Back in October 2012, PJM Interconnection filed a request to the Federal Energy Regulatory Commission for approval of a number of revisions to the cartel’s rules designed to comply with FERC’s Order 1000. One of FERC’s main goals in Order 1000 was to grease the skids for big new multi-state transmission lines.
The big power company members of PJM, who really run the show, recognized an opportunity with all this Order 1000 compliance talk. There is one organized group within PJM, the Transmission Owners committee, who saw their chance to change the rules about the cost recovery gravy train for big transmission lines. The name Transmission Owners is really just a smoke screen. Yes, it includes all the owners of transmission systems in PJM, but look at the list of members, and you see the same old names. The Transmission Owners are just the big generators and other big power companies dressed up in different clown hats.
Of course, PJM is a classic cartel. The dictionary definition of cartel – a combination of independent commercial or industrial enterprises designed to limit competition or fix prices – explains most of what goes on within PJM.
A company called Atlantic Grid Operations (AGO) is the owner and developer of the Atlantic Wind Connection, the proposed high voltage direct current (HVDC) transmission line that will run from East Virginia to New Jersey off the Atlantic coast to connect the series of offshore wind farms that will be built in the next few decades. Poor old Matt Wald has his usual misguided take on the project, but his article at this link provides a description of the project. Atlantic Grid Operations is also a member of PJM, but the fact that it is a new member and a project that is not based on fossil fuels makes it a threat to all the advantages that incumbent Transmission Owners enjoy as members of the PJM cartel.
As it turns out, one of the main goals of the PJM Transmission Owners in the flurry of activity surrounding Order 1000 compliance at FERC has been to make sure that AGO’s Atlantic Wind Connection never gets built. AGO has applied to have its project financed from PJM’s cost recovery program, but the Transmission Owners want to stomp on that one, before it even has a chance.
According to AGO (and remember, this is only AGO’s side of the story, but it seems credible), the Transmission Owners have proposed changes to PJM cost recovery rules that are deliberately designed to keep AGO from getting this privilege for their Atlantic Wind Connection. As we saw from the PATH situation, PJM will only allow an owner of a high voltage transmission project if that project is identified as needed and is included in PJM’s Regional Transmission Expansion Plan (RTEP). So the Transmission Owners want raise the bar to make sure AGO’s project will never be included in a PJM RTEP.
Here is AGO’s description of the Transmission Owners’ scheme:
- The TOs claim that the AWC isn’t a real transmission project, because its main purpose is to connect generators to the PJM system. Real transmission lines carry electricity from substation to substation instead of just connecting a generator to the transmission grid.
- The TOs claim that the AWC, which is a direct current line rated at +/- 320 kV is below the required capacity threshold to qualify as a high voltage transmission line, which is currently set at 500 kV rating for an alternating current line.
- The TOs want to use their power to change the PJM Transmission Owners Agreement to dictate what projects qualify for the RTEP, a power that lies exclusively with the PJM Transmission Expansion Advisory Committee and the Board of Managers.
- The TOs claim that because the AWC is only designed to connect a few specific generators to the PJM grid, it has no regional-wide benefits that would allow it to be included in the RTEP for cost recovery from all rate payers in PJM.
- Here’s the real doozy – the TOs want to change the definition of high voltage transmission line to include double circuited AC lines rated at 345 kV. So even as they are wanting to raise the bar for DC lines, they want to lower it for their own AC projects.
The real laugher here is item 2. As AGO’s lead engineer patiently explains in the testimony attached to the filing, there is a reason that “+/-” is in front of the 320 kV rating for a DC transmission line.
Moreover, the explanation the PJM TOs provide in their Answer for this patently unjust result rests on a serious error. That error is to make a straight comparison of A.C. and HVDC voltages without adjusting for the differing electrical characteristics of these facilities. As explained in the attached affidavit of Dr. Mohamed El-Gasseir, to evaluate A.C. and HVDC facilities on a comparable basis, it is important to measure the voltage measure for A.C. lines using the pole-to-ground rating, whereas the voltage measure for HVDC lines is the pole-to-pole voltage differential, which is sometimes expressed by a “+/-” in front of the voltage number. Thus, a project like AWC that has a +/- 320 kV voltage rating actually has a pole-to-pole (conductor-to-conductor) rating of 640 kV (the difference between + 320 kV and -320 kV), and a conductor-to-ground voltage of 320 kV. Conversely, measuring A.C. lines on a similar phase-to-phase basis (conductor-to-conductor) would mean that double-circuit 345 kV lines actually have a voltage rating of just 200 kV, conductor-to-ground, as Dr. El-Gasseir explains. PJM has recognized this important electrical distinction between A.C. and HVDC facilities; for example, in the case of the MAPP project which PJM described as having a pole-to-pole rating of 640 kV, which is the same rating as the AWC facility.
The PJM TOs, however, have accused Atlantic Grid of lowering the bar by making the factually incorrect comparison of voltages between A.C. and HVDC facilities without recognizing the significance of the “+/-” designation for HVDC lines. The PJM TOs thus defend their proposal against the charge that it is unduly discriminatory by arguing that “they apply to D.C. projects the same 345 kV minimum voltage threshold that they apply to double circuit A.C. projects.”
I agree. The fact that the TOs apparently don’t know the basics of electrical engineering would be a pretty strong reason not to allow them to make decisions about what high voltage transmission lines should be included in PJM’s RTEP. This is a pretty strong argument that adult supervision is required.
The TOs argument that the AWC is really just a generator tie line is a disingenuous claim. Wind turbines must be ranged over a relatively large geographic area, compared with the relatively small footprint of a big fossil fuel generator like the coal-fired John Amos plant. In the less energy dense wind power system, relatively high voltage transmission lines are required to manage the surges of current flows that result across the line in times of high wind. This is a very different function from the short high voltage connectors that run for coal-fired plants to long distance transmission systems in the current centralized system. Thus, the TOs, based on the obsolete centralized fossil fuel model, are trying to strangle the emerging renewable power grid in its cradle.
If you still cling to the idea that using “deregulation” as a ruse to create industry-controlled cartels to run the US electric grid was a good idea, check out the AGO filing. It will open your eyes.