Vicky A. Bailey, a member of the Federal Energy Regulatory Commission, has left the FERC to serve as president of Cinergy Corp.'s PSI Energy Inc. unit in Indiana. Bailey served on the Indiana...
Stringing Transmission Lines, Untangling Red Tape
Centralized federal oversight sounds good, but what about squabbles between separate federal agencies?
Some cite California's notorious "Path 15" as an example of how transmission bottlenecks can stifle electricity competition, but the problem extends beyond the West Coast. In reality, TLR events (transmission loading relief) rose significantly across the country in 2000, compared to the previous three years. ()
In the upper Midwest, Wisconsin Governor Scott McCallum released a report in June that underscored his state's unique electricity geography and its vulnerability to a weak transmission infrastructure. As explained in the report (), the state resembles an isolated transmission "peninsula," as it is nestled between two Great Lakes. It also straddles the dividing line between two regional reliability regions, the Mid-Continent Area Power Pool (MAPP) and the Mid-Area Interconnected Network (MAIN), that are linked only by one major line. So Wisconsin Public Service Corp. and Minnesota Power Inc. have been at work to link the two regions with a new line.
Further to the east, American Electric Power (AEP) has spent a decade trying to certify a new a 765-kilovolt (kV) line to link southern West Virginia with southwestern Virginia. That project finally won approval last May from the Virginia State Corporation Commission. And in California, Pacific Gas & Electric Co. and the state's Independent System Operator (ISO) have set 2004 as a target date for completion of upgrades to Path 15.
These three examples help show why political momentum has grown for federal action to simplify the process of transmission line siting and certification. President Bush's proposed national energy policy, released last spring, calls for a "national grid." Yet these examples also show that the problem is not so simple to solve.
First, the electric utility industry began its TLR program only several years ago, so a long history of data is not yet available. Also, TLR events can fluctuate with the weather and with market price behavior, making such events perhaps not entirely reliable as an indicator of transmission performance. Second, it remains difficult to evaluate need for grid expansions or to put a value on the worth of grid upgrades, since decisions are made locally, while the cost-benefit equation takes on a regional character. Finally, as shown by AEP's experience in southwest Virginia, transmission owners may not be altogether uncomfortable with the idea of the states retaining decision-making over the certification of transmission lines.
TLRs: An Evolving Metric
Figure 2 shows how the number of TLR events rose last year more or less across the board for security coordinators. AEP, in its role as security coordinator for ECAR (East Central Area Reliability Coordination Agreement), led the pack with the most TLRs declared in 2000. (The statistic represents 13 control areas within the ECAR region, and not just AEP's company-specific area.)
Note, however, that TLR events can fluctuate significantly from year to year, depending on weather in the various regions. Says Scott Moore, vice president, transmission operations at AEP, "A lot of TLRs are dependent upon where the markets are at any given time. ... Last year [for example],