Procurement News Notice |
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| PNN | 9314 |
| Work Detail | Faced with opposition and an approaching deadline, Jersey Central Power & Light on Thursday withdrew its request to transfer its high-voltage transmission lines to another company, a move that critics had said was designed to help it get around state rules to build power lines. In a letter to state Board of Public Utilities President Richard Mroz, JCP&L said it had hoped to be able complete the move to Mid-Atlantic Interstate Transmission LLC by January, but that now doesn't seem possible. "As the BPU is aware, FirstEnergy has received final approvals from both the Pennsylvania Public Utility Commission and the Federal Energy Regulatory Commission," states the letter from JCP&L's attorney, Gregory Eisenstark. "However, at this juncture, nearly fifteen months after the original Petition was filed, there appears to be no prospect of resolving this matter in New Jersey to accommodate the above time-frame." JCP&L's decision does not affect its plans to build the proposed $111 million Monmouth County Reliability Project, a 10-mile high-voltage transmission line between Aberdeen and Red Bank along the NJ Transit's North Jersey Coast Line tracks now being considered by state regulators. "FirstEnergy remains committed to transmission plans in New Jersey," spokesman Ron Morano said. It includes "a number of key transmission initiative around the state, including the Monmouth County Reliability Project." Stefanie Brand, the director of the state Division of Rate Counsel, said JCP&L's decision on MAIT "was good news for the ratepayers of New Jersey." "I am very pleased," Brand said. "I do think we raised a lot of important questions about this transaction." Under the proposal, JCP&L, the Morristown-based utility wanted to transfer its transmission assets, valued at $750 million and consisting of 2,569 circuit miles of high-voltage lines and transmission towers to Mid-Atlantic Interstate Transmission, a subsidiary of FirstEnergy Transmission. JCP&L would have leased the associated land to the company too. If it had been approved, MAIT would have built and owned the Monmouth line. JCP&L, and its parent company FirstEnergy Corp., had wanted regulators to rule that MAIT is a public utility, giving it to the right to use eminent domain and circumvent local zoning laws to build power lines. So, after first getting the brush off by the board, JCP&L proposed to transfer five large business customers to MAIT, giving the transmission company the retail electric customers it says its needs to comply with state law. In New Jersey, a public utility must have distribution customers. Two FirstEnergy utilities, Pennsylvania Electric Co. and Metropolitan Edison, have received a nod from Pennsylvania regulators to transfer their transmission systems to Mid-Atlantic Interstate. The Federal Energy Regulatory Commission has approved, too. The state Division of Rate Counsel had recommended that the board deny the company's request, citing concerns the transaction did not fairly value JCP&L's lines, would hurt ratepayers and was anti-competitive. If approved, MAIT would have been overseen primarily by the Federal Energy Regulatory Commission, Brand said. The ability to use eminent domain and get around local zoning laws are "two very significant powers that come along with being a public utility," she said. "There's so many ways in which this transaction sold the ratepayers short that I think it's just better for everyone if the BPU retains its regulatory authority and ratepayers get the benefit of that," she said. "We felt that that the transfer of five customers was a bit of a paper transaction and not one the really held them to the same standards that public utilities are held to. We think if this had been approved that there was going to be a harm to ratepayers." JCP&L had said a transmission-only company would be able to complete projects quicker and at less cost to ratepayers. "FirstEnergy is disappointed that New Jersey regulators determined that a transmission-only company cannot be considered a public utility in the state," Morano said. "As we've said a separate transmission-only company carries a more favorable credit rating, can borrow money for less and result in lower costs to customers. "We will begin to work with the BPU and other stakeholders in New Jersey to try to find a way to deliver on the benefits that MAIT would have otherwise delivered but using a structure that can be supported by all the interested parties," Morano said. At a public hearing last week, U.S. Rep. Frank Pallone, D-N.J., spoke against the proposal, as did some residents from Monmouth County who also are fighting JCP&L's Monmouth County Reliability Project. Pallone and Rep. Chris Smith, R-NJ, both opponents of the Monmouth transmission line, said they were encouraged by JCP&L's decision. "“Had it been approved, I believe it would have made it easier for JCP&L to build the Monmouth County Reliability Project, which I believe is ill-conceived and not in the best interest of the residents," Smith said in a statement. The proposal could have had "unforeseen impacts" in Monmouth County given the transmission line project, Pallone said. "There were numerous unresolved questions about the consequences of this transfer, including how ratepayers would be affected, and whether BPU would have authority over MAIT," he said in a separate statement. The New Jersey Sierra Club called on JCP&L to abandon its plans for the Monmouth line as well. "This sale would have been a complete rip-off of ratepayers. Now that they have ended this proposal, this makes their destructive transmission line proposal even more unneeded," said Jeff Tittel, director of the New Jersey Sierra Club, in a statement. "JCP&L should now withdraw their proposed transmission line because it is bad for the environment and bad for ratepayers." |
| Country | United States , Northern America |
| Industry | Energy & Power |
| Entry Date | 15 Oct 2016 |
| Source | http://www.app.com/story/money/business/consumer/press-on-your-side/2016/09/08/jcpl-power-lines/90006614/ |
