After recently confronting confusion around the stakeholder task force nomination process, MISO’s Steering Committee is seeking to clarify how the RTO will nominate and elect individuals to fill stakeholder group leadership positions in the future.
The issue emerged at the Steering Committee’s September meeting, when the committee deviated from standard practice by administering separate elections for the positions of chair and vice chair of MISO’s Energy Storage Task Force during the same election cycle. Both candidates for chair expressed an interest in running for vice chair if they weren’t picked for the top spot and, as a result, one nomination for vice chair was submitted after the deadline, leaving the committee to decide whether to include the late submission for voting. Committee members voted to reopen the nominating process, but not all stakeholders were pleased with the process. (See Nomination Redux for MISO Energy Storage Task Force.)
MISO’s Stakeholder Governance Guide is silent on the issue of moving election dates, accepting late nominations or dealing with instances when stakeholders simultaneously run for two leadership positions in the same committee.
The Steering Committee will take up the issue in January, when it will vote on redline clarifications to the elections process outlined in the governance guide. The changes could allow consecutive ballots in instances where a stakeholder wants to run for chair but also be considered eligible for vice chair should they lose their bid for the chair position.
Ameren’s Ray McCausland said his company supports Stakeholder Governance Guide changes that allow a stakeholder to run for both chair and vice chair simultaneously, with the option for runoff elections when needed. If the same candidate is elected to both positions, the candidate would accept the chair position, and a runoff election would be held using the previous slate of vice chair candidates. Currently, elections for chair and vice chair for all MISO stakeholder committees and groups are held simultaneously via electronic ballot among MISO members with voting rights. No late nominations are accepted.
Madison Gas and Electric’s Megan Wisersky said that while she understood the RTO’s wish not to dissuade stakeholders from running for leadership positions, she could also see the value in compelling individuals to focus on running for a single position.
“I’m not much help here,” she joked during a Nov. 7 conference call.
WPPI Energy also advocated for the continued simultaneous election of chair and vice chairs, requiring candidates to choose to run for a single position and not both leadership positions.
McCausland argued that preventing a candidate from running for both positions might lead to empty vice chair positions.
The New England Power Generators Association (NEPGA) on Monday filed a request for rehearing of FERC’s Oct. 6 order accepting ISO-NE’s updated cost of new entry value for the RTO’s capacity auctions (ER17-795).
ISO-NE is required to recalculate the values every three years and will apply the revisions in next February’s Forward Capacity Auction 12 covering the 2021/22 capacity commitment period, as well as in FCAs 13 and 14. (See FERC Approves ISO-NE CONE, Offer Trigger Updates.)
The Brayton Point Power Station in Somerset, MA went offline in June 2017.
In its Nov. 6 filing, NEPGA specified several perceived errors in FERC’s order and asked the commission to reconsider its previous finding that a net CONE value based on simple cycle generator technology is just and reasonable. The group instead favors basing that value on the costs needed to support a combined cycle turbine. It is asking the commission to change the rules in time for FCA 12, which begins Feb. 7, 2018.
NEPGA contended that the order was “arbitrary and capricious and not the product of reasoned decision-making” because the commission did not balance the financial interests of capacity providers against the “substantial” benefits conferred to load. The group also argued that the commission failed to consider the record of evidence indicating that simple cycle generators are not likely to be built in New England.
The $8.04/kW-month net CONE value proposed by the grid operator will cause a $1.5 billion reduction in market-wide capacity revenues at equilibrium from FCA 11 to FCA 12, which for a 500-MW capacity resource means a $22.8 million cut in capacity revenues in a single year, and more than $67 million during the three years covered by the auction, NEPGA said.
The filing did not seek to change the commission’s approval of offer review trigger price (ORTP) values, which were also part of the order.
CAISO is facing pressure from some stakeholders to broaden the scope of its latest effort intended to increase the participation of energy storage and distributed energy resources in its market.
The ISO is in the beginning stages of its Energy Storage and Distributed Energy Resources (ESDER) Phase 3 initiative, kicked off in September with an issue paper that will be developed into a straw proposal. (See CAISO Load-Shifting Product to Target Energy Storage.) Participants in the effort include companies such as eMotorWerks, Stem, investor-owned utilities and the California Energy Storage Alliance.
Energy storage company STEM is participating in CAISO’s ESDER Phase 3 | STEM
ESDER Phase 2 unearthed several issues for Phase 3, most which are touched on in the issue paper. Based on stakeholder input, CAISO is proposing that the latest initiative cover rule changes that would relax limitations on how demand response can participate in the market, as well as the integration of distributed resources, microgrids and electric vehicle charging infrastructure. The effort could also explore “multiple-use applications” for energy storage, which recognize the ability of those resources to provide services and receive revenue from more than one entity at a time, such as at the wholesale, transmission and distribution levels.
Developing electric vehicle charging equipment load curtailment as a proxy demand resource is one aspect of ESDER Phase 3 | emotorwerks
In a Nov. 6 conference call, the ISO asked stakeholders to prioritize among a list of six topics listed in the issue paper regarding changes to demand response rules, which provide a point of market entry for distributed resources. Those topics include how to handle challenges such as setting start-up and minimum/maximum load costs, dealing with variability of weather-sensitive DR, refining DR aggregation rules and others.
CAISO representatives at various points in the call indicated they do not want to delve too deeply into one particular focus area of the initiative, which includes many complex challenges in implementing new technologies and market products.
But Robert Anderson — chief technology officer for Olivine, a DR and DER services company — urged the ISO not to require commenters to choose among the six topics for the DR portion of the initiative, but instead cover them all.
“When is ESDER Phase 4?” Anderson asked rhetorically. “The question is: ‘When do we get another chance at this?’ I am very optimistic that you guys can take on a lot more than you think.” Instead of a slower approach to the proposals, “maybe we can get through them very quickly, and get them done and get them behind us,” he said.
Margaret Miller of Customized Energy Solutions said the microgrid sector is not well-represented in the stakeholder process, and there are a lot of unanswered questions as to how microgrids will participate in wholesale markets.
“There are decisions made today that could unduly limit those microgrids from participating,” she said, calling for policy guidance in ESDER 3 or elsewhere. “Otherwise, we are continuing to address these on a one-off basis.”
CAISO External Affairs Officer Peter Colussy said microgrids are being studied in other processes. ESDER 3 is aimed at looking at different technologies and platforms to provide various services, not focusing too much on one technology, he said.
“We are not trying to focus on microgrids here,” Colussy said.
The CAISO Board of Governors in July approved ESDER Phase 2, which is still pending approval by FERC. (See New CAISO Rules Spell Increased DER Role.) That initiative developed a set of alternative energy usage baselines to assess the performance of proxy demand resources, which are DER aggregations of retail customers. It also developed new rules that distinguish between charging energy and station power for storage resources, and created a net benefits test for DR resources that participate in the Western Energy Imbalance Market (EIM).
FERC on Tuesday agreed to sharply reduce the penalty Barclays Bank must pay to settle claims that it manipulated Western electricity markets a decade ago.
The commission approved a settlement agreement requiring the U.K.-based company to pay $105 million in penalties after company traders engaged in a two-year scheme to influence physical power prices at certain trading hubs in the West in order to benefit from their positions in financial swaps covering those same markets (IN08-8). The illegal trades occurred from November 2006 to December 2008, and involved the Mid-Columbia, NP-15, SP-15 and Palo Verde delivery points.
FERC accused Barclays traders of influencing prices at the Mid-Columbia, NP-15, SP-15 and Palo Verde trading hubs in order to benefit the bank’s positions in financial swaps covering those markets. | EIA
The agreement represents a significant comedown for FERC, which in July 2013 levied a record $470 million fine against Barclays, which included a requirement that the bank disgorge nearly $35 million in profits from the scheme. Those proceeds were to be paid into the low-income home energy assistance programs (LIHEAPs) of Arizona, California, Oregon and Washington. Former FERC Chairman Norman Bay was director of the commission’s Office of Enforcement at the time.
Barclays challenged the penalty in federal court, and Tuesday’s settlement indicates the bank largely prevailed in its nearly five-year legal battle with FERC. Under the terms of the agreement, the bank will pay just $70 million in civil penalties, though it must still relinquish its profits from the scheme, just over half of which will be directed to the LIHEAPs. The company and its traders did not admit nor deny committing any violations against the commission’s anti-manipulation rules.
“The commission concludes that the agreement is a fair and equitable resolution of the matters concerned and is in the public interest, as it reflects the nature and seriousness of the conduct and recognizes the specific considerations stated [in the order] and in the agreement,” FERC wrote in its decision to approve the order.
One critic of the settlement strongly disagreed with FERC’s take.
“FERC’s action is an outrage and sends a clear signal to market manipulators: Crime will now pay,” Tyson Slocum, director of Public Citizen’s energy program, said in a statement.
Slocum said the “egregious” settlement did not occur in isolation but instead points to a broader development in which FERC “may be getting soft on rule-breakers.” As evidence, he cited the recent appointment of General Counsel James Danly, who previously served on the legal team defending Dynegy in market manipulation case brought by Public Citizen (EL15-70). One of Danly’s former law partners has written articles “attacking” Bay’s enforcement actions and appointment as chair, Slocum pointed out.
“Consumers have benefited from FERC’s aggressive enforcement of wrongdoers,” Slocum said. “The evisceration of the Barclays settlement, when combined with key staffing decisions at FERC, may signal that the days of tough enforcement on banks, hedge funds and other energy traders may be coming to an end.”
Slocum called for Congress to hold an oversight hearing on FERC operations to ensure that consumers are protected from energy market manipulation.
David Applebaum, an attorney who previously served as director of investigations in the Office of Enforcement, told Bloomberg that FERC’s move was “inevitable” after a federal judge in September ruled the agency had waited too long to bring its case against Ryan Smith, one of the Barclays traders involved in the scheme. Smith, along with fellow traders Karen Levine and Daniel Brin, initially faced penalties of $1 million each, while their manager, Scott Connelly, was ordered to pay $15 million.
“I think once the Smith decision came out, it was inevitable that FERC would have to reduce its damages and civil penalties significantly,” Applebaum said.
Levine, Brin and Connelly were covered under Tuesday’s settlement.
ERCOT on Monday approved Luminant’s proposal to dispose of nearly 2,300 MW of coal-fired generation capacity in Texas.
The ISO’s reliability assessments determined that none of the four units at the company’s Big Brown and Sandow plants was “required to support ERCOT transmission system reliability.”
ERCOT said the Texas grid is undergoing “significant change,” with new technologies “changing the role that some older generation resources play in grid and market operations.” The ISO said lower natural gas prices have been reducing revenues for all generators in recent years, and wind and solar resources continue to flood the market.
As of Oct. 30, ERCOT has nearly 48 GW of new generation projects under study, and more than 21 GW of new projects have interconnection agreements. That includes more than 10 GW of proposed gas-fired projects, 2 GW of utility-scale solar and more than 8.7 GW of wind projects.
ERCOT has said it will have almost 81 GW of total capacity available this winter, more than enough to meet a projected peak of more than 61 GW. It will update the expected reserve margins for 2018 and the next several years in the next Capacity, Demand, and Reserves Report, scheduled for Dec. 18.
The Public Utility Commission of Texas has also directed the ISO to study and consider the appropriate level of reserves needed to maintain reliability while minimizing costs in its energy-only market.
Big Brown’s two units date back to the early 1970s and are capable of 1,150 MW of output. Vistra has said it is exploring a sale of the site north of Houston, but the plant will be shut down if it hasn’t been sold by Feb. 12, 2018.
Sandow’s units date back to 1981 and 2009 and have 1,137 MW of capacity. They will be closed Jan. 11.
Combined with the earlier retirement of Monticello’s three coal units, Luminant will have shuttered 4,167 MW of coal capacity by early next year — more than half of its 8,000 MW of available capacity. The company has only two coal plants left: Martin Lake (2,250 MW) in East Texas and Oak Grove (1,600 MW) in the southern part of the state.
Exelon will relinquish four Texas natural gas plants to its lenders and pay $60 million to keep a fifth plant in the latest response to what the company called “historically low power prices” in the state.
The plans were detailed in a Chapter 11 bankruptcy filing Nov. 7 by ExGen Texas Power, Exelon’s merchant generation business in Texas, and in an 8-K filing by Exelon. It follows Vistra Energy’s announcements last month that it would retire 4,100 MW of coal-fired generation in the state.
The 738-MW Wolf Hollow facility in Granbury, Texas, is one of the four power plants in the state Exelon will sell as part of the bankruptcy of its ExGen Texas Power subsidiary. | GE Power
Exelon said it made the bankruptcy filing to offload most of a $675 million loan due in September 2021. “Pending a competitive bidding process,” the company said in a statement, it will pay $60 million to lenders to keep its 1,265-MW Handley Generating Plant in Fort Worth.
“Lenders have agreed to exchange the debt they currently hold in EGTP’s other four plants for equity in the plants, effectively taking ownership of these facilities,” Exelon said.
The company told the Securities and Exchange Commission that it expects a pre-tax gain of $125 million to $200 million in the fourth quarter off the sale. It had recorded pre-tax impairment charges of $418 million in the second quarter of 2017 and $40 million in the third quarter for the plants.
The other four plants are the 738-MW Wolf Hollow combined cycle facility in Granbury; the 510-MW Colorado Bend combined cycle in Wharton; the 808-MW Mountain Creek steam boiler in Dallas; and the 156-MW simple cycle facility in La Porte.
The company has been seeking to sell its Texas fleet since at least March, when Reuters reported that it had hired a debt restructuring adviser to help it evaluate its options. This followed a January decision by Moody’s Investors Services to downgrade EGTP’s debt from B2 to Caa1.
Exelon’s stock closed at $41.27/share Tuesday, up 1.45% from Monday’s close.
Independent Market Monitor Beth Garza told ERCOT’s Board of Directors last month that the Vistra retirements will result in higher prices and lower capacity margins, citing two years of “clearly unsustainably low prices with high reserve margins.” (See ERCOT IMM: ‘Fat and Happy’ Times Ending with Coal Closures.)
Nuclear and coal generators made their closing argument for price supports Tuesday, as opponents urged FERC to reject the proposal or let RTO stakeholders take up the resilience debate.
Tuesday was the deadline for reply comments in response to the Department of Energy’s Notice of Proposed Rulemaking, which called for cost-of-service pricing for coal and nuclear generators in competitive markets (RM18-1). The deadline for initial comments was Oct. 23. (See FERC Flooded with Comments on DOE NOPR.)
The Rule of Three
Three-step proposals were all the rage in the latest filings, with the Nuclear Energy Institute calling for a cost-of-service mechanism to prevent “premature” retirements, an order requiring RTOs to promptly improve their price formation rules, and a long-term program for ensuring that organized markets value resilience.
Exelon, which is the beneficiary of nuclear subsidies in Illinois and New York, had its own three-step proposal, starting with “immediate action” to correct “inaccurate price signals [for] fuel-secure resources,” including ordering PJM to make energy market reforms within 90 days. RTOs and ISOs also would be prevented from mitigating the capacity market bids of plants receiving zero-emission credits “or other support payments.”
FERC should follow those actions, the company argued, with an order requiring RTOs to report on their systems’ vulnerabilities to high-impact, low-frequency events. Lastly, it said the commission should use that data, “together with threat analysis from the national security and intelligence communities, to establish a design basis threat (DBT) that can inform cost-effective market reforms.” The DBT would provide a resilience benchmark and a basis for developing solutions, the company said.
The last two steps of Advanced Energy Management Alliance’s proposal were like those of Exelon’s, with the opening of a resilience proceeding and reporting by RTOs.
But the group, which represents distributed energy resource companies and storage providers, had its own idea for step one: “Eliminate barriers to storage and distributed energy resource participation” by finalizing FERC’s November 2016 NOPR (RM16-23). (See FERC Rule Would Boost Energy Storage, DER.)
The commission received hundreds of responses to the DOE NOPR. FERC staffer Patrick Clarey told the SPP Board of Directors meeting Oct. 24 that the commission had received more than 700 comments; AEMA said it had counted “roughly 750 sets of comments.”
Congress Weighs in
Among the most recent responses were dueling submissions from members of Congress, with Republicans generally supporting the proposal and Democrats mostly in opposition.
Illinois Republican Reps. Mike Bost, Rodney Davis and Darin LaHood said “the proposed DOE rule makes critical strides toward correcting faulty market designs and valuing the role of baseload generation.”
Rep. Joyce Beatty (D-Ohio) joined with David Joyce and 10 other Ohio Republicans to warn that premature plant closings “have resulted in an electrical grid with weakened resiliency and a diminished ability to respond to crisis.”
New Jersey Republican Reps. Frank LoBiondo and Leonard Lance expressed fear that the state could lose its nuclear generation — the source of almost half of its electricity.
Hope Creek Nuclear Generating Station in New Jersey
Rep. Jerry McNerney (D-Calif.) and 13 other Democrats from his state, Pennsylvania, Hawaii, New York, Massachusetts, North Carolina, Virginia and Vermont expressed “serious concerns with the proposal and its timeline.”
They cited DOE data showing outages resulting from extreme weather increased 10-fold from 1984 to 2012 and doubled between 2003 and 2014. “Given these facts and the compounding, regional and varied effects of climate change on extreme weather, a one-size-fits-all approach to resiliency, as outlined in the NOPR, is inappropriate and not adequate to the challenge,” they said.
House Energy Subcommittee Vice Chair Pete Olson (R-Texas) joined with ranking member Bobby Rush (D-Ill.) to say more time is needed to study the “remarkably complex issue.” They said it should be addressed “through existing proceedings at the federal and regional level rather than quickly moving to make a sweeping, top-down decision in the near term.”
“FERC — with bipartisan support from members of Congress and presidents — have worked for decades to improve these markets. Ultimately, this has given us markets that provide a reliable and resilient power system through open competition. This has also meant that risks are borne by investors in generating assets, not consumers or taxpayers. We continue to believe this is critically important,” they said.
Among those also registering support for the NOPR were the Interior Department, Southern Co. and AES (parent of Indianapolis Power & Light, Dayton Power and Light and AES Energy Storage).
Opponents Urge Time for Study
In contrast, the Electricity Consumers Resource Council and other industrial energy users said the NOPR would “overturn decades of precedent and suddenly determine the existing RTO/ISO tariffs are unjust and unreasonable.”
A broad coalition including the American Petroleum Institute, American Wind Energy Association, Conservation Law Foundation and Electric Power Supply Association reiterated its earlier comments, urging FERC to reject what they called an “abrupt and unjustified cost-based compensation mechanism.”
The National Association of State Utility Consumer Advocates, which had not filed initial comments, said acting on DOE’s demand for a final rule within 60 days would violate the Administrative Procedure Act by failing to provide the public with adequate notice or reasonable time to have meaningful input.
ISO-NE said the “very limited time” FERC allowed for reply comments did “not permit a comprehensive rebuttal to the efforts of the NOPR’s supporters to overcome the proposal’s unsound foundation.”
“However, in-depth analysis is not needed to understand why the proposal is both legally untenable and an unviable policy option,” the RTO said. “The breadth and depth of opposition to the NOPR among industry stakeholders and electricity consumers is striking in its own right.”
American Municipal Power also cited procedural concerns. “Several other commenters suggested that the commission adopt alternative proposals to modify the RTO energy market rules or take other actions that are beyond what was contemplated by the DOE proposal. The commission cannot lawfully accept such proposals as part of this rulemaking process.”
Former FERC Chairman Norman Bay made a similar point at the GTM U.S. Power and Renewables Summit in Austin, Texas, Tuesday.
“The timeline really amounts to a rocket docket. There’s no other way to describe it,” Bay said. “When you look at FERC Order 888, FERC spent a year on that particular order. In the normal course of events, it’s not uncommon to see a rulemaking take 12-15 months, or even longer than that,” Bay said.
AMP also agreed with many critics that the DOE proposal failed to prove existing RTO market rules are unjust and unreasonable. “The legal deficiencies coupled with the practical reality that the DOE proposal would not resolve the reliability concerns raised by the secretary but would impose significant new costs on customers should make this an easy call for the commission,” AMP said.
The Environmental Defense Fund urged FERC to “further enhance gas-electric coordination in a focused and targeted manner.”
“Electric generators were the smallest sector for natural gas demand in 1988, and they now are the largest,” EDF said. “But the natural gas regulatory framework has not kept pace with this new development.”
Next Steps
The commission has said it expects to take some action on the proposal within 60 days after its Oct. 10 publication in the Federal Register.
FERC will address the NOPR with a full complement of commissioners, thanks to the Senate’s Nov. 2 confirmation of Republican Kevin McIntyre and Democrat Richard Glick.
Tom Kleckner and Michael Kuser contributed to this article.
CenterPoint Energy executives Friday said the company is in “late-stage discussions” over its Enable Midstream Partners gas-gathering and processing joint venture but offered few details beyond that.
“Should these discussions not come to fruition, we will evaluate the sale of units in the public market place,” CenterPoint CEO Scott Prochazka said during a conference call with analysts.
Prochazka also said the Houston-based company “continues to believe Enable is well positioned for success.”
CenterPoint owns a 54.1% share of Enable. Oklahoma City’s OGE Energy holds a 25.7% limited-partnership interest and a 50% management interest.
In August, OGE accepted a right of first offer for CenterPoint’s shares. Any competing offer CenterPoint accepts for its interest would have to be at least 5% higher than OGE’s, CFO Bill Rogers said.
“This has been admittedly a long process,” Prochazka said. “As we come to the end of this, we will communicate the outcome, irrespective of what it is.”
CenterPoint reported quarterly earnings of $167 million ($0.38/share), down from $177 million ($0.41/share) a year ago. A Thomson Reuters survey of analysts had projected earnings of 39 cents/share.
The company said revenue for the quarter rose 11.1% to $2.10 billion, up from $1.89 billion for the same quarter last year.
Rogers said CenterPoint’s Hurricane Harvey restoration efforts have cost the company between $110 million and $120 million. A third of that will be covered by property insurance claims, with the rest recovered through capital mechanisms or regulatory assets in the company’s next rate case, he said.
| CenterPoint Energy
CenterPoint’s electric utility operations added 46,000 metered customers during the quarter, a 2% growth rate.
Wall Street reacted to CenterPoint’s announcement by driving down the company’s share price by 79 cents, to $28.96/share, when the market opened Friday. The stock recovered to $29.59/share by the market’s close.
OGE Q3 Earnings Unchanged from 2016
OGE on Thursday reported net income of $183 million ($0.92/share), compared to $184 million ($0.92/share) the same period a year ago. Third-quarter revenue was $717 million, down from $744 million the year before.
Analysts surveyed by Zacks Investment Research had projected earnings of 93 cents/share.
OGE’s Sean Trauschke | YouTube
OGE said its Oklahoma Gas & Electric subsidiary expects to file a rate case with the Oklahoma Corporation Commission by the end of year. The utility is seeking to recover $390 million in expenses to retrofit its Mustang power plant with seven 66-MW combined cycle gas turbines.
“It’s a much simpler case” than previous rate proceedings, CEO Sean Trauschke told analysts. “The plant will be finished and in service, so there’s no question about the cost.”
OG&E also expects to file another rate case with the OCC in 2018 to recover $542 million in environmental upgrades at its Muskogee plant.
OGE shares, which closed Wednesday at $36.75, were down to $35.97/share in Friday afternoon trading, a loss of 2.1%.
Pacific Gas and Electric earnings jumped 42% to $550 million during the third quarter ($1.07/share), boosted in large part by reduced expenses and realization of one-time income. Year-to-date profits for the utility have more than doubled to $1.5 billion, compared with $711 million last year.
The Pacific Gas & Electric building, San Francisco
Operating revenues for the electric side were $3.6 billion for the quarter, out of total revenues of about $4.5 billion.
“The quarter-over-quarter increase reflects lower expenses primarily due to the absence of disallowed charges related to the San Bruno penalty decision, which impacted the third quarter of 2016, and also due to insurance proceeds in the third quarter of 2017 related to the court-approved settlement of the shareholder derivative suit, with no similar amount in 2016,” PG&E said during an earnings call Thursday.
During the first nine months of the year, the utility incurred $71 million in costs associated with in fines and penalties, including disallowed expenses of $32 million, related to an April 2015 decision by the California Public Utilities Commission regarding the San Bruno pipeline explosion.
PG&E CEO Geisha Williams also discussed the wildfires that blazed across the state in the third quarter, saying “we also remain focused on continued investment in vital infrastructure and technology to increase the resilience and the sustainability of California’s energy economy for the future.”
The utility restored service to 360,000 electric customers and 42,000 gas customers during the disasters, saying it is aiding the PUC and California Department of Forestry and Fire Protection in their investigations.
PG&E updated its 2017 guidance range to $3.36 to $3.56/share because of the reinstatement of the company’s liability insurance following the wildfires and an increase in the expected third-party claims associated with the 2015 Butte fire, partially offset by insurance recoveries.
PG&E’s Humboldt Bay nuclear plant, which is being decommissioned
More than 12 victims of the recent wildfires have filed suit against PG&E for this season’s blazes, which claimed 43 lives and burned thousands of homes and commercial buildings. The company told the Securities and Exchange Commission on Oct. 13 that “the causes of these fires are being investigated by the California Department of Forestry and Fire Protection (Cal Fire), including the possible role of power lines and other facilities of” PG&E. The company said it is unknown whether it will have any liability, but it has $800 million in liability insurance for potential losses from the fires.
Arizona Public Service parent company Pinnacle West Capital earned $276 million ($2.46/share) in the third quarter, compared with $263 million during the same period in 2016.
APS’ Palo Verde nuclear plant
“Our service territory experienced solid customer growth of 1.9% as new customers moved to Arizona for job opportunities and an improved quality of life, our employees continued to demonstrate superior customer service and operational performance, and we successfully settled our rate review,” Pinnacle CEO Donald Brandt said.
The Arizona Corporation Commission allowed APS to raise its rates for the first time in five years. The company said the increase will allow it to invest in cleaner infrastructure and provide customers with new rate options.
APS’ Navajo Generating Station coal-fired power plant
Customer growth lifted profits by 2 cents/share compared to a year earlier despite milder temperatures. Pinnacle raised its earnings guidance to $4.25 to $4.45/share for 2017 and $4.15 to $4.30/share for 2018.
APS’ rate base is expected to grow about 6% annually, to a projected $8.2 billion in 2019.
