Work on Phase 2 of Project Mountaineer Begins
PA utility PPL has announced the beginning of the PA section of the Susquehanna to Roseland line. PJM’s Project Mountaineer, unveiled by FERC and PJM executive Karl Pffirmann at the Charleston Love Fest in 2005, was obsolete when it was proposed, but it is now entering Phase 2 with the construction of the S-R line.
Phase 1 was completed on May 2011 when the TrAIL line was energized in WV and East Virginia.
PJM and power companies AEP and Allegheny Energy (since swallowed by Ohio’s FirstEnergy) conceived Project Mountaineer as the construction of four new high voltage transmission lines stretching from the Ohio River Valley into high priced East Coast markets. The plan was to pump new life into the power companies’ coal-fired power plants. These plants had lost most of the customers they were built to serve as OH, WV and western PA had their industrial businesses hollowed out by economic policies which shipped US jobs to cheaper labor markets.
Things haven’t turned out the way FERC and the PJM managers had hoped. Demand on the East Coast is falling and coal-fired electricity has priced itself out of the market. There simply is no more “surplus power” in OH, WV and western PA as power companies begin closing down their expensive coal-fired plants.
Yet PJM, with FERC’s blessing, continues down the Project Mountaineer road with first TrAIL and now Susquehanna-Roseland. The other two projects on the Project Mountaineer agenda, PATH, in WV, MD and East Virginia, and MAPP in MD, appear to be dead. All electric rate payers in PJM continue to pay for even these dead projects.
We also know, from Keryn’s excellent analysis, that, although all of us rate payers in PJM will spend at least $200 million on the line’s construction, PJM estimates that this will save only $44 million in congestion costs for NJ rate payers only. So, not only are we not getting our $200 million’s worth, S-R only helps people in one state in PJM who end up paying far less than the $44 million the rest of us are giving them. And the two power companies building S-R walk away with a more than 12% return on equity for their construction investment, essentially forever. So much for Project Mountaineer’s “market efficiency.”