Library filed under Energy Policy from New York
Iberdrola SA could walk away from its $4.5 billion merger with Energy East Corp. if state regulators try to extract too much money from the Spanish utility. Just a few days from a vote by the Public Service Commission, one of the biggest questions surrounding the deal appears to be just how much Iberdrola will be required to share with customers. ...In a hearing before the PSC on Aug. 20, staff had suggested three different scenarios that involved between $202 million and $300 million in PBAs [positive benefit adjustments]. Two of the scenarios involved sharing earnings with consumers, while the third called for a rate case before the PSC in which the agency could potentially reset Iberdrola's electric and gas rates in upstate New York.
For a moment, it seemed as if NBC had no love for Texas billionaire T. Boone Pickens' energy conservation plan, but the tide turned Wednesday, when the network reversed its decision to reject a commercial featuring Pickens promoting alternative energy. According to Adweek, NBC's original rejection letter, issued Tuesday, read, "The ad is not acceptable for air on the NBC network because the spots address controversial issues and it is our policy not to air ads addressing such issues on our network."
The state Public Service Commission put Iberdrola SA's $4.5 billion acquisition of Energy East Corp. on hold for a week Wednesday after two of its five members could not attend a special hearing to vote on the plan. The vote might have taken place had one of the commissioners, Robert Curry Jr., not fallen ill with what was described as a stomach bug. The other commissioner to miss the meeting, Cheryl Buley, has decided to resign from the PSC for personal reasons. Her departure from the $109,800-a-year job will take effect next Wednesday, but it's unclear at this point if she will attend that day's meeting and cast a vote. News that a vote would not occur was met with surprise by the dozens of attorneys, lobbyists and journalists who attended Wednesday's meeting.
The absence of two of the five members of the panel that regulates utilities in New York led to a delay today in a decision about whether to allow a Spanish company that wants to invest $2 billion in wind power in New York to buy the parent company of two large upstate utilities. State Public Service Commission members Cheryl Buley and Robert Curry, who make $109,800 a year, were absent. Curry was ill, and Buley missed for "personal reasons,'' said commission spokesman James Denn, who said he had no other information on her absence.
A state Public Service Commission member who was embroiled in several political skirmishes during her two-year tenure says she's resigning next month to get married and move to Kentucky. Commissioner Cheryl Buley was appointed to the $109,800-a-year position on the PSC by former Republican Gov. George Pataki in June 2006 for a term ending in February 2012. Her resignation is effective Sept. 3, the day the PSC is to vote on Iberdrola SA's $4.6 billion proposal to buy Energy East.
Iberdrola SA of Bilbao, Spain, has bid more than $4.5 billion for Energy East Corp., the parent company of Rochester Gas and Electric Corp. and New York State Electric and Gas Corp. Fourteen months after the friendly deal was unveiled, Iberdrola is due to get a thumbs up or thumbs down Wednesday from the state Public Service Commission. At stake are $2 billion in upstate investment, New York's reputation as a place to do business and what might happen to the fourth-highest residential electricity rates in the nation.
When the builders of the Maple Ridge Wind farm spent $320 million to put nearly 200 wind turbines in upstate New York, the idea was to get paid for producing electricity. But at times, regional electric lines have been so congested that Maple Ridge has been forced to shut down even with a brisk wind blowing. That is a symptom of a broad national problem. Expansive dreams about renewable energy, ...are bumping up against the reality of a power grid that cannot handle the new demands.
Top executives at Energy East Corp. stand to make $100 million if they lose their jobs as part of Spanish utility Iberdrola SA's $4.5 billion acquisition, according to one member of the state Public Service Commission. It's unclear just how important the issue will be as part of the PSC's deliberations on the $4.5 million deal. PSC commissioners, who discussed the case at their monthly meeting this week, have scheduled a special meeting on the merger Wednesday. A vote also is likely that day.
One industry insider, Mick Sagrillo of the American Wind Energy Association, warned in an interview in Renewable Energy World that the some companies may try to exploit the concerned public's inflated hopes: "It's great that people are looking for alternatives, but it's amazing how little people know when they seek them out. That leaves people open to purchasing a product that is less-than-reliable. We are a very gullible culture, we're always looking for the magic bullet."
A state utility regulator on Wednesday questioned whether a $2 billion investment in wind power by Iberdrola SA, the company that wants to buy Energy East Corp., is a good idea. "I view the wind proposal in almost a neutral fashion," said Cheryl Buley, one of five members of the state Public Service Commission, which began considering whether to allow Spanish utility Iberdrola to buy the parent of Rochester Gas and Electric Corp. and New York State Electric and Gas Corp. Buley said that despite an apparent fascination by elected officials with Iberdrola's promised investment, wind power has drawbacks. She said it is expensive, since it requires a subsidy, is often not available when most needed and could be hard to transmit to areas that need it.
Concerns over Iberdrola's ability to manipulate the state's wholesale electric market by owning both transmission and distribution lines and wind generation were "milder" than previous cases that have come before the agency, senior advisory staff told the five PSC commissioners. It's unclear whether the commissioners will support the proposal. The panel plans to discuss the merger at a special session on Wednesday could vote on the deal the same day.
Senior advisers to the state Public Service Commission laid out several options Wednesday under which the commission could approve Spanish energy company Iberdrola's $4.6 billion acquisition of Energy East, the parent of two Upstate utilities. But it won't be known until next week whether the five commissioners will approve the deal and, if so, on what conditions. ...Several of their recommendations seemed to open the door to a decision that might be acceptable to Iberdrola, which until now has fought tooth and nail with the PSC staff.
Interviews with architects, engineers and energy experts on Wednesday suggest that Mayor Michael R. Bloomberg's proposal to place wind turbines atop the city's skyscrapers and bridges, as well as off the coastline of Queens and Brooklyn, would be complicated and expensive and barely begin to meet the growth in demand for electricity that is expected in the coming years. ...Even if Mr. Bloomberg could find investors willing to build turbines capable of generating 1,000 megawatts of electricity, experts said, operators of the city's grid would be able to count on only 100 megawatts, or less than 1 percent of peak demand.
The five commissioners of the Public Service Commission were told by their senior advisory staff today that they should allow Spanish utility Iberdrola SA to build and own wind farms anywhere in the state as part of its $4.5 billion acquisition of Energy East Corp. ...Senior staff also recommended that the PSC require Iberdrola to set aside between $202 million and $300 million of what is known as public benefit adjustments that would benefit ratepayers.
A state utility regulator on Wednesday questioned whether a $2 billion investment in wind power in New York by a company that wants to buy two upstate utilities is a good idea. "I view the wind proposal in almost a neutral fashion," said Cheryl Buley, a member of the state Public Service Commission. The commission is considering whether to allow Iberdrola, a Spanish-based firm, to buy Energy East Corp.
The Public Service Commission is meeting this week to consider Iberdrola SA's $4.5 billion acquisition of Energy East Corp., and its eventual vote on the matter later this month may test one of the state's long-standing energy policies. One of the most contentious issues in the merger of the two utilities is whether Iberdrola, which is based in Spain, should be allowed to own electricity-generating wind farms in New York. ..."The commission can accept, reject or modify whatever is put before them at session," Denn said. "They have the opportunity to review all the evidence in the case and make the best determination possible."
Public Service Commission spokesman James Denn said this morning he doesn't know of any settlement talks between staff at the Department of Public Service and Iberdrola SA, the Spanish utility seeking to acquire Energy East Corp. for $4.5 billion. The merger is going to be discussed at the PSC's monthly meeting Wednesday, and a special session has been scheduled for Aug. 27. A vote on the merger could take place that day.
If Iberdrola does invest $2 billion in New York wind, that will turn a good chunk of "potential" into "capacity." A brief prepared on behalf of PSC staffers says Iberdrola intends to develop 998 megawatts of wind power at $2 million per megawatt - hence, $2 billion. (The staffers, in their brief, say they don't have faith in the promise since it is unenforceable. Also, they say, the company has only proposed $100 million worth of investment on the record.) Some of that money could land here. Iberdrola has agreements with some Hamlin landowners to lease to the company. Earlier this year, over great controversy, the town passed laws to allow wind towers. There's no proposal yet from Iberdrola or any other company, says Supervisor Dennis Roach. He expects that Iberdrola is waiting on the merger decision.
The proposed $4.5 billion takeover of Energy East Corp. by Iberdrola SA of Spain will come before the state Public Service Commission on Aug. 20 and 27, the PSC announced Friday. ...Iberdrola, a big international utility that specializes in wind energy development, proposed the acquisition in June 2007.
Integrity of all government-regulated and supported programs is an absolute requirement in a democratic society. However, characterizing wind energy as a "vital industry" demonstrates a fundamental lack of understanding of wind energy's capabilities to contribute in a significant way to our energy needs. If your editor had attempted to understand some simple technicalities of wind energy, via even a cursory glance at readily available resources, he/she would have learned the following: ...