DOE in 2009 was vacated by the 9th Circuit Court in February of 2011.  It simply doesn't exist anymore because its designation was found to be faulty. 

"“They rely on imports, and if those imports go offline they have nothing to rely on,” says John Kyei, a former APS transmission planning engineer who is now director of Transmission for Houston-based renewable power developer BP Wind Energy."  San Diego wouldn't have to rely on imports if they began developing their own distributed generation or simply sited some generation near load.  Kyei can't see the forest through the trees.  Don't blame a transmission line when the solution is so much simpler.

"Kyei calls such delay’s business as usual, thanks to the phalanx of roadblocks – from environmental approvals to funding refusals by state-level public utility commissions with parochial interest – that regularly stretch new line planning in the U.S. to a decade or longer."  Yikes, abuse of the apostrophe, but I digress!  Of course the Arizona PUC has "parochial interests" -- they are tasked with ensuring Arizona citizens are provided with a utility system that protects their interests first, not Californians.  The contention that new lines are held up "a decade or longer" is completely bogus.  There is nothing "broken" about individual state authority to site new transmission lines.  Some transmission projects simply AREN'T NEEDED!  The state review process weeds out bad projects.

"There is, however, a chance that federal authorities will step in to force transmission improvements. The Energy Policy Act of 2005 empowers the Federal Energy Regulatory Commission (FERC) in Washington to override opposition from states and push through transmission upgrades within designated National Interest Electric Transmission Corridors.
 
DOE is currently considering a proposal to also delegate to FERC its power to designate national interest corridors, thus streamlining the process for federal involvement. To date use of the federal power has been blocked by state challenges to the DOE’s designation process – a situation that FERC staff would like to change, according to a policy paper posted last week. As they write: “Clearly, the backstop transmission procedure established by Congress has not yet been effective."

The EPAct only empowers FERC to override "opposition" from states when they fail to act within one year.  Denial of a project at the state level does not give FERC authority.  The backstop transmission procedure has not yet been effective because it has not yet been utilized!  There is no need for federal transmission siting authority.  The system we currently have is not broken.  FERC could not provide one example of a "broken" process.  Needed transmission is being approved and is being built.  FERC's power grab is illegal and will do nothing but complicate and delay the building of new transmission.

This kind of propaganda to push a federal transmission siting coup, dreamed up and championed by industry lobbyists in order to increase corporate profits, is shameful.