Thursday, January 17, 2013

Clean Line FERC & Federal Eminent Domain

Last Summer Clean Line Energy Partners, d.b.a. Rock Island Clean Line (RICL) won approval from the Federal Energy Regulatory Commission to operate a powerline from  Spencer County, Iowa to Channahon, Illinois as a “Merchant Transmission Line”. In 2011 while denying the existence to Illinois landowners, RICL had petitioned the Illinois Commerce Commission to be classified as a “public utility” in our state.  Last September RICL withdrew the petition and reapplied again to the Illinois Commerce Commission in October 2012.

Since that time, RICL has quietly worked to circumvent the Illinois Commerce Commission should the ICC deny RICL's request to become a public utility in Illinois.  Back in March 2012 Clean Line was writing to the Department of Labor about a need for “Federal Siting Authority” (1).  RICL then approaches PJM Regional Transmission Organization in September about having the costs of the powerline allocated across the states of the MSIO and PJM regions (6).  RICL was denied by PJM to force ratepayers to pay for their powerline.

Last November at a conference in Nashville about renewable energy Clean Line Energy’s Jimmy Glotfelty gave a presentation.  FERC Commissioner John Norris was also a featured guest.  The next day the FERC Commissioner John Norris writes a statement on FERC's Policy Statement on Electric Transmission Rate Incentives with a very positive review about renewables and the “need” for further transmission for the renewable energy industry (5).  Shortly after that conference, we find a petition by Jimmy Glotfelty asking FERC to force PJM’s to allow RICL to allocate costs of the powerline to ratepayers of several states under FERC’s Order No. 1000 (2).

On December 10, RICL filed a protest before the Federal Energy Regulatory Commission (FERC) to allow RICL to charge the customers for the cost of building this powerline (2).  RICL is protesting PJM, the Regional Transmission Organization’s application of FERC’s Order No. 1000.  RICL has not publicly talked about any of these maneuvers.  There has been no press conference or announcement by RICL to the local paper but RICL is attempting to slide this through without the public’s knowledge.  
Fortunately, the ICC has filed a petitioned to intervene and is against Clean Line Energy's request (3), as well as an organization of states in the PJM region (4).   If Clean Line is successful, the next step will be to obtain eminent domain from FERC through "federal siting authority" under FERC’s Order No. 1000. (7&8)   
While RICL is a local issue to the residents of Northern Illinois, including Grundy, LaSalle, Bureau, Henry, Rock Island, and Whiteside Counties, this company is preparing for a long fight.  This powerline could very likely become a national eminent domain issue through Clean Line’s interpretation FERC’s Order No. 1000 and the Federal Energy Commission’s desire to for a transmission line to create “federal siting authority”  (federal eminent domain).  It is not known that the company is directly working towards “federal siting authority”. It is known RICL believe “federal siting authority” is necessary and based on RICL’s actions the company has not disclosed, it is reasonable to expect the company to seek “federal siting authority”.

What ever happened to economically priced energy?  When are wind energy companies going to be held to the same standards and regulatory compliance as Exelon, Ameren, or Midwest Generation?  Why is the federal government (FERC) looking to force private landowners through federal siting authority (eminent domain) to give our land for powerlines specifically for wind energy when the energy is not needed and the energy is overpriced?  A need for more energy has not been demonstrated.  It has only been argued that there is a “need” for more wind energy.

There are some who say the RICL powerline is a state issue and not a national issue.  Yes, it is a state issue.  There needs to be greater supervision from state regulators for wind energy.  Renewable Portfolio Standards or “Public Policy Statement” should not expose ratepayers to pay an exorbitant price for wind energy.  Wind Energy Companies should be regulated and forced to sell electricity at the same market price Ameren and Exelon sell energy into the market.  Yes, it is good to have some renewable energy in a state's portfolio of different types of energy, but all energy companies need to compete.  As consumers, we should not be forced to pay for the cost of powerlines on the scale of RICL when the energy is not needed.

The RICL powerline is also a federal issue.  If FERC approves Clean Line’s petition, consumers will be paying to build this companies “merchant” transmission line.   The company accepted the potential risk and rewards as a “merchant” transmission line.  Clean Line Energy Petition to the ICC (Docket 12-0560) was not even submitted to the ICC.  Yet, we have proof through a letter submitted to the PJM Regional Transmission Authority that RICL was already requesting cost allocation approval in September 2012.  Hans Detweiler of RICL was running around Northern Illinois having meeting with state and county officials during last summer and fall plus all the newspapers, but he never once stated the “merchant” transmission line intends to force the consumers to pay for building the powerline to the windmills across Iowa.  There is a letter from Clean Line Energy to the PJM Regional Transmission Organization from last September discussing Clean Line’s desire to have PJM’s approval for cost allocation, but the company intentional kept this hidden from the public.

Cost allocation was never discussed at any public informational meeting.  I seriously doubt cost allocation to the consumer was discussed in any private meetings RICL had with local government officials.  The only thing stated was the virtues of a “merchant” line.  The powerline has not been strung one mile of line and the company is now working towards a federal trump card should the ICC not approve their application to become a public utility and give Clean Line eminent domain powers through the federal government.

The ICC and Organization of PJM States have also filed a motion to intervene and comments at FERC arguing the states have a right to decide their own fate and a right to represent their own residents.  FERC should not be deciding which states Public Policy Statements are relevant and how they should be implemented.  FERC should not be requiring all states in a region to pay for projects like RICL.  This is a matter for the states to work out amongst themselves.  Some suspect FERC is using state’s Public Policy Statements like Renewable Portfolio Standards as an excuse to take authority and representation away from the states, like the Illinois Commerce Commission.  FERC is not representing the interest of the consumers with its Order No. 1000.  FERC is using Clean Line Energy with its RICL project as a means to take authority away from the states and consumers to advance big business and FERC’s objectives of more powerlines everywhere.

What ever happened to the concept of economically priced energy?

Our government's priorities have become so misguided if cost does not matter when considering the virtues of "clean" energy.

The Rock Island Clean Line is also a local issue at the county level.  Last fall RICL went to the county boards seeking their approval and offering a payment of $7,000 per mile for 20 years to gain the county board’s support and assistance with working the powerline through the township boards and road commissioners.  Those county boards that approved such agreement            s need to be aware of the level of deception in  RICL’s management and questions the ethics of a company that desires to work within the public’s trust. 

Michael Skelly and Jimmy Glotfelty of Clean Line have had one do-over with the Illinois Commerce Commission for state approval.  Clean Line is in the process of another do-over with FERC attending public informational meeting for a sister project.  If Clean Line and RICL wants to follow the Cost Allocation Model, they need to have a do-over with for FERC’s approval of the RICL project.  It’s absolutely ridiculous RICL wants to change in midcourse from the merchant model to some modified cost allocation model.  This is sneaky, deceitful, and dishonest.   RICL did not represent themselves in this manner to the residents of Illinois.

At the time, we, the residents of Illinois, ask the county board to not entertain any offers with RICL that may be on the table until RICL comes "Clean" with their intent.  The company needs to explain to the residents of northern Illinois their true intent.  RICL needs to explain to this board and why it didn’t inform us about their actions with FERC.  RICL presented themselves to all of us as a Merchant Transmission Line.  This was clearly not their intent and the county board needs to be aware of RICL’s actions

RICL has had a do-over with the ICC.  RICL is attempting another do-over to obtain cost allocation from FERC.  If RICL is denied public utility status by the ICC, it is reasonable to expect RICL to ask FERC for “federal siting authority”, another do-over.  If this unnecessary powerline is built, there will be no do-over for Illinois landowners.  If this powerline is not profitable, the only do-over will be forcing consumers to pay more for this powerline. 

With Clean Line’s recent actions, it is not unreasonable for the Illinois residents, county boards, or the ICC to inquire about RICL’s intent, cost allocation to the ratepayers, and federal siting authority.

Yes, I firmly believe federal eminent domain is coming should the ICC deny RICL’s request.

(1)  Jashree Desai’s Letter to DoE
(2)  Clean Line Energy’s Protest to FERC asking for Cost Allocations
(3)  Illinois Commerce Commissions Comments on Clean Line’s Protest 
(4)  Organization of PJM States Inc. Comments on Clean Line’s Protest  
(5)  FERC Commissioner John Norris’s statement about Order No. 1000 benefiting Renewables
(6)  Clean Line to PJM about cost allocation
(7)  Opinion on OPSI Comments against Clean Line’s Protest
(9)  FERC approval and authorizing RICL


  1. "Regional public policy goals" What? There is no such animal. Therefore, Clean Line's conclusion to PJM that the cost of these "regional" goals should be allocated to "the region" is based on a flawed understanding of public policy goals.

    That said, there really is no workable "federal eminent domain" mechanism at this time. Federal courts have deconstructed both FERC's backstop siting authority and the NIETCs it relied on. However, when has defeat ever discouraged companies that have a money-making agenda from trying again? Have I shown you Clean Line's NIETC comments at DOE?

    Oh, what a tangled web we weave, Clean Line.

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