Keryn tracks PATH’s filings at FERC. Yesterday, Keryn reports, AEP/FE filed a document at
FERC PJM Interconnection (see Keryn’s correction in comments) ending the coy little game that FE spokesman Tod Meyers played with reporters last week about whether AEP/FE were going to try to make rate payers pay them for their big mistake.
Here’s Keryn’s take on the
FERC PJM filing:
“On August 24, 2012, the PJM Board of Managers (“PJM Board”) decided to terminate the Potomac-Appalachian Highline Transmission (“PATH”) Project and remove it from the PJM Regional Transmission Expansion Plan. In accordance with the Federal Energy Regulatory Commission’s (“Commission”) order authorizing the PATH Companies to recover prudently-incurred costs associated with abandonment of the PATH Project for reasons beyond their control, the PATH Companies intend to file, pursuant to Section 205 of the Federal Power Act, revisions to the PATH Formula Rate to allow for recovery of prudently-incurred abandoned plant costs associated with the PATH Project. Following Commission action on the Section 205 filing, the PATH Companies will revise the 2013 PTRR to reflect changes authorized by the Commission.”
Translation: We’re going to make a filing to ask FERC’s permission to recover our stranded investment when we get around to it, but in the meantime, we’re going to continue to milk you like nothing happened. We’ll settle up later (as in much).
So AEP/FE are going for that $130 million that they have sunk into PATH but haven’t been able to extract from our pockets yet. Meanwhile, they will continue charging us for another $20 million in another annual cost recovery filing for 2013, as Keryn breaks it down:
So, what’s in PATH’s 2013 PTRR that adds up to $20M? A return (profit) of an additional $12,051,167 that it’s not entitled to. Administrative and General expenses of $1,964,529 that it’s not entitled to. “Miscellaneous Transmission Expense” of $237,785 that it’s not entitled to. There are also allowances for taxes and other expenses that add up to $20M. But there is no PATH Project in 2013! How can there be any expenses? Because PATH still wants you to pick up a share of their parent company expenses that have nothing to do with the PATH Project. Starting to see how you’ve been ripped off all along now?
What??!! AEP/FE want to recovery ongoing costs in 2013 when PATH died on Aug. 28, 2012? The zombie continues to stalk rate payers. This is crazy.
As Keryn explains in her post, in order for AEP/FE to recover their other $130 million stranded costs, which are separate from the annual cost recovery filings, federal law and FERC regulations require them to prove two things: (1) the costs were “prudently incurred” and (2) the abandonment of the project was forced on the companies “for reasons beyond their control.”
Of course, neither of these factors holds true in the PATH case. A prudent company would never have proposed the project in the first place, and the reasons for the abandonment of PATH were completely within the control of the companies. They could each have taken steps to eliminate PJM’s problems instead of proposing PATH.
AEP and FirstEnergy continue to ride the PATH gravy train, and you and I are paying for their ticket. You have Dick Cheney, Ken Lay and the 2005 Republican-controlled Congress to thank for the transmission line “incentives” that built the gravy train railroad.