Good afternoon and welcome to another EnerKnol Pulse! This week we bring you a series of rate case updates, asset sales and ambitious renewable energy plans, all accessed and tracked using the EnerKnol platform.

February 12, 2018


Featured Topics

Expanding Renewables

Protecting Ratepayers

Power Markets and Disputes

Fossil Fuel and Pipeline Actions


Featured Entities

AGL Resources

Alliant

Appalachian Power

Avista

Dayton Power and Light

Delmarva Power

Dominion Virginia Power

DTE Energy

Duke Energy Florida

Duke Energy Ohio

EQT

Exelon Corp

Florida Power & Light

Idaho Power

Mississippi Power

New Jersey Resources

Northern Illinois Gas

Ohio Power

PPL Electric Utilities

South Jersey Industries

Spectra Energy Partners

UGI Energy

Top News

Connecticut Regulator Seeks to Boost Renewable Standard to 40 Percent, Endorses Support for Nuclear Power

The Connecticut Department of Energy and Environmental Protection released a plan calling for the state to draw 40 percent of its energy supplies from renewable sources by 2030, up from the current target of 20 percent by 2020. The agency also endorsed the state’s decision to lock in purchases of power supplies from nuclear generators, including Dominion Inc.’s Millstone reactor, which provide a quarter of the state’s electricity. Connecticut’s Comprehensive Energy Strategy updates the state’s clean energy goals to reflect a surge in renewable generation since the first report was published five years ago, and comes as the state looks to cut greenhouse gas emissions 10 percent below 1990 levels by 2020.

Texas Grid Calls for Removal of Out-of-Market Generating Capacity from Reserve Estimates to Bolster Prices, Investments

The Electric Reliability Council of Texas Inc. staff recommended that the agency consider excluding supplies of out-of-market generation when calculating payments awarded to power plants for electricity sold during scarcity periods. Generation dispatched under orders by Ercot, particularly reliability unit commitments, and reliability must-run generation, inappropriately inflates the estimates of the power supplies in the “operating reserve demand curve,” staff said. The inflated estimates depress payments that are critical to draw investments for the system’s long-term reliability, according to the memo. The commission will discuss the recommendations at its Feb. 15 meeting.

Idaho Power Seeks Update to Net Metering for Rooftop Solar as Renewable Generation Soars

Idaho Power Company, a subsidiary of IDACORP Inc., seeks to create a separate compensation scheme for customers who are paid for the excess rooftop solar power they supply to the grid, a practice known as net metering. Customers are credited at the full retail rate, a level which Idaho Power argues is excessive because it includes compensation for maintaining and operating the distribution system, a service ratepayers don’t provide. The utility argued that sophisticated rate designs are now possible with the advent of advanced meters and that an update is needed as the number of net metering customers is poised to top 7,000 by 2021, from just 350 five years ago. The commission has scheduled public hearings for March 1 and 5.

Avista Unveils 20-Year Resource Plan, Adding Storage for First Time, Relying Heavily on Conservation

Avista Utilities, a division of Avista Corp., filed its 2017 integrated resource plan with the Idaho Public Utilities Commission, laying out its strategy to meet electricity demand through 2037. The utility expects conservation measures to offset over half of the projected demand growth through 2037. To meet power consumption the utility is also building 2.5 megawatt-hours of storage and 15 megawatts of solar generation. Regulated electric utilities are required to file a 20-year plan every two years detailing projected growth in power use and new resources needed.

Expanding Renewables

New Jersey Lawmaker Proposes Bill Setting 100 Percent Renewable Energy Goal

New Jersey House Democrat John McKeon introduced legislation on Feb. 1 that would require the utilities to source all their electricity from Class I renewable energy resources by 2050. Class I renewables include solar panels, wind energy, fuel cells, geothermal, wave or tidal power and small scale hydropower. The state currently has a goal to draw 20 percent of its electricity from Class I and II renewables by 2020-2021 and a requirement to source 4.1 percent from solar power by 2027-2028. States are pushing for stronger renewable targets as costs for the technology plummet while demand for a shift to zero-emitting power sources takes hold. (A 2716)

 

New York Solar Power Soared 1,000 Percent Over 6 Years as Private Investments Reach Nearly $3 Billion

New York installed over 970 megawatts of solar generating capacity through 2017, from 83 megawatts in 2011, thanks to the $1 billion NY-Sun program, an initiative that aims to add 3 gigawatts by 2023, according to a Feb. 5 announcement by Governor Andrew Cuomo. Nearly 1,100 megawatts of solar projects are under development and an average of 900 applications are filed each month from residents seeking to install solar panels. The growth in solar is key for the state to reach a goal of drawing half of its electricity from renewable energy sources by 2030.

New Jersey State Lawmaker Proposes Bill to Add Fusion Power to Renewable Energy Class

New Jersey state Senator Joseph Pennacchio, a Republican, introduced legislation on Feb. 1 that would group aneutronic fusion under a class of renewable energy resources along with solar, wind, and geothermal resources. Aneutronic fusion reactions are considered to be virtually “neutron-free” and hence not radioactive. (S 1336)

Wisconsin Public Service's 20-Megawatt Hydro Plant Clear U.S. Review After No Major Impacts Found

The Federal Energy Regulatory Commission found that relicensing of the 2.6-megawatt Tomahawk Hydroelectric Project and 17.24-MW Grandfather Falls Hydroelectric Project on the Wisconsin River in Lincoln County, would not carry any significant environmental impacts, according to the commission’s Jan. 30 notice. The subsidiary of the WEC Energy Group is seeking a 30 year license for the facilities after the current one expires this year.

Rhode Island Lawmakers Float Bill for Price on Carbon to Accelerate Greenhouse Gas Emission Cuts

Rhode Island House Democrats including Aaron Regunberg, introduced legislation on Feb. 1 that would collect fees on fossil fuel sales, with the money to fund clean energy and climate adaptation programs. The carbon price would be set at $15 per metric ton of emissions initially, increasing at the rate of $5 per year until it reaches $50 and then increase according to inflation. (HB 7400)

Protecting Ratepayers

Virginia Governor Endorses Bill Seeking $200-Million Credits from Dominion, Repealing Controversial Rate Freeze

Virginia Governor Ralph Northam, a Democrat, announced on Feb. 5 his support for legislation that would lift a freeze on rates, order Dominion Energy to provide $200 million in credits for customers said to be overcharged during the freeze, restore oversight of electric utilities, and consider rate cuts for utilities starting in 2020 with American Electric Power subsidiary Appalachian Power. Ratepayers were said to have been overcharged following the suspension of rate reviews under a 2015 law intended to help utilities cope with expensive power plant emission rules that have since been repealed under the Trump administration. The law would also order spending on clean energy projects, including $1.145 billion in investments in energy efficiency and low-income energy assistance over a decade.

Mississippi Power Customers to Be Shielded from Costs Tied to Failed $7.5 Billion Kemper Coal Project

The Mississippi Public Service Commission on Feb. 6 approved a settlement agreement that removes the costs associated with Mississippi Power Company’s Kemper coal gasification plant from the rate base to protect customers from “past, current, and future” risks tied to its operations. The settlement requires the facility to run only on natural gas and lowers the revenue requirement for this year to $99.3 million, down from the previously approved amount of $112.6 million. The Southern Company subsidiary has written off over $6 billion of capital costs from the gasification project, which was once hailed as the first large-scale clean coal facility but has been scrapped amid delays and cost-overruns.

Duke Energy's Florida Customers Spared Rate Hike from $500 Million in Hurricane Damages Thanks to Federal Tax Cut Savings

The Florida Public Service Commission accepted a negotiated plan from Duke Energy Florida LLC, a subsidiary of Duke Energy, to apply the utility’s savings under the recently enacted federal tax cuts to pay for an estimated $513.2 million in restoration costs from Hurricanes Irma and Nate, sparing customers from a monthly bill surcharge of $5.20 that the company originally requested, according to the commission’s Feb. 6 news release. The federal tax overhaul signed into law by the Trump administration slashed the corporate income tax rate to 21 percent from 35 percent at the start of the year.

New Jersey Rates to Fall as Much as 4.7 Percent Under State’s Annual Electric Auction

New Jersey’s 17th annual auction saw the cost for basic generation service slip by an average of 4.65 percent for Atlantic City Electric, 1.9 percent for Public Service Electric & Gas, 3.5 percent for Jersey Central Power & Light, and 4.3 percent for Rockland Electric, compared to the contracts they replace from three years ago. Prices increased by up to 7.6 percent versus last year’s auction. Basic generation service, a component of residential and business power bills, applies to the 12-month period starting June 1. The auction held in early February, which was approved by the New Jersey Board of Public Utilities, locked in commitments for about $6 billion worth of purchases covering approximately 8,400 megawatts of demand.

Iowa Regulators Cut Alliant Rate Hike to 7.8 Percent, Order Grid Modernization Plans

The Iowa Utilities Board approved a settlement setting Interstate Power and Light Company’s annual revenue boost to $130 million, or 7.8 percent, versus a request for an additional $176 million, or 11.6 percent, according to a Feb. 2 press release. The Board also approved the Alliant subsidiary to earn a return on equity of 9.6 percent and required the utility to submit grid modernization plans.

Illinois Regulators Slash Northern Illinois Gas Rate Hike by 38 Percent in First Update in a Decade

The Illinois Commerce Commission authorized Northern Illinois Gas Company, a subsidiary of Southern Company Gas, to boost annual revenues by $137 million, versus its request for $208.5 million, according to the commission’s Jan. 31 press release. The new rates, to take effect on Feb. 8, will increase rates by 20.96 percent. The higher revenues were requested to pay to modernize the pipeline network, comply with state and federal pipeline safety rules, among other issues.

Maryland Commission Cuts Delmarva Power's Rate Hike by 30 Percent, Probes Higher Spending on Grid Reliability

The Maryland Public Service Commission announced on Feb. 9 that it approved a settlement agreement authorizing Delmarva Power and Light Company to boost electric distribution rates by $13.4 million, down from a request from the utility for $19 million. The new rates, which take effect Feb. 10, amount to an increase of $2.71, or 1.9 percent, a month for the average customer. The commission also initiated a probe into the cost-effectiveness of the utility’s reliability spending, finding that it spends the highest amount per customer compared to other electric utilities in the state. Delmarva, a subsidiary of Exelon Corporation, supplies electricity to 200,000 customers in 10 counties in Maryland, primarily on the Eastern Shore.

Pennsylvania Commission Allows Participation in PPL Electric’s Low Income Program Via Competitive Supplier

The Pennsylvania Public Utility Commission on Feb. 9 provided rules for managing customers receiving service from a competitive supplier and subsequently enroll in PPL Electric Utilities Corp.’s customer assistance program called OnTrack. The order requires customers to return to the utility’s default service, with the option to re-enroll with a competitive supplier through the utility’s “Customer Assistance Program Standard Offer Program,” which took effect in June. Under the program, a participating supplier is required to serve customers for 12 months at a 7 percent discount.

Florida Power & Light Cuts Rates Early to Reflect Savings from Coal Plant Closure

The Florida Public Service Commission on Feb. 6 approved an annual adjustment to the rates of Florida Power & Light Company, a subsidiary of NextEra Energy Inc., to reflect savings from the premature retirement in January of the St. Johns River Power Park generating plant. The adjustment, which was not due until next January, reflects decreasing fuel, capacity and environmental costs following the closure. The commission also declared immediate jurisdiction to determine whether utilities’ tax savings from corporate income tax cuts must be passed on to customers.

Power Markets and Disputes

AES Cleared by U.S. to Sell Generation Portfolio to Rockland Capital Fund, as Utility Cuts Exposure to Power Markets

The Federal Energy Regulatory Commission approved a request by a subsidiary of AES Corporation to sell six power plants with a combined generation capacity of 1,000 megawatts to a private equity fund managed by Rockland Capital LLC, an order issued by the agency Feb. 9 showed. The plants consisting of the Tait Electric Generating Station, Montpelier Generating Station, Yankee Street, O.H. Hutchings, Monument Generating Station, and the Sidney generating plant are all located in the PJM Interconnection market. AES is a diversified global energy company that owns about 12,000 megawatts of generation in the U.S. Merchant generators are seeking to exit wholesale competitive markets amid a slump in prices and tepid electricity demand.

DTE Energy Faces Regulator's Probe into 2017 Power Outages from System Bug Amid Claims of Misinformation

The Michigan Public Service Commission ordered DTE Energy Company to prove it didn’t violate the agency’s billing rules after a malfunction in a new billing system improperly shut power for about 5,000 customers last January. The commission said its investigating the shutoffs after the utility provided inaccurate information. A prehearing conference is scheduled for March 2 before Administrative Law Judge Lauren VanSteel.

Ohio Power, Duke, DP&L Seek to Eliminate Joint Ownership of Transmission Assets to Minimize Disputes

The Ohio Public Utility Commission staff recommended approving the exchange of commonly owned transmission assets among the companies finding that the basis for joint ownership is no longer valid because operating control has been ceded to the regional transmission organization, according to a Feb. 7 filing with the commission. Eliminating co-ownership would minimize the potential for disputes due to controversy over the need for upgrades and assignment of costs. Ohio Power Company, a subsidiary of American Electric Power, Duke Energy Ohio Inc., and Dayton Power and Light Company, a subsidiary of AES Corporation, said that the joint ownership resulted from historically co-owning generating units which have since been transferred to other entities.

Fossil Fuel and Pipeline Actions

U.S. Appeals Court Rejects Environmental Group's Move to Block EQT's $3 billion Mountain Valley Gas Line

The U.S. Court of Appeals for the District of Columbia Circuit dismissed a request by the environmental group Appalachian Voices to suspend pre-construction activities for the 300 mile Mountain Valley Pipeline, owned by EQT Midstream Partners LP, and NextEra US Gas Assets LLC, Con Edison Transmission Inc. The court denied FERC’s request to throw out the challenge, and the merits of the project will be heard by a new panel, according to a Feb. 2 order. The case is Appalachian Voices v. FERC (17-1271).

New Jersey Rejects Permit for $1.13 Billion PennEast Gas Line Cleared by U.S. Regulators

The New Jersey Department of Environmental Protection informed PennEast Pipeline Co. LLC on Feb. 1 that it will have to re-submit a new application for a freshwater wetlands permit for the natural gas link because the original application was incomplete and had been dismissed. The decision by the administration of newly-elected Democratic Gov. Phil Murphy comes after the Federal Energy Regulatory Commission granted approval. PennEast, a 116-mile pipeline with a capacity of over 1.1 million dekatherms per day, is a joint venture owned by AGL Resources Inc., New Jersey Resources, South Jersey Industries, UGI Energy Services, and Spectra Energy Partners LP.

U.S. Interior Department Seeks to Streamline Federal Oil, Gas Leasing With Cuts to Reviews, Protest Opportunities

The Bureau of Land Management eliminated “duplicative” layers of environmental review on oil and gas leasing on federal lands with the removal of so-called master leasing plans, according to the bureau’s Jan. 31 memo. The notice indicated that a sale should proceed even if all protests haven’t been resolved. The agency also sets a 10-day protest period and a 60-day timeframe for processing proposed lease sales. The agency’s bid to “simplify and streamline the leasing process” and cut what it says are unnecessary impediments and burdens follows the Trump administration’s move to boost domestic energy production and become a dominant force in global markets.

U.S. Lawmaker Proposes Bill to Extend Tax Credit for Production of Refined Coal in Latest Bid to Support Struggling Fuel

U.S. Senator John Hoeven, a Republican representing North Dakota, introduced legislation on Feb. 5 that would extend the production tax credit period for refined coal to 20 years. Currently, facilities claiming the credit must have been in service by December 2011 and qualify for the first 10 years of operation. The tax credit was valued at $6.91 per short ton in 2017. The Trump administration and coal-state lawmakers have sought to support the fossil fuel with incentives and subsidies, as natural gas and renewables steal market share thanks to historically low prices. (S.2373)

Cheniere’s $1-Billion Midcontinent Natural Gas Pipeline Clears Federal Draft Review

The Federal Energy Regulatory Commission found Cheniere Energy Inc.’s Midcontinent Supply Header Interstate Pipeline Project won’t have significant impacts on the environment with the use of additional safeguards, the agency said in its preliminary environmental review issued Feb. 9. Cheniere’s proposed natural gas line would extend over 230 miles, allowing the shipment of 1.44 billion cubic feet per day of additional supplies from Oklahoma’s Anadarko Basin to Gulf Coast and Southeast markets. The project is scheduled to start as early as late 2018.

U.S. Interior Department Opens California Desert to Mining in Latest Reversal of Obama Policy

The Bureau of Land Management canceled a proposal developed under the Obama administration to withdraw 1.3 million acres of California Desert Conservation Area from new mining activity, according to a Feb. 6 press release. Based on a review, the agency said that impacts of future exploration would not significantly harm the environment. The bureau recently announced that it is considering amendments to the Desert Renewable Energy Conservation Plan to increase opportunities for renewable energy generation on public lands. The Trump administration has rolled back a slew of landmark environmental protections ushered in under President Barack Obama to remove what it calls burdensome and unwarranted restrictions on industry.

U.S. Poised to Become Net Energy Exporter Within Five Years Amid Advancing Shale Boom: EIA

The nation’s booming oil and natural gas production is positioning the U.S. to become a next energy exporter by 2022, ending the status its held since 1953 as a net importer, according to the U.S. Energy Information Administration’s Annual Energy Outlook. The projections also indicate that all new electricity generation will be fueled by natural gas and renewable energy after 2022. Advanced drilling technology, particularly hydraulic fracturing, have allowed producers to unleash a glut of supplies from prolific shale deposits.

West Virginia State Lawmaker Proposes Bill Requiring Half of State Vehicles to Use Natural Gas

West Virginia House lawmaker Joe Statler, a Republican, introduced legislation on Feb. 5 that would require 50 percent of vehicles used by state agencies to be fueled by compressed natural gas, liquefied natural gas, or propane by 2025. West Virginia is the ninth-largest natural gas-producing state in the U.S. (HB 4432)

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