DOH! This is NOT rocket science. This came out last month, posted on the CapX 2020 site, and around the same time, there was a PR push about the tax payments, “benefits,” that local governments were receiving for the CapX 2020 transmission lines. This report is all about the “benefits” and not about the costs, let’s be clear on that:
WIRES Brattle Report – Benefits of Transmission Jul 2013
Now I’ll take a look at this…
What it looks like is advance work for the 765kV overlay, for which there is no logical “need” claim. They want to turn “planning” on its head, and put “benefits” at the top, the first item on the check list, in “planning.” I’ll be using a lot of “quotes” here because I’m not buying it.
What they advise, what they’re trying to sell, is that transmission planning should:
1) Identify potential transmission projects that could supplement or replace baseline reliability projects and to develop a comprehensive list of their likely benefits.
2) Estimate the value of as many of the identified benefits as practical.
3) Determine whether the proposed transmission investments would be beneficial overall by comparing the magnitude of estimated economy-wide benefits with estimates of the total costs of the projects.
4) Address cost allocation.
They say that “planners must plan for the highest value first…”
Citing my favorite Posner decision, they quote, “To the extent that a utility benefits from the costs of new facilities, it may be said to have “caused” a part of those costs to be incurred, as without the expectation of its contributions the facilities might not have been built, or might have been delayed.
Illinois Commerce Commission v FERC (7th Cir.)
Benefits should be weighed at the outset when assessing need, in essence benefits supplanting need as reason for a transmission project. Yeah, OK, what’s new???