PSC Staff Finds Five Faults with Allegheny Power TrAIL Plan
With the evidentiary stage of hearings on Allegheny Power’s TrAIL application set to start Wednesday (Jan. 9), the staff of the West Virginia Public Service Commission says the plan comes up short in five areas: Need, reliability, economic benefits, line routing and regulatory obligations.
The staff laid out their objections in an opening statement made public on Friday (Jan. 4).
Here are excerpts:
After reviewing the Company’s March 30, 2007 application and pre-filed direct testimony; the Company’s August 10,2007 supplemental materials and testimony; the prefiled
direct and rebuttal testimony of the Staffs own expert witnesses; as well as the Intervenors pre-filed direct and rebuttal testimony in response to the Company’s case in chief, the Staff recommends the filed certificate application by TrAILCo be denied. The Company has failed to meet its State statutory requirement of evaluating the need for action, balanced with environmental impacts and economic benefits, at the expense, at least in part, of West Virginia ratepayers and landowners in accordance with the statutory provisions of West Virginia Code f 24-2-1 la (d)( 1) and (2). The Staff finds that the application is deficient in these significant areas:I. Need - 1) Lack of showing of the reasonableness of the PJMRTO load forecasts underlying the claimed need for TrAIL in 201 1. 2) Insufficient demonstration that TrAIL serves as a most economical or cost-effective means of resolving the outages that PJM reports are likely to occur in 201 1 in the absence of TrAIL. In particular including a failure (I) to evaluate the ability to reduce end-use power demands responsible for the overloads; (ii) to evaluate additions of new generation; and (iii) most significantly to evaluate upgrading existing transmission facilities.
II. Reliability - 1) Lack of showing of necessity of TrAIL for reliability purposes in West Virginia and PJMRTO in 201 1. 2) Insufficient analysis of benefits of upgrading existing facilities. 3) Insufficient analysis of impacts of major planned transmission facilities in West Virginia e.g., PATH. (This is the planned joint venture 765kV transmission line of Allegheny Energy, Inc. and American Electric Power, that is known as Potomac-Appalachian Transmission Highline, L.L.C., consisting of 290-miles of extra-high voltage line to be constructed primarily in West Virginia.)
III. Economic Benefits - 1) Failure to utilize the requirements of integrated resource planning in evaluating need for action. 2) Failure to demonstrate the reasonableness of the load forecasts on which the claimed need for TrAIL is based. 3) The magnitude of the economic benefits of TrAIL remain insufficiently documented by calculation and the corresponding results are not
reasonably supported. In particular the Staff witnesses take issue with the Company’ s calculation of the localized project expenditure amounts claimed to be made in the geographic area, the reasonableness of the ‘multipliers’ implicitly incorporated in the spillover analysis and the adverse property impacts calculated by TrAILCo.IV. Line Routing - 1) TrAILCo’s filing does not demonstrate that the route referred to as ‘Preferred Route’ for which the Company is seeking approval presents an acceptable balance between reasonable power needs and reasonable environmental impacts for the affected population. In particular the Staff witness’ testimony will demonstrate that Route A has significantly less impacts. 2) TrAILCo has not committed to reasonable mitigation measures associated with line routing, including: purchase of properties within an adequate buffer zone (Staffs witness proposes 400 feet of centerline), a prohibition of aerial spraying in the maintenance of this line, adoption of ommission previously stated conditions in Appalachian Power Company case, Case No. 9003, Commission Order entered May 18, 1979.
V. Regulatory Compact Obligations - Under the TrAILCo proposal the regulatory compact obligations of a utility operating in the State of West Virginia have not been fulfilled, specifically: 1) TrAILCo has not committed to recognizing this Commission’s exclusive ratemaking authority over the recovery of transmission costs from retail customers in West Virginia. 2) TrAILCo has not committed to recognizing the Commission’s authority for jurisdictional allocation of transmission costs to West Virginia retail customers. 3) TrAILCo has not demonstrated the flow through benefits to West Virginia ratepayers in dollars for off system sales transactions.