PJM Using a Pile Driver to Hammer Tacks

One year ago, in his testimony before the East Virginia SCC on the PATH power line, independent electrical engineer George Loehr stated:

In general, the PJM process for assessing reliability and determining “need” seems to favor extreme solutions – solutions far more massive than necessary.  This overkill approach violates an important engineering principle: “Don’t use a pile driver to hammer tacks.”

We are now seeing just how extreme PJM has become.  The power company cartel has announced that it proceeding with both PATH and the rebuilding of Dominion Virginia Power’s Mt. Storm to Doubs 500 kV transmission line.  The cost of the Dominion rebuild is projected at over $300 million and PATH is projected at $2.1 billion.

Last June, Dominion submitted this proposal to PJM that would completely eliminate the need for PATH:

By 2015

Install reactive reinforcements to resolve 2015 reactive deficiencies. ($110 M)

900 MVAR SVC at Loudoun 230 kV
900 MVAR SVC at T157 Tap 500 kV
300 MVAR static caps @ Meadow Brook 500 kV
300 MVAR static caps @ Loudoun 500 kV
300 MVAR static caps @ Doubs 500 kV
Rebuild Mt Storm – Doubs 500 kV Line to 4330 MVA (65% increase in lines current thermal capability)
($300 M)

Can be completed by 2015
Can be built for DC compatibility with little additional expense
Limited CPCN requirement
With Trail in service, longer outage windows available to minimize construction period

Install 50% series compensation at Meadow Brook end of Trail ($10 M)

Flexible option with short lead time for construction or can be deferred based on final assessment

By 2017

Rebuild Mt Storm – Pruntytown line ($200 M) cost only for Pruntytown line

Double circuit line may be required
Extend rebuild back to Harrison

Estimated Cost – $ 620 M

This was Alternative 1 of four alternatives to PATH that Dominion proposed to PJM.  As you can see, Alternative 1 also involves rebuilding the Mt. Storm-Doubs line as well as Allegheny’s Pruntytown-Mt. Storm circuit west of Dominion’s Mt. Storm power plant in Grant County, WV.  Dominion told PJM that Alternative 1 would resolve all of the problems PJM had identified in its PATH planning.  As you can see in the text above, Dominion projects that the transmission line rebuild would increase the thermal capacity of their existing 500 kV lines by 65%.  Most of PJM’s problems involve thermal capacity.

So, instead of scrapping PATH and going with Dominion’s $620 million solution, PJM has decided to go with part of Dominion’s plan and to continue with PATH for a total of about $2.5 billion.

On September 29, 2009, PJM engineer Paul McGlynn answered a discovery question I had asked in the WV PSC PATH case as follows:

NERC criteria obligate PlM to resolve identified violations of NERC Reliability Standards. Absent market solutions, PlM develops a transmission solution robust enough to resolve the identified violations and does not reject a solution on the basis of cost if it is the only feasible solution. To the extent that more than one feasible solution is identified, the more cost-effective one is generally pursued. PlM has not identified a construction cost for the PATH Project above which the project would not be considered “feasible” or PlM would not continue to recommend it. [emphasis mine]

Now PJM has a second “feasible solution” to “resolve identified violations of NERC Reliability Standards”.  Mr. McGlynn states further that PJM will “generally” (I guess that is a weasel word to give him an escape hatch.) pursue the most cost effective solution.

Well, here it is.  Which is more cost effective?  $620 million or $2.5 billion?  Even if Dominion’s Alternative 1 didn’t solve all of PJM’s problems, wouldn’t it still be cost effective to go through with Dominion’s Alternative 1, even if you had to spend as much as $1 billion on other fixes?

There is now a simple and elegant engineering solution on the table from Dominion.  Will PJM continue to “hammer tacks with the PATH pile driver”?