Our annual survey of rates of return on common equity authorized by state public utility commissions in recent rate cases for electric and gas retail distribution utilities.
Legal challenges continue for the undersea transmission line.
When the Connecticut Siting Council granted a certificate of environmental compatibility and public need approving the Cross-Sound cable in January 2002, it determined that the project would provide a public benefit and would not have an environmental impact constituting "sufficient reason to deny the application." The 330-MW transmission cable was installed beneath the seabed of Long Island Sound between Connecticut and New York in the spring of 2002, months after the state siting and environmental permits, and a federal dredging permit were granted for this electric transmission line project.
The pre-installation permitting process was non-linear (see "Chronicle of a Transmission Line Siting," Public Utilities Fortnightly, Jan. 1, 2003), but the post-installation political, legislative, and administrative agency process has demonstrated a chilling new reality: The permitting process may not have an endpoint, and political/legislative obstacles to transmission line siting may be more effective than opponents' direct challenges to the granting of permits based on an agency's application of statutory permitting criteria.
The Cross-Sound cable, at the time of this writing, is in operation pursuant to federal order, while opponents continue to try to shut down the cable. What happened in 2003 to delay the project, and how might the ongoing struggle affect similar projects proposed or under way?
A Tough Year
The Cross-Sound cable project faced setbacks in 2003, but it began operating in the summer. The state legislature enacted and extended a moratorium on the construction of certain types of new transmission lines. In addition, the Connecticut attorney general appealed the Siting Council's approval in both the Connecticut Superior Court and Supreme Court. (The superior court rejected the appeal. The attorney general further appealed to the Connecticut Supreme Court, but eventually withdrew his appeal.)
Until the summer of 2002, most of Cross-Sound's battles were fought in Connecticut. In August 2002, however, the U.S. Department of Energy stepped into the fray, issuing an emergency order directing Cross-Sound to operate the cable if certain energy supply and demand conditions were met. Those conditions were not met before the emergency order expired on Oct. 1, 2002, and the cable was never operated pursuant to the order.
In the wake of the Aug. 14, 2003, blackout, however, the DOE ordered the facility to begin transmitting power. The facility is now operating under that order, but legal and political challenges continue to mean an uncertain future.
Shortly after the transmission line was installed, Cross-Sound determined that in several places the cable was not buried to the final depths specified in permits provided by the U.S. Army Corps of Engineers and the Connecticut Department of Environmental Protection (CDEP). Subsequently, Cross-Sound submitted information to the Army Corps of Engineers and the CDEP demonstrating that operation of the cable as installed would have no adverse effect on navigation or the environment. After consulting with the National Marine Fisheries Service and reviewing the information provided by Cross-Sound, CDEP agreed with Cross-Sound and specifically stated that the electromagnetic field (EMF) and temperature variations associated with operation at the as-buried