EC May 2012

ec@lists.wvsierraclub.org

7 participants
24 discussions

Fwd: EIP and Public Justice Sue FirstEnergy on behalf of LBRAG at nation's largest coal ash pond - Little Blue
by Jim Sconyers 30 May '12

30 May '12

This is huge. ---------- Forwarded message ---------- From: "Lisa Widawsky Hallowell" <lhallowell(a)environmentalintegrity.org> Date: May 30, 2012 1:57 PM Subject: EIP and Public Justice Sue FirstEnergy on behalf of LBRAG at nation's largest coal ash pond - Little Blue To: <COAL-COMBUSTION-WASTE(a)lists.sierraclub.org> **apologies for cross-posting****** ** ** EIP and Public Justice, on behalf of the Little Blue Regional Action Group (formerly “Citizens Against Coal Ash”), filed a notice letter for violations of the Clean Water Act, Resource Conservation and Recovery Act, Emergency Planning and Community Right to Know Act, and PA Clean Streams Law at FirstEnergy’s Little Blue Run Coal Ash Impoundment today. The NOI is available here:**** ** ** http://www.environmentalintegrity.org/news_reports/05_30_2012.php**** ** ** ** ** Lisa Widawsky Hallowell**** Attorney**** Environmental Integrity Project**** 1 Thomas Circle, Suite 900**** Washington, DC 20005**** 202.294.3282 (direct/mobile)**** 202.296.8822 (fax) **** lhallowell(a)environmentalintegrity.org **** ** ** *The information contained in this email message may be privileged, confidential and protected from disclosure. If you are not the intended recipient, any dissemination, distribution or copying is strictly prohibited. If you think that you have received this email message in error, please notify the sender by reply email and delete the message and any attachments.* ** ** - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - To unsubscribe from the COAL-COMBUSTION-WASTE list, send any message to: COAL-COMBUSTION-WASTE-signoff-request(a)LISTS.SIERRACLUB.ORG Check out our Listserv Lists support site for more information: http://www.sierraclub.org/lists/faq.asp

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NYTimes.com: Even in Coal Country, the Fight for an Industry
by william.depaulo＠gmail.com 30 May '12

30 May '12

This page was sent to you by: william.depaulo(a)gmail.com. Even in Coal Country, the Fight for an Industry http://www.nytimes.com/2012/05/30/business/energy-environment/even-in-kentu… ---------------------------------------------------------- ABOUT THIS E-MAIL This e-mail was sent to you by a friend through NYTimes.com's E-mail This Article service. For general information about NYTimes.com, write to help(a)nytimes.com. NYTimes.com 620 Eighth Avenue New York, NY 10018 Copyright 2012 The New York Times Company

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SHALE OIL IN OHIO
by William V. DePaulo, Esq. 24 May '12

24 May '12

Chesapeake Raises Big Bet in Ohio By DANIEL GILBERT<http://online.wsj.com/search/term.html?KEYWORDS=DANIEL+GILBERT&bylinesearch…>And RYAN DEZEMBER<http://online.wsj.com/search/term.html?KEYWORDS=RYAN+DEZEMBER&bylinesearch=…> Aubrey McClendon, CEO of Chesapeake Energy <http://online.wsj.com/public/quotes/main.html?type=djn&symbol=CHK>Corp., once described oil buried in a layer of rock that stretches from the outskirts of Cleveland to West Virginia as "the biggest thing to hit Ohio since the plow." Mr. McClendon bet big on that new oil field, the Utica Shale, paying billions of dollars over the last two years for drilling rights to 1.3 million acres of it, or about 5% of Ohio's land area. Now, Chesapeake is raising its bet—ramping up drilling on a promising but unproven oil field, at a time when the embattled natural-gas giant is under financial stress and facing heightened scrutiny from investors. Battered by the lowest natural-gas prices in a decade, Chesapeake is selling off some of its most lucrative assets and taking out increasingly expensive loans in a bid to transform itself into an oil power. The cash-strapped company, whose stock market valuation is under $10 billion, has more than $13 billion in debt on its balance sheet and total obligations of close to $24 billion, ratings agencies say. Key to its ambition is the Utica, which Ohio officials estimate holds 1.3 billion to 5.5 billion barrels of oil. The Utica, which spans parts of five states, often draws comparisons to the huge Eagle Ford Shale in Texas, which could hold 3.4 billion barrels of oil, according to the U.S. Energy Information Administration. On Tuesday, a Chesapeake executive told an industry conference in Austin that the Utica could generate a higher rate of return than any of Chesapeake's other properties. But analysts say that relatively little is known about the true potential of the Utica. Chesapeake has only released results from nine of the 59 wells it has drilled in the Utica, and none of the nine have been in operation for long. Chesapeake says that oil made up less than a third of its average peak production from eight of the wells, with natural gas accounting for half and the rest coming from liquid gases like ethane and propane. The limited data the company has released "fail to wow," analysts at Sanford C. Bernstein & Co. wrote last month. [image: CHKUTICA] [image: CHKUTICA] None of the nine wells is in what executives call the "oil window," the sweet spot the Oklahoma City-based company believes holds the most crude. "We haven't cracked the code on the oil window," Mr. McClendon said at an industry conference last month in New York. "The prize is big if you can do that." The Utica is far from Chesapeake's only oil property. It is spending more money on the proven Eagle Ford in south Texas and ramping up drilling in the Mississippi Lime field that straddles the border between Oklahoma and Kansas. Chesapeake isn't alone in its belief that the Utica holds a lot of oil. BP<http://online.wsj.com/public/quotes/main.html?type=djn&symbol=BP.LN> PLC, Exxon Mobil<http://online.wsj.com/public/quotes/main.html?type=djn&symbol=XOM>Corp., Hess <http://online.wsj.com/public/quotes/main.html?type=djn&symbol=HES>Corp., Anadarko Petroleum<http://online.wsj.com/public/quotes/main.html?type=djn&symbol=APC>Corp. and Devon Energy<http://online.wsj.com/public/quotes/main.html?type=djn&symbol=DVN>Corp., among others, have bought Utica drilling fields in Ohio. In December, Total<http://online.wsj.com/public/quotes/main.html?type=djn&symbol=tot>SA, the French oil giant, paid Chesapeake $610 million for a stake in its holdings in the Utica, with the promise to cover $1.4 billion of drilling costs. Total declined to comment. "While we agree with the view that the Utica is an emerging play and there is little publicly available well information, we have drilled and tested a sufficient number of wells for us to have a high level of confidence," Jim Gipson, a Chesapeake spokesman, said Wednesday. The company plans to disclose details about its oil production in the coming months, he said. Chesapeake has staked more on the Utica than any other producer by far. It has leased twice as much land as its nearest competitor, Chevron<http://online.wsj.com/public/quotes/main.html?type=djn&symbol=CVX>Corp. Of the 223 permits the state has issued for Utica wells, Chesapeake has obtained 162. It is drilling with 10 rigs there, the most of any company, and plans to operate 22 rigs in 2013, which would amount to almost 18% of its working rigs. Chesapeake is continuing to expand its holdings in the Utica. In the first quarter of this year, Chesapeake spent $900 million acquiring drilling rights—more than half of what it has budgeted for the entire year—with much of the activity in the Utica, where it had already spent $2 billion. The company said Tuesday that it plans to dedicate 8% of its capital spending, or up to $600 million, on the Utica in 2013, which doesn't include Total's contribution. Ramping up drilling may help Chesapeake demonstrate the oil and gas potential in the Utica, allowing it to add to its reserves. Until that potential is proven by drilling, the company can't use its Utica holdings as collateral to take out reserve-based loans because the amount of oil and gas there is uncertain, said Neal Dingmann, an analyst with investment bank SunTrust Robinson Humphrey Inc. Chesapeake currently draws on a $4 billion line of credit, backed by reserves, for its daily cash needs. To raise cash, Chesapeake in December 2011 completed a sale of $1.25 billion in preferred shares in a newly created subsidiary for some of its Utica holdings to private-equity firms led by EIG Global Energy Partners. Chesapeake must pay a steep 7% annual return to the investors, as well as 3% of the royalties from the first 1,500 wells, beginning this year and is committed to drilling 50 wells a year in the Utica through 2016. The company is under pressure to raise as much as $11.5 billion before the end of the year to bridge a widening gap between its cash flow and spending. It is shopping its entire 1.5 million acres in a lucrative west Texas oil field, which makes up 5% of its production, to pay for drilling in places like the Utica that it believes will prove even more profitable. The cash crunch, combined with corporate-governance controversies, has pushed Chesapeake's stock down 51% in the last 12 months. It closed Wednesday at $15.09. For years, Mr. McClendon has taken a small stake in every well that Chesapeake drills, sharing equally in their costs and profits. In November, he pledged his stakes in the company's wells in the Utica and elsewhere as collateral to borrow up to $1 billion from EIG, which didn't become widely known until April. The revelation that he borrowed from a company doing business with Chesapeake has rocked the company in recent weeks. Chesapeake has said that allowing Mr. McClendon to invest in the wells aligned him with shareholders and that his borrowing didn't pose a conflict of interest, though they have agreed to end the practice in 2014. Board members are reviewing his financing deals with firms that have relationships with Chesapeake. Mr. McClendon has apologized for what he calls "distractions" and agreed to step down as chairman. But he has not changed his tune about the Utica. Earlier this month, Mr. McClendon said that a natural-gas well drilled in Ohio's rural Harrison County "may very well be our best shale well ever." Analysts say it is too early to determine whether the Utica will prove as profitable as other major U.S. oil fields. "It's an Eagle Ford lookalike, it's got that kind of potential," said David Tameron, a senior analyst at Wells Fargo Securities LLC. But he cautioned, "We don't have a history with any of these wells." *Write to * Daniel Gilbert at daniel.gilbert(a)wsj.com and Ryan Dezember at ryan.dezember(a)dowjones.com - ** - - - -

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PNC finances MTR
by Jim Sconyers 23 May '12

23 May '12

http://delaware.sierraclub.org/2012-05-22-pncbank PNC has branches in Morgantown. It would be fun to set up an action targeting them for their enabling of mountaintop removal. -- Jim Sconyers jimscon(a)gmail.com 304.698.9628 Remember, Mother Nature bats last.

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Fwd: WVNS story: Who Pays for Dominion Hope's Natural Gas Gambles?
by Paul Wilson 23 May '12

23 May '12

fyi, paul ---------- Forwarded message ---------- From: Public News Service <wvns(a)newsservice.org> Date: Wed, May 23, 2012 at 8:55 AM Subject: WVNS story: Who Pays for Dominion Hope's Natural Gas Gambles? To: PaulWilson <pjgrunt(a)gmail.com> Who Pays for Dominion Hope's Natural Gas Gambles? Public News Service-WV http://www.publicnewsservice.org/index.php?/content/article/26594-1 Join the discussion: facebook.com/PublicNewsService<http://www.facebook.com/PublicNewsService> Twitter: @pns_news <http://twitter.com/#!/pns_news> @pns_WV<http://twitter.com/#!/pns_WV> Google+: plus.to/publicnewsservice <http://plus.google.com/106260479325451709866> (05/23/12) CHARLESTON, W.Va. - Gas utility Dominion Hope has lost $22 million hedging on natural gas prices, and this week a judge will decide if the company can pass more than $9 million of that on to its customers. Under the direction of the Public Service Commission, Dominion Hope started hedging six years ago to try to protect against gas price spikes. But the bets lost money consistently, with higher losses recently. The company now wants ratepayers to cover its fiscal 2011 losses. Byron Harris, who heads the PSC's Consumer Advocate Division, says something might need to be changed. "The fact that they have consistently lost money is something I think we need to look at, and if there is a better way, I think that's something we definitely need to look at." Harris says Dominion Hope's hedging was done properly, as designed with the Consumer Advocate Division. Dominion Hope spokesman Chuck Penn says his company didn't make any mistakes. "Gas prices have essentially collapsed, down more than 70 percent since 2008. The entire market failed to foresee the drastic decline in prices that would occur." For every dollar Hope lost and charges to customers, Virginia Power Energy Marketing Group stands to profit. That's another Dominion subsidiary which Hope made these bets with. Energy market consultant George Donkin was hired by the Affiliated Construction Trades to look into the rate case. He says that kind of deal raises questions. "Any time you have a transaction involving corporate affiliates, it needs to be recognized that the transaction is now taking place at arm's length." According to Byron Harris, that does raise red flags, although it doesn't seem illegitimate. "The fact that they contract with their affiliate really has no impact. The reason that Hope paid above-market prices is because they've been hedging into this declining market." By comparison, Mountaineer Gas also hedges, but has lost about 25 percent less per unit of gas purchased. The hedging only protects against price increases, but gas prices have fallen dramatically, mostly because of large amounts of gas coming from the Marcellus shale formations under the eastern U.S. The Administrative Law Judge's decision will be posted on the PSC's website, case no. 11-1103-G-30C. Click here to view this story on the Public News Service RSS site and access an audio version of this and other stories: http://www.publicnewsservice.org/index.php?/content/article/26594-1<http://www.publicnewsservice.org/index.php?/content/article/26594-1> --- To be removed from this list please send an e-mail to remove(a)publicnewsservice.org <remove(a)publicnewsservice.org?subject=remove>and put the word "remove" in the subject line. -- Paul Wilson Sierra Club 504 Jefferson Ave Charles Town, WV 25414-1130 Phone: 304-725-4360 Cell: 304-279-1361 "There is no forward until you have gone back" ~Buddha "In all things of nature there is something of the marvelous" ~ Aristotle

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First Energy efficiency plans lag in WV
by Jim Sconyers 22 May '12

22 May '12

---------- Forwarded message ---------- From: Rashay Layman <rashay.layman(a)sierraclub.org> Date: Tue, May 22, 2012 at 4:03 PM Subject: Re: need mileage reimbursement To: Jim Sconyers <jimscon(a)gmail.com> FYI, http://www.statejournal.com/story/18573803/firstenergy-efficiency-programs-…

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Fwd: WVNS story: Impact of 'War On Coal' Questioned - Mining Jobs Actually Up
by Paul Wilson 21 May '12

21 May '12

great story from the WV Public News Service...... ---------- Forwarded message ---------- From: Public News Service <wvns(a)newsservice.org> Date: Mon, May 21, 2012 at 4:27 AM Subject: WVNS story: Impact of 'War On Coal' Questioned - Mining Jobs Actually Up To: PaulWilson <pjgrunt(a)gmail.com> Impact of 'War On Coal' Questioned - Mining Jobs Actually Up Public News Service-WV http://www.publicnewsservice.org/index.php?/content/article/26543-1 Join the discussion: facebook.com/PublicNewsService<http://www.facebook.com/PublicNewsService> Twitter: @pns_news <http://twitter.com/#!/pns_news> @pns_WV<http://twitter.com/#!/pns_WV> Google+: plus.to/publicnewsservice <http://plus.google.com/106260479325451709866> (05/21/12) CHARLESTON, W.Va. - The mining industry and most of the state's political leaders accuse the Environmental Protection Agency and the White House of waging a "war on coal." But according to Workforce West Virginia, the number of mining jobs is near a two-decade high. Ted Boettner, executive director of the West Virginia Center on Budget and Policy, analyzed the employment numbers. He says the environmental policies actually have very little impact on the number of mining jobs here. He says that number is actually higher now that at any time since Bill Clinton's first term. "Last year there were more people employed in the coal mining industry than at any time since 1995. In fact, since Obama took office we've seen an increase of 1500 people in the mining industry." The industry has attacked the EPA for tightening rules on mountaintop removal and air pollution from coal-fired power plants. Boettner says those changes have far less impact than simple supply and demand. Many of the state's mines produce high-quality metallurgical coal. Since "met" coal is used to make steel rather than burned for power, demand for it is largely unaffected by efforts to slow global climate change. And Boettner says the price is up around the world. "We're exporting more and more of that coal. Metallurgical coal during its peak was well over $200 a ton, whereas steam coal was $60, $75 a ton." Over the long term, Beottner says, he expects less coal to be burned to produce electricity. But he says that has more to do with cheap natural gas than any federal policies. "The fact of the matter is the EPA has very little impact on price and production. Meanwhile, what does have a big impact is discovering 180 trillion cubic feet of Marcellus gas." Boettner says another factor is thinner Appalachian coal seams. He says that means more miners are needed to get the same amount of coal. More information is at tinyurl.com/d6ojrsy. Click here to view this story on the Public News Service RSS site and access an audio version of this and other stories: http://www.publicnewsservice.org/index.php?/content/article/26543-1<http://www.publicnewsservice.org/index.php?/content/article/26543-1> --- To be removed from this list please send an e-mail to remove(a)publicnewsservice.org <remove(a)publicnewsservice.org?subject=remove>and put the word "remove" in the subject line. -- Paul Wilson Sierra Club 504 Jefferson Ave Charles Town, WV 25414-1130 Phone: 304-725-4360 Cell: 304-279-1361 "There is no forward until you have gone back" ~Buddha "In all things of nature there is something of the marvelous" ~ Aristotle

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Fwd: Tell Gov. Tomblin: This is outrageous
by Paul Wilson 21 May '12

21 May '12

I signed and posted on my Facebook wall. fyi, paul ---------- Forwarded message ---------- From: Josh Nelson, CREDO Action <act(a)credoaction.com> Date: Mon, May 21, 2012 at 8:03 AM Subject: Tell Gov. Tomblin: This is outrageous To: Paul Wilson <pjgrunt(a)gmail.com> ** [image: Tell Governor Tomblin: Stop spending taxpayer money to promote the coal industry's misleading talking points!] <http://act.credoaction.com/r/?r=6891581&id=40465-3414728-Evb4Sxx&t=1> photo: Joost J. Bakker IJmuiden Clicking here will automatically add your name to this petition to West Virginia Governor Earl Ray Tomblin:<http://act.credoaction.com/r/?r=6891582&id=40465-3414728-Evb4Sxx&t=2> * "Using taxpayer money to pay for anti-EPA coal industry political attacks is an outrageous breach of public trust. As a West Virginia resident, I urge you to put an end to the state's sponsorship of the annual "coal forum" and stop your brazen shilling for the dirty coal industry." <http://act.credoaction.com/r/?r=6891582&id=40465-3414728-Evb4Sxx&t=3> * Automatically add your name: <http://act.credoaction.com/r/?r=6891582&id=40465-3414728-Evb4Sxx&t=4> [image: Take action now!] <http://act.credoaction.com/r/?r=6891582&id=40465-3414728-Evb4Sxx&t=5> Learn more about this campaign<http://act.credoaction.com/r/?r=6891581&id=40465-3414728-Evb4Sxx&t=6> [image: CREDO Action | more than a network, a movement.] *Tell Gov. Tomblin: Taxpayer money shouldn't promote coal propaganda and right-wing attacks on the EPA.<http://act.credoaction.com/r/?r=6891581&id=40465-3414728-Evb4Sxx&t=7> * Dear Paul, An explosive article published Wednesday on the Charleston Gazette's website exposed that West Virginia taxpayer money is being used to promote the coal industry's misleading attacks on the Environmental Protection Agency and President Obama's attempts to protect public health.1 *In the past two years, Governor Tomblin and the state legislature have set aside $58,500 in taxpayer money for a series of annual events called "the coal forum," in which coal industry staffers and pro-coal elected officials will attack EPA's efforts to protect public health as "the EPA's war on coal."* It is bad enough that Governor Tomblin is supporting pro-coal policies that throw people's health under the bus, but to be so brazen about using taxpayer money to parrot right-wing and coal industry political attacks is a stunning breach of public trust. *Tell Governor Tomblin: Don't spend taxpayer money on political attacks. Click here to automatically sign the petition.* <http://act.credoaction.com/r/?r=6891582&id=40465-3414728-Evb4Sxx&t=8> Everything about these events just reeks. This year's "coal forums," which are scheduled to take place this week in Charleston, Wheeling and Beckley, are literally being planned and promoted by a coal industry public relations firm owned by a registered lobbyist!2 These forums are a blatant attempt to advance the one-sided interests of the coal industry, which is working to reverse life saving federal pollution limits. Absent from the forums will be scientists, public health professionals and anyone else who might tell the truth about the devastating impacts of coal and the need to protect West Virginians from dirty coal pollution.3 *Mother Jones' Kate Sheppard characterized the issue well: "It's not surprising that the coal industry is down on Obama. But there aren't many states where the industry would have direct state support in advancing that agenda."4* The Coal Forum's Twitter account gives a good indication of the anti-Obama sentiment the events will be pushing, with several recent Tweets highlighting "Obama's war on coal" and one actually saying "Obama faces trouble in coal country."5 *Tell Governor Tomblin: Don't spend taxpayer money on political attacks. Click here to automatically sign the petition.* <http://act.credoaction.com/r/?r=6891582&id=40465-3414728-Evb4Sxx&t=9> Governor Tomblin has a well-deserved reputation for acting as a mouthpiece for West Virginia's powerful coal industry. His re-election website is largely committed to defending the coal industry and attacking the EPA.6 And of course, his list of campaign contributions reads like a who's who of power brokers in the dirty coal industry.7 But the blatant use of state-funds to promote what clearly amounts to coal industry propaganda and right-wing political attacks is truly brazen, even for him. Click below to automatically sign the petition and send a strong message to Governor Tomblin: *http://act.credoaction.com/r/?r=6891582&id=40465-3414728-Evb4Sxx&t=10* Thanks for fighting against the West Virginia government's shameful shilling for dirty coal. Josh Nelson, Campaign Manager CREDO Action from Working Assets <http://act.credoaction.com/r/?r=11&id=40465-3414728-Evb4Sxx&t=11> 1. W.Va. taxpayers fund anti-Obama coal campaign<http://act.credoaction.com/r/?r=6891583&id=40465-3414728-Evb4Sxx&t=12>, Charleston Gazette, 5/16/12 2. Coal PR firm set up state's anti-Obama meetings<http://act.credoaction.com/r/?r=6891585&id=40465-3414728-Evb4Sxx&t=13>, Charleston Gazette, 5/18/12 3. Events<http://act.credoaction.com/r/?r=6891586&id=40465-3414728-Evb4Sxx&t=14>, The Coal Forum 4. West Virginia Funds Pro-Coal Attack on Obama Admin.<http://act.credoaction.com/r/?r=6891587&id=40465-3414728-Evb4Sxx&t=15>, Mother Jones, 5/17/12 5. The Coal Forum<http://act.credoaction.com/r/?r=6891594&id=40465-3414728-Evb4Sxx&t=16>, Twitter 6. W. Va. Gov. Earl Ray Tomblin on Coal<http://act.credoaction.com/r/?r=6891584&id=40465-3414728-Evb4Sxx&t=17>, YouTube, 1/13/12 7. Contributions to Tomblin, Earl Ray<http://act.credoaction.com/r/?r=6891591&id=40465-3414728-Evb4Sxx&t=18>, National Institute on Money in State Politics ------------------------------ [image: Facebook]<http://act.credoaction.com/r/?r=6891592&id=40465-3414728-Evb4Sxx&t=19> *Share on Facebook* Post to your wall<http://act.credoaction.com/r/?r=6891592&id=40465-3414728-Evb4Sxx&t=20> [image: Twitter]<http://act.credoaction.com/r/?r=6891593&id=40465-3414728-Evb4Sxx&t=21> *Tweet this* Post to Twitter<http://act.credoaction.com/r/?r=6891593&id=40465-3414728-Evb4Sxx&t=22> © 2012 CREDO. All rights reserved. To remove yourself (Paul Wilson) from this list, please visit our subscription management page at: http://act.credoaction.com/s?i=40465-3414728-Evb4Sxx To change your email address or update your contact info, please visit: http://act.credoaction.com/subscrip/coa.html?id=40465-3414728-Evb4Sxx -- Paul Wilson Sierra Club 504 Jefferson Ave Charles Town, WV 25414-1130 Phone: 304-725-4360 Cell: 304-279-1361 "There is no forward until you have gone back" ~Buddha "In all things of nature there is something of the marvelous" ~ Aristotle

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Fwd: Public Source article on Dana Mining's abuse of the Steele Shaft site agreement
by James Kotcon 20 May '12

20 May '12

Excellent articel about the on-fging water quality problems associated with Longview's affiliate AMDRI. The quote from Charlie Huguenard is particlurly enlightening. Jim Kotcon

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PJM Capacity Market Results Announced
by Frank Young 19 May '12

19 May '12

WordPress.comNote this PJM paragraph: "Although the RPM auction procured sufficient resources to meet the projected demand, some generating units may need to remain available beyond their proposed retirement dates until transmission upgrades are completed. These units would be operated under “reliability must run” agreements." I wonder what this bodes for First Energy's recently announced closure of Albright and other older generating facilities.- Frank ----- Original Message ----- From: The Power Line To: fyoung(a)mountain.net Sent: Saturday, May 19, 2012 10:39 AM Subject: [New post] PJM Capacity Market Results Announced New post on The Power Line PJM Capacity Market Results Announced by Bill Here is a link to PJM's press release on the just concluded capacity auction results. PJM is a cartel, and these annual auctions determine what companies and power plants can sell their power in PJM three years in the future. By disguising its cartel gatekeeping as an auction, PJM maintains a facade of "market based" neutrality. In fact, we know that the RPM system is "gameable" and is really a PIG (protection of incumbent generators). So what happened at the auction? Here's what PJM said: This year, the auction procured 164,561 MW of capacity resources at a base price of $136 per MW. A megawatt is enough electricity to power 800 to 1,000 homes. PJM’s all-time peak demand is 158,448 MW. Prices were higher in northern Ohio and the Mid-Atlantic region. How much higher were prices in the Mid-Atlantic region? The price of capacity in much of the Mid-Atlantic area will be $167 per megawatt. That is only $31 more than the PJM overall base price. This if far below the differences in RPM prices that PJM cited as a need for PATH. What does PJM say caused this shift? In addition to new generation, most of it natural gas-fired, the capacity auction also procured 14,833 MW of demand response, a 5 percent increase over last year, and energy efficiency, a 12 percent increase. The amount of demand response was also a record for PJM, as well as for renewable generation. Solar increased to 56 MW of solar — a 22 percent increase over last year – and wind increased to 796 MW – a 15 percent increase. Because all of these sources of capacity are far less polluting than coal, most of them are located in Mid-Atlantic states, a trend that is accelerating. Its a good thing that PJM, FE and AEP did not railroad state regulators into approving PATH. All rate payers in PJM would have been stuck with a very expensive white elephant. Speaking of FE, here is the auction result for the ATSI region of PJM, the northern region of Ohio and the heart of FE's business: In northern Ohio served by FirstEnergy, the price will be $357 per megawatt. This is a classic example of gaming the RPM system. FE announced a lot of coal plant closures early, instead of whining like AEP's "chiefs" have been. These plant closures, which FE said would be accomplished before 2015-16, the period of this year's RPM auctions, resulted in a severe decline in generating capacity in FE's home region. This will make it more likely for FE to appeal to PJM to keep these plants open to insure reliability, called Reliability Must Run, or RMR, in PJM jargon. Or, as the last paragraph of the press release describes it: Although the RPM auction procured sufficient resources to meet the projected demand, some generating units may need to remain available beyond their proposed retirement dates until transmission upgrades are completed. These units would be operated under “reliability must run” agreements. FE's gaming of the RPM market in 2015-16 artificially drove up prices in the ATSI zone, insuring at least some of its plants slated for closure will get RMR status from PJM and can remain open. As Keryn points out, FE beat AEP like a rented mule in the plant closure game. The high ATSI zone prices also completely undercut the PATH argument that capacity prices in eastern PJM are higher than prices in western PJM. The press release also notes, as we have in recent posts on The Power Line, that the FE plant closures have completely altered the transmission picture in PJM away from Project Mountaineer and unnecessary boondoggles such as PATH. Bill | May 19, 2012 at 9:39 am | Tags: Alternatives to PATH, PJM Fakery, Power Companies & PATH | Categories: Uncategorized | URL: http://wp.me/piwFb-1yq Comment See all comments Unsubscribe or change your email settings at Manage Subscriptions. Trouble clicking? Copy and paste this URL into your browser: http://calhounpowerline.com/2012/05/19/pjm-capacity-market-results-announce… Thanks for flying with WordPress.com

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EC May 2012