Feeds:
Posts
Comments

Archive for the ‘Electricity’ Category

Linemen

The online magazine Transmission & Distribution World today re-ran an earlier article on the dangers faced by electric utility workers. Though it describes a really brutal accident, it merits reading if only to be reminded about the danger that some workers face every day as part of their job — more dangerous than police and fire. You can read the full article here.

Advertisements

Read Full Post »

Tax Reform

The GOP-passed tax reform law, a/k/a the Tax Cuts and Jobs Act of 2017, lowered the corporate federal income tax from a maximum of 35% to a flat rate of 21%.

Numerous transmission utilities file tariffs with the Federal Energy Regulatory Commission that are based on a cost of service revenue requirement. The expense of federal corporate income tax is one of those costs of service. When a corporation’s tax rate goes down from a maximum of 35% to a flat 21%, its income tax expense goes down, and thus its cost of service revenue requirement goes down. So, one would think that when transmission utilities’ tax rates go down, as they have, that benefit might flow through (or is that trickle down) to ratepayers.

Nope.

No transmission utility filed any amendments to its tariffs to reflect the new, lowered tax rate. Maybe they thought nobody would notice it, and they could pocket that 14% difference. (“Oh boy!!!).

So on March 15, 2018, FERC opened a series of new proceedings requiring that these transmission utilities either lower their rates to reflect the tax cut, or show cause why they should not be required to do so.

Your tax dollars at work.

Read Full Post »

NYC Substation

The New York Times today reported that Russian hackers had gained access to nuclear plants and electricity grid controls, and would have been able to shut off the power in the United States at will.

That is deadly serious stuff.

More amazing still, it was the Trump Administration, that leveled the accusation against Russia. Putin may regard that as an act of disloyalty by Trump, perhaps triggering his release of kompromat on the Donald.

Perhaps he’ll announce a 25% tariff on Steele dossiers.

Read Full Post »

energy expense nat gas $$$

State laws and regulations generally specify the time periods for which public utilities must keep records, and those periods vary for different types of records. For example, a public utility may be required to maintain records of meter tests for six or more years, while customer billing records may be subject to retention periods of only a year or two.

Similarly, these regulations may limit the time period for which a public utility may recover from its customer if the utility learns that it has provided service to the customer for which it hasn’t billed. This permitted backbill period may be as short as one year in the  case of residential customers, and perhaps longer in the case of nonresidential customers.

These time periods vary from state to state and must be confirmed in any particular case. But all of these time periods can have important consequences for customers if they suspect, or discover, that they’ve been overcharged.

For example, assume Customer Industries opened its factory in 2010, and in 2018 it learns that it has been overcharged for a particular cost component of its bill since the account was opened. Naturally, it would like to recover the whole amount of the overcharge. But it may find itself stymied because it doesn’t keep copies of its own utility bills for more than a year or so.

Assume further that the utility is required to keep customer bills for only two years. If the utility recognizes that it has overcharged Customer Industries and is willing to issue a refund, it may limit its refund to the previous two years, even though the overcharge stretches back for eight years. The utility may claim that Customer Industries can’t prove overcharges for any period prior to that. Will they win on that? A definite “maybe.” At the very least, Customer Industries will have a steep evidentiary climb in order to make its case.

The customer would also have to check applicable regulations to see if there’s a distinction between errors that appear on the face of the bill (e.g., an error in addition or multiplication), and errors that are “latent” and can only be determined by analyzing the cost components on the bill.

In either case, Customer Industries would be in a much stronger position if it had simply kept its bills, or copies of them, because then it would have an actual record of what the overcharge was.

Recall that state regulations may limit the periods for which a utility can backbill a customer. But that does not necessarily limit the period for which the customer can claim a refund from the utility — provided that it has evidence. And that evidence consists of utility bills.

Given that you can buy a scanner at any office supply store for less than $200, there’s really no excuse for not keeping copies of utility bills. They could turn out to be worth a lot more than you think.

 

 

Read Full Post »

S Korea Nuke plant

On Tuesday, ISO New England, which operates the electric grid for certain states in that region (other than New York), issued a report that New England’s average annual real time wholesale electricity price for 2017 at $33.94 per megawatt-hour was the second-lowest price in fifteen (15) years. ISO New England stated that these low prices were driven chiefly by low prices for natural gas, the principal fuel used for generation at the margin, as well as reduced demand levels.

As earlier stated on the Sparkspread, for several years Exelon CEO Chris Crane has played the role of Peter the Hermit in the electric utility industry’s Crusade to rescue nuclear generation fleets from the infidels of the wholesale market. That is, he wants to make sure that electricity consumers make Exelon and other nuke operators whole for any losses they suffer because, contrary to their expectations, electricity prices have been hitting record lows in a number of markets, mainly due to low natural gas prices. When prices fell, Crane and his cohort lost no time in complaining about the “flawed market” for wholesale electricity.

If things had gone the other way – if electricity prices had risen to record highs instead of fallen to record lows – you can bet that Mr. Crane and his fellow nuke CEOs would be saying that electricity consumers must simply accept the results of the perfectly self-regulating free market in electricity, and if prices rise, that’s just, as they say in Brooklyn, T.S., Elliott.

 

Read Full Post »

Today’s edition of Utility Dive discusses our pending appeal in the Illinois Zero Emission Credit Case. You may read the article here.

Read Full Post »

Exelon CEO Chris Crane

Exelon CEO Chris Crane

Chicago, IL February 14, 2017:  Chicago energy attorneys, Patrick N. Giordano and Paul G. Neilan, announced they filed a lawsuit in the U.S. District Court Northern District of Illinois today against Anthony Star in his Official Capacity as Director of the Illinois Power Agency.  Village of Old Mill Creek, et al. v. Anthony Star was filed on Tuesday, February 14, 2017 at the U.S. District Court Northern District of Illinois.

Attorneys Giordano and Neilan represent Plaintiffs that are governmental, residential, commercial, and industrial electricity consumers located throughout the State of Illinois. Plaintiffs claim that P.A. 99-0906, executed by Governor Rauner on December 7, 2016, violates the U.S. Constitution’s Supremacy Clause, Commerce Clause, and 14th Amendment Equal Protection Clause. The underlying basis for the constitutional claims is that the prices charged by electricity generating plants are subject to federal rather than state regulation. A similar case has already been filed in federal court in New York challenging that state’s subsidy of Exelon nuclear plants by the law firm Boies, Schiller & Flexner, LLP, which is headed by preeminent attorney David Boies.

Among other things, P.A. 99-0906 is designed to subsidize Exelon Corp.’s Quad Cities and Clinton nuclear plants. This subsidy will be charged to all Illinois electricity consumers beginning June 1, 2017 regardless of what company supplies the consumer’s electricity. The lawsuit specifically asks that the U.S. District Court grant a permanent injunction blocking the charges from going into effect as scheduled on June 1, 2017. According to Mr. Giordano: “These additional charges will reverse twenty years of deregulation in Illinois which have given us perhaps the one advantage we have over neighboring states: relatively low electricity charges due to an effectively functioning competitive market.” Mr. Giordano also said: “We’re challenging the nuclear bailout provision of the legislation because the prices charged by electricity generators have already been established by the competitive wholesale electricity market subject to federal jurisdiction and cannot be increased by the State of Illinois.”

The estimated impact to all Illinois consumers will be about $3.3 billion over the ten years of the nuclear bailout. Mr. Neilan points out that: “This nuclear bailout is one of four rate increases to Illinois consumers this year, including increased delivery charges, increased renewable energy subsidies, increased energy efficiency subsidies, and these nuclear energy subsidies.” When the nuclear subsidies go into effect on June 1, 2017, Illinois residents and businesses can expect to see an average 3% increase in their electricity bills due to the nuclear subsidies alone.”

Giordano & Associates, Ltd. is Chicago’s first law firm devoted to energy issues. We provide clients with experienced counsel on regulatory, litigation, transactional, and legislative matters in the areas of electricity and natural gas. Pat Giordano can be reached at pgiordano@dereglaw.com.

The Law Offices of Paul G. Neilan, P.C. represents commercial, industrial and governmental energy users in disputes against public utilities, as well as in litigation and transactional matters with non-utility competitive energy suppliers.

FACT SHEET

  1. Village of Old Mill Creek, et al. v. Anthony Star was filed in the United States District Court for the Northern District of Illinois on February 14, 2007.
  2. The Plaintiffs are: Village of Old Mill Creek, Ferrite International Company, Got it Maid, Inc., Nafisca Zotos, Robert Dillon,Richard Owens, and Robin Hawkins, both individually and d/b/a Robin’s Nest.
  3. The Defendant is Anthony Star in his official capacity as Director of the Illinois Power Agency.
  4. This case arises from unlawful Illinois legislation that invades the exclusive jurisdiction of the Federal Energy Regulatory Commission (“FERC”) over “the sale of electric energy at wholesale in interstate commerce” pursuant to the Federal Power Act. 16 U.S.C. 824(b)(1).
  5. The unlawful legislation is contained in subsection (d-5) Zero Emission Standard of Illinois Public Act 99-0906 (“P.A. 99-0906”), which was enacted on December 7, 2016 and is available at http://www.ilga.gov/legislation/99/HB/09900HB65761v.htm.
  6. Subsection (d-5) Zero Emission Standard of P.A. 99-0906 requires the Illinois Power Agency to procure contracts for Illinois utilities Commonwealth Edison Company, which serves northern Illinois, and Ameren Illinois Company, which services central and southern Illinois, for purchases of Zero Emission Credits (“ZECs”) from nuclear-fueled generating plants.
  7. The ZEC payments will be passed through by the utilities to all Illinois consumers through automatic adjustment tariffs.
  8. A. 99-0906 is designed to provide additional revenues to the Illinois-based Quad Cities and Clinton nuclear plants.
  9. Exelon Corp. owns both the utility ComEd and Exelon Generation, which owns the Quad Cities and Clinton nuclear plants that will sell the ZECs to the utilities.
  10. Although P.A. 99-0906 has many other provisions, this case concerns only subsection (d – 5) Zero emission standard.
  11. Plaintiffs are not challenging any other provisions of P.A. 99-0906. Section 97 of P.A. 99-0906 provides that the provisions of the Act are severable under Section 1.31 of the Illinois Statute on Statutes. 5 ILCS 70/1.31.
  12. In New York, ZEC payments to Exelon nuclear plants in that state are being challenged on the same grounds set forth by Plaintiffs in Illinois. Coalition for Competitive Electricity, et al. v. Audrey Zibelman, et al. was filed in the U.S. District Court Southern District of New York on October 19, 2016.
  13. A typical residential customer using 1 mWh (1,000 kWh) per month would pay an additional $2.64 per month beginning June 1, 2017 based on the initial ZEC price established in P.A. 99-0906.
  14. A manufacturing company using 10,000 mWh per month would pay an additional $26,400 per month beginning June 1, 2017 based on the initial ZEC price established in P.A. 99-0906.

Read Full Post »

Older Posts »