The Wind Blows, Power Goes Out in WV

Here’s the account from the Charleston Gazette of how 20-30 mile per hour gusts were “knocking out power to thousands of West Virginians” on Monday.

The WV PSC will probably give both AEP and FirstEnergy significant rate increases in their current base rate cases for right of way maintenance.  Monday’s local blackouts indicate, however, that WV’s aging electrical distribution system is still very brittle.

Keep in mind that this was just wind, on a relatively warm day.  There was no rain or snow, and still there were thousands of customers without power.

Too bad WV government “leaders” aren’t taking a tip from New York on building real reliable electrical systems:

Under an innovative program to create at least 10 “microgrids” (independent community-based electric distributions systems) statewide, the State will launch NY Prize, a $40 million competition, to help build community-scale power grids for areas with approximately 40,000 residents. Microgrids can operate in tandem with existing power supply during normal conditions, but will disconnect and operate as an independent power system to keep the lights on during an emergency.

New Testimony Filed in PATH Cost Recovery Cases at FERC

AEP and FirstEnergy want $121 million (and more) from all rate payers in PJM Interconnection to cover their stranded capital costs (the abandonment case) and operating costs (the formal challenges case) on the failed PATH transmission project.  Remember that this boondoggle was created by the Energy Policy Act, inspired by the Cheney administration, and passed by the Republican Congress in 2005.  The 2005 Energy Policy Act allowed certain anointed transmission projects to charge all their costs to rate payers, even if they were never built – a good deal for power companies, not so good for rate payers.  You can’t find a better example of money for nothing.

While I am still technically an intervenor in the PATH abandonment case at FERC, I am no longer an active participant.  Last Friday was the deadline for testimony by the remaining active participants in the cases: Keryn Newman and Ali Haverty in the formal challenge case and a group of state public service commissions and consumer advocates (with the conspicuous exception of the WV PSC) as well as the staff of FERC itself.

Pro se intervenor Keryn Newman filed testimony on behalf of herself and my neighbor Alison Haverty in their formal challenge to expenses charged by PATH to rate payers from 2009 to 2011.  As they have all along, Keryn and Ali maintained in their testimony that PATH charges for lobbying and fake front groups should be borne by AEP/FE shareholders and not PJM rate payers.  Here is a link to their testimony.

FERC staff analysts also filed their testimony last Friday.  Staff witness Jean Miller appeared to agree with Keryn and Ali that PATH had illegally charged rate payers for their PR and lobbying costs.  Keryn’s  and Ali’s challenges only covered the years 2009-2011.  Ms. Miller testified that PATH’s 2008 costs should also be refunded to rate payers.  Here is a link to Ms. Miller’s testimony.  FERC expert Craig Deters also filed testimony that fills out the evidence Ms. Miller presented.  Here is a link to his testimony.

Staff witness Robert Keyton attacked testimony provided earlier by AEP/FE concerning the return on equity and debt costs that they were proposing the charge rate payers.  Most of this discussion is pretty abstruse and, as Mr. Keyton himself points out, largely hypothetical, because the front companies for PATH created by AEP/FE never produced anything and never borrowed any money, and are now defunct.  Here is a link to Mr. Keyton’s testimony.

The state agencies also filed some excellent testimony by transmission expert Peter Lanzalotta.  Mr. Lanzalotta basically testified that the AEP/FE should have pulled the plug on PATH after the East Virginia State Corporation Commission rejected the companies’ claim that PATH was needed to resolve reliability problems on the PJM system.

The summary in the introduction to Mr. Lanzalotta’s testimony tells the tale:

Mr. Lanzalotta concludes that PATH’s recommendation to Virginia that PATH be allowed to proceed while waiting for the 2010 RTEP to determine the need for the Project was not prudent.

If PATH had successfully recommended that it would be prudent to suspend the Project at the beginning of 2010, at least a year earlier than it actually was, then the abandonment costs would have been about $29 million lower than they actually were.

Beyond PATH’s 2010 recommendation that it be allowed to proceed, the escalation of PATH’s costs from its inception through its multiple delays were in excess of typical transmission cost escalation over the same period. Based on the Handy Whitman Cost Trends for Electric Utility Construction, the amount of excessive spending on the PATH Project is estimated to be $4.3 million.

The reference to prudence is important, because FERC rules require that rate payers can only be charged with costs that were prudently incurred by the power company.  Mr. Lanzalotta is saying here that more than $30 million for which AEP/FE want to charge rate payers violates FERC rules, and must be paid only by AEP/FE shareholders.

This point has been made repeatedly throughout the case by me and by other intervenors.  Mr. Lanzalotta sums it up nicely.  You can see his testimony at this link.

Those of you who fought the PATH line in the WV PSC will appreciate the testimony of Randall Woolridge, on behalf of the state agencies.  Mr. Woolridge provides an analysis of the exorbitant legal costs for which AEP/FE are trying to charge rate payers.  The power companies had the gall to redact important information from the records they provided to the state agencies in discovery.  Mr. Woolridge states that his analysis was incomplete, because he only received the unredacted copies of lawyers’ records two days before his testimony was due.

The final hearing in this case, dockets ER09-1256 and ER12-2708, isn’t until March 24, 2015.  A final decision by the Commission is due on July 31, 2015.

WI PSC Sides with Power Company Against Innovation While a German Town Takes Matters into Its Own Hands

The contrast between this week’s decision by the Wisconsin PSC to support Wisconsin Energy’s assault on its solar generating customers and the remarkable progress being made in Wildpoldsried, Bavaria couldn’t be clearer.

Here’s a link to Greentech Media’s report on the WI PSC decision.

The Wisconsin Public Service Commission recently voted 2-1 to allow We Energies to increase fixed charges on all residential bills, decreasing the financial benefit for customers who use less energy. The PSC also granted the utility permission to pay less for the power generated by customers with rooftop solar.

But the story doesn’t end there. Cleantech advocates are now preparing to bring suit against the two commissioners who voted in favor of the changes, and they are confident the decision will be overturned.

Last week’s vote increases monthly fixed charges for We Energies customers from roughly $9 to $16, making them among the highest in the country. The variable rate will be reduced from $0.139 per kilowatt-hour to $0.1349 per kilowatt-hour.

The approved change in net metering will switch the program from annual netting to monthly netting, and reduce the price credited for excess generation from the current 14 cents per kilowatt-hour to 3 cents per kilowatt-hour.

All customers with solar systems on their property will also have to pay We Energies $3.80 per kilowatt per month. The average solar system size in Wisconsin is 4 kilowatts, bringing average annual fees to $182 per year.

Meanwhile, in Bavaria:

The story began in 1997, when Wildpoldsried mayor Arno Zengerle and the city council decided they wanted to revitalize the community and encourage growth without incurring debt. The town adopted the Innovative Leadership Plan, WIR-2020, to reinvent Wildpoldsried based on renewable energy, green building, and water resource protection. As part of the plan the town set a goal of producing 100 percent of its electricity from renewable energy by 2020.

Things happened much faster than planned — 17 years later, the town now has five biogas plants, almost 5 MW of solar PV, 11 wind turbines with a total capacity of more than 12 MW, a biomass district heating network, three small hydro power plants, and 2,100 square meters of solar thermal systems. While the first two wind turbines were partly financed by a small grant from the state of Bavaria, local residents — many of them dairy farmers — have financed all following turbines. Those turbines, which generated over 17,000 MWh of electricity in 2013, have a payback of 10 years, and then generate 80 percent of the earnings of the dairy farms.

All public buildings, 120 private residences, and 4 companies are connected to the district heating system. The biomass for the system is all sourced from waste wood from local forests and generates 8.2 MMBtu of heat each year. The majority of the PV systems in the town are on private residences — about 200 homes now have rooftop solar. Nine municipal buildings including the primary school, recycling facility, and sports center also have PV systems. The electricity generated from the solar, wind, and biomass is sold to AÜW under a fixed-price 20-year power purchase agreement (PPA).

Wildpoldsried invested in microgrid control technologies that allowed small scale renewable producers to capture the full value of their product, instead of feeding it into the grid where power companies and speculators skimmed off the real value.

The key to the smart grid is a self-organizing automation system called SOEASY, which balances supply and demand to keep the grid stable. It is IRENE’s brain, so to speak. SOEASY considers weather, electricity prices, power quality, and other factors when deciding whether to send electricity into the grid or to storage. It’s actually more complex than the name makes it sound. SOEASY contains five different software modules — the personal energy agent, balance master, area administrator, network transport agent, and energy police.

  • Personal energy agent: Every “prosumer” in the town has a personal energy agent. This small device allows the energy producer to dictate how much power he or she wants to sell, at what time, and at what minimum price, in 15-minute intervals. It is, in some sense, a distributed energy resource marketplace on the scale of one town embedded in a far larger grid.
  • Balance master: The balance master is installed at AÜW and decides which personal energy agent offers it will accept to cover demand in the grid. It can plan adjustments up to a day in advance, and takes into account different parameters such as weather changes.
  • Area administrator: The area administrator helps AÜW maintain network stability if too much energy is being fed into the grid. The area administrator can modify the input from different sources via commands to their personal energy agents, can send energy to storage, or can adjust the voltage through the variable transformer.
  • Network transport agent: The network transport agent (NTA) collects data from the energy producers, consumers, and the grid, and supplies it to the area administrator, which intervenes if maximum voltage is exceeded, and to the balance master, which decides what power can be accepted without overloading the grid.
  • Energy Police: The energy police makes sure that all energy producers supply the power promised by their personal energy agents, and that no power is illegally siphoned off.

This is real investment in the future, and it increases the reliability of the increasingly unstable centralized grid with which the local microgrids must still interact.  Keep in mind that this is a town of 2600 people.  They generate $7 million dollars a year selling their electricity.

WV politicians looking to revitalize the economies of WV’s small towns need to wake up and take a good look at what the people of Wildpoldsried have done for themselves.

Good Overview of Denmark’s Renewable Energy Situation, and Comparison with Germany

Here is a link to an interesting overview of Denmark’s renewable energy plans.  The comparison with Germany is somewhat unfair, because Denmark also has coal-fired electrical generation, and the Germans have a definite plan to phase our their coal plants.  I also find the title of the story, “Brave little Denmark leads war against coal” to be condescending and, well, belittling.

The story pulls together a number of threads from my series on my recent trip to Denmark, and fills in a little more history.

The title page of the article has a great picture of a very common sight in the Danish countryside.

The yellow crop in the foreground is rape, which the Europeans use for ethanol production.  Note also that these are not monster wind turbines, but smaller ones probably financed by and serving local farms or a rural village.

Anya Schoolman on Decentralized Power

Anya Schoolman is the genius behind the Community Power Network which has built solar generation in communities in the District of Columbia and three states, including two community solar co-ops (so far) in WV.  Anya is also one of the leading experts in the world on building community-based solar power generation.

Here on The Power Line, I have been posting a little bit (here and here) about the takeover of Pepco, the retail utility in DC, by nuclear giant Exelon.  Exelon, with its numerous nuclear plants, which are often forced to take negative prices for electricity when renewable resources flood the grid, has led the battle against decentralized power wherever it rears its head.

Here is a link to Anya Schoolman’s testimony in the DC PSC Exelon/Pepco merger case.  The testimony looks long, at 455 pages, but most of that is appendixes, which you can skip.  Anya’s testimony is only 64 double spaced pages long.

Her testimony includes a history of DC Sun (well worth reading in itself), an account of how local utilities have to change to effectively handle new high penetrations of decentralized power and how obsolete holding companies like Exelon are desperately trying to hold onto their control of the grid.

Anya’s testimony is well worth the read.  You will get an education from one of the most knowledgeable experts on decentralized power and one of the most effective community organizers in the US.  Anya is a treasure and a teacher to us all.

 

DoE Loan Program Turning Profit

Remember all the Republican propaganda about the collapse of Solyndra?  Remember all the blame that was heaped on the Obama Administration by Fox News for the Department of Energy renewable power loan program that was created by a Republican majority Congress and the Cheney administration?

Well, guess what?  The program is a big success.  Here’s how a new NPR report describes the program now:

Overall, the agency has loaned $34.2 billion to a variety of businesses, under a program designed to speed up development of clean-energy technology. Companies have defaulted on $780 million of that — a loss rate of 2.28 percent. The agency also has collected $810 million in interest payments, putting the program $30 million in the black.

When Congress created the loan program under the Energy Policy Act of 2005, it was never designed to be a moneymaker. In fact, Congress imagined there would be losses and set aside $10 billion to cover them.

Looks like Solyndra was just a minor blip and the Obama Administration has again rescued a floundering Cheney project.