Tuesday, July 30, 2013

Basic Questions for Michael Skelly about RICL/GBE Reliability


I have a question.  Lots of questions actually.

What’s the backup plan if RICL goes down?

Where is this energy going to go if RICL were to have a malfunction and go down?

Seriously, how does RICL increase reliability or even maintain the current level of reliability?  

3,500MW’s and if the convertor station at the east end of the line takes a crap, what happens? 
If 3,500 MW’s of juice is going through Channahon to the east states, and the flow of juice stops, is there enough backup generation to handle the loss of RICL? 
Will this cause a rolling blackout on the east coast?

As I understand the “grid” there is multiple powerlines to transport generation from point A to point B.  One transmission line going down shouldn’t cause a major catastrophic failure. 

RICL does not have an alternate route.  If RICL is providing the energy of “three times the Hoover Dam” and the plug is pulled, that energy will not flow to the eastern states.  So what happens?

Will MISO and PJM tell us we “need” to build another powerline?

And what about Iowa?  As I understand it, the energy will feed into MISO from new generation, whether it is coal, wind, or methane gas from confinement cattle operations.  Being a HVDC powerline, the operator can easily adjust the amount of energy being admitted and transmitted through the line.  As I understand it there won’t be a separate infrastructure transmission system built solely feed RICL.  Rather, RICL can draw the specific amount of energy being generated by its suppliers.    Suppose Blow-It-Out-Your-Hole Wind Farm produces 150 MW’s of energy consigned to RICL. 

RICL draws off 150MW’s of energy from the MISO transmission system.  Mid-States-Coal build a big coal plant and produces 1,500MW’s of energy and RICL draws off another 1,500MW’s off the MISO system.  Nuke’m Energy builds a nuclear plant in Iowa because it’s frowned upon in Maryland and provides another 1,500 MW’s into the MISO system and RICL draws a total of 3,150MW’s in this example. 

SO what happens in MISO is RICL goes down?  Can MISO handle an immediate influx of 3,500 MW’s of energy?  Can Nuke’m Energy and Mid States Coal shut down fast enough so as not to overload MISO? 

Will a wayward pigeon in Channahon cause a brownout in PJM states and a blackout in MISO states as too much energy is being generated and nowhere for it to go?  Will consumers and ratepayers be asked to pay for backup routes and precautions?  As a ratepayer, I’d like to know how much this Merchant Transmission Line will cost us.

The industry has a term for such costs.  They call it “but for” costs.  This substation and switching would not be necessary “but for” RICL.  This additional powerline through Indiana would not be necessary “but for” RICL.   Before any state approves RICL or GBE, it would be prudent to ask these questions and know what the true costs will be for the consumers.

No.  I’m not predicted this will happen.  I’m not saying RICL will reduce reliability in energy transmission in Illinois, but I haven’t heard these questions fully answered yet and we need to be sure there are no additional costs that consumers will be required to pay but for RICL/GBE.  Not to give CLE too much assistance, but it probably would be a good idea for RICL to put this information on their website.  ;}

It would relieve consumer worries about this powerline.

Perhaps CLE should focus on generation in Iowa between Kansas and Spencer County Iowa.  Each of Clean Line Energy's projects (RICL, and GBE) can act a backup for the other powerline.  1750 MW's can go to RICL and 1,750 MW's can go to GBE.  If one powerline goes down, there is still a backup powerline that can handle 3,500MW's of energy.  Of course that would be less cost effective, basically running each powerline at half capacity, but wouldn't it provide greater reliability to ratepayers in MISO, PJM, and SPP?

 Now that I think of it, it's interesting to see RICL being marketed by CLE as Northern Iowa and into South Dakota and Minnesota.  I don't recall RICL being markets south, towards the Grain Belt Express and into central and southern Iowa....interesting.

OK one more question.  Where is the application to FERC for the Grain Belt Express?  Isn't it a tad premature to ask for Kansas Corporation Commission to approve the Grain Belt Express when Clean Line Energy hasn't received approval from FERC?  If I was Kansas, I'd tell Mr. Skelly to comeback when they properly had their ducks in a row.

Wednesday, July 10, 2013

Commentary about Grain Belt Express, RICL, and Clean Line Energy


After reading ComEd’s expert witness testimonies and the testimonies  of the ICC staff here’s my opinion on some of the current affairs of Clean Line Energy.   I think ComEd raises some valid points about who is going to pay for the reliability issues created by the addition of the Rock Island Clean Line (RICL).   Yes, I imagine RICL is hoping ComEd would help them out and pay for the improvements.   These costs could be allocated to the consumer through ComEd and there is no chance ratepayers will pay for the upgrades and necessary improvements to handle the 3,500 mwh project through RICL.   RICL has already asked PJM and FERC for some cost allocation on this project, and Clean Line Energy was rejected at both levels.   Like ComEd either directly states or implies, if construction begins on RICL and there are cost overruns, Clean Line would likely ask for cost allocations.   In essence, Clean Line very likely could ask FERC for a consumer bailout.
While it is probably not the place of the Illinois Commerce Commission (ICC) to decide which part of this RICL project Clean Line should pay for and which part ComEd is responsible to build to help out RICL, ComEd raises some valid concerns that have not yet been addressed or decided by MISO, PJM, or FERC.   I think ComEd is correct in asking the ICC to hold off until these concerns have been ironed out.   The last thing we want is for RICL to proceed and then complain they don’t have access because somebody else needs to build another powerline for them at the expense of the ratepayers.
While FERC approval for Grain Belt Express should be an easy cut & paste from the RICL filing, Clean Line Energy has not filed with the fed’s asking for approval.    It is not by accident Grain Belt Express has not filed for FERC approval and has not filed with the ICC for state approval.   Next, combine this situation of many undecided RICL issues with Grain Belt Express.   It appears to me Clean Line is traveling in virgin land with RICL and learning were the landmines are located.   Whether RICL succeeds or fails to obtain state approval, my guess is Clean Line will take what they have learned and pursue cost allocation for Grain Belt Express.
Clean Line knows they are not a part of any Regional Transmission Organization’s (RTO’s) long term planning and this is a problem to obtain cost allocation.   I suspect Clean Line is working behind the scenes trying to get Grain Belt Express to be a part of PJM’s long term plans.     Whether the RICL project succeeds or fails, I fully expect Clean Line will likely claim the costs of additional upgrades to assure reliability are too great and further costs for similar upgrades will make the GBE project unfeasible as a Merchant Transmission Line.   I expect Clean Line Energy to argue the only way the Grain Belt Express project to be feasible is if PJM or FERC grant them cost allocation.  
Of course with the consumers aware Clean Line Energy has not filed with FERC, this will be another hurdle for the company.   In FERC’s recent decision on those consumers fighting MISO’s CapX2020 projects, the consumers were told they should have gone through proper channels and argued their position with the RTO first and it’s now too late to appeal to FERC.   Clean Line Energy should most assuredly know consumers plan to fight FERC approval for Grain Belt Express Clean Line.   We will also be advocating against cost allocation for Grain Belt Express at the RTO’s, whether it is PJM, MISO, or SPP.
It’s not that we’re opposed to the RICL project coming through our farms.   This is not a NIMBY issue.  We are opposed to Clean Line Energy coming into Illinois.   We oppose the way Clean Line Energy was granted Public Utility Status by the Kansas Commerce Commission without even declaring a route.  

So...when is GBE going to seek FERC approval?   

Why should states or even counties, for that matter, vote to approve a project where the company hasn't even asked FERC for approval?

Grain Belt Express does not have one customer signed up.  It can't without FERC approval.  There is absolutely no proof this project is economically feasible (as a Merchant Transmission Line).  There is no economically proof wind power plus the cost of transmission at current prices is a feasible business model.  Is the supply really there at current market prices?  

There are no customers lined up to supply the wind energy for this project.  NONE.  Yes, Clean Line Energy will surely claim their potential wind energy customer base is confidential information or a trade secret but the question needs to be answered at some point.  

Where are the potential suppliers for this alleged Merchant Transmission Line?

Where is Grain Belt Express (GBE) Clean Line's FERC Approval? Did somebody forget to file?

I'm having trouble finding the FERC approval for Grain Belt Express.  Has Grain Belt Express even applied to FERC for approval?  I think not.

There is an application from Grain Belt Express for the Department of Energy under Section 1222 of the 2005 EPA, but I don't see an application to FERC to operate as a Merchant Transmission Line.  There is an application for the Rock Island Clean Line (RICL) to FERC and a FERC approval, but no application or approval for Grain Belt Express. There is also a FERC filing for Plains & Eastern Clean Line.  Clean Line Energy PowerPoint presentations point to Kansas Commerce Commission approval, but nothing is ever said about FERC approval.

Grain Belt Express is proud to point to Indiana approval, but I don't see a FERC application or approval anywhere for Grain Belt Express. 

Why?

Why did KCC approve GBE without a FERC approval for GBE to negotiate with wind companies?  Without FERC approval, this is a powerline from nowhere to nowhere.

Maybe I'm wrong. I am a simple farmboy from Illinois and all.  So I might be missing the obvious here, but it seems like "Clean" Line's statements about GBE milestones are carefully worded to omit a FERC approval.

Smoke and mirrors? 

Seriously, if Clean Line is legitimate and wants to build a powerline through Kansas, Missouri and Illinois, then why is there no FERC approval yet? 

So without FERC approval, how many wind companies has Clean Line negotiated with to sell their services?  How many potential buyers on the eastern end of Grain Belt Express has Clean Line negotiated with?  Zero.

Is this a game to Clean Line? 

Do Clean Line really intend to build this powerline?

Is "Clean" Line's intent to talk this up, put on a sell job, obtain the right of way, and sell it to another company?

Maybe I'm wrong here, but when Clean Line is attempting to build 4 powerlines simultaneously, why has Clean Line avoided the federal approval process of this powerline?  They received FERC approval last summer for RICL.  Clean Line is the only company ever to apply and "partnering" with the Department of Energy under Section 1222 for the Plains & Eastern "Clean" Line.  Centennial West "Clean" Line is working with the federal government for the western states, but where is the FERC application for Grain Belt Express?  Where is the FERC approval? 

This leads me to wonder what other trick does "Clean" Line have up there sleeve if they are not directly pursuing FERC approval like they did for RICL?  Cost Allocation? Is “Clean” Line holding back on FERC approval for GBE as a merchant transmission line because it is hoping to obtain cost allocation under FERC Order 1000?

Even Grain Belt Express's own website is cryptic on FERC approval when they ask and answer their own question.

Will FERC be involved in the approval of this project?
FERC will have oversight of the terms and conditions of service and rates charged and will ensure that the Project's transmission lines are operated on a non-discriminatory basis.

Clean Line conveniently fails to state whether it has applied or intends to apply for federal approval through FERC.  The same page of "frequently asked questions" also asks and answers another question cryptically.

Who will pay for the Grain Belt Express Clean Line?
The Grain Belt Express Clean Line is estimated to cost $2 billion. Clean Line intends to privately fund the development costs of the project and will sell transmission capacity to renewable energy generators or to the buyers of the clean energy that will be delivered by the line.

"Intends" is a very ambiguous word.  With the lack of federal approval at this late in the process while pursuing state approval, and the fact that "Clean" Line Energy pursued cost allocations fro PJM and FERC while never admitting it to the ratepayers of Illinois (and claiming otherwise), I seriously question "Clean" Line Energy's true intent with funding of Grain Belt Express.

This is the company that is so proud to brag about any and all "approvals", even to promote the approval of a state's ag impact mitigation agreement, but there is no known federal approval from FERC for Grain Belt Express and "Clean" Line Energy has failed to brag about FERC approval for Grain Belt Express. 

So why the hold up in filing for FERC approval for Grain Belt Express? Did the company's strategist forget to file at FERC?  I think not.  This is no accident.
 
Again, I believe this is the next biggest energy industry scam in the energy industry since Enron.  This company shouldn’t be called Clean Line Energy.  “CleRon” Energy's is a more fitting name for its lack of transparency, honesty and the reek of being a scam.  Call it what it is.  This is dirty business as usual.