This isn't just a fight for PA, but it's a fight against a publicly traded corporation with real shareholders. This is the excerpt from the latest 10Q filing.
(PPL and PPL Electric)
In June 2007, PJM approved the construction of a new 130-mile, 500-kilovolt transmission line between the Susquehanna substation in Pennsylvania and the Roseland substation in New Jersey that has been identified as essential to long-term reliability of the mid-Atlantic electricity grid. PJM determined that the line is needed to prevent potential overloads that could occur in the next decade on several existing transmission lines in the interconnected PJM system. PJM has directed PPL Electric to construct the portion of the Susquehanna-Roseland line in Pennsylvania and has directed Public Service Electric & Gas Company (PSE&G) to construct the portion of the line in New Jersey by June 1, 2012. PPL Electric's estimated share is between $300 million and $500 million. PPL Electric's capital projections currently include approximately $320 million for the new transmission line, which will require certain regulatory approvals.
In December 2007, PPL Electric and PSE&G filed a joint petition for a declaratory order with the FERC requesting approval of transmission rate incentives for the Susquehanna-Roseland transmission line. The companies requested: (1) an additional 1.5% allowed rate of return on equity; (2) recognition of construction work in progress in rate base; (3) recovery of all costs if the project is cancelled; and (4) an additional 0.5% allowed rate of return on equity for membership in PJM. In April 2008, the FERC approved the filing and granted all of the requested incentives except that the allowed rate of return on equity was approved at 1.25%.
from:
http://www.sec.gov/Archives/edgar/data/317187/000092222408000035/ppl10q.htm
What are the real benefits to Option C? Option A and B address reliability issues and can help new generation points in PA reach PA customers according to the PJM. Option C seems to exist mostly to deliver electricity to New Jersey. What are the PPL profits on PSE&G using these lines over in perpetuity?
Tuesday, June 24, 2008
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