If you are browsing the filings at the PSC PATH case file and come across a funny looking filing by the power companies called “Copy of 2009 Annual Update to recalculate its annual transmission revenue requirements, as filed on June 1, 2009 with the Federal Energy Regulatory Commission,” you might want to take a look at it.
If you have been doing your homework on The Power Line, you know that the first thing AEP/Allegheny had to do in their PATH project was to apply to FERC to have us all pay their costs for PATH plus their nifty 14.3% guaranteed profit. In return for FERC’s gift, AEP/Allegheny have to file a report to FERC every year of all the costs the power companies want us to pay as part of our electric rates.
The filing on the PSC site appears to be AEP/Allegheny’s report to FERC for this year. Of course, there are abbreviations and codes all through this report. This is typical practice now in the electrical industry. They claim they are making their information public, but what they report is coded in such a way that no one else can understand what they are saying.
Glance at the numbers anyway. The main thing to take away from this report is that the stupid line hasn’t even been built yet, and FERC is letting AEP/Allegheny charge us for all their pre-construction expenses.
Here’s an interesting note that I gleaned from the report. AEP/Allegheny have borrowed $500 million for the PATH line. They are paying off a bond and “other long term debt” with interest rates of 7% and 6.6%. That means AEP/Allegheny are paying out 7% interest on money they can invest and earn 14.3%. And, FERC lets them charge the interest itself as an expense of the project, on top of which AEP/Allegheny make the full 14.3%.
FERC incentives, the gifts that keep on giving.
The Power Line 