DFAX: ‘Poison Pill’ or ‘Best Method’ of Cost Allocation?

By Suzanne Herel

WASHINGTON — Stakeholders from Maryland, Delaware and New York urged FERC last week to allocate the costs of the Artificial Island and Bergen-Linden Corridor transmission projects more broadly across PJM, while utilities in New Jersey and Pennsylvania called for continued use of the solution-based distribution factor (DFAX) method.

The two sides squared off at a Jan. 12 technical conference ordered by the commission, which said the use of the DFAX method for such projects might be unjust and unreasonable (EL15-95). (See FERC Questions Fairness of Artificial Island Cost Allocation.)

Two Questions

The forum focused on two questions: Is there a definable category of projects for which the DFAX cost allocation method might not be appropriate, and could a fair approach be developed prospectively for those occasions?

PJM Vice President of Planning Steve Herling told the commission staff that the RTO could devise an alternative to DFAX for certain fixes, but the scheme would be tricky to develop and wouldn’t be used very often.

PJM presented a matrix of project categories, showing that they could be defined as thermal violations, voltage/reactive, stability, short circuit, storm hardening, end of life/aging infrastructure or real-time operation concerns.

Since 2000, when PJM inaugurated its Regional Transmission Expansion Plan, there has been only one project each for the stability, short circuit and storm hardening categories. Artificial Island is the stability project; the Bergen-Linden Corridor is the short circuit project.

Regarding stability projects, Herling said, “I honestly don’t think we’re going to see many of those going forward. We might see one more next year and not another in 20 years.”

Solution-based DFAX works well for most of the project categories, Herling said, because in most cases those who caused the problem are the same ones who will benefit from it being repaired. The flow of electricity that the projects are designed to enhance can be measured. But flow is not the driver of stability or short circuit fixes.

“With stability and short circuit, that’s a trickier proposition,” Herling said.

Thirty years from now, for example, the stability benefits of the Artificial Island project probably won’t exist because one or more of the Hope Creek and Salem nuclear reactors might be retired.

“The point is that the initial benefit of solving the problem fades over time. So is there a way to calculate the benefits of solving the problem? There very well may be,” he said.

“The big benefit of going to DFAX is that you don’t have to divvy up all the problems and all the beneficiaries. You have one solution. Then you look at who’s using the fix. And that can be looked at year by year,” he said.

Status Quo

Testifying at the conference in favor of keeping the status quo for all projects were Frank Richardson of PPL and Takis Laios of Transource Energy, representing the PJM Transmission Owners, and Esam Khadr of Public Service Electric and Gas.

New Jersey’s Board of Public Utilities and Division of Rate Counsel also submitted comments recommending that the commission not distinguish among projects for cost allocation. “All projects to ensure the reliability of the bulk transmission system are related to flow,” the filing said.

It also noted that if the cost of the Artificial Island project is figured differently, it would allocate more costs to New Jersey ratepayers.

DFAX Unfair

Advocates for customers on the Delmarva Peninsula protested the DFAX methodology, which charged them the bulk of the Artificial Island fix.

Arguing that the DFAX method is inappropriate to be applied to projects unrelated to flow were Mayer Sasson of Consolidated Edison; Amy Fisher of Linden VFT; attorney Robert Weishaar, of McNees Wallace & Nurick, and John Farber of the Delaware Public Service Commission, representing Delaware and Maryland commissions and agencies; Jeff Wood of Hudson and Neptune Transmission; and Mark Ringhausen of Old Dominion Electric Cooperative.

Also objecting to the DFAX method in filed comments were the New York Power Authority and the Easton Utilities Commission.

“For non-overload projects, there is no rational relationship between flows and intended benefits,” Sasson said. “This makes the use of distribution factors as part of the DFAX analysis a ‘poison pill.’”

Short circuits, for example, are system disturbances, not the result of customer demand, he said, and the intended beneficiary is the transmission zone where the problem exists. The typical solution is to upgrade the breaker, not build a transmission line.

“The Bergen-Linden Corridor Project is intended to fix short circuits in PSE&G’s service territory. And as PJM recently informed its stakeholders, it remains necessary with or without the flow from Con Edison’s transmission contracts. Clearly, PSE&G is its intended beneficiary,” he said.

Laios, of the PJM TOs, argued that all projects involve flow.

“Why are circuit breakers there? They’re at a facility to carry flows. You could figure out who tripped it, but you’re back to a one-time violation calculation.”

He was referring to the violation-based DFAX method, a predecessor to the solution-based model, which went into effect in 2013.

Sasson said Con Ed is not proposing the violations-based method. “Our position is that, for non-overload projects, no DFAX analysis can apply because there is no rational or technical relationship between flows and intended beneficiaries.”

Ringhausen agreed. Representing 20% of the load in the Delmarva zone, ODEC stands to pick up a significant portion of the Artificial Island project cost. The primary component of the project is a 230-kV line that is not required to resolve any thermal or voltage reliability issues caused by load growth in the Delmarva zone, he said.

“The results of solution-based DFAX, then, do not signify any significant benefit to the Delmarva zone from the new line that could justify the proposed cost allocation.”

Allocation Based on Economic Benefits

“For a generator stability problem like Artificial Island, one potential alternative would be to allocate costs based on the relative proportion of economic benefits that result from a stability upgrade since a primary benefit of such a project is to increase the availability of a generator’s output to provide capacity and energy to the PJM region,” Ringhausen said.

PSE&G’s Khadr, however, pointed out that the project gives the Delmarva area, which has been subject to transmission constraint, another high capacity line. He also noted that about 30% of the zone’s generation is more than 40 years old and at high risk of retirement.

Laios cautioned creating “carve-outs” for certain projects.

“You’re inviting another driver where someone doesn’t like the cost allocation to argue they should be included in that carve-out,” he said. “Once you start a carve-out, where do you stop?”

PPL’s Richardson said that any attempt to categorize some reliability projects differently would be “fraught with problems.”

“Some results may look strange,” he conceded of the DFAX methodology. But, he said, “It is not arbitrary. It is defensible, and it is the best method that we have.”

Weishaar, counsel to the Delaware Public Service Commission, suggested that a cost allocation method based on economic benefits would be the best option to address stability issues.

“The process would be objective and neutral,” he said. “A narrow exception to the DFAX rule need not swallow the rule. It may be appropriate for the overwhelming number of projects.”

Ringhausen also backed an economic-based allocation.

“We would have PJM run their market efficiency models and allocate the cost based on that,” he said. “Solution-based DFAX is better for most, but for certain projects, it is not matching cost and beneficiaries appropriately.”

Laios objected to the idea of an economic solution.

“Why would you use economics for reliability projects?” he said. “If you did, wouldn’t you feel compelled to do it for all the projects? It’s still a one-time calculation. It’s not updateable each year.”

FERC staff said they would regroup to see if they had any more questions for the participants. Meanwhile, FERC on Thursday granted a rehearing for further consideration of PJM’s Tariff changes involving the cost allocations.

January 19, 2016

Reduced Reserve Margin Could Cut SPP Capacity Costs

By Tom Kleckner

OKLAHOMA CITY — Reducing SPP’s current 13.6% reserve margin to 12% could cut required capacity by about 1,000 MW, saving $86 million annually and $1.3 billion over 40 years, a task force told the Markets and Operations Policy Committee.

The Capacity Margin Task Force has been evaluating resource adequacy since SPP became a central balancing authority with the Integrated Marketplace’s implementation in 2014. The RTO’s capacity margin has been unchanged since 1998 despite an expanding footprint, operational changes and significant transmission expansion.

Task Force Chairman Tom Hestermann, manager of transmission policy for Sunflower Electric Power, said the group believes the reserve margin can be reduced without affecting reliability. He said stakeholders have been supportive of reserve margins as low as 12.5% but less so when the margin drops to 12% or less.

“The more reserves you require, the more it will cost,” he told members during a four-hour educational forum preceding the MOPC meeting. “We want a good balance between reserve margins and system reliability. If 12% is where we want to be, we have a good story to tell. We believe we can do this successfully.”

The savings would come from reduced generation investment made possible by transmission upgrades. Hestermann said lower margins could align with generation retirements due to the Clean Power Plan.

Hestermann noted resource adequacy is generally expressed in terms of capacity margin or reserve margin for planning purposes. Both are measured using the same numerator: the difference between available resources and net internal demand. SPP uses capacity margin, in which resources serve as the denominator. Reserve margin, used by NERC and other regions, uses net internal demand as the denominator.

Hestermann said the task force will recommend switching to reserve margin, where a 13.6% margin is equivalent to a 12% capacity margin.

“NERC doesn’t have a standard for planning reserves,” Hestermann said. “SPP enforces this requirement through the membership agreement.”

The task force ran “limbo studies” — “How low can you go?” Hestermann explained — that simulated four reserve margin levels for each of three years: 2016, 2017 and 2020. The analysis found SPP could maintain required loss-of-load expectations in every case except 2017, and then only when the reserve margin was set at 7.53%. (The study assumed additional transmission infrastructure.)

“The current criteria requires an assessment every two years to ensure 12% is adequate,” Hestermann said. “What we haven’t done before is see whether we can go lower than that and still maintain a reasonable level of reliability.”

The task force has completed a white paper defining load-responsible entities, which was approved by MOPC and the board last July and is currently being discussed within various task forces. Tariff revisions or changes to previously approved policy will be brought back to the MOPC for approval.

The group will present its reserve margin requirements and a deliverability study for MOPC approval in April. It also will present a planning reserve assurance policy, an enforcement mechanism using payments, not penalties, from LREs short on capacity to those who are long.

The task force also is still working on a distributed energy resource policy.

January 19, 2016

DOE Announces $220M for Grid Modernization

By Michael Brooks

RTOs and ISOs will take part in 15 research and development projects awarded almost $38 million in funding by the Energy Department last week.

U.S. Energy Secretary Ernest Moniz last week announced $220 million in funding as part of the Energy Department’s Grid Modernization Initiative, an effort by the Obama administration to integrate new technology into the country’s energy infrastructure.

The department awarded the funds over three years, subject to congressional appropriations, to its national laboratories. The labs will partner with grid operators, energy companies, universities and local government agencies on 88 projects, ranging from advanced storage systems to improving transformer resiliency, to accommodate increased transmission from renewable sources.

“Modernizing the U.S. electrical grid is essential to reducing carbon emissions, creating safeguards against attacks on our infrastructure and keeping the lights on,” Moniz said. “This public-private partnership … will help us further strengthen our ongoing efforts to improve our electrical infrastructure so that it is prepared to respond to the nation’s energy needs for decades to come.”

The projects are based in part on recommendations from last year’s Quadrennial Energy Review. (See Federal Energy Review Calls for Billions of Dollars in Spending on Infrastructure.)

“A modernized grid will enable two-way communication and data flows, allowing operators to better understand the grid’s immediate operating status,” said Franklin Orr, DOE undersecretary for science and energy. “By having this information, operators can run the grid closer to its full potential and capabilities, resulting in greater efficiencies and reliability.”

PJM in 8 Projects

PJM will take part in eight projects, followed by ERCOT with six, MISO with five and ISO-NE, NYISO and SPP with three each, according to the department. CAISO is participating in one project.

Grid-Modernization-Projects-Involving-RTOs-ISOs-(US-Dept-of-Energy)-web-slider — Click for detailed description of projects.

The eight projects in which PJM is participating were awarded about $25 million. One involves enhanced grid modeling; the others address transmission reliability, said Emanuel Bernabeu, manager of applied solutions.

Bernabeu called the modeling project “critical.”

“Our load changes rapidly. The composition is changing, and the way the customer behaves is also changing,” he said. “Our model needs to be able to capture that. Otherwise, when I run a [model], it may not match reality.”

The project, which will cost $2.7 million, will be developed at Argonne National Laboratory in partnership with Iowa State University, ERCOT, Commonwealth Edison and Alliant Energy, among others.

The other projects span a wide range of grid reliability. One aims to improve situational awareness in the control room. Another project, a $3 million effort across eight of the labs, aims to enhance the modeling of extreme events, including cold weather, hurricanes and geomagnetic disturbances. “Extreme weather is becoming more prevalent now,” Bernabeu said.

SPP, MISO Team on Seams Project

SPP and MISO will be the key players in an effort to evaluate the HVDC and AC transmission seams between the U.S. interconnections, according to SPP. The $1.2 million Midwest Interconnection Seams Study “will explore timely questions about aging infrastructure and enhance existing regional and interregional planning processes,” said Lanny Nickell, SPP vice president of engineering.

“It’s a long overdue study. SPP has been recommending such a study to investigate the interconnections between the eastern and western grids,” said Jay Caspary, director of research, development and special studies for SPP. The project will also involve the Energy Department’s Western Area Power Administration, the Solar Energy Industries Association, Minnesota Power and Xcel Energy. “No individual regional planner can do this on their own,” Caspary said.

“This important work will play a key role as MISO continues to ensure reliability now and in the future,” said Jennifer Curran, MISO vice president of system planning and seams coordination.

Some RTOs’ Roles Unclear

It is unclear to what degree each RTO and ISO will play in the projects.

ISO-NE said it is only acting as an adviser to the labs for certain projects. NYISO said that, though it is listed on the department’s website, it declined to partner with it on WindView, a $1.8 million visualization program that would display wind forecast information along with system power flows in order to better monitor how wind power affects the grid as the resource becomes more prevalent throughout the U.S.

Companies Involved

Also among those participating in the projects are:

Utilities (including Southern Co., Dominion Resources, Tennessee Valley Authority, Duke Energy, National Grid, Louisville Gas and Electric);
Equipment suppliers (Alstom Grid, GE-Alstom, United Technologies);
Research organizations and universities (Electric Power Research Institute, George Washington University, UNC-Charlotte, Clemson University, University of Vermont, Regulatory Assistance Project, New York State Energy Research and Development Authority);
Trade associations (American Public Power Association, National Rural Electric Cooperative Association).

Suzanne Herel, Tom Kleckner, Amanda Durish Cook and William Opalka contributed to this report.

January 19, 2016

Company Briefs

Thomas Klink has been named CFO of Pioneer Power Solutions, a Fort Lee, N.J., manufacturer of electric transmission, distribution and generation equipment. He takes the place of Andrew Minkow, who left to pursue other opportunities.

Klink was formerly president of Jefferson Electric, a Pioneer Power subsidiary in Franklin, Wis., that builds transformers.

“I plan to focus on our bank relationships, stringent financial controls throughout our organization and facilitating profitable growth by maintaining tight expense management processes already in place,” Klink said.

More: Pioneer Power Solutions

Dominion Virginia Earmarks $9.5 Billion in Improvements

Dominion Virginia Power says it will spend $9.5 billion in capital improvements through 2020, including $700 million in solar facilities. The company said it will spend $2.4 billion on its distribution system, $3.6 billion on transmission lines and substations and $3.5 billion on new generation.

That does not count what its parent company will spend on its share of the Atlantic Coast Pipeline, a $5 billion project it is working on with several other companies.

More: Reuters

Exelon Completes Uprate at Peach Bottom Plant

Exelon Nuclear announced it has completed its multiyear uprate of Peach Bottom Atomic Power Station Unit 3, which boosts the capacity of the Pennsylvania reactor to 1,355 MW from 1,180 MW.

The company replaced high-pressure turbines, feed pump turbines, condensate pumps and motors and steam dryers. Its low-pressure turbines had already been upgraded. Peach Bottom Site Vice President Mike Massaro said that as part of the uprate “almost every major component in the plant has been upgraded or replaced, which makes Peach Bottom an even safer and more efficient facility.”

Peach Bottom is on the banks of the Susquehanna River near Delta, Pa., upstream from Exelon Generation’s Conowingo Hydroelectric Power Station.

More: Exelon

Battery Maker Files to Join PJM

Battery maker Axion Power International has filed an interconnection application with PJM for a site in Sharon, Pa., where it seeks to develop a 12.5-MW energy storage system.

The project will be located in a former steel fabrication facility about 60 miles north of Pittsburgh.

Axion plans to use the system to participate in PJM’s frequency regulation market. Start-up is expected in mid-2017, pending regulatory approval.

More: Axion Power International

Akins was ‘Skeptical’ About Sierra Club Partnership

News that American Electric Power forged a settlement with the Sierra Club while lobbying for its proposed power purchase agreement in Ohio struck many as an unlikely alliance, including Nick Atkins, AEP’s chief executive.

“I have to admit, initially I was skeptical of ultimately what the value would be,” he told Columbus Business First. “But in retrospect the fact that it’s much of a national story that AEP, a major coal-fired utility, could come together with Sierra Club on a common solution — I don’t know of anybody that’s done that in this position.”

The Sierra Club signed on to the proposed agreement, which would allow AEP to gain guaranteed income for some of its generating facilities for eight years, after the company committed to developing 900 MW of renewable energy in Ohio. The settlement still must be approved by the Public Utilities Commission of Ohio.

More: Columbus Business First

Exelon Generation’s Muddy Run Gets OK for Another 40 Years

FERC has given Exelon Generation’s Muddy Run Pumped Storage Facility on the banks of the Susquehanna River a 40-year license extension after the company promised a number of improvements to the site for recreation and to permit passage for American shad and American eels.

The company has committed to implement a shoreline management plan to control erosion and to manage debris. It also said it will implement improvements to allow eels to be trapped and transported upriver, to make conservation efforts for bald eagles, ospreys and bog turtles and to remove some small dams along its property.

More: Lancaster Online

Westar Adds 200 MW of Additional Wind Energy

Westar Energy has reached an agreement with an affiliate of NextEra Energy Resources to purchase another 200 MW of Kansas wind energy.

The utility will purchase power produced from the Kingman Wind Energy Center west of Wichita when the facility goes into service in early 2017. As part of the transaction, Westar will be given the option to purchase one-half of the facility before “substantial completion.” The wind farm is expected to bring more than $400 million in investments and payments to the area.

With this addition, Westar’s wind generation will surpass 1,700 MW.

More: Westar Energy

Arkansas Cooperatives File for SPP Membership Change

The Arkansas Electric Cooperative Corp. has filed with the state’s Public Service Commission to change its SPP membership status from a non-transmission-owning member to transmission-owning member.

AECC said in its Jan. 13 filing that it seeks the commission’s approval “to transfer control of current and future eligible transmission facilities to SPP as a means to modify its current non-transmission owning membership to transmission owning membership.” AECC said it will continue to “own, operate and be responsible for maintaining any transmission facilities under SPP’s control,” but that SPP will direct the day-to-day operation of the transmission facilities.

The Little Rock alliance of cooperatives requested a final order by June 1 and anticipates $1.3 million in revenue from use of its eligible facilities.

More: Docket 16-002-U

Tree Clearing, Squirrel Guards Help Prevent PPL Outages

PPL Electric Utilities says its grid improvement projects prevented power outages for 410,000 customers last year.

It credited tree clearing, its smart grid system and the installation of more animal guards to keep squirrels from damaging lines.

Customers are experiencing 30% fewer outages than in 2007, the company said.

More: PPL

Apex Seeks to Build Tenn.’s Largest Wind Farm

Apex Clean Energy is expecting to develop Tennessee’s largest wind farm, to be located in Cumberland County.

The $100 million project will involve erecting 20 to 23 wind turbines that will produce 71 MW annually. It’s scheduled to be in operation by the end of next year.

Apex, of Charlottesville, Va., also operates the Volunteer Wind farm in Gibson County.

More: Crossville Chronicle

FirstEnergy’s Perry Nuclear Gets New Site Vice President

David B. Hamilton has been named site vice president at FirstEnergy’s Perry Nuclear Power Plant in Perry, Ohio, replacing Ernie Harkness, who is retiring. Frank Payne will move into Hamilton’s previous position of general plant manager.

Hamilton has more than 23 years of experience in nuclear operations, coming to FirstEnergy Nuclear in 2012 from Entergy’s Waterford Plant in Louisiana. Before that he was at Entergy’s Palisades nuclear station in Michigan. He also held positions at various Exelon Nuclear stations.

Payne came to FirstEnergy from Duke Energy, where he held a number of positions at the Brunswick Nuclear Power Plant in Southport, N.C.

More: FirstEnergy

Duke’s Asheville Plant Hearing Will Go Ahead as Planned

North Carolina regulators turned down a request to delay a hearing for Duke Energy’s plan to replace a coal-fired plant near Asheville with two 280-MW natural gas-fired plants. Duke’s plan, which it proposed in response to opposition to an alternative to build a two-state transmission line, was fast-tracked by the state legislature last year.

Opponents to the plan, including environmental group NC WARN, had sought to delay the hearing on the plant in order to have an evidentiary hearing on the overall plan. The commission ruled Friday that to delay its January hearing would “frustrate and contravene the specific intent” of the legislature. NC WARN has said the new plants are not needed.

More: Charlotte Observer

Duke, Piedmont Gas File for NCUC Approval

Duke Energy and Piedmont Natural Gas on Friday formally sought approval from the North Carolina Utilities Commission for Duke’s acquisition of the gas company. The companies also filed with the Tennessee Regulatory Authority for approval of change of control of the gas company.

Duke asked the commission for accelerated approval of its plan to raise $4.5 billion to finance the $4.9 billion acquisition. As part of the deal announced late last year, Duke will assume $2 billion in Piedmont debt. If approved, Duke will become the largest investor-owned utility in the U.S.

More: Duke; Charlotte Business Journal

January 19, 2016

MISO Reliability Subcommittee Briefs

MISO Consulting Advisor Terry Bilke said MISO is ready for NERC’s new frequency response reliability standard.

“We’re good right now, and we don’t see anything on the horizon that would decline our performance,” Bilke told the Reliability Subcommittee on Wednesday.

The RTO reported that 18 governor scorecards were completed and returned by utilities as of early January, and scorecards covering Sept. 1, 2015, to Dec. 31, 2015, were sent out to local balancing authorities in preparation for the rule’s April 1 effective date (BAL-003-1).

The rule requires balancing authorities to meet an annual frequency response measure (FRM) “equal to or more negative” than its frequency response obligation. The FRM is the median of frequency response performances for 20 to 35 frequency events chosen throughout the year by NERC’s Frequency Working Group.

The frequency response obligation under MISO’s field trial is ‐211 MW/0.1 Hz. MISO’s median performance from September to November was estimated at -362 MW/0.1 Hz. Those 2015 results will be submitted to NERC by March 7.

MISO said it plans to continue to “work with local balancing authorities and generators to boost governor response where appropriate.”

Bilke said if MISO was found noncompliant by NERC, MISO would have to search generator by generator until it located the source of the noncompliance. “NERC has wide latitude in what penalties they can assess,” he said in response to questions on what consequences would result from non-compliance. “We can’t predict what would happen. It would depend on how bad, how non-compliant, how receptive the parties are to making it right.”

Bilke said the fines could be as much as $1 million per day, but he said there are several options MISO can make use of before it comes to penalties. “There are ways to adjust if we see problems on the horizon.”

“I’d like frequency response to be a formal issue of the Reliability Committee. For the future, especially in light of folks concerned over the Clean Power Plan, I think this should be a formal issue,” Reliability Subcommittee Chair Tony Jankowski said.

Preparation for the rule’s deadline continues with MISO’s next governor collaboration call taking place Jan. 22.

MISO: November and December ‘Uneventful’

Senior Real Time Operations Engineer Steve Swan reviewed what he called “two relatively uneventful months” in the November and December operations updates. Swan said there weren’t any areas of concern. November’s load averaged 68.9 GW, about even with October’s load, and 6.6 GW lower than November 2014. During December, load peaked at 87.1 GW on Dec. 17, down from December 2014’s peak of 93.1 GW.

In both November and December, real-time unit commitment performance was rated “excellent” on a daily basis. Real-time unit commitment performance at peak hours was also consistently rated excellent, with the lone exception of Nov. 23, when it was given a “good” rating. December, however, achieved near-perfect ratings every day of the month.

“This is the report through December you hope to expect,” Swan said.

Neither November nor December had any capacity shortages or any periods of load so light that generators had to operate at emergency minimum levels. During the two months, there also weren’t any reliability issues. Swan said generator maintenance was on the rise in October and planned generator outages remained high during November before tapering off in December as maintenance season drew to a close.

MISO said during December, day-ahead and real-time LMPs were at their lowest levels since January 2009, when the ancillary services market was launched. The RTO credited the dip to reduced congestion.

— Amanda Durish Cook

January 19, 2016

ERCOT Energy Use up 2.2% in 2015; Wind Surpasses Nuclear

ERCOT reported a 2.2% increase in energy usage within its region of Texas in 2015, fueled by a record-breaking summer that brought a new peak demand record approaching 70,000 MW.

The Texas grid operator released a report Jan. 15 that indicated the system consumed 347,522,945 MWh of electricity last year, nearly 7.5 million MWh more than in 2014.

According to ERCOT’s 2015 Demand and Energy Report, wind accounted for 11.7% of the grid’s energy consumption, surpassing nuclear (11.3%) as a generating source for the first time. In 2010, the nuclear and wind numbers stood at 13.1% and 7.8%, respectively.

Natural gas remains the primary fuel at 48.3% — a 17.5% increase over its 2014 share — with coal supplying 28.1%.

ERCOT’s system set a series of peak demand records in August during the region’s hottest summer since 2011. By summer’s end, the system had topped 67,000 MW of demand for the first time in four years, eventually setting a new peak demand of 69,877 MW and recording its five highest peak demands:

10: 69,877 MW
11: 69,775 MW
6: 68,979 MW
7: 68,731 MW
5: 68,683 MW

ERCOT also set new records for monthly energy use (36,975,136 MWh in July), July peak demand (67,650 MW) and weekend peak demand (66,587 MW on Aug. 8).

ERCOT manages about 90% of Texas’ electric load, representing 24 million customers. It estimates 1 MW serves about 200 homes during summer peak demand and about 500 homes during milder weather conditions.

— Tom Kleckner

January 19, 2016

State Briefs

State Auditor Doubts Energy Efficiency Initiative

State Auditor Tom Wagner says an energy efficiency project involving state buildings in the capital would cost taxpayers $8 million over 20 years but yield energy savings of only $2.7 million. “The possibility of the state breaking even on this agreement is looking bleak,” he said.

The project to upgrade the Legislative Mall buildings in Dover is part of a broader $67.4 million conservation effort undertaken by the Sustainable Energy Utility, a quasi-public agency established in 2007 to reduce energy consumption.

Tony DePrima, the SEU’s executive director, said the auditor’s report was unfounded. “These are fairly complex energy efficiency projects,” he said. “I don’t think they understand the protocols or standards being used, especially since they didn’t consult with any experts in the field of energy engineering.”

More: The News Journal

INDIANA

Activists Concerned Utilities Connecting Wind Tx Line to Coal Plants

Environmentalists are concerned that two proposed transmission lines that Northern Indiana Public Service Co. is touting to deliver wind power will actually be used to transmit excess electricity from coal-fired plants.

Kerwin Olson, executive director of Indianapolis’ Citizens Action Coalition, said the lines could connect to several coal-fired generators belonging to Duke Energy and American Electric Power. Duke Energy and AEP jointly own Pioneer Energy, which is a partner with NIPSCO on the 65-mile project.

“We have utility companies who are continuing to invest billions of dollars in aging coal plants that really should be retired and replaced with clean energy, so Indiana isn’t doing so well,” Olson said. “We seem to be doing everything in our power to maintain our addiction to coal.”

More: Public News Service

IOWA

Rock Island Clean Line Process Request Turned Down Again

State regulators again turned down Clean Line Energy Partners’ request to consider the necessity of its transmission line proposal without requiring it to first acquire the rights of way for the power line. Clean Line said it may not proceed with the Rock Island Clean Line project if the Utilities Board continues to require full right-of-way approval before the project’s route or need are determined.

The IUB on Monday rejected Clean Line’s third request to separate the proceedings, saying both state law and board regulations call for a single proceeding to determine all those issues.

More: Midwest Energy News

MICHIGAN

Lawmaker to Concentrate on Energy Laws in 2016

Senate Majority Leader Arlan Meekhof, in his first year leading the Republican-dominated chamber, said that making the state’s electricity markets more competitive is a priority in 2016.

Meekhof said lawmakers are considering whether to allow competitive bidding for new electric generation to reduce reliance on the state’s two dominant electric utilities, DTE Energy and Consumers Energy. He said the process could encourage independent power producers to propose alternatives to replace retiring coal generators.

“Some of the discussion around it is it can’t just be the big two,” he said. “There may be other people who have smaller generating things that might be able to add on at a relatively inexpensive cost and then generate more energy and incrementally bring up the amount of energy we need as the demand is there — as opposed to building [a] 500-, 600-, 700-MW plant one time.”

More: The Associated Press

Consumers Extends Biomass Plant’s Power Purchase Agreement

Consumers Energy has extended a power purchase agreement with Hillman Power’s 20-MW wood-burning plant for another 17 months.

The agreement’s termination now coincides with the Public Service Commission’s timeframe to review federal laws that oversee contracts between regulated utilities and smaller, renewable electricity generators.

The power plant, which is owned by Fortistar, said the contract extension saved about 100 direct and indirect jobs. The power plant employs about 20 people and spends about $3.5 million a year to buy local wood.

More: WBKB 11

MINNESOTA

Scandia to Build 5-MW Community Solar Garden

The city of Scandia, population 3,936, is embracing a $12.5 million community solar garden that private investors are building on a former 59-acre gravel pit. Scandia Mayor Randall Simonson said he wants the facility to be a showcase for other communities.

“It shows people as soon as they cross the border into Scandia, ‘Hey, look at what they’ve got here,’” Simonson said.

SolarStone Partners is slated to begin construction of the 5-MW project this spring. Subscribers will receive credits to lower their Xcel Energy bills.

More: Pioneer Press

Judge Advances Great Northern Line Route

An administrative law judge has sanctioned most of the route on Minnesota Power’s proposed 220-mile Great Northern Transmission Line, which would import power from Manitoba Hydro.

Judge Ann O’Reilly concluded that the 500-kV line’s route largely satisfied permit criteria, except for a segment in Itasca County.

The Public Utilities Commission is expected to vote on the project in March. The U.S. Department of Energy would then decide whether to grant Minnesota Power a permit to build the line. Minnesota Power says the line will cost up to $710 million.

More: Grand Forks Herald

MONTANA

Regulatory Panel Averts Shutdown of Coal Mine

A deal to keep an underground coal mine running includes a confidential secret side agreement between the owner and an environmental group that had argued state officials failed to properly examine the long-term groundwater impacts of expanding the mine.

The Board of Environmental Review on Jan. 12 approved the agreement between Signal Peak Energy, the Montana Environmental Information Center and the state Department of Environmental Quality. The deal gives the DEQ six months to revise its environmental analysis to correct problems the board found when the agency previously approved the expansion of Bull Mountain Mine.

The agreement includes a paragraph that says the Montana Environmental Information Center and Signal Peak reached a separate, confidential agreement that includes other “material terms.” Neither the mine owner nor the environmental group said they could discuss the terms of their truce.

More: The Associated Press

NEW HAMPSHIRE

Site Evaluation Committee Hearings on Northern Pass Begin

The Site Evaluation Committee held its first county hearing on the controversial Northern Pass transmission line project. The session was held in Franklin, whose mayor has enthusiastically embraced the $1.6 billion project that would deliver Canadian hydropower to New England.

A crowd of 250 people heard project representatives say Northern Pass is the best alternative to bring energy into New England. They said a substation in Franklin would pay about $7 million annually in property taxes. The money would be used to improve city services, Mayor Ken Merrifield said.

Several in the audience wore orange “Trees Not Towers” shirts in opposition to the project and applauded questioners who said the visual impact of the project could not be justified.

More: New Hampshire Union Leader

NEW YORK

Hydro Plant Proposed on Canal near Albany

A new 10-MW hydroelectric power plant is being proposed for Lock C1 on the Champlain Canal in Waterford, north of Albany.

Albany Engineering has filed for a preliminary permit with FERC for the new facility, which could also be reduced in size to produce 4 MW.

The firm has designed or rebuilt many of the hydro power plants upstate, but it did not disclose the identity of its latest client.

More: Times Union

Plan Could Offset Tax Revenue Loss

Gov. Andrew Cuomo has proposed creating a $19 million fund to help local communities cope with the loss of property taxes after the closure of the coal-fired Huntley power plant. Cuomo has pledged the closure all coal generation in the state by 2020.

The Town of Tonawanda and Ken-Ton School District will lose $5 million in annual revenue after the plant closes in March. “Based on what I’ve heard and what I’ve read, it looks like we’re going to be eligible for that pot of money and we’re going to be aggressively seeking it,” Town Supervisor Joseph H. Emminger said.

The Just Transition Coalition, composed of the Clean Air Coalition, labor unions and teachers associations, has been lobbying to secure money to make up the expected loss of revenue for the town on the Niagara River, north of Buffalo.

More: Buffalo News

NORTH DAKOTA

Commissioner Withdraws from Dakota Access Pipeline Process

One of three members of the Public Service Commission has recused himself from voting on a proposed pipeline that would transport crude oil from the state’s Bakken Formation to out-of-state markets.

Commissioner Randy Christmann said that the Dakota Access Pipeline’s revised proposed route would cut across the property of his mother-in-law, who is currently negotiating an easement. The remaining two members of the commission are expected to vote on the matter Jan. 20.

The 1,134-mile pipeline would deliver 450,000 barrels of crude oil per day from the state to Patoka, Ill. Dakota Access has negotiated voluntary easements for 95% of its state route.

More: Forum News Service

OHIO

Duke Customers Entitled to Payout Under Class Action Suit

About a million customers of Duke Energy in the state have until April 13 to file a claim to be included in an $81 million class-action settlement, which resolved claims that the utility illegally paid rebates to large commercial and industrial customers at the expense of smaller customers.

Plaintiffs in the federal case alleged that Duke paid rebates from 2005 to 2008 to large customers including General Electric, Procter & Gamble and AK Steel in violation of antitrust laws. Duke, while denying wrongdoing, agreed to settle the suit.

Under the settlement, residential customers could receive from $40 to $400 each, while commercial customers could be entitled to as much as $6,000. About $8 million of the settlement will be set aside to improve energy efficiency programs. A federal judge in Columbus is expected to give final approval in April.

More: The Cincinnati Enquirer

OKLAHOMA

Regulators Order Wastewater Injection Reduction in Wake of Earthquakes

The Corporation Commission has ordered the operators of 27 wastewater disposal wells to reduce wastewater injections after a swarm of earthquakes unsettled residents northwest of Oklahoma City.

The order comes about a week after a series of earthquakes jarred the Fairview region. None of the recent temblors caused damage or injuries, but commission members are listening to experts who have drawn a connection between wastewater injections and the increase in the seismic activity.

The Oklahoma Geological Survey has said it is “very likely” the quakes are being triggered by the injection of wastewater produced from oil and gas wells, which has increased dramatically in volume because of the growth of shale drilling.

More: The Associated Press

Asst. AG Criticizes PSO’s Smart Meter Opt-Out Plan

The attorney general’s office has taken issue with a plan by Public Service Company of Oklahoma to charge customers who decline to allow a smart meter to be installed.

Assistant Attorney General Dara Derryberry criticized an administrative law judge’s report favoring the opt-out charges. PSO wants to charge a one-time fee of $183 and a monthly charge of $28 to customers who opt out of its smart meter program. The utility says that it will need to manually read the meters of customers who decline the wireless devices.

Derryberry said the proposed fees were excessive when compared to opt-out fees in 11 other states and in a recent proposal by Oklahoma Gas and Electric. Derryberry said the Corporation Commission should defer a decision on opt-out fees until PSO finishes installing the devices in September.

More: The Oklahoman

PENNSYLVANIA

PUC Plans Hearing to Study Alternative Ratemaking Methods

The Public Utility Commission will hold a hearing March 3 focused on alternative ratemaking methods for the state’s natural gas and electric utilities.

The hearing is part of the commission’s effort to promote energy efficiency and conservation programs.

Forum topics will include revenue decoupling and whether such rate mechanisms are fair to consumers.

More: Natural Gas Intel

RHODE ISLAND

Plant’s Climate Impacts Review to Come

State regulators have rebuffed an attempt by the Conservation Law Foundation to stall Invenergy’s application for its 1,000-MW Clear River Energy Center because of the proposed gas-fired power plant’s climate impacts.

CLF had argued the application was incomplete because it failed to fully outline the projected climate effects of the plant under the Resilient Rhode Island Act, a 2014 law that calls for a reduction in greenhouse gas emissions. The Energy Facility Siting Board agreed on the importance of the act, but it ruled that more information on emissions could be submitted later.

Invenergy estimates the new plant would reduce emissions across New England by about 1% because the power plant would displace older fossil fuel-fired power generators.

More: Providence Journal

SOUTH DAKOTA

Environmental Agency Plans CPP Extension Request with EPA

The Department of Environment and Natural Resources is taking a two-pronged approach as it prepares to respond to EPA’s Clean Power Plan, which seeks to reduce carbon emissions from power plants.

The DENR is participating in a lawsuit with 24 states opposing the CPP. At the same time, it plans to develop a state compliance proposal, should the lawsuit fail. The department will seek public input in the coming months, request a two-year extension from EPA by the Sept. 6 deadline and then finalize a state CPP for submittal to EPA by Sept. 6, 2018.

More: Butte County Post

TEXAS

PUC Urged to Reject Oncor Sale on Ratepayer Concerns

The chief executive of Oncor told state regulators last week that the plan to sell the company out of bankruptcy to Dallas billionaire Ray L. Hunt is not in the public interest.

Oncor CEO Bob Shapard’s testimony adds to a chorus of concerns raised by consumer advocates who asked the Public Utility Commission to reject the sale, arguing it will enrich Hunt and his group of private investors at the expense of ratepayers.

The sale of Oncor, the transmission arm of Energy Future Holdings, is the linchpin in the parent company’s plan to emerge from bankruptcy proceedings and reduce $42 billion in debt. The sale to Hunt Consolidated needs the blessing of utility commissioners, who are not expected to decide before March.

More: The Dallas Morning News

VIRGINIA

State Board Approves Dominion Coal Ash Drainage Plan

The state Water Control Board has approved a plan allowing Dominion Virginia Power to start draining its coal ash ponds into the James and Potomac rivers, overriding vocal opposition from citizen and environmental groups.

Dominion, in its application, said its plans to drain the coal ash ponds at the Bremo Power Station on the James River and the Possum Point Power Station on the Potomac River met all state and federal laws, including a rule last year setting new discharge limits on power plants. “This approach complies with all current federal and state regulations, including the newly promulgated EPA rule,” said Cathy Taylor, Dominion’s director of electric environmental services.

The James River Association and the Southern Environmental Law Center had filed opposition to the plans. The water board’s final hearing was attended by more than 100 opponents.

More: Capital News Service

WISCONSIN

Assembly Passes Measure to End Nuclear Moratorium

The State Assembly last week voted to lift a moratorium on developing nuclear generation, sending the bill to the State Senate for consideration. The Republican-backed bill would lift a state law blocking new nuclear generation without the formation of a national repository for nuclear waste.

The measure also does away with a requirement that any new nuclear plant would not burden ratepayers. Democrats in the Republican-controlled Assembly voted against the measure.

The state is home to a single nuclear generating station, Point Beach, owned and operated by NextEra Energy Resources. The Kewaunee Power Station, another nuclear station in the state, was retired by Dominion Resources in 2013.

More: The Associated Press

January 19, 2016

OMS IDs Capacity, DR, Cost Allocation as Key 2016 Issues

By Amanda Durish Cook

The Organization of MISO States board approved its 2016 Strategic Initiative on Thursday, calling for the RTO to focus on issues including resource adequacy, capacity, demand response and cost allocations under the settlement of the SPP transmission dispute.

“There were several different focus areas,” said OMS President Sally Talberg, of the Michigan Public Service Commission.

At the request of Minnesota Public Utilities Commissioner Nancy Lange, the strategy document was amended to include mention of MISO’s stakeholder redesign.

The board also discussed MISO’s queue reform. (See MISO Unveils Queue Reform Transition as Wind Advocates Seek Delay.) Lange said MISO contacted Minnesota officials to solicit feedback on the changes. Minnesota has “bumped up against queue restraints in the past,” Lange said, adding that the reform will be a welcome change.

Comments on MISO’s queue reform filing are due to FERC on Jan. 28. OMS Executive Director Tanya Paslawski said the group is determining if and what’s appropriate to file.

Members also discussed FERC’s Dec. 31 ruling ordering MISO to change the way it conducts capacity auctions. (See FERC Orders MISO to Change Auction Rules.) Several regulators said they’d like to see changes to the auction rules.

“We don’t have the jurisdictional authority to say, ‘MISO you must do this.’ That’s up to FERC, but at the end of the day, MISO knows that as a state, we’re very discontented right now,” Illinois Commerce Commissioner Sherina Maye Edwards said. “We can address these Zone 4 issues without negatively impacting other states.”

Talberg said Michigan is also following the capacity auction issue closely. “We’re a kind of a fish-out-of-water state in that we are a hybrid state,” she said. Michigan caps retail choice at 10% of each utility’s retail sales.

January 12, 2016

PJM Operating Committee Briefs

PJM will implement a new process for ensuring compliance with training and certification requirements effective Feb. 1.

The Operating Committee unanimously approved changes to Manual 40 to enable the new process, which stems from an August problem statement to improve compliance by generation dispatchers, demand response providers and energy storage device operators. (See “PJM Moves to Tighten Training, Certification Requirements” in PJM Operating Committee Briefs.)

The process requires that operators or dispatchers that are not in compliance be removed from their shifts.

PJM will calculate compliance scores based on a count of operators and months out of compliance. A score of 5 will trigger a violation notice from PJM’s legal department, which will be sent to the company’s Members Committee representative as well as its compliance contact. (A company with one operator out of compliance for two months and a second operator in violation for three months would score a 5.)

Companies that fail to correct scores of 5 or higher within 30 days could be reported to FERC as a violation of the PJM Operating Agreement and Tariff.

“By putting in a requirement to remove a noncompliant operator from their shift, that essentially puts the company back in compliance,” said PJM’s Glen Boyle. “That’s what we would hope would come out of this. We don’t want to go the FERC route.”

The changes will go before the Markets and Reliability Committee on Jan. 28.

PJM Met ACE, Load Forecast Error Goals in 2015

PJM achieved a perfect dispatch score of 86.64% in 2015, beating its goal of 86.62%, officials told OC members.

Perfect dispatch, designed to measure how well PJM commits combustion turbines, is the hypothetical least production cost commitment and dispatch — what PJM would spend if it knew and could control all system conditions (load forecast, unit availability, unit performance, interchange and transmission outages) in advance.

The score is calculated by dividing the optimal CT production cost by the actual real-time CT production cost. The average RTO load forecast error for December was 2.31%, and it remained below the 3% goal throughout the year, said Chantal Hendrzak, executive director of operations support.

There were, however, five days that exceeded the average — two when the weather was warmer than expected, one when temperatures were colder and two days around the holidays, including Dec. 26.

“We always have some trouble with the holidays — what day of the week it is, what the weather is and what history we have,” she said.

PJM’s balance authority area control error (ACE) performance exceeded the accuracy goal of 99% for each month in 2015.

The average forced outage rate for the year was 4.65% (8,484 MW). The average total outage rate was 15.99% (29,186 MW).

All Hot, Cold Weather Action Items Closed out

PJM has completed all 115 hot and cold weather action items, Director of Operations Planning Dave Souder told the OC.

Since the last update in June, PJM closed out three cold weather action items related to Capacity Performance, regulation market rules and gas infrastructure future adequacy.

On the hot weather side, it completed issues involving synchronized reserves, cascading outage analysis procedure, facility limits, the emergency procedure tool and system modeling.

PJM’s Dave Schweizer reported that mild weather in December limited generator cold weather testing, so the exercise was continued into January.

PJM Strategy Would Guide Expansion of PMUs

PJM is developing an RTO-wide strategy for the placement of phasor measurement units (PMU) as their deployment expands on the grid. The strategy aims to address monitoring gaps and provide redundancy.

PJM, which has about 386 PMUs located at 123 transmission substations, is targeting additional installations at 60 substations.

In July 2013, members approved Tariff revisions requiring the installation of PMUs at new generation units of 100 MW and larger. The first generator PMU installation is expected early this year.

— Suzanne Herel

January 12, 2016

State Briefs

Ponseti, Kormos Named to EIPC Committee

The Eastern Interconnection Planning Collaborative has announced the appointment of Tim Ponseti as chairman of the executive committee for 2016 and Mike Kormos as vice chairman.

Ponseti is vice president of transmission operations and power supply for the Tennessee Valley Authority. Kormos is executive vice president and chief operations officer for PJM. Ponseti takes the place of Steve Whitley, former president and CEO of NYISO.

The EIPC was formed by Eastern Interconnection planning authorities to perform interconnection-wide transmission analysis.

More: Eastern Interconnection Planning Collaborative

COLORADO

PUC Affirms Decision on Boulder’s Municipal Plans

The Public Utilities Commission on Wednesday affirmed an earlier decision that rejected the City of Boulder’s application to municipalize Xcel Energy facilities that exclusively serve customers outside city limits, saying the commissioners won’t force the utility to share facilities with the city.

The commission in November partially dismissed an application from Boulder to acquire facilities to create a city-owned utility, including substations and distribution infrastructure outside the city’s boundary. But the commission also will allow Boulder to engage in discovery and permit it to amend its original application after it learns more about Xcel’s system.

City engineers anticipate receiving data needed from Xcel in order to formulate an interconnection plan that works for Boulder customers and those who will remain with Xcel. Boulder is targeting a December 2017 start date for a city-owned utility.

More: Daily Camera

INDIANA

NIPSCO Directed to Resubmit Energy Efficiency Plan

Consumer advocates responded positively to the Utility Regulatory Commission’s order requiring Northern Indiana Public Service Co. to resubmit its overall energy efficiency plan after deciding the utility’s filing did not include adequate goals. The commission ordered the resubmittal by 2017.

The commission’s order was viewed as the first test of Gov. Mike Pence’s 2015 energy efficiency law, which replaced a more aggressive statewide energy efficiency program that the General Assembly killed in 2014. The state law does not place a time limit on surcharges that utilities can impose to recover revenue lost due to greater efficiency efforts, but the commission’s order on NIPSCO imposed a four-year cap on cost recovery.

“This is a big win for ratepayers,” Kerwin Olson, executive director at Citizens Action Coalition, told The Times of Northwest Indiana. “We will see a continuation of efficiency programs from NIPSCO but also caps on how much NIPSCO can collect from ratepayers.”

More: The Times of Northwest Indiana

MAINE

Low Prices Forcing Biomass Plants to Shut Down

Low power prices are forcing two biomass plants to suspend operations in March, raising concerns in the state’s logging industry.

The Professional Logging Contractors of Maine on Thursday said the move will affect up to 2,500 jobs. The two plants buy wood waste from logging operations.

Covanta Holding Corp., the plants’ operator, said this has happened before and operations have resumed when the economy has improved. The Covanta plants are two of six biomass plants in the state. Biomass accounts for 60% of the state’s renewable energy portfolio and 27% of its electricity generation, according to the U.S. Energy Information Administration.

More: Portland Press Herald

MICHIGAN

Consumers Gets OK for New Gas Compressor Station

Local officials in Huron County have approved construction of Consumers Energy’s proposed $9 million natural gas compressor station, which the utility says would improve reliability of its gas distribution system.

The County Planning Commission approved site plans for the 1,900-square-foot compressor building, which will be situated on three acres in the town of Sebewaing. Consumers, which supplies gas and electricity service across most of the state, said the compressor station is expected to only run about two weeks per year, as needed.

More: Huron Daily Tribune

NEW HAMPSHIRE

Radio Station Fined $540,000 for Ads

The Federal Communications Commission has reached a $540,000 settlement with Cumulus Media, the former owner of a radio station that in 2011 broadcast 178 ads supporting the Northern Pass transmission project without identifying the ad’s sponsor — Northern Pass Transmission.

FCC says its settlement is the largest ever involving a single station for violating sponsor identification laws. “Radio and television stations that are paid to air any announcements or other content are required to clearly disclose the payer’s identity,” FCC Enforcement Bureau Chief Travis LeBlanc said.

The Northern Pass is a proposed 192-mile transmission line that would deliver 1,090 MW of Canadian hydropower to New England. About 60 miles of the line would be buried to reduce its visual impact.

More: New Hampshire Union Leader

Bills Filed in Legislature Against Northeast Energy Direct

At least 10 bills have been filed in the state legislature to impede Kinder Morgan’s proposal to build its Northeast Energy Direct gas pipeline across the state’s southern tier.

One bill would prohibit charging residents for the construction of high-pressure gas pipelines, taking direct aim at the Public Utilities Commission, whose staff said it would be legal for utilities to recover their costs from electricity customers. Several bills, anticipating that FERC will approve the project, would allow property owners to require the pipeline company to purchase their entire property, not just a pipeline easement. Another bill would require pipeline companies to pay 300% of fair market value.

Other bills would give a community the right to regulate noise levels for compressor stations, require a royalty on income from gas exported to another country paid to landowners along the pipeline route and mandate owners of gas transmission pipelines to maintain insurance against damages.

More: New Hampshire Union Leader

NEW JERSEY

State Best Poised to Produce Offshore Wind Energy

The state has the highest potential to develop offshore wind energy of any Northeastern state, according to a report by the Environment New Jersey Research Policy Center.

The study was released as the Legislature prepares to vote on an experimental wind farm off the coast of Atlantic City.

The environmental group, which supports the project, says the ability to generate as much as 1,700 MW in wind power could be realized within five years if the state moves quickly.

More: Associated Press

NEW YORK

Smart Meters Coming to Long Island Businesses

PSEG Long Island will roll out a scaled-back smart meter plan aimed mostly at large commercial and solar customers after its initial plan to install 180,000 devices was shelved last year by state regulators.

PSEG’s plan, part of a broader grid-modernizing initiative called Utility 2.0, calls for building a wireless communication system to collect the smart meter data. PSEG also will deploy smart meters for all new solar energy installations for net metering and for some residential customers who have hard-to-reach meters. The cost for the project, expected to be completed by year-end, is $3.9 million.

The utility already has more than 7,000 smart meters deployed around Long Island after several separate smart grid pilot programs.

More: Newsday

State Grant Allows for Cut in Plant Emissions

Modifications to its 350-MW gas-fired power plant will reduce CO₂emissions by 4,000 tons/year, Caithness Long Island Energy says.

The company received a $163,000 grant from the New York State Energy Research and Development Authority to pay for the upgrades, which were completed in December. The grant is part of a statewide plan to reduce emissions from traditional plants.

Caithness says the more technically advanced turbine components improve efficiency. The plant has a $1.7 billion, 20-year contract to supply the Long Island Power Authority.

More: Newsday

PENNSYLVANIA

Natural Gas Production from Shale Stalls

Natural gas production from the Marcellus and Utica shales in the state was stagnant last year, as falling prices led companies to defer expansion, demand slumped and a shortage of pipelines remained.

The demand for gas surged in recent years as generators switched from coal-fired plants to comply with tighter air quality standards, but that activity is expected to slow until 2020.

Meanwhile, consumer growth has remained sluggish amid milder-than-usual temperatures.

More: State Impact

SOUTH DAKOTA

PUC Approves Keystone XL Route Through State

Local regulators have once again approved the route of the Keystone XL pipeline through the state, but they made its endorsement conditional on eventual approval of the project by the Obama administration.

The Public Utilities Commission approved the pipeline in 2010, but it had to undergo a review again because the state-imposed four-year statute of limitations had expired.

TransCanada’s project is currently stalled after being rejected by President Obama. The proposed pipeline would run from Canada through parts of Montana, South Dakota and Nebraska and then interconnect through existing pipelines to refineries on the Gulf Coast.

More: Associated Press

TEXAS

Protested Gas Pipeline Closer to Approval with FERC Move

A coalition of state ranchers, environmentalists and disgruntled landowners has suffered a major setback in its battle to block a proposed pipeline that would carry natural gas beneath 143 miles of largely untouched Big Bend land.

FERC staff offered a key endorsement of a stretch of the Trans-Pecos Pipeline, writing that it “would not constitute a major federal action significantly affecting the quality of the human environment” in a draft environmental assessment issued Jan. 4.

The partnership between Energy Transfer Partners and Mexico’s Carso Energy could deliver as much as 1.4 billion cubic feet of gas each day to Mexico, where officials have recently opened up the energy sector to private companies. Supporters say the pipeline will generate construction jobs in the state and local tax revenue. Gas imports could also allow Mexico’s border cities to retire dirtier power plants that burn coal, wood and oil.

More: The Texas Tribune

Solar Power Expected to Jump 6-Fold in 2016

The state leads the nation in wind energy production but ranks 10th in solar production as of September 2015. The state doesn’t match the incentives of some states and has an abundant supply of other cheap energy, including natural gas.

But prices for solar panels have fallen more than 80% since 2009, and the outlook for solar generation is picking up in the state because there’s plenty of sun, a growing population, a huge electric load and a hyper-competitive electricity market.

Last year, solar installations in ERCOT grew almost 50%. This year, solar generation could jump six-fold, according to ERCOT projections, which are based on developer agreements to connect with the grid.

More: The Dallas Morning News

WISCONSIN

Lawmakers Set to Vote on Lifting Nuke Moratorium

State lawmakers are scheduled to vote this week on a bill that would lift the moratorium on construction of new nuclear generating stations. Current law blocks new plants unless a national repository for spent fuel is developed. Current state law also prohibits construction of nuclear plants if costs would burden ratepayers.

The bill’s Republican sponsors say nuclear energy is a possible way to meet new federal emissions standards.

More: Associated Press