Did AEP Just File for Another Rate Payer Subsidy to the WV Coal Industry?

On Wednesday, I read this AP story on the Charleston Gazette Web site.

An American Electric Power subsidiary is asking state regulators to approve a transmission line that the company wants to build in Boone and Raleigh counties.

AEP West Virginia Transmission Company, Inc. filed an application for the Bim Tap Project on Tuesday with the West Virginia Public Service Commission.

The company’s filing says the proposed 5.5-mile 138-kilovolt line would replace an existing line located on property where Independence Coal Company has mining operations. Independence has asked the company to move the line because it plans to conduct operations in the immediate vicinity.

The new line would be located primarily on reclaimed and previously mined land.

The project would cost about $6.6 million.

So, OK, no big deal.  Independence Coal wants to mine where the existing 138 kV line is located.  They asked AEP’s newly split off merchant transmission company to move it onto land they have mined out.  Of course, Independence will pay the $6.6 million to move the line, right?

Probably not.  Let’s look at the certificate of public convenience and necessity application AEP made to the WV PSC concerning the Bim Tap move.  In the text of the AEP application to the PSC, you will not find an answer to the question, “Who will pay for this move?”  You have to look in the attached materials on page 19 to find what looks like the answer.  On this form, you will see information indicating that the cost of this project will be passed on to all rate payers through something referred to as “OATT.”  OATT is the Open Access Transmission Tariff system used by PJM Interconnection through which transmission owners pass on their costs to all rate payers in PJM through PJM assessments on electric utilities.  This means that the cost of this move will apparently be paid by every rate payer in WV through a rate increase that will be hidden away in charges in their power companies’ ENEC rate filings at the PSC.

Back in 2012, I did a post on how PJM OATT transmission costs are passed on to WV rate payers.  The Bim Tap project will not have all the extra added bonuses for transmission that were added to larger projects like PATH, but the mechanism by which PJM transmission charges appear on your electric bill in WV will be basically the same.

In AEP’s application to the PSC, the company notes that its right of way agreements with the big land companies that own the land that Independence is mining require that the owner of the line might have to move it, if the land owners wanted to use the land under the lines.  I’ll bet land owners under the TrAIL line would have liked that clause in their right of way agreements, if AEP’s claim is actually correct.  AEP did not provide copies of these original agreements with its application.

The WV PSC staff and the PSC’s Consumer Advocate Division should certainly intervene in this certificate of need case to get answers to the question of who is paying for Independence Coal’s private convenience.  It certainly shouldn’t be WV rate payers, or any other rate payers in PJM.

Or will the WV PSC and the Consumer Advocate Division just let another $6.6 million hidden subsidy to the coal industry slide by?

 

An American Electric Power subsidiary is asking state regulators to approve a transmission line that the company wants to build in Boone and Raleigh counties.

AEP West Virginia Transmission Company, Inc. filed an application for the Bim Tap Project on Tuesday with the West Virginia Public Service Commission.

The company’s filing says the proposed 5.5-mile 138-kilovolt line would replace an existing line located on property where Independence Coal Company has mining operations. Independence has asked the company to move the line because it plans to conduct operations in the immediate vicinity.

The new line would be located primarily on reclaimed and previously mined land.

The project would cost about $6.6 million.

– See more at: http://www.wvgazette.com/article/20140611/GZ01/140619842/1102#sthash.9GPzWlR5.dpuf

An American Electric Power subsidiary is asking state regulators to approve a transmission line that the company wants to build in Boone and Raleigh counties.

AEP West Virginia Transmission Company, Inc. filed an application for the Bim Tap Project on Tuesday with the West Virginia Public Service Commission.

The company’s filing says the proposed 5.5-mile 138-kilovolt line would replace an existing line located on property where Independence Coal Company has mining operations. Independence has asked the company to move the line because it plans to conduct operations in the immediate vicinity.

The new line would be located primarily on reclaimed and previously mined land.

The project would cost about $6.6 million.

– See more at: http://www.wvgazette.com/article/20140611/GZ01/140619842/1102#sthash.9GPzWlR5.dpuf

An American Electric Power subsidiary is asking state regulators to approve a transmission line that the company wants to build in Boone and Raleigh counties.

AEP West Virginia Transmission Company, Inc. filed an application for the Bim Tap Project on Tuesday with the West Virginia Public Service Commission.

The company’s filing says the proposed 5.5-mile 138-kilovolt line would replace an existing line located on property where Independence Coal Company has mining operations. Independence has asked the company to move the line because it plans to conduct operations in the immediate vicinity.

The new line would be located primarily on reclaimed and previously mined land.

The project would cost about $6.6 million.

– See more at: http://www.wvgazette.com/article/20140611/GZ01/140619842/1102#sthash.9GPzWlR5.dpuf

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