PATH project temporarily suspended by regional grid operator

Plan postponed until demand for energy increases, PJM says

February 28, 2011|By Liz F. Kay, The Baltimore Sun

A plan to build a $2 billion high-voltage transmission line from West Virginia to Frederick County has been suspended for additional study, the region's electricity grid operator, PJM Interconnection, announced Monday.

American Electric Power and FirstEnergy Corp. also announced they would withdraw their applications to state regulators to construct the Potomac-Appalachian Transmission Highline, or PATH, after PJM's decision.

PJM's board decided that the slow economy delayed the need for the additional transmission capacity. The 275-mile line had been proposed in 2007 to improve reliability — and to help avert the risk of blackouts — by connecting the Amos substation in West Virginia's Putnam County with the proposed Kemptown substation near Mount Airy in Frederick County.

Now the utilities will await a PJM decision to revive the project, continue the suspension or abandon the project altogether, said FirstEnergy spokesman David Neurohr. "We started the project at the behest of PJM," he said.

Michael J. Kormos, PJM's senior vice president of operations, said the grid operator reviews its projects annually based on the latest forecasts. PJM re-analyzed the need based on estimates of customer demand for electricity, the impact of programs that shift electric use to off-peak hours and other factors.

Terry Boston, chief executive of PJM, also stated in a filing to the Maryland Public Service Commission, the state's top energy regulator, that dramatic swings in economic forecasts and changing public policies promoting renewable energy also add uncertainty to the planning.

These recalculations pushed the need for the PATH line out several years, Kormos said. "We thought it prudent to suspend the work to allow us to do our more rigorous analysis."

PJM officials said that an analysis of a separate project, the Mid-Atlantic Power Pathway, or MAPP, has not yet been completed. That line, a $1.2 billion project proposed by Pepco Holdings Inc., would stretch from northern Virginia through southern Maryland up to Delaware.

"Right now the drivers underlying the MAPP project are more complex and are going to require more analysis," said PJM spokeswoman Paula DuPont-Kidd.

Paula Carmody of the Office of the People's Counsel, which represents consumer interests before state utility regulators, said she was not surprised by the decision regarding the PATH project, given the combined impact of the economic downturn as well as demand-response programs that shift energy use to off-peak times. Her agency supports this additional, more rigorous analysis before moving forward, she said.

While saying that "reliability is critical," Carmody added that "because of the expense of these projects — particularly if you have multiple projects being considered — you want to be very clear that the project is needed and there are no least-cost alternatives to the project."

"Ultimately the customers will be paying," Carmody said, explaining that the cost to build transmission lines would be added to utility bills.

Environmental groups had argued that the project was not necessary and would allow power from coal-fired plants in the western part of the PJM region to move east.

"We didn't believe this was needed for reliability reasons," said Wil Burns, attorney for the Sierra Club. "We're hoping this will be the last time this will come back again."

liz.kay@baltsun.com

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