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November 16, 2024

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State Briefs

CO2 Emissions down as Coal Plants Used Less

The state is already meeting the carbon dioxide emissions target under the final year of EPA’s Clean Power Plan, thanks to reduced use of coal-fired power generation because of the low price of competing natural gas.

The state’s carbon emissions were 30.1 million tons in 2015, down from 39.7 million tons in 2014, according to an analysis by the Department of Environmental Quality. The state’s target for 2030 is 30.6 million tons.

Southwestern Electric Power Co. said that SPP did not dispatch its Arkansas coal plants as much in 2015 as the previous year. The company said lower natural gas prices and mild weather were the primary factors.

More: Arkansas Democrat-Gazette

CALIFORNIA

Regulators Reopen San Onofre Rate Deal, Moody’s Frowns

sanonofresourcesocaledisonMoody’s Investors Service took a dim view of a Public Utilities Commission decision to reopen a 2014 agreement that shouldered ratepayers with most of the multibillion-dollar shutdown costs of the San Onofre nuclear plant.

The commission earlier this month decided to reopen the $4.7 billion settlement amid disclosures that secret meetings were held before the deal was approved 18 months ago and complaints from stakeholders. The plant was closed prematurely in 2013 after a radiation leak was discovered during the replacement of a steam generator.

More: The San Diego Union-Tribune

DELAWARE

Delmarva Power Proposes To Raise Rates Post-Merger

delmarvagarystockbridgesourcedelmarva
Stockbridge

Delmarva Power, one of the Pepco utilities recently acquired by Exelon, is asking the Public Service Commission for a $62.8 million electric rate hike and an increase of $21.5 million for its gas services.

President Gary Stockbridge said the money is needed to cover $120 million in upgrades to the gas system and $222 million in improvements to its electricity infrastructure.

For a typical residential customer, the increases would translate to $10.23/month for electricity and $13.55 for gas.

More: Delaware Public Media

ILLINOIS

Future Shaky for Bill to Save Quad Cities, Clinton Stations

clintonsourcenrcThe chair of the Senate Energy and Public Utilities Committee said Thursday that it’s unlikely Exelon’s “Next Generation Power Plan,” which would extend state clean power subsidies to nuclear plants, will come to the floor before the legislative session ends May 31.

Exelon has said it will shutter its struggling Quad Cities and Clinton nuclear power plants if the General Assembly doesn’t act, and if Quad Cities doesn’t clear the PJM Base Residual Auction. (See Absent Legislation, Exelon to Close Clinton, Quad Cities Nukes.)

Among other provisions, SB1585 would extend state subsidies for clean power to nuclear plants. It also would allow Commonwealth Edison to shift its billing model from one based on monthly kilowatt-hour consumption to a demand charge assessed on a customer’s peak monthly usage.

More: The Northwest Indiana Times

KENTUCKY

Coal Miner Numbers Hit 120-Year Lows

KentuckyBlueHeronCoalSourcewikiThe amount of employed coal miners in the state has hit a nearly 120-year low, according to a report released this month from the Energy and Environment Cabinet. About 6,900 coal miners are working in the state, the lowest number recorded since 1898.

The cabinet also reported that coal production fell 13% in the first quarter of 2016 to 11 million tons, the lowest level since 1939.

Cabinet Assistant Director Aron Patrick said he anticipates that coal’s decline will bottom out by 2018. “Currently we are supplying coal to power plants that are scheduled to close before 2018,” Patrick said. “So in the near term, i.e., 2016 through 2017, there likely will be continued declines. But 2018 and beyond, there probably will be some sort of stabilization.”

More: WFPL

MAINE

SunEd Wind Farm not Affected by Zoning Change

sunedisonsourcesunedisonThe proposed 26-turbine Somerset Wind project in the Misery Ridge area won’t be affected by a change in zoning regulations that allow communities to opt out of a fast-track wind development zone, according to the project’s developer.

More than 20 communities have petitioned the state for exemptions from a law providing for an expedited permitting area, which allows for the fast-track development of commercial wind farms in parts of the state’s unorganized and rural areas.

Last week, landowner Weyerhaeuser withdrew its opposition to several townships opting out of the expedited permitting area. SunEdison said that those townships were not part of its plans for the project.

More: Portland Press Herald

MICHIGAN

Senate Proposes Legislation To Regulate Retail Choice Cap

The Senate is considering legislation that would impose a new electric generation service charge on retail customers entering the deregulated market, which advocates of competition say would hinder retail electric choice.

The proposal, which is supported by utilities, would retain a 10% cap on the amount of power the state can receive from alternative generators and out-of-state suppliers. But, along with the additional charge, it would require alternative suppliers to prove future resource adequacy.

“Adding a punitive new capacity charge will all but thwart electric choice,” said Laura Chappelle of the Energy Michigan trade association. Sen. Mike Nofs, the bill’s sponsor, said the new law is necessary to ensure reliability.

More: The Detroit News

MONTANA

State Becoming a Hotbed for Solar Energy Development

Interest in developing solar power is soaring in the state, with out-of-state developers working to lease land to develop solar farms.

“There’s a lot of prospecting in our area for sure,” said Susan Conell, Cascade County planning director. She said at least six different companies from North Carolina, South Carolina, California and Virginia have called the county inquiring about the county’s solar regulations.

NorthWestern Energy, the largest public utility in the state, has signed five 25-year power purchase agreements with California-based Cypress Creek Renewables for 14 MW of solar power from in-state farms. Statewide, two out-of-state developers alone are proposing 43 solar projects, each 3 MW, NorthWestern said.

More: Great Falls Tribune

NEW JERSEY

JCP&L Revives Controversial Transmission Line Project

NewJerseyjcpandlsourcejcplJersey Central Power & Light is reviving plans to build a 10-mile 230-kV transmission line in Monmouth County, a project that was canceled 25 years ago after local protests.

The so-called Monmouth County Reliability Project is virtually identical to the old line, but it will cost a lot more: $75 million, compared to $14.5 million in 1991. The company says the demand for power has caught up to what had been forecast for the area back when the line was first proposed.

PJM has called the project necessary for regional grid stability. It would run along an existing railroad right of way.

More: NJ.com

NEW MEXICO

PRC Incumbent Accused of Close Ties with PNM

NewMexicoCynthiaHallsourceHall
Hall

A race for a seat on the Public Regulation Commission has become hotly contested, as challenger Cynthia Hall has portrayed incumbent Karen Montoya as being deferential to the state’s largest utility company, Public Service Company of New Mexico.

Hall, a lawyer who finished second to Montoya in a three-way race in 2012, says the incumbent has been “far too close” to PNM. She cites the commission’s approval last year of the utility’s plan to close two coal-fired units at the San Juan Generating Station.

Montoya’s website touts her record as commissioner. She said in the last four years, the commission has approved the largest solar array in the state and lowered the universal service fee on residents’ phone bills.

More: The Santa Fe New Mexican

Albuquerque Delays Decision To Increase Renewable Energy

The Albuquerque City Council has delayed voting on a resolution that calls for the city government to obtain at least 25% of its electricity from solar by 2025.

The two council members who introduced the resolution acknowledged they have no idea how much the effort will cost. The resolution calls on the city’s energy council to weigh various options, from retrofitting existing city buildings with solar arrays to constructing a new solar farm. An implementation plan would be due by 2017 and the City Council could decide what path to pursue.

More: The Associated Press

NEW YORK

NYISO Says Summer Supply Adequate

nyisosourcenyisoNYISO said a total of 41,874 MW of supply is available to meet summer power demand in the state, well above its forecasted peak demand of 33,360 MW.

The total capacity includes 38,534 MW of generating capacity from power plants, 1,248 MW in demand response resources and 2,092 MW from out-of-state resources.

Last summer’s peak demand of 31,138 MW, recorded on July 29, 2015, was below the 15-year average of 31,540 MW.

More: NYISO

PSC Expands Energy Discount Programs

nystatepscsourcegovThe Public Service Commission created the state’s first-ever Energy Affordability Policy to provide $248 million in direct relief to low-income residents.

The new policy will limit energy costs to no more than 6% of household income.

The order will immediately increase the number of low-income utility customers receiving monthly discounts by 50%, from 1.1 million customers to 1.65 million. The order also creates a multiagency low-income energy task force to develop new strategies aimed at all of the state’s 2.3 million households at or below 200% of the federal poverty level.

More: New York PSC

NORTH CAROLINA

Duke Ordered to Excavate Coal Ash, but May Get Reprieve

DukeEnergyCoalAshSourceDukeState environmental authorities ruled that Duke Energy must excavate all of its coal ash dumps and ponds, which the utility says would “significantly increase” its estimated $4 billion in coal ash remediation costs. But the regulators said they may later change the ruling to allow the company to make improvements to the storage areas instead.

In response, Duke said it would seek regulatory approval to pass on to ratepayers any additional costs it incurred if it is required to remove all the ash.

Environmentalists said the ruling doesn’t go far enough to protect drinking water of those living near the sites. Gov. Pat McCrory’s administration “is making a mockery of the law and continuing to cower away from taking one iota of meaningful action to clean up leaking coal ash dumps,” said Pete Harrison of the Waterkeeper Alliance.

More: The News & Observer

Bill Would Impose Financial, Safety Regulations on Solar, Wind

NCSenBillCookSourcegov
Cook

A bill introduced by two Republican state senators would impose safety requirements on wind and solar farms that critics say could be stricter than those on coal-burning and nuclear plants.

Sen. Bill Cook, co-sponsor of SB843, said the increase in renewable projects is prompting complaints about safety, appearance and negative effects on property values. Cook represents the area where a Spanish developer is building the Amazon Wind Farm.

Among the provisions, the bill would require that a wind farm could not generate more than 35 decibels of sound, the volume of human whispering, as measured from a neighboring property.

More: The News & Observer

OKLAHOMA

Bill to Phase out Wind Tax Credits Fails in House

oklahomawindsourcewikiA House committee last week defeated a bill that would have begun phasing out the state’s zero-emissions tax credit for the wind industry at the end of 2017 rather than 2020.

Members of the state House Joint Committee on Appropriations and Budget questioned whether it would be fair for lawmakers to renege on a deal made just last year that included a five-year property tax exemption for the wind industry to expire at the end of this year. The bill was defeated by a 13-15 vote.

The state currently is scheduled to end the 10-year tax credit for new wind farms placed in service after Dec. 31, 2020. By moving the deadline up to 2017, the state would have saved $306 million.

More: The Oklahoman

PENNSYLVANIA

Regulators Reject Proposed Net Metering Cap

PaPucSOURCEgovThe Independent Regulatory Review Commission last week rejected a proposal from the Public Utility Commission that would have curtailed net metering at 200% of a customer’s annual consumption.

The PUC has 40 days to amend, withdraw or present to lawmakers its rule.

“I don’t believe the authority exists to create such a cap,” IRRC member W. Russell Faber said in explaining the board’s disapproval. The PUC said it worried that homeowners trying to make money from selling back alternative electricity would drive up the cost of power and prevent utilities from being able to collect enough money to maintain the grid.

More: Pittsburgh Tribune-Review

WYOMING

Chokecherry Wind Farm In Doubt over Tax Increases

Power Company of Wyoming said it is reconsidering plans to break ground on the $5 billion Chokecherry Sierra Madre wind farm after two bills moved forward in the State Legislature that would raise taxes on wind energy.

The Revenue Committee advanced a bill to raise the production tax on wind beyond the current $1/MWh and a second bill that would obligate wind companies to hand over to the state some portion of the federal wind energy production tax credits they currently receive.

The bill “has created significant uncertainty and added a huge new risk regarding our plans to construct and operate two new renewable energy businesses in Wyoming,” said Kara Choquette, a PCW spokeswoman. The company has worked for more than a decade to obtain the regulatory clearance for the 1,000-turbine, 3-GW installation.

More: Wyoming Business Report

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FERC Punts SMECO-J.P. Morgan Capacity Dispute to Courts

By Suzanne Herel

FERC last week dismissed a complaint by Southern Maryland Electric Cooperative alleging that it has the right to a Capacity Performance credit from J.P. Morgan Ventures Energy Corp., saying the contractual dispute would be better resolved by a court (EL16-35).

In 2011, the parties executed a capacity purchase and day-ahead heat rate call option on physical electricity for the Brandywine Generation Facility from Jan. 1, 2014, through Dec. 31, 2021. The power purchase agreement provides SMECO a 225-MW Reliability Pricing Model capacity credit in exchange for a monthly payment to JPMVEC.

SMECO said that it did not believe JPMVEC intended to transfer the credit under PJM’s new Capacity Performance model and instead treat the product as base capacity.

“Determination of the dispute between SMECO and JPMVEC depends upon whether the parties contracted to sell and purchase capacity specifically from the Brandywine facility with the intent to allow SMECO to meet its RPM obligation, as SMECO claims, or whether the parties contracted for the transfer of any type of capacity from any source without regard to SMECO’s RPM obligation, as JPMVEC argues,” the commission ruled in declining to exercise primary jurisdiction in the case. “The outcome of this matter appears to turn on interpretation of the parties’ intentions and construction of the relevant clauses in the Brandywine PPA rather than any determination requiring our special expertise.”

Commissioner Cheryl LaFleur dissented from the opinion, saying the decision “effectively consigns SMECO to a potentially lengthy and costly court proceeding to resolve what is, in my view, a clear and easily resolved contractual interpretation that is squarely within the commission’s jurisdiction and expertise.”

Not only would she have supported exercising primary jurisdiction in the matter, she said, she would “find that the parties’ contract requires JPMVEC to provide SMECO with capacity credits to meet SMECO’s obligations under the RPM.”

In addition, LaFleur said, FERC erred by “failing to frame the dispute between these two parties in the proper context of the broader transition underway in the PJM capacity market.”

She urged the commission to exercise primary jurisdiction over future Capacity Performance issues to ensure consistent interpretation of common contractual language and avoid the unintended undermining of Capacity Performance reforms.

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FERC Approves ISO-NE FCA 1 Refund Plan

By Michael Brooks

ISO-NE will issue more than $20 million in refunds to capacity resources that were prevented from reducing their offers in Connecticut for reliability reasons in the 2008 Forward Capacity Auction under an order issued by FERC last week (ER08-633).

Refund Distribution Table (ISO NE)
Load-serving entities that will have to make additional capacity payments under ISO-NE’s resettlement plan.

Under the RTO’s “proration” rule at the time, the total payment to all listed capacity resources had to equal the clearing price multiplied by the installed capacity requirement. To achieve this, resources could either receive capacity payments lower than the clearing price (price proration) or reduce their capacity supply (quantity proration). All proration, however, was subject to a reliability review.

Public Service Enterprise Group complained that ISO-NE barred it from prorating its capacity supply in Connecticut, forcing the company to offer at a lower price, which the company said cost it $2.8 million. When its protest and rehearing request were denied by FERC, the company sued in federal court. The D.C. Circuit Court of Appeals ruled in favor of PSEG and remanded the case back to the commission.

Last year, FERC reversed its decision, saying, “We now find that where resources needed for reliability were prohibited from prorating quantity under the proration rule, they should have received the full market clearing price for each megawatt offered.” It ordered ISO-NE to provide a plan for resettlement.

The RTO reported that 5,870 MW would have been prorated had plants been allowed to. The clearing price for FCA 1, conducted in February 2008, was $4.50/kW-month. To determine how much each plant would be owed, ISO-NE took the difference between the clearing price and the prorated price, $4.254/kW-month, converted it to megawatt-years and multiplied it by 5,870. The result was about $17.3 million in refunds, plus about $3.1 million in interest. The RTO said it would recalculate the interest owed upon FERC’s order, so the final amount refunded to companies will be higher.

“We find the resettlements … appropriate to ensure that PSEG and other Connecticut resources that were not able to prorate quantity be paid the full capacity clearing price for each of the megawatts that cleared FCA 1,” the commission said.

Eversource Energy, which was Northeast Utilities at the time of the auction, will pay the bulk of the refunds, at almost $15.6 million. UIL Holdings, now part of Avangrid, will pay about $3.8 million.

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Generators Rebut PJM Study on Investment in Competitive Markets

By Suzanne Herel

A coalition of generators led by American Electric Power and FirstEnergy last week responded to PJM’s analysis of resource investment in competitive markets, saying it presents a skewed view of the risks and benefits of such constructs compared with the traditional regulated model.

Kyger Creek Power Plant - Generators PJM competitive markets
Kyger Creek Power Plant

Joining AEP and FirstEnergy in a May 19 letter to the Board of Managers were Dayton Power and Light, Duke Energy Ohio and Kentucky, Buckeye Power and East Kentucky Power Cooperative.

The PJM study concluded that the RTO’s markets more efficiently attract cost-effective new generation and minimize risk to consumers. (See PJM Study Defends Markets, Warns State Policies can Harm Competition.)

The study was commissioned by the board after AEP and FirstEnergy asked Ohio regulators, and Exelon asked Illinois legislators, for financial aid to support money-losing generators.

The generators said PJM’s paper fails to point out that competitive markets have achieved their benefits because of legacy generation and transmission assets that were built under the regulated utility model, noting that PJM had a reserve margin of more than 20% when it began the capacity market in 2007.

“The paper presents a case in which nuclear and coal baseload resources that do not clear the capacity market for a given delivery year should not have been built. It is naive to think that a future driven by marginal resources through short-term capacity markets can adequately serve customers,” the letter said.

“The [Reliability Pricing Model] construct has never provided long-term price support for investments in long-life assets,” it said. “As a result, a significant amount of generation [in western PJM] has, or is seeking, some type of retail rate support.” (See Absent Legislation, Exelon to Close Clinton, Quad Cities Nukes.)

The signatories represent 44,000 MW of capacity in the RTO and serve more than 11 million consumers with about 69,000 MW of load. They note that 30% of the capacity in PJM comes from suppliers who operate under a traditional regulatory model.

“We strongly urge the PJM board to recognize that there is a place within PJM for generation supported by the market and by traditional cost-of-service regulation,” the letter said.

The companies said there were several major weaknesses in the PJM report:

  • Risks to the consumer. PJM’s contention that customers face less risk in a deregulated model is “a short-term view,” the letter said, and is greatly influenced by recent decreases in the price of gas. “In contrast, the regulated paradigm inherently takes a long-term view of investments necessary to maintain proper fuel diversity, plant type diversity, transmission needs and reliability, which results in reduced market volatility and consumer benefits.”
  • Value proposition of an integrated utility model. Regulated utilities have a legal long-term commitment to serve customers, the letter said, whereas merchant generation can close up shop if they don’t receive the desired return. “PJM does not account for any necessary transmission investment associated with premature retirement of baseload generation,” it said. “Integrated resource plans holistically consider these costs as well as societal and policy objectives. … Customers pay for the cost of new transmission, which often can exceed the costs of keeping a unit online.”
  • Innovation. “PJM’s market rules and its stakeholder process result in a sluggish response to change,” the letter said, citing what it called “the inability of the markets to accommodate variables such as changing fuel mixes and resource adequacy as a result of environmental policies.”
  • New investment. The writers contend that market signals have not attracted new technology, and that renewable generation largely relies on bilateral arrangements or government subsidies. They say the capacity market’s one-year clearing price, three years in advance, results in increased price volatility and higher consumer costs.
  • Fuel diversity. “PJM’s position that legislators and policymakers should solve the issue of diversity contradicts PJM’s overall premise that any market outcome is superior to regulation,” the letter said.

In closing, the writers note that PJM said its paper was “intended as the beginning of a dialogue on resource investment.”

“We are ready to engage in a fact-based discussion of the risks and benefits associated with different market and regulatory paradigms,” they said, urging PJM to “focus on a market design that accounts for transmission costs, ensures both robust competition and adequate compensation for diverse capacity resources and respects the roles and responsibilities of the states in providing a comprehensive approach to least-cost reliability for consumers.”

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Former PUCO Chairman Andre Porter Joins MISO

By Amanda Durish Cook

Former Public Utilities Commission of Ohio Chairman Andre Porter is crossing state lines to become MISO’s general counsel.

Andre Porter, PUCO, MISO
Porter

He will replace Stephen Kozey, who will continue in his other roles overseeing compliance services and serving as secretary to the board. Kozey, the RTO’s first general counsel, will be able to devote more time to remaining responsibilities and advise Porter as he takes on the role, according to MISO.

Porter will begin work at MISO’s Carmel, Ind., headquarters on June 27.

Porter said he did not seek nor consider positions with other RTOs. “MISO is the only place for me. It’s the opportunity of a lifetime … and an exciting one.”

MISO spokesperson Andy Schonert said bringing Porter into MISO involved an “ongoing conversation” between Porter and the RTO, while Porter said he was able to develop a longstanding relationship with MISO from his work in PJM. “I’ve always followed MISO and admired MISO’s transparency. I’m hopeful that I can add to what is already a spectacular team,” he said.

MISO CEO John Bear said Porter’s expertise is “a great match” for the RTO.

“Andre’s background spans a broad spectrum of the energy industry, and he has extensive experience working with commissions and FERC,” Bear said.

Porter holds a bachelor’s degree in political science from Capital University and a law degree from The Ohio State University Moritz College of Law.

Porter worked as an energy, public utilities and real estate taxation attorney before serving as a PUCO commissioner from 2011–2013.

Before returning to PUCO as chairman, Porter led the Ohio Department of Commerce.

Porter resigned from PUCO late last month, just over a year after taking the position and less than a month after PUCO unanimously approved controversial, eight-year power purchase agreements for FirstEnergy and American Electric Power. Porter’s term wasn’t slated to expire until April 2020. (See PUCO’s Porter Submits Resignation.)

The PPAs guarantee the utilities’ merchant generators receive revenue streams above current market prices to shield them from cheaper natural gas generation. The companies asked PUCO to cancel the agreements after FERC ruled that they would need to be reviewed under the commission’s affiliate abuse test. (See PUCO Grants FirstEnergy Rehearing on PPA; Opponents File Protests.) FERC said last month that in spite of Ohio’s retail choice law, the companies’ ratepayers were effectively “captive” customers because the PPAs impose non-bypassable distribution charges.

Critics contend the PPAs, which weren’t subject to competition, could impose billions in extra costs on consumers and equate to coal bailouts. FirstEnergy and AEP maintain the PPAs are essential in keeping their struggling Ohio coal plants operational, and AEP CEO Nick Akins said the company intends to lobby Ohio legislators to reregulate the deregulated Ohio power market or sell all its generation in the state before it consents to submitting its PPA for FERC review.

Porter declined to say whether he was brought back to PUCO to complete the AEP/FirstEnergy agreements.

“I came back to the commission because there were challenges, and I’m the kind of guy that seeks out challenges. It was just really about coming back to a place where I could help. I certainly appreciated my time working with the utilities of Ohio.”

Porter also declined to answer questions on what he thought of the status of the deals now and if AEP could run a successful bid for reregulation in Ohio, citing FERC’s ongoing review and his new commitment to MISO.

“Right now I’m squarely focused on MISO,” Porter said.

Gov. John Kasich named PUCO Vice Chair Asim Haque to replace Porter, making Haque the fourth PUCO chairman in four years.

“I enjoyed my time at PUCO, and I’m forever grateful to Gov. Kasich for the opportunity. I think my successor, Mr. Haque, is more than capable; he’s going to lead with clarity, and the state of Ohio will be well served,” Porter said.

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Texas PUC Denies Rehearing on Oncor Sale, Ends Hunt Bid

By Tom Kleckner

The Public Utility Commission of Texas on Thursday rejected all motions for rehearing in Hunt Consolidated’s proposed acquisition of Oncor, effectively closing the books on a deal thought to be key to Energy Future Holdings’ emergence from bankruptcy (Docket No. 45188).

The commission’s unanimous vote allowed its March 24 order conditionally approving the acquisition to stand. Because the Hunt group has said it couldn’t complete the deal as approved, that means the order will “evaporate,” as Commissioner Ken Anderson put it.

The Hunt group and other EFH creditors had filed a request May 18 asking the commission to vacate the order and dismiss the proceeding, which would have left open the possibility of a new application.

Commission Chair Donna Nelson said she was joining her two fellow commissioners in denying the motions “solely in the interest of allowing us to be done with this today.”

“Time is of the essence in this case,” she said, “which is funny because of how it’s dragged along.”

Oncor, Texas PUC, Hunt Consolidated

The Hunt group asked the commission in September for approval to acquire Oncor, the largest transmission company in Texas, for almost $20 billion. In March, the commission approved Hunt’s proposal to split Oncor into two companies, one of which would operate as a real estate investment trust (REIT). (See Texas Commission Approves Oncor REIT Structure.)

However, the PUC attached conditions to the approval that included sharing the REIT’s tax savings with Oncor customers, which EFH creditors found unacceptable. EFH filed a new Chapter 11 reorganization plan May 1, saying it would be unable to complete the Oncor acquisition as it tries to eliminate $42 billion in debt. (See EFH Files New Chapter 11 Plan; Oncor-Hunt Deal in Doubt.)

Richard Nolan, an attorney for the Hunt group, said his parties had concluded May 17 that if they were to pursue a new transaction, “it will require a new application.”

“From our perspective … it would be more helpful to clear the decks and make a fresh start,” Nolan said. He said the original proceeding became moot when the acquisition was terminated.

He received no argument from intervenors and PUC staff, who all agreed with denying the rehearing request.

“I don’t want to go through another proceeding where we end up with major stumbling blocks,” Anderson said. “ERCOT, and the Texas power market, will benefit from getting this matter resolved.”

The Hunt group said it will continue to work with stakeholders on a plan that meets its goal of keeping Oncor under management control by Texans. “The commission’s actions today now allow all parties to engage in conversations about next steps,” Hunt spokesperson Jeanne Phillips said in a statement.

While Phillips, Anderson and others have expressed a strong desire that Oncor remain under in-state control, Florida-based NextEra Energy reportedly remains a suitor. The company made its own bid for Oncor last year, only to be outflanked by the Hunt group.

Anderson said that with the proceeding behind the commission, it can now take a more assertive role in EFH’s bankruptcy case in Delaware.

“We’ve generally been pretty passive up until now,” he said.

Under EFH’s new bankruptcy exit plan, it would again be broken up into two parts (Oncor and the competitive Luminant and TXU Energy businesses), with noteholders potentially being able to grab Oncor. EFH has asked the bankruptcy court to hold a hearing on the plan Aug. 1.

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Pipeline Protesters Force FERC to Close Monthly Meeting

By Michael Brooks

WASHINGTON — Citing safety concerns, FERC closed its monthly meeting to the public Thursday, allowing only staff, guests and credentialed members of the press inside commission headquarters.

The meeting was broadcast via the Internet, which Chairman Norman Bay said allowed the commission to meet its “statutory requirement” under the Government in the Sunshine Act to allow the public to observe the meeting.

“The decision to conduct this open meeting by webcast only was not made lightly,” Bay said. “It was made after consultation with law enforcement and our security staff, and the primary concern was preserving the safety of the public and commission staff. The webcast allows us to maintain the ability of the public to observe and listen to the commission meeting.”

Beyond Extreme Energy protesters outside FERC headquarters © RTO Insider
Beyond Extreme Energy protesters outside FERC headquarters © RTO Insider

The decision to close the meeting — possibly the first time the commission has held a webcast-only open meeting, according to Bay — came amidst a week of intense protest activity by environmentalist group Beyond Extreme Energy (BXE). Members of the group demonstrated outside the homes of Commissioner Tony Clark on Monday and Bay and Commissioner Cheryl LaFleur on Wednesday. They were also already camped outside commission headquarters prior to the start of the meeting but had departed by the time the meeting ended.

“I, too, find it unfortunate that we had to decide to restrict access to the building today,” Clark said. “But it was done with the consultation of law enforcement and I understand why. If you look at the room in the headquarters building, it’s simply not designed to handle the activities that were being discussed, and when decisions like this are made, public safety has to come first.”

Bay declined to say what activity the commission was expecting to take place. BXE’s modus operandi is to interrupt meetings with statements criticizing the commission’s approval of natural gas infrastructure before being escorted out by security. Known members have been barred from the meeting room, relegated to a side room to watch the meetings on TV. (See Meet the People Making Life a Little More Difficult for FERC this Week.)

Melinda Tuhus, a Beyond Extreme Energy spokeswoman, said that the group was not going to do anything different in the meeting room beyond their normal interruptions. She said there were about a dozen protesters, out of the 50 to 60 total, at the rally outside FERC on Thursday who had never attended an open meeting.

“The commissioners know that we’re nonviolent activists,” Tuhus said. “That’s a fundamental precept of our organization. … The commissioners know that.”

Tuhus speculated that the commissioners overreacted to the demonstrations outside their homes. “We made absolutely no threats.”

Last week, Bay had to be escorted out of the Independent Power Producers of New York’s annual spring conference when protesters rushed the stage while he was holding a question-and-answer session.

During the protest outside FERC headquarters, the Rev. Lennox Yearwood of the HipHop Caucus criticized President Obama, California Gov. Jerry Brown and Canadian Prime Minister Justin Trudeau for supporting fracking. “They are not climate leaders until they realize we must transition to 100% renewable energy,” he said.

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MISO Sees Enough Capacity for Summer

By Amanda Durish Cook

Carmel, Ind. — MISO has adequate capacity to meet summer demand, though there’s a good chance the RTO will dip into its load-modifying resources, officials said at a summer readiness workshop last week.

MISO officials reported 148.8 GW of capacity to meet a projected demand of 125.9 GW, giving it an 18.2% reserve margin, well above its 15.2% requirement. Compared with last year’s summer forecast, available capacity declined by 1.5 GW, while the load forecast decreased by 1.4 GW.

MISO Summer 2016 Risk Analysis MISO - capacity

Probabilities

MISO said there is a 72% probability it will need to deploy some of its 9.5 GW of load-modifying resources, but only a 10% chance it will use all of them and have to tap operating reserves.

There is a 4.3% probability that MISO will deplete operating reserves and be forced to order load shedding, Vice President of System Operations Todd Ramey said.

Ramey said that even when MISO declares a capacity emergency, 10,000 MW are still available for use. “Emergency doesn’t mean imminent load shed,” he said. Unit retirements that reduced capacity create “a new operating reality” for the RTO, he added.

MISO is close to completing its 2016 Coordinated Seasonal Assessment for summer, which identifies potential stressors to the transmission system. “For this summer, we didn’t see any outstanding issues,” MISO transmission planning engineer Carlos Bandak said. MISO’s full analysis is due by end of the month.

Gas Inventory High

miso capacityPhil Van Schaack, MISO electric-gas operations coordinator, said there was a record 2,480 Bcf of natural gas in storage at the beginning of April, a 60% rise over last year’s end-of-winter inventory.

Van Schaack also noted natural gas prices in the New York Mercantile Exchange hit lows in March not seen since 1999, at $1.64/MMBtu. He said the oversupplied market, coupled with forecasts of a warmer-than-normal summer, could result in “significant power burns, longer runs and higher capacity [factors for] gas units, similar to the summer of 2012.”

Emergency Offer Floors

MISO has established new emergency offer floors to combat depressed emergency prices. Michael Robinson, the RTO’s principal adviser for market design, said depressed emergency prices occur because offer prices for emergency resources either aren’t available or are cheaper than an economic resource dispatched prior to the emergency declaration.

Now, when a maximum generation emergency warning is issued, the pricing floor is set at the highest available economic offer. After a maximum generation emergency event is declared, the pricing floor moves up to the highest available economic and emergency offer.

Hurricane Readiness

MISO has assembled a hurricane readiness team to identify inadequacies in contingency plans for MISO South, which enters the Atlantic hurricane season next month.

“We hope to focus on communication coordination limitations,” project leader Van Schaack said. “We’ve had mild hurricane seasons since the integration of MISO South. We want to make sure we are educated on how to prepare.”

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Company Briefs

A 485,000-pound Exelon Generation wind turbine that toppled in February “basically shook itself apart” after a mechanism meant to control its speed failed, according to a company investigation.

exelongenerationsourceexelonAll three cylinders of the pitch system in the eight-year-old Vestas V82 1.65-MW turbine in Oliver Township, Mich., suffered oil leaks, according to an investigation by Exelon. The failed pitch system, and 45-mph winds, pushed the blades to rotate at 18 rpm, far more than the 14.4 rpm nominal speed. Nobody was injured, but the $1.5 million turbine was destroyed when it fell to the ground.

All of the other turbines of that model were inspected, and none showed problems with more than one cylinder. It is the only recorded instance of a catastrophic failure of the Danish-designed turbine, officials said.

More: Huron Daily Tribune

Will Talen Energy Be Taken Private?

talenenergysourcetalenRiverstone Holdings, Talen Energy’s largest shareholder at 35%, reportedly is leading an effort to take the independent power producer private.

Bloomberg cited anonymous sources in its report, which said Talen has not decided whether to accept that or other offers.

Talen, which spun off from PPL last June, reported a first-quarter profit of $151 million.

More: Bloomberg; The Morning Call

Duke to Build $55M 21-MW Plant at University

dukeuniversitysourcedukeDuke Energy will build a 21-MW combined heat and power plant at Duke University that will cut the university’s carbon emissions by 25%. The natural gas-fired plant will fuel a turbine that will turn a generator, and the waste heat will be captured to produce steam for buildings. The project still needs approval from the North Carolina Utilities Commission.

It will be the company’s first foray into heat plants in the Carolinas. The university will sign a 35-year operations contract with the utility.

More: Charlotte Business Journal

Talen to Pay More than $1M for 2005 Fly Ash Spill

martinscreeksourcetalenTalen Energy will pay more than $1 million to agencies in Pennsylvania, Delaware and New Jersey to settle a claim stemming from a 2005 fly ash spill at its Martins Creek Power Plant on the Delaware River.

Under the ownership of Talen’s predecessor company, PPL, a containment basin burst, spilling about 100 million gallons of fly ash and water into local fields, Oughoughton Creek and the Delaware River.

The Martins Creek coal-fired units stopped running in 2007, and the plant was converted to natural gas.

More: LehighValleyLive.com

Six Energy Companies Launch Grid Assurance Sparing Program

aepohiosourceaepSix energy companies have launched Grid Assurance, a company providing shared transmission parts inventory to restore service during emergency outages more quickly.

American Electric Power, Berkshire Hathaway Energy, Duke Energy, Edison International, Eversource Energy and Great Plains Energy worked together over a year to form the independent company this month. Kansas City Power & Light Senior Vice President Michael Deggendorf was named Grid Assurance CEO.

Grid Assurance is a subscription-based service open to transmission providers where large transformers, circuit breakers and other system components are stored in warehouses around the U.S., available for quick dispatch in case of a catastrophic event.

More: American Electric Power

ATC Restructures to Facilitate Expansion

americantransmissioncosourceatcThe Wisconsin Public Service Commission last week approved American Transmission Co.’s reorganization plan that will allow the company to more easily take on transmission work in other states.

Under the plan, the Wisconsin-based ATC will create a separate holding company specifically for out-of-state investments. The company still needs approval from the Illinois Commerce Commission, whose decision is expected later this year.

ATC spokeswoman Anne Spaltholz said the company is focusing on a string of potential Midwestern projects, in addition to possibly building a line to connect a Wyoming wind farm to California. ATC is also eyeing the formation of a separate transmission utility in Alaska.

More: Milwaukee Journal Sentinel

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More Pipelines for New England: ‘Gold-plating’ or Necessity?

By William Opalka

NORTH FALMOUTH, Mass. — It all comes back to pipelines.

Discussions about New England’s energy future invariably end up focused on the outsized role natural gas plays in the region’s power mix, and how that aligns or runs counter to various policy goals. Also debated is who should pay for pipeline build-outs.

A discussion at the 23rd Annual New England Energy Conference on Wednesday, presented by the Northeast Energy and Commerce Association and the Connecticut Power and Energy Society, was no different.

Most speakers agreed that some pipeline capacity is needed (though environmental groups, energy efficiency advocates and LNG suppliers dispute that premise).

The discussion came three weeks after the suspension of the Northeast Energy Direct pipeline and amid ongoing controversy over whether regulators should allow electric ratepayer support for the proposed Access Northeast project. (See Kinder Morgan Board Suspends Work on Northeast Energy Direct Pipeline.)

Dan Dolan - New England Energy Conference - Pipelines
Dolan © RTO Insider

Dan Dolan, president of the New England Power Generators Association, said new generation clearing in recent Forward Capacity Auctions show the market has responded to the region’s needs. Smaller gas infrastructure projects shows that contractual commitments from distribution customers are increasing supply without electric ratepayer support, he added.

“We look through any public policy proposal through the prism of subsidies. Given that rubric, no, we don’t support” Access Northeast, Dolan said. “As we see contracts, that [demonstrates what] should be built, but I don’t think we need to gold-plate the system.”

Serna © RTO Insider - New England Energy Conference - Pipelines
Serna © RTO Insider

Not so, according to Camilo Serna, vice president of strategic planning and policy for Eversource Energy, who disputed the subsidy characterization. “The alternative is that the [electric] customers will be paying more in the winter,” he said.

Eversource, which is a partner in Access Northeast, predicts consumer electricity costs will drop by $1 billion to $2 billion annually with increased natural gas supply.

“The market hasn’t been able to deliver that infrastructure. The generators don’t have the incentive to commit [to pipeline contracts]. I don’t think it’s gold-plating if you see that we really haven’t made any gas infrastructure investments for 20 years,” Serna said.

Rebecca Tepper - New England Energy Conference - Pipelines
Tepper © RTO Insider

Whether the investment falls on pipeline developers or electric ratepayers will be resolved for Massachusetts by the state’s Supreme Judicial Court. Arguments were held recently on an order by the state’s Department of Public Utilities allowing pipeline cost recovery. The order was challenged by Massachusetts Attorney General Maura Healey.

“We don’t think it’s legal. It’s not consistent with the [state] restructuring act, which was to take ratepayers out of the business of investing in large infrastructure projects and put the risk on private investors,” said Rebecca Tepper, deputy chief of the attorney general’s energy and environmental bureau.

Anne George - New England Energy Conference - Pipelines
George © RTO Insider

“We get very nervous about making big infrastructure decisions on the backs of ratepayers based on something that happened two winters ago when the circumstances today are entirely different,” she added.

Although ISO-NE is project-neutral, it says more pipeline capacity is necessary for stable and affordable electricity, as nearly half of New England’s supply comes from gas-fired generation, a share that is expected to increase.

“We still see natural gas as one of our primary challenges,” said Anne George, vice president, external affairs and communications for ISO-NE. “We see demand for it to continue to grow and we have not built any pipeline infrastructure to support that growth.”