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November 14, 2024

Wildlife Refuge Preps for Trial Against ATC Clear-Cut

By Amanda Durish Cook

A Wisconsin wildlife hospital’s dispute with American Transmission Co. over its “Grandfather Spruce” tree will go to trial after a judge this month denied the utility’s motion to dismiss the case.

Yvonne Wallace Blane and Steven Blane, founders of Fellow Mortals Wildlife Hospital in southeastern Wisconsin, filed the lawsuit in June against ATC after the company proposed to clear-cut a 50-foot easement into the 5-acre wildlife sanctuary for a 138-kV transmission line.

On Aug. 15, ATC’s motion to dismiss the case was denied by Walworth County Circuit Court, which also imposed a temporary restraining order preventing the company from cutting any trees or applying herbicides on the hospital’s property pending a four-day trial scheduled for Oct. 10.

Fellow Mortals’ lawyer Robert Kennedy, of law firm Rizzo & Diersen in Kenosha, said he plans to argue that the 1970 easement — between the property’s previous owners and ATC predecessor Wisconsin Power and Light — is ambiguous and intends that trees should be cut only if ATC’s lines are in danger.

A Wisconsin animal wildlife hospital won a temporary injunction to block American Transmission Co. from clear cutting trees along its 138- kV transmission line. The hospital says the trees provide their animals a “buffer” from the weather and traffic noise from the adjacent road. A 100-year-old Norway spruce towers above younger walnuts and other trees in summer (left), and winter (right).
A Wisconsin animal wildlife hospital won a temporary injunction to block American Transmission Co. from clear cutting trees along its 138- kV transmission line. The hospital says the trees provide their animals a “buffer” from the weather and traffic noise from the adjacent road. A 100-year-old Norway spruce towers above younger walnuts and other trees in summer (left), and winter (right).

‘Tough Case’

“We have a very tough case ahead because in one interpretation, we have a 50-year-old easement that does state that ATC can cut down any trees they want,” Kennedy said. “Our argument is the trees do not pose a threat.”

Kennedy said if ATC is allowed to clear-cut, it’s “very likely” that Fellow Mortals would have to shut down the sanctuary.

“ATC does not think Fellow Mortals is unique enough to warrant an exception, yet wildlife rehabilitation itself is an endangered resource,” said Yvonne Blane, who first opened the hospital with her husband, Steven, from their home in the mid-1980s before selecting the current location in 1994.

According to Blane, there were 229 licensed wildlife rehabilitators in Wisconsin in 2001; today there are 110. “Honestly, there aren’t a whole lot of wildlife hospitals like us left,” Blane said.

Blane said Fellow Mortals’ acreage used to be part of a farm that was split up following a house fire. “That simple farmer signed that easement so long ago because he had a kind heart. I don’t think he ever dreamed this would have happened,” she said. “I don’t think people think about easements, and this is a cautionary tale. Never ever find out later what contracts are tied to your property.”

Blane said she receives a letter from ATC “every few years” notifying them of trimming. Near the first of the year, Blane said she received another letter and assumed it was for routine trimming. “We worked with them in the past, and they’ve always been great,” she said.

However, Blane said she woke up one morning in February to see the area partitioned off with orange tape and blue X’s spray-painted on several trees.

“It’s a tremendous amount of wildlife habitat that they could be destroying,” said Kennedy, who first came across the hospital years ago when he brought in two orphaned woodchuck cubs.

Vegetation Management Plan

ATC says its vegetation management plan will minimize service interruptions and create access for maintenance, and that pruning trees, as has been done in the past, is less efficient than cutting the tall-growing vegetation on a regular rotation.

Fellow Mortals Wildlife Hospital (aerial) - ATC
Aerial view of Fellow Mortals Wildlife Hospital   Source: Google Maps

The company, which spoke to local media earlier in the dispute, is no longer commenting because of the litigation. Spokesperson Alissa Braatz would only say that the company is “removing all incompatible vegetation from the easement area for safety and reliability purposes.”

The Blanes say that mature trees and dense undergrowth on the easement are necessary to provide the animals a buffer against wind, snow and noise from the adjacent road.

They also say they are willing to pay for trimming. An estimated 100-year-old Norway spruce, or “Grandfather Spruce” as Fellow Mortals staff refer to it, has been periodically trimmed for the nearly 50 years the easement has been in place, most recently in 2009.

“The idea is to keep these animals segregated from humans as much as possible,” Kennedy said.

The Blanes posted photos on Facebook to show the spruce in winter, when it “alone buffers the wind and snow and noise and provides screening and privacy” for the wildlife. There is additional cover from young walnut trees and other vegetation “during the busy summer months, when traffic on rural Palmer Road is nearly constant,” they wrote.

Hawks, Woodchucks and Deer

Unlike other animal rescue facilities that transfer wildlife elsewhere for care and rehabilitation, Fellow Mortals keeps its animals from the time they are admitted to when they’re released. Over the years, its patient list has included owls, hawks, rabbits, woodchucks, beavers and deer. The Blanes and their small staff have treated 1,400 animals so far in 2016.

Blane said the hospital treats about five large birds per year, including cranes that are admitted with leg fractures from colliding with transmission lines. She said the hospital has spent about $25,000 in donations so far on the case, and she regrets it can’t be spent on the “hundreds” of animals currently in the hospital’s care.

“We bought [the property] for the trees and the location,” Blane said. “Everything has been built around the property we chose. We were offered other property for free and turned it down. We created a very special place here that we thought would be around for a long time.”

Room for Settlement?

The couple argues that no power interruption incidents have ever occurred on their premises.

According to the Blanes, the spruce was recently examined by a certified master arborist and given a low risk of falling. Kennedy said he is prepared to call on a tree expert who can testify the spruce is “solid as a rock” and any weather event that causes the tree to fall would also cause severe damage to ATC’s lines.

Their attorney says the only suggestion ATC has offered Fellow Mortals in the dispute is not much of a compromise: The company has offered to plant low-lying vegetation after the trees are removed. Kennedy says that is not an option.

“We would accept some trimming, but we have pictures of the clear-cutting they’ve done in other places. It looks like a Brontosaurus rampaged it,” he said.

“There’s no question that it’s more profitable for ATC to clear rather than trim periodically. If you clear-cut, you can wait 20 years before sending crews back out. But it’s a cost-saving measure on the backs of all these landowners with nice forested areas,” Kennedy said.

Town Weighs In

The hospital’s online petition protesting ATC’s plans has gathered more than 86,000 supporters, nearing their 90,000 goal. It also gained an ally in the town of Geneva, which has an ordinance that requires town approval for all tree cutting and sharply restricts clear-cutting.

“As I am sure you are also aware,” Town Attorney Richard W. Torhorst wrote in a June 9 letter to ATC, “the Federal Energy Regulatory Commission takes the position that best practices relating to vegetation management does not require clear-cutting along the right of way.”

ATC attorney Christopher Zibart fired back with a letter the following day saying that the company recognized the state Public Service Commission — and not the town — as having “the authority to regulate this core public utility function.”

Fellow Mortals Wildlife Hospital - ATC
Street view of Fellow Mortals Wildlife Hospital Source: Google Maps

Zibart also swatted away Torhorst’s reference to FERC, noting that ATC’s line X-55 is below FERC’s 200-kV voltage threshold.

“In any event, the FERC does not manage specific vegetation practices and has stated that it does not ‘mandate nor prohibit’ removal of trees,” Zibart continued. “Where, as here, the specific trees in the right of way are incompatible with the line (they will continue to grow back into the lines and would not likely survive whatever ‘trimming’ could be done), it is best to remove them.”

The town attorney acknowledged that the town’s ordinance does give public utilities an exemption from obtaining a permit for tree trimming, but he said ATC is “not exempt from the prohibition against clear-cutting,” which allows exceptions only for residential properties.

‘Positive Balance’

ATC’s Braatz told local website MyWalworthCounty.com in June that the company hopes to reach a settlement that would include “compatible vegetation and fencing to help create the privacy and noise buffering that they desire.” The company has a Web page illustrating the low-lying plants it recommends for rights of way.

“We believe this would accomplish a positive balance between ATC’s responsibility for ensuring safe and reliable electric service and the Fellow Mortals’ compassion and commitment for healing wildlife,” she said.

“I think what ATC is doing is unethical and not community-minded, and I think there are employees in the company who are uncomfortable with how far this has gone,” Blane said. “I don’t know why it’s so important for ATC to be right except they might be afraid that this is going to set a precedent.

“The voltage has remained the same. The poles have remained the same. The only thing that’s changed is ATC’s policy.”

 

NIPSCO Considers Closing 4 Coal Units in 7 Years

By Amanda Durish Cook

Northern Indiana Public Service Co. said last week it may shut down one coal-fired plant and partially close another.

Though nothing has been finalized, NIPSCO officials said they are considering closing the two-unit Bailly Generating Station on Lake Michigan as soon as mid-2018 and idling two of the four units at the R.M. Schahfer Generating Station in Wheatfield, Ind., by 2023. NIPSCO’s plan was unveiled last week at a public meeting on its biennial integrated resource plan, which is due to the Indiana Utility Regulatory Commission on Nov. 1.

Bailly Generating Station (NIPSCO) -NIPSCO Considers Closing 4 Coal Units in 7 Years
Bailly Generating Station Source: NIPSCO

“Companies with aging coal-fired units are facing intense economic and environmental regulatory pressures that are driving important decisions today about how to meet the customer needs of tomorrow. Given these factors, we believe it may be in our customers’ best interests to retire some of NIPSCO’s coal-fired generation units,” Violet Sistovaris, NIPSCO executive vice president, said in a statement.

Sistovaris said NIPSCO would work closely with stakeholders to come up with a retirement strategy for inclusion in its IRP, which looks ahead 20 years.

The retirement dates coincide with the effective dates of EPA’s coal ash rule in 2018 and Effluent Limitations Guidelines in 2023.

Graycor Industrial Constructors completed a Wet Flue Gas Desulfurization system at NIPSCO's R.M. Schahfer Generating Station located in Wheatfield, Ind., in 2014
Graycor Industrial Constructors completed a Wet Flue Gas Desulfurization system at NIPSCO’s R.M. Schahfer Generating Station located in Wheatfield, Ind., in 2014 Photo Source: Graycor

NIPSCO, which has invested more than $800 million in emission-reducing technologies for its coal-fired units, said compliance with the new rules would cost an additional $1 billion over seven years if it keeps its entire coal fleet operating.

Six years ago, 90% of NIPSCO’s generation capacity was coal-fired. Today, that figure is down to 72%. NIPSCO’s portfolio includes three coal-fired plants, one natural gas–fired station, two hydroelectric plants and purchased wind power.

The closures at Bailly and Schahfer would remove about 31% of NIPSCO’s total generating capacity. Bailly’s two units opened in 1962 and 1968; Schahfer’s four units were opened over 10 years beginning in 1976.

This month, the company said it would demolish its long-dormant Gary, Ind.-based Mitchell Generating Station over the next two years for $18 million. The plant was permanently closed in 2011.

UPDATED: California Legislature Approves Bill to Sharply Reduce GHG Emissions

By Robert Mullin

California lawmakers last week passed a bill to reduce the state’s greenhouse gas emissions to 40% below 1990 levels by 2030.

The State Assembly approved the measure on a 48-31 vote, largely along party lines. Two Democrats opposed the bill, with one abstaining, while just one Republican voted in favor. The bill breezed through the State Senate on a vote of 25-13 and is expected to be signed into law by Gov. Jerry Brown.

The bill builds on the California Global Warming Solutions Act of 2006, the landmark legislation that required the state to reduce its emission to 1990 levels by 2020. It also codifies an executive order issued last year by Brown, making it more difficult for a future governor to roll back efforts to reduce the state’s emissions.

“Today, the Assembly speaker, most Democrats and one brave Republican passed SB 32, rejecting the brazen deception of the oil lobby and their Trump-inspired allies who deny science and fight every reasonable effort to curb global warming,” Brown said in a statement in response to the Assembly’s vote.

Senator Pavley
Senator Pavley

“Today’s action sends an unmistakable signal to investors of California’s commitment to clean energy and clean air,” said Sen. Fran Pavley (D), author of the bill. “This will trigger more investment and more jobs in our thriving clean-energy sector and solidify California’s leadership in demonstrating to the world that we can combat climate change while also spurring economic growth.”

The bill affects the electric, manufacturing and transportation sectors. The state Air Resources Board (ARB) will determine specific reductions by industry.

Utilities — which could benefit from the electrification of the transportation fleet — have not opposed the bill and have been preparing for the change since last year’s executive order. The state’s renewable portfolio standard — 50% by 2030 — is expected to generate most of the needed reductions for the power sector. (See California Policy Goals to Require Significant Transmission Upgrades.)

california ghg emissions sb 32
Oil industry lobbying efforts unexpectedly stalled SB 32 in California’s assembly last year, but supporters wrangled a comfortable margin to pass the bill during the current session. Photo of Valero Benicia Refinery

The oil industry lobbied hard against the legislation, which faced uncertainty since stalling in the Assembly last summer. Prospects soured after a group of Democrats representing low-income communities opposed the bill based on concerns that efforts to reduce the carbon content in gasoline would translate into higher fuel prices, which disproportionately affect people with lower incomes. Some lawmakers also complained that the bill provided the ARB with too much latitude to develop and implement emission-reduction programs without sufficient public oversight.

To address both concerns, the legislature last week passed a companion bill (AB 197) that will put two legislators on the ARB as nonvoting members and require the board to report annually to a newly created joint legislative committee on climate change policies. It also directs the ARB to prioritize emissions rules and regulations that limit economic impact on the state’s disadvantaged communities and regions reliant on agriculture.

Implementation of SB 32 was contingent on the passage of AB 197.

The current version of SB 32 does not extend the state’s cap-and-trade system, which is set to expire after 2020. The California Chamber of Commerce is challenging the program in court, contending that the emissions trading scheme constitutes a tax requiring approval by a two-thirds majority of the legislature.

That legal uncertainty has undermined investor confidence in the market for California carbon credits. The ARB-run auction Aug. 16 saw buyers pick up less than 35% of available allowances, following a dismal 10.5% showing in May. Previous auctions have typically been fully subscribed, providing significant revenues for the state.

Still, in light of last week’s Assembly vote, Brown expressed optimism about the program.

“With these bills, California’s charting a clear path on climate beyond 2020 and we’ll continue to work to shore up the cap-and-trade program, reduce super pollutants and direct more investment to disadvantaged communities,” Brown said.

Eversource, National Grid Withdraw Requests to Bill for Pipeline

By William Opalka

Eversource Energy and National Grid have withdrawn their requests to bill electric ratepayers for natural gas capacity from the proposed Access Northeast pipeline project, bowing to a ruling by the Massachusetts Supreme Judicial Court.

The filings made Monday for their four electric distribution companies followed the court’s Aug. 17 decision vacating an order by the state Department of Public Utilities approving pipeline capacity contracts. (See Mass. Supreme Court Vacates EDC-Pipeline Contract Order.)

Last week, state Attorney General Maura Healey filed a motion asking the DPU to dismiss the contracts.

Eversource spokesman Michael Durand said the companies’ filings with the DPU were a formality in light of the court’s decision. “This does not affect our commitment to the project. We remain committed to working with the New England states to provide the infrastructure so urgently needed to ensure reliable and lower-cost electricity for customers,” he said.

“The companies reserve the right to seek department approval of the same or similar agreements in the future to the extent that, in the future, there is a change in relation to the department’s legal authority to approve such agreements,” Eversource wrote. National Grid made an identical filing on behalf of its EDCs.

national grid eversource access northeastEversource and National Grid are co-sponsors of Access Northeast, which developer Spectra Energy says will deliver 925,000 dekatherms/day of natural gas to the New England power market.

Spectra spokesman Creighton Welch said the company is not giving up on the pipeline. “There is a sizeable need for natural gas throughout New England that is unabated by the court’s decision,” Welch said. “Therefore, our path forward is clear and our mission to re-establish the Massachusetts contribution is full-speed ahead. We are confident that, ultimately, the interests of New England’s consumers will prevail with desperately needed gas supply made available by Access Northeast.”

The Conservation Law Foundation, the successful plaintiff in the case, said the EDCs had no choice. “The Massachusetts Supreme Judicial Court made it clear last week that electric companies can’t gamble on pipelines with the hard-earned money of businesses and families across our state. That is exactly what these contracts would have done, and so Eversource and National Grid had no choice but to face reality and withdraw their proposals,” spokesman Josh Block said.

FERC OKs CAISO Energy Storage Rules

By Robert Mullin

FERC last week approved rule changes to improve the ability of energy storage resources to participate in CAISO’s markets (ER16-1735).

The changes will allow “non-generator resources” to submit their state-of-charge as a bid parameter in the day-ahead market and manage their own state-of-charge and energy limits for the purposes of bidding into the market.

Non-generator resources are those that can be dispatched to generate, consume or curtail consumption of energy to any operational level within their specified capacity range.

The non-generator resource model is the primary means by which energy storage devices currently participate in CAISO’s market, enabling batteries to continuously operate across a range that includes both charging and discharging. For bidding purposes, the ISO assumes that the available energy from a storage resource is a function of the resource’s state-of-charge — information the ISO obtains through telemetry.

While that approach is sufficient for real-time operations, CAISO contends that it does not provide a storage resource’s scheduling coordinator a “usable” bid parameter for the day-ahead market.

Under current day-ahead bidding practices, CAISO assumes that a resource’s initial state-of-charge is the ending value from the previous day’s day-ahead award. If there was no such award, the ISO assumes the charge to be 50% of the resource’s megawatt-hour limit.

The Tariff change will allow a scheduling coordinator to replace the ISO’s assumed state-of-charge values with its own bids “to better reflect actual conditions” for a storage resource, CAISO said in its proposal.

ferc, caiso, energy storage
Sodium sulfur battery storage facility at Pacific Gas and Electric’s Vaca-Dixon substation. Source: California Energy Commission

“CAISO contends that non-generator resources choosing to self-manage their energy limits and state-of-charge will be able to maintain their states-of-charge at an optimal level through their bidding strategies, enabling resources to better account for dynamic needs in real time and avoid uninstructed imbalance energy settlements,” the commission’s order explained.

The commission’s ruling will also enable CAISO to implement a mechanism to allow energy storage devices to more effectively participate in the ISO’s demand response programs. Those programs measure demand reductions by comparing actual consumption relative to a baseline of expected consumption.

But when demand is offset by a behind-the-meter generation device — such as a storage resource — and “there is no sub-meter to separate consumption and energy produced on site, this approach fails to distinguish the cause of the demand response,” the ISO wrote. “The CAISO cannot tell whether the [DR provider] is curtailing consumption or serving its load from a behind-the-meter resource.”

To remedy the problem, the ISO consulted with stakeholders to develop special metering methodologies.

“These performance methodologies will accommodate sub-metering and allow the CAISO to ascertain demand response performance based upon the gross load [of a DR provider] independent of behind-the-meter generation, the behind-the-meter generator output itself or both,” the ISO said.

The amendments become effective Oct. 1.

Heeding Stakeholders, PJM Reduces Proposed Fuel-Cost Penalties

By Rory D.  Sweeney

Acknowledging stakeholders’ criticism, PJM removed capacity-deficiency and administrative penalties it had proposed for its fuel-cost policy rules and instead offered a single formula-based one. The proposal was made in the compliance filing PJM submitted to FERC on Aug. 16 (ER16-372-002).

The filing was supposed to focus on improving flexibility for hourly generation offers, but PJM also proposed changes to its policy-approval rules and penalties that it said were “integral to the effective clearing of cost-based hourly offers.” The RTO announced it was simultaneously initiating a petition under Section 206 of the Federal Power Act to get the additional changes implemented in case FERC decided their inclusion was outside the scope of the compliance order.

The debate over the rules governing fuel-cost policies stems from a 2015 FERC order to allow day-ahead offers that vary by the hour and the ability to update offers in real time. (See Generators Balk at PJM Proposal on Fuel-Cost Policies.)

FERC wanted the changes made by November 2015, but PJM said at the time that the required revamp to its market system would make that timeline impossible.

Hunlock Power station (Stantec) - Heeding Stakeholders, PJM Fuel-Cost Penalties
Natural gas plants in PJM’s energy market, such as UGI’s Hunlock Creek Energy Center in Luzerne County, Pa., would be subject to the RTO’s rules on fuel-cost policies. Photo Source: Stantec

In this week’s filing, PJM requested an effective date of Dec. 1 for the penalty and policy-approval rules contingent on FERC issuing its approval by Oct. 17. Implementation on Dec. 1 would maximize the benefit of the rules, PJM said in the filing, because “winter is the season in which price volatility in the natural gas markets are most likely to occur.”

The Independent Market Monitor has requested a 10-day extension to the Sept. 6 deadline for submitting comments on PJM’s filing. The Delaware Public Service Commission filed comments in support of the Monitor’s request.

For the hourly offer market rules, PJM said it couldn’t accurately estimate an implementation date because it “will be one of the most in-depth and complicated undertakings in PJM’s recent history, as PJM’s systems have been designed and implemented on the basis of daily offers.” The RTO suggested it will take at least a year, but it requested approval of a timeline that gives it 30 days after FERC’s ruling to propose an estimated effective date and up to 30 days before that proposed date to determine a final effective date.

PJM kept much of its original submission for real-time offer regulations, but it proposed several definitions and revisions. Among them are:

  • Prohibiting generators from oscillating between market-based and cost-based offers;
  • Increasing the cutoff for real-time offers from 60 minutes to 65 minutes prior to the applicable clock hour to account for PJM’s ancillary services optimization engine; and
  • Prohibiting increases to a generator’s incremental energy offer, but allowing it to increase its market-based offers in real time to reflect increases in costs. (PJM proposes defining incremental offers as those pairing price and megawatt quantities, in dollars per megawatt-hour, which combine to include all of the energy segments above a resource’s economic minimum. It excludes no-load costs.)

The fuel-cost policy rules are designed to provide clarity for how policies will be reviewed, delineate submission requirements, define consequences and outline the role of the Monitor.

Sellers without a PJM-approved fuel-cost policy could only be price takers, making offers of $0/MWh. They would also be subject to the penalty, which is up to 75% of the product of the LMP paid to the seller and the unit’s capacity during the hour. The percentage starts at 5% on the day the seller is notified about not having an approved policy and increases 5% each day until a policy is approved. It caps out at 15 days, after which the seller continues to be penalized at that rate.

PJM proposes using the same penalty for a seller who submits an offer that doesn’t comply with its existing policy. The penalty structure is based on a formula used by ISO-NE.

Sellers who have policies rejected by PJM or the Monitor would revert to a previously approved policy until the rejected policy is satisfactorily amended. The RTO also proposed a procedure to revoke a seller’s policy altogether — meaning it would no longer have any approved policy — but said it would only be used in cases of fraud or when a policy doesn’t “remotely reflect” applicable fuel costs.

PJM also proposed an annual review process, in which sellers would have to submit by June 15 of each year any updated policies or confirm that the existing policy remains compliant. PJM would then have until Nov. 1 to provide the seller with a compliance determination.

Solar, storage and run-of-river hydro would be required to have a cost of $0, while wind would need to account for energy and tax credits. Waste-to-electricity resources, such as landfill gas and biomass facilities, would have to include fuel costs even if the facility is paid to accept the waste — meaning their fuel costs would be negative.

The policies would also need to include maintenance adders, heating requirements, unit-specific performance factors and start-up cost calculations.

The filing also detailed PJM’s understanding of the Monitor’s role, noting stakeholder confusion over its involvement in initial policy approval and ongoing oversight. In previous discussions on the topic, the Monitor has questioned PJM’s proposed regulations, saying they cross into its authority.

FERC “has made clear that the act of approval or disapproval of fuel-cost policies is one to be undertaken by PJM and not the IMM,” PJM said in its filing. Penalties would only be assessed if both PJM and the Monitor agree on it. In the event that they disagree, PJM proposed that the matter be referred to FERC’s Office of Enforcement.

During a conference call last week to review the filing, PJM staff clarified that specific implementation processes would be outlined later in changes to Manual 15. The changes will be reviewed by the Market Implementation Committee.

If FERC approval allows for an effective date prior to the beginning of the annual review process, PJM plans to concentrate initially on generation units without any policies or ones that received tacit PJM approval based on negotiations with the Monitor. It would then rely on the annual review process to ensure all units had approved policies. Under PJM’s existing protocols, some units have not been under any requirement to get a policy approved and others have undergone lengthy negotiation processes with the Monitor.

Both PJM and the Monitor described “significant philosophical differences” in their perspectives on the correct oversight scheme.

The “fundamental difference,” according to Monitor Joe Bowring, is his group’s role in the process. PJM made some “significant mistakes” in the filing and isn’t “correctly observing that division of labor set forth in the Tariff,” he said.

Ed Tatum of American Municipal Power asked about the differences in opinion on how short-run marginal costs should be handled.

Bowring responded that PJM’s proposed protocols should be adjusted. PJM’s Jeff Schmitt said that would be addressed in changes to Manual 15.

Jason Cox of Dynegy suggested that the penalty have tiered levels corresponding to whether a noncompliant offer affected the market price, but PJM said that was not part of the filing.

UPDATED: FitzPatrick Sale Filed with New York Regulators

By William Opalka

Entergy and Exelon filed a petition with New York regulators Monday seeking approval of Exelon’s $110 million purchase of the James A. FitzPatrick nuclear plant (16-E-0472).

entergy, fitzpatrick, exelon
Fitzpatrick Nuclear Plant Source: Entergy

The companies asked the Public Service Commission to approve the acquisition by Nov. 18. The PSC has a regularly scheduled meeting on Nov. 17.

“Prompt approval is warranted here because … the transfer does not raise any issues regarding retail energy sales to captive ratepayers, it does not raise any market power concerns in the competitive wholesale markets in New York or the adjoining regions and it is consistent with commission precedent,” the companies said.

The petition says an “investment decision” on refueling the plant must be made soon, as FitzPatrick’s current fuel cycle is expected to end about Jan. 31, 2017.

Entergy said last year it would close the money-losing plant in early 2017. Exelon agreed to purchase the generator after the PSC adopted a subsidy for the no-carbon emission attributes of nuclear power. (See Entergy Sells FitzPatrick to Exelon.)

FitzPatrick, which produces an average 7 million MWh annually, is licensed to operate through 2034.

If approved, Exelon would own all of the upstate nuclear fleet in New York: FitzPatrick, R.E. Ginna and Nine Mile Point 1 and 2. They total 2,267 MW, or 5.9% of the generating capacity in NYISO, according to the companies.

Entergy would still own the only other nuclear plant in the state, Indian Point in the Lower Hudson Valley.

Concern over Subsidy Payments

In a separate filing Monday, Exelon asked the PSC to guarantee subsidy payments for Ginna and Nine Mile Point in the event that its purchase of FitzPatrick plant falls through (15-E-0302).

The company said language in the Clean Energy Standard adopted Aug. 1 by the commission could be interpreted to end the subsidy in March 2019 if not clarified. The order directed the purchase of zero-emission credits (ZEC) in six two-year tranches from 2017 to 2029. (See New York Adopts Clean Energy Standard, Nuclear Subsidy.)

The CES anticipated the FitzPatrick sale after negotiations between Exelon and Entergy were announced in mid-July.

“The FitzPatrick purchase condition [of the CES order] is unclear as to whether the 12-year duration of the R.E. Ginna facility’s, the Nine Mile Point facility’s and the FitzPatrick facility’s respective ZEC contracts are conditioned on the sale of the FitzPatrick facility by Sept. 1, 2018, or whether the 12-year duration language applies only to the FitzPatrick facility’s ZEC contract,” the petition states.

The petition says there is ambiguity in the order and its Appendix E, which states: “If the sale and closing does not occur, there will be no commitment for the program to continue beyond Tranche 1 and the commission will have six months before the otherwise planned commencement of Tranche 2 to determine a future course of action, if any.”

Exelon is asking for specific language to limit the two years of ZEC payments only to FitzPatrick if the sale is not completed.

It asks for a clarification or limited rehearing order by Nov. 18, the same date it has requested for approval of the sale.

State Briefs

Broderick Resigns from ACC After 1-Year Stint

Thomas Broderick, the director of utilities for the Corporation Commission, is leaving after a little more than a year on the job. Broderick provided no reason for his departure and said he was not taking another job.

ArizonaBroderick(gov)
Broderick

Broderick was hired last summer after a nationwide search to replace the longtime agency staffer who previously held the position, which manages 60 regulatory experts and oversees a $5.5 million budget. Commission Chair Doug Little said he was “truly disappointed” to see Broderick go.

His departure comes as the commission considers a pending rate case for Arizona Public Service, the state’s largest utility.

More: The Arizona Republic

CALIFORNIA

IID to Launch Biggest Battery in West

CalifImperialIrrig(gov)The Imperial Irrigation District (IID) will inaugurate a $38 million battery storage facility next month, the largest power storage unit in the western U.S.

The 30-MW facility will be capable of discharging as much as 20 MW in an hour. The massive battery will help the publicly owned utility to firm up intermittent output from the region’s renewable resources and to support the grid in the face of unexpected problems.

“The energy industry is ever-changing and fast-paced, and regulations are changing daily almost, it seems like,” IID spokesman Robert Schettler said. “So this is a way we’re trying to get ahead of an issue.”

More: KPBS

COLORADO

Boulder Approves Annexation Package

The Boulder City Council voted unanimously to approve the annexation of 16 properties adjoining the city, overcoming an obstacle in its bid to municipalize the electric distribution system of Xcel Energy.

The annexation eliminates the need to build separate distribution facilities to serve those customers after Boulder takes ownership of Xcel’s local system. The state Public Utilities Commission had ordered the city to pay for construction of separate facilities to allow Xcel to continue to serve the customers in unincorporated Boulder County.

The annexation prevents “a lot of unnecessary, expensive additional construction,” according to the city staff.

More: Daily Camera

KENTUCKY

Customers to Cover Upgrades at Coal Plants

Kentucky Utilities ratepayers will pay an additional surcharge to cover the utility’s environmental upgrades through 2024 under a settlement approved in early August by the Public Service Commission.

The PSC said the surcharge amount increases over time, beginning with 30 cents in 2016 and climbing to $1.37/month in 2017 and $2.32 in 2018. The amount crests in 2022 at about $3.32/month.

KU and Louisville Gas & Electric asked the PSC for permission to spend more than $900 million on pollution-control measures at their coal-fired plants to comply with federal coal ash storage requirements and to limit emissions under EPA’s Mercury and Air Toxic Standards.

More: Lexington Herald Leader

MARYLAND

PSC Revamps Shutoff Regs After Customer Deaths

The Public Service Commission has approved new notification requirements for service terminations after a Princess Anne family that was using a generator inside their home for heat died of carbon monoxide poisoning last year.

Delmarva Power had removed the home’s electric meter after it discovered that it had been stolen and terminated service to the home.

Under the new regulations, customers whose service is terminated because of allegations of theft or hazardous conditions must be notified by the utility, either in person or in writing, and the notice must include safety precautions. The utility must also notify the commission within one day of the cancellation. The PSC would then add the address to a database for use by local governments, so they can provide assistance to the customer.

More: Maryland PSC; The Baltimore Sun

MICHIGAN

Regulators Say No Reason to Shut Down Mackinac Pipelines

State regulators say they found no evidence to support an order to shut down Enbridge’s Line 5, a pair of underwater petroleum pipelines that go under the Straits of Mackinac, and ordered more studies into their integrity.

Environmental advocates who have called for a shutdown accused the state of dragging its feet. They complained that the studies by the Department of Environmental Quality could take 18 months to complete. The department said it was unable to shut the pipeline down without “clear violations” of environmental easements and evidence that there is “imminent threat” of pipeline failure.

More: Midwest Energy News

MONTANA

Proposed Bills Would Slap Fees on Colstrip Owners

montana pscThe State Legislature’s Energy and Telecommunications Interim Committee has drafted seven bills that would impose millions of dollars in fees on the Colstrip power plant’s owners for 10 years following the closure of two of the plant’s units.

The committee will decide next month whether to file the bills for the 2017 legislative session. Closure of the units by 2022 is required in a legal settlement filed last month.

More: The Associated Press

NorthWestern Fails Again to Recover Costs from Outage

The Public Service Commission has rejected NorthWestern Energy’s second attempt to pass on costs related to a 2013 outage at the Colstrip power plant to consumers through a rate increase. The PSC rejected the company’s appeal of an earlier decision by a 3-2 vote.

NorthWestern had to buy $8.2 million of electricity on the market when a malfunction shut down Colstrip’s Unit 4 three years ago. The commission in March found that the outage was avoidable and NorthWestern didn’t meet requirements for the replacement costs to be passed along to consumers.

“I’m not sure what part of ‘no’ NorthWestern doesn’t understand,” Commissioner Roger Koopman said in a press release.

More: Billings Gazette

Land Board Approves Lease For Potential 70-MW Wind Farm

The Land Board approved the lease of 450 acres near Billings for a possible 70-MW solar development. The lease includes a two-year option to MTSun while regulators conduct an environmental study.

More: Billings Gazette

NEW MEXICO

Regulators Approve PNM’s Energy Contract for Facebook Data Center

The Public Regulation Commission last week unanimously approved a special services contract between Facebook and Public Service Company of New Mexico outlining how the state’s largest utility would supply power to the technology giant’s proposed data center.

The contract, approved Aug. 17, describes a mechanism for providing renewable energy to the data center, which would include the construction of three solar facilities and a high-voltage electric line. Under its terms, PNM would receive about $31 million a year for providing electricity to the data center.

The Los Lunas Village Council has already approved up to $30 billion in industrial revenue bonds for the project.

More: Albuquerque Journal

NORTH CAROLINA

Erin Brockovich Points to State In Call to Set Toxin Standard

erinbrockovich(brockovich)Famed environmental activist Erin Brockovich cited the ongoing coal ash dispute in the state in a request to EPA to set groundwater standards for hexavalent chromium.

A state toxicologist had warned residents living near Duke Energy coal ash storage sites that tests showed unsafe levels of the compound, a finding disputed by Gov. Pat McCrory’s administration. Brockovich pointed to the dispute in a letter she and the Environmental Working Group sent to EPA calling on the agency to set safety levels of the compound.

“It is clear that the delay [in setting safety levels] is sowing confusion among state and local regulators, utilities and the public about how much hexavalent chromium is safe in drinking water,” the letter reads. The current federal level for the compound is 100 parts per billion. It was set 25 years ago and is considered by many to be outdated.

More: News & Observer

OKLAHOMA

Settlement Results in $30.3M Windfall for OG&E

oklahomacorpcomm(gov)The Corporation Commission approved a $30 million settlement that allows Oklahoma Gas and Electric to recover some lost revenues from its popular SmartHours energy efficiency program. More than 110,000 residential OG&E customers have signed up for the program.

OG&E will recover $30.3 million for lost revenue from 2013 to 2015, when the case was first filed.

The settlement among the utility, the commission’s public utility division and the OG&E Shareholders Association resolves a dispute in calculating the amount of lost revenue under SmartHours. The division said the annual amount was closer to $5 million.

More: The Oklahoman

PENNSYLVANIA

Refunds Start Flowing from Polar Vortex Settlements

Utility customers are beginning to see refunds as state officials conclude their cases with energy suppliers accused of misleading consumers about energy prices during the polar vortex of 2014.

Customers of Pennsylvania Gas and Electric, IDT Energy and Hiko Energy will receive $15.6 million. Respond Power will pay $4.1 million. One case, against Blue Pilot Energy, is pending.

More: The Morning Call

WYOMING

State Considers Increasing Nation’s Only Wind Output Tax

A proposal by lawmakers to raise the state’s tax on wind output is meeting resistance from a large wind farm developer.

Bill Miller, CEO of the Power Company of Wyoming, which has proposed building two wind farms rated at 3,000 MW total, is attempting to thwart the tax increase. “Just about every legislator we’ve met with asks us, ‘You tell us how much we can tax you before we put you out of business,’” said Miller. “I just shake my head and say, ‘Zero.’”

The state is the only one in the country that taxes output from wind turbines, currently collecting $1 for every megawatt-hour produced. The state’s take since implementing the program: $15 million. Power Co.’s proposed Chokecherry and Sierra Madre projects could potentially triple revenues.

More: Los Angeles Times

PJM Markets and Reliability Committee Preview

Below is a summary of the issues scheduled to be brought to a vote at the Markets and Reliability Committee on Thursday. Each item is listed by agenda number, description and projected time of discussion, followed by a summary of the issue and links to prior coverage in RTO Insider. The Members Committee does not meet in August.

PJM MRC Agenda FIRTO Insider will be in Wilmington, Del., covering the discussions and votes. See next Tuesday’s newsletter for a full report.

PJM Manuals (9:10-9:40)

Members will be asked to endorse the following manual changes:

  1. Manual 3A: Energy Management System Model Updates and Quality Assurance. Changes reflect administrative and modeling process updates.
  2. Manual 11: Energy & Ancillary Services Market Operations. Conforming changes, updated references and spelling and grammatical corrections are the result of a periodic review.
  3. Manual 12: Balancing Operations. Administrative and conforming updates align with NERC reliability standard BAL-001-02, which went into effect July 1, and with the frequency bias calculation in BAL-003-1.
  4. Manual 14D: Generator Operational Requirements. Changes include updates to the cold weather generation resource preparation section. Amends cold weather testing process effective with winter 2016/17. Generators that cleared as Capacity Performance in the current delivery year will no longer be eligible for compensation for conducting the exercise but may test and receive compensation as a self-scheduled resource. (See “PJM Plans to End Compensation for CP Units Participating in Winter Testing,” PJM Operating Committee Briefs.)
  5. Manual 37: Reliability Coordination. Updates are the result of an annual review.

MISO Planning Subcommittee Briefs

MISO is working to coordinate its generator retirement studies with PJM without changing the RTOs’ Tariffs.

“We’re not going to overhaul the individual Tariffs,” Neil Shah, MISO advisor of seams administration, said during an Aug. 16 meeting of the Planning Subcommittee. “The coordination will align to the extent possible with the Tariffs. We don’t see the need to change anything in the Tariff requirements just yet.”

FERC ordered that MISO coordinate its generator retirement studies with PJM in response to a complaint by Northern Indiana Public Service Co. (EL13-88). (See “MISO Outlines Work Plan for PJM Retirement Coordination,” MISO Planning Subcommittee Briefs.)

Shah said MISO will continue to exchange retirement notification and study information with PJM. “We’ve been doing that before the FERC order came out, so there’s nothing new there,” he said.

MISO is proposing to consult with PJM on how it uses its 30-day window to study generators seeking deactivation for adverse reliability impacts so MISO can consider incorporating those methods in its own reliability impact studies. MISO also wants to exchange study models with PJM as they are updated.

Shah also said MISO plans to use the Interregional Planning Stakeholder Advisory Committee to discuss impacts to the RTOs and analyze upgrades proposed in place of the retiring generator.

Shah said MISO’s suggested approach allows for RTOs to conduct their own studies “with inputs and common assumptions of adjacent system conditions.”

He said MISO will comb through the RTOs’ joint operating agreement to see if any language needs to be revised to include the proposed coordination. MISO is asking for stakeholder feedback on its proposal by Sept. 7 to shape the draft JOA language. Before then, stakeholders will offer opinions on the JOA language at a Nov. 15 Joint Common Meeting. A final filing in the NIPSCO order is due Dec. 15.

Shah said a key difference between the RTOs’ retirement obligations is that PJM cannot force a resource owner to stay online, while MISO can order system support resource agreements.

The RTOs’ retirement timelines are also mismatched. PJM requires 90 days’ notice before retirement while MISO requires twice as long.

Shah also noted that MISO keeps retirement information confidential unless there’s a need for SSR designation while PJM announces retirement notifications.

“That’s not as much of a concern,” Shah said of addressing the confidentiality issue.

Possible MISO-PJM Joint Model in Works

In the NIPSCO ruling, FERC also ordered MISO to explore the potential for a joint regional model with PJM with the same assumptions and criteria to coordinate the two regional transmission planning processes.

MISO started the process at last week’s subcommittee meeting by asking stakeholders to envision what a MISO-PJM joint model would look like.

MISO engineer Adam Solomon said it is possible to model power flow and economic models that contain both MISO and PJM assumptions. However, Solomon said MISO is opposed to creating common assumptions such as production cost models.

“Our approaches are so different that it doesn’t make sense,” he said.

An informational filing on a possible joint model is due Oct. 18. Solomon said MISO isn’t certain of the action it would have to take after that.

“If [FERC] likes our answer, they might require us to incorporate some of the things into our joint operating agreement, but for now, it’s just informational,” he said.

MISO Releases Minimum Requirements for Competitive Tx Projects

MISO released the first revision of Business Practices Manual 029, which governs requirements for competitive transmission projects.

MISO principal adviser Matt Tackett said the Minimum Design Requirements Task Team added minimum normal rating requirements that borrow from current minimum emergency ratings. Tackett also said the manual includes a default table for minimum transmission circuit ampere ratings.

“The biggest trick was coming up with a default table based on typical percentages,” Tackett said.

MISO has also developed what it calls adequacy validation ratings to verify that the circuit conductors specified by developers provide adequate load capacity.

The ratings factor in wind speeds along with ambient temperatures. MISO North assumes an ambient temperature of 35 degrees Celsius in the summer and 0 degrees in the winter; all other MISO regions will use 40 degrees Celsius in the summer and 10 degrees in the winter.

Tackett said BPM 029 will undergo more refinements based on stakeholder feedback before another presentation at the October PSC. It is set to become effective in January.

Meanwhile, Tackett said BPM 020, which guides use of non-transmission alternatives and describes how storage can qualify for interconnection, needs another monthlong round of vetting in the subcommittee before final language is reviewed before the Planning Advisory Committee.

Transfer Limits Range from 1,400 to 4,500 MW in MTEP16 Analysis

MTEP16 Transfer Studies (MISO) - miso planning subcommittee

MISO senior engineer Scott Goodwin announced preliminary linear thermal limits for MISO’s 2016 Transmission Expansion Plan transfer analysis:

  • MISO North to SPP has a transfer limit of 3,600 MW;
  • Two paths from Manitoba Hydro to MISO North have limits of 1,400 MW or greater;
  • MISO North to PJM Ohio has a limit of 4,000 MW;
  • Limits from Missouri and Illinois to PJM Ohio range from 2,800 to 3,600 MW depending on different contingencies;
  • SPP to Southern Co.’s territory has a limit of 4,100 to 4,500 MW depending on different contingencies; and
  • MISO South to SPP has a limit of 1,800 MW.

Goodwin said the transfer limit results will be finalized by the middle of September and MISO will report final numbers in October.

— Amanda Durish Cook