By Rory D. Sweeney

VALLEY FORGE, Pa. — In a rare occurrence, half a dozen residents opposed to PJM’s largest-ever congestion-reducing transmission project attended last week’s Transmission Expansion Advisory Committee to protest the RTO’s reconfirmation that the project would be beneficial to the public.

The $366.17 million project proposed by Transource Energy would consist of two separate 230-kV double-circuit lines, totaling about 42 miles, across the Maryland-Pennsylvania border — one between the Ringgold substation in Washington County, Md., and a new Rice substation in Franklin County, Pa., and another between the Conastone substation in Harford County, Md., and a new Furnace Run substation in York County, Pa. (See Line Opponents Set Sights on PJM in Public Campaign.)

PJM’s annual re-evaluation of the project’s benefit-to-cost ratio found that it had increased to 1.42 from a 1.32 evaluation published in February. The RTO’s threshold for considering such market efficiency projects is 1.25. The new evaluation included an increase in the project’s cost from its original $340.6 million estimate. PJM’s Nick Dumitriu said he spent an extensive amount of time attempting to make the analysis as comprehensive as possible and said “there are good reasons why” the ratio increased.

“I do have my engineering pride,” he said.

However, Vice President of Planning Steve Herling admitted “you can never know you have all the data” for evaluating a project and that “you have to put a stake in the ground” to determine what set of information is used.

“It’s unfortunately a moving target,” he said. “We’ve had lines where the supplemental analyses [found], based on the passage of time, the need erodes.”

“How do you expect us to have trust in your figures when you’re telling us now you don’t know,” asked Patti Hankins, one of the objecting residents of Harford County. She noted that PPL told Pennsylvania regulators it could add another cable on an existing right of way that parallels the proposed route. “That’s a hard thing for us to swallow,” she said, when state officials “all understand there’s existing infrastructure that can support this” upgrade.

PJM has previously confirmed that PPL also proposed a project to address the congestion on the AP South interface, which the Transource proposal also targeted. But PPL’s proposal only upgraded a nearby substation, didn’t include utilizing the extra space it has on its existing line and failed to achieve a benefit-to-cost ratio that exceeded the 1.25 threshold, RTO officials said.

While staff acknowledged the residents’ concerns, Herling said the decision to move forward with the project is now in the hands of state regulators to determine whether it should receive necessary permits. He added that staff “will certainly support” the commissions with any analyses they request.

“We’re not in a position to essentially usurp a state’s authority and take action on determining whether or not the project should move forward,” Herling said, indicating that staff will go back to the drawing board if the project is denied. “Our audience right now are the two commissions, and … we will abide by whatever decisions Pennsylvania or Maryland require us to make.”

The states’ consumer advocates showed interest, with representatives from both agencies asking questions about PJM’s analysis process. Gary Alexander from the Maryland Office of People’s Counsel questioned the urgency of the project, asking why Transource hasn’t yet entered into contracts with suppliers.

Herling said the company is getting bids. “I don’t know what the sequence of activities will be for executing those contracts,” he said.

FERC could also throw a wrench into PJM’s analysis. The Markets and Reliability Committee endorsed Tariff revisions in August that would exclude generating units with facility study agreements (FSAs) and suspended interconnection study agreements from PJM’s base case for analyzing market efficiency projects. The RTO says including these units causes unrealistic benefit estimates for proposed transmission projects. (See “Market Efficiency,” PJM MRC/MC Briefs: Aug. 23, 2018.)

Staff acknowledged that projects may need to be re-evaluated if FERC accepts the revisions.

“I think we’re going to have to look at units on a project-by-project basis” to determine if FSAs made a difference, Herling said. “We just don’t have time to run sensitivities ahead of time.”

However, he said if FSAs were removed from the Transource evaluation, the ratio would actually increase “based on current factors.”

The math did little to reassure the residents, who said they were being forced to waste time on a process that should be an easy decision.

“From the ground, the people see that PJM is not working in the interest of the ratepayers,” Harford County resident Aimee O’Neill said. “We must simply slog through it. … You are making it a very expensive process [when it] is apparent [there is] an alternative to a greenfield project.”

Herling said the current process will continue for the Transource project, but he conceded that staff needs better engagement with states.

“They have a process, we have a process, and we need to change that moving forward,” he said.