It’s Been a Bad Week for PATH and the Power Companies

This week has been a bad one for the PATH project and the power companies that want to build it.  Here are the highlights:

  1. PJM Interconnection has apparently approved the rebuilding of Dominion Virginia Power’s Mt. Storm to Doubs 500 kV transmission line.  For the last two weeks, Dominion has held public meetings in communities along that line.  Dominion engineers are moving forward with the project.  Dominion has also opened a case at the WV PSC, case number 10-1588-E-P, because part of this line lies in WV.
  2. The Mt. Storm to Doubs line rebuild project is the central part of Dominion’s Alternative 1 that the company presented to PJM last June as one of its four alternatives to the PATH project.  PJM engineers are now publicly stating that they are investigating alternatives to PATH.  Although PJM has criticized a number of alternatives to PATH, they have not rejected, or even mentioned, Dominion’s Alternative 1.  For more details go to my earlier posts here and here. Here is a link to Dominion’s four PATH alternatives.
  3. If the Mt. Storm to Doubs line is rebuilt, most of the violations of NERC standards that PJM claims are reasons to build PATH will go away.  If those “problems” (and they may or may not be real problems) go away, is there any more justification for saddling electric rate payers with the $2.1 billion PATH project?  Not likely.  Especially when independent engineer Hyde Merrill has identified what is essentially Dominion’s Alternative 1 as the superior and more costly alternative to PATH.  Here is a link to a summary of Merrill’s testimony in the East Virginia SCC PATH case.  Compare that with Alternative 1.
  4. Thursday evening, the Frederick County, MD Board of Zoning Appeals voted 2-1 to reject Allegheny Energy’s request for a special variance which would have allowed the construction of the mammoth substation at the eastern end of PATH to connect with the east coast.  This decision is the final rejection of the substation by Frederick County government and sets the stage for a drawn out court case between the Frederick County Commission and the MD PSC over which entity has final say about siting of the substation.  In arguments at the MD PSC in 2009, the PSC claimed that the substation was part of the PATH line and that the PSC has sole power to site transmission lines.  In that case, the Frederick County Commission argued that the substation was an independent industrial facility (it would serve at least four other high voltage transmission lines besides PATH) and was therefore not part of the PATH project, but subject to their zoning authority under MD law.  Lots of fireworks ahead on this one.  Allegheny appears to side with the MD PSC, because they want to keep the decision as far from the local community as possible.
  5. The good news just kept on coming as the week went on.  A number of state PSCs challenged FERC’s heavy handed and undemocratic process for giving AEP/Allegheny their guaranteed 14.3% return on equity in the PATH project.  The case has remained open ever since 2008 when FERC issued the order granting its cost recovery scheme.  This week, FERC issued an order in the PATH case saying that they will allow the state PSCs to present a case that may result in a roll back of the 14.3% return on equity ruling.  The state challenge does not deny that FERC has a right to award the incentive profit rate, but it may have a direct impact on AEP/Allegheny’s bottom lines if the super high profit rate is reduced.  And that’s bad news for PATH.
  6. Finally, there was a major breakthrough in the TrAIL case late on Friday which may have some impact on the PATH situation as well.  In 2009, several land owners in Tucker and Hardy County filed a formal complaint about the environmental destruction caused by the construction of the TrAIL line and abuse of land owners by Allegheny Energy in the TrAIL project.  The WV PSC case number for the complaint is 09-1758-E-C.  The parties in the complaint spent the last year filing discovery on each other, but we had begun to think the PSC was just going to let the case die.  Allegheny, of course, made a motion to dismiss the complaint.  Late Friday the WV PSC issued this order setting a hearing date on the complaint for January 13, 2011.

So its been a very bad week for AEP and Allegheny Energy in the PATH case.  Let’s hope it gets worse and worse.

The people in Jefferson County have been spending a lot of time going to meetings in East Virginia and Maryland in the past few weeks.  You can see a lot of what they have learned about the topics covered in this post by going to the StopPATH blog here.  StopPATH’s reports include a lot of eyewitness information that you won’t find in any other media.