Who Pays for PATH?

It is clear from Project Mountaineer that PJM, AEP and Allegheny Energy want to use PATH and TrAIL to move coal-fired electricity to Middle Atlantic markets.  Through the cost allocation mechanism developed by the power companies and FERC, this business benefit for PJM and the power companies will be paid for by electric rate payers hundreds of miles from the East Coast.

Below is a table showing the FERC cost allocations for the PATH power line.  Note that this allocation is not by state, but by the retail utility companies that will be buying power transmitted along PATH.  The cost allocation percentages and companies are the same for TrAIL, as well as the Susquehanna-Roseland line and the MAPP line, both far from West Virginia.

The far right column represents each company’s share of the current projected cost of PATH as shown in AEP/Allegheny’s application to the WV PSC.  Note that over 40% of the costs of PATH will be borne by customers in WV and states to the west of us, including customers in IL and MI.  In much the same way that WV electric customers, with no filings by PJM or FERC with the WV PSC, will be paying for new lines in NJ, MD and PA, far from WV.

PATH cost allocation

All information comes from FERC and PJM documents available on the Internet.  The “PATH Share” figures are based on the rounded construction cost estimate of $1.9 billion given by AEP/Allegheny in their WV PSC application.

Here is a link to PJM’s map of what it calls its service zones. The map shows where all of the utilities on the table operate.  There are some differences in the labelling, but it is pretty clear which utilities are which.  Note also that while PJM claims to “operate in 13 states and the District of Columbia,” PJM really only covers all or most of seven states and DC.