The Mythology of “Denied” Transmission Lines
The full court press is on by FERC Chairman Wellinghoff to “streamline” the approval of new mega-transmission lines. The Chairman has proposed three different processes at FERC to give the agency full control of transmission siting so federal regulators can turn up the pressure on state PSCs. First, FERC filed a notice of inquiry requesting ideas about “improving” their giveaway incentive process for power lines. Then the Commission filed Order 1000 which would give new powers to regional transmission organizations and remove citizens further from the siting process. Finally, the Chairman intervened directly by circulating a plan to take over all of the functions provided by Dick Cheney and his Congress in the 2005 Energy Policy Act.
Chairman Wellinghoff has prepared the ground well in the media. All year there has been a chorus of organizations and reporters screaming that all kinds of transmission projects have been delayed by states and federal agencies and FERC needs to do something to make it easier for power line hucksters to get their projects approved.
The problem is that there are no denied projects, especially in the eastern US. I have already documented the ridiculous report that the US Chamber of Commerce announced last March and continues to tout around the country.
The PATH case is often used as a poster child by the streamliners. But the PATH case was withdrawn by the two power companies that wanted to build it and by the power company cartel that had been promoting it for over six years. How was PATH “denied” by state regulators? In fact, the process worked perfectly in the PATH situation. The power companies and PJM were forced to prove that PATH was needed and they failed. End of story.
Was the TrAIL line “denied” or “delayed,” as the Chamber wrongly asserted in their “report?” No. The line was swiftly approved by both West Virginia and East Virginia and went into service one month ahead of schedule last May.
I am on the FERC mailing list in a couple of cases and received a comment yesterday in my inbox filed by an independent transmission company that filed comments supporting FERC’s boondoggle incentive program. In misguided support of their comments, the company’s lawyers attached an article published by Standard and Poors bond rating agency about how FERC needed to streamline the power line approval process because states were causing delays.
Personally, I would be embarrassed to use anything published by S&P in support of any argument I might make. S&P spent most of the 2000s stamping AAA bond ratings on the collateralized debt obligation crap churned out by the investment banks in their fraudulent real estate investment schemes that wrecked the US economy. S&P’s most recent misadventure was downgrading US Treasury bonds. When a country’s debt is downgraded, interest on its bonds usually rises dramatically. The world bond market expressed its opinion of S&P’s downgrade by continuing to gobble up US Treasury bonds and the yields on those bonds actually fell.
Once again, in the S&P story found in Appendix I of the FERC filing, we find the claim that PATH have been delayed by state regulators. Not only that, but we learn that PATH was intended to extend from West Virginia to Maine. The S&P “analyst” also notes that the TrAIL line required states to work together. That was true. And there was no problem. In fact, WV Gov. Manchin brokered the deal that got TrAIL approved in WV. So how did “regulators and politicians” cause any problems here?
As I noted with the US Chamber’s fake “report,” if S&P’s facts for other power line projects are as inaccurate as their descriptions of PATH and TrAIL, what can we believe about the rest of their story?
Chairman Wellinghoff, when pressed to provide specific examples of delayed or denied projects that would support his argument that FERC needs more power, can’t really provide any. Where’s the problem? Where is the evidence that anything needs fixed? It seems to many of us that the current system, especially state regulatory processes, have worked pretty well in most cases.