FERC Response to Federal Seventh Circuit Rejection
Back in the summer of 2009, the US 7th Circuit Court of Appeals rejected FERC’s attempt to force all rate payers in PJM Interconnection to pay for high voltage transmission projects like PATH. Instead of throwing out FERC’s cost recovery system, the 7th Circuit panel remanded the case to FERC, requiring FERC to identify the benefits that rate payers would derive from projects hundreds of miles away.
From what I can tell from the remand response, FERC still has a long way to go to justify burdening rate payers far from claimed benefits of new power line projects with the costs of those projects. FERC pulls a lot of numbers out of the air to justify the “benefits” of distant transmission projects, but provides little clear reasoning or justification behind those numbers. Here is a direct link to FERC’s remand response.
If you are interested in following the PATH situation, you need to stay on top of this case. It has huge implications for how PJM will finance its high voltage transmission projects in the future. It also has nationwide relevance to all of FERC’s new plans to ramrod transmission projects across the US.