Pioneer asks FERC to intervene in dispute with NIPSCO

Pioneer Transmission, a joint venture of American Electric Power (AEP) and Duke Energy (NYSE:DUK), is asking FERC to resolve a dispute with Northern Indiana Public Service Company (NIPSCO) over which parties have the right to invest in and construct the first segment of the Pioneer project.

The 765-kV line will extend from the proposed New Reynolds substation to Duke’s existing Greentown substation.

The complaint, filed on Feb. 8 against NIPSCO and the Midwest ISO (MISO), also asks the commission to set aside MISO’s interpretation of its transmission owners agreement (TOA) that Pioneer is not currently eligible to become a party to the TOA.

According to the complaint, NIPSCO contends a “right-to-build” provision in MISO’s TOA gives it an exclusive right to invest in and own “ 50% of the investment and ownership of the 765-kV line from New Reynolds to Greentown (which, together, is greater than 50% of the total Project investment)” as well as “all of the investment in the 765-kV/345-kV substation that needs to be constructed in order to interconnect the project into the existing 345-kV system.”

Pioneer agrees that NIPSCO is entitled to share in the investment in 345-kV facilities at New Reynolds because NIPSCO is constructing its own 345-kV line to this substation, but says NIPSCO is not entitled to any portion of the 765-kV project. Pioneer asserts that it should retain exclusive rights to invest and own the product, and is asking FERC to block NIPSCO’s interpretation of the TOA “right-to-build” provision.

“The owner/sponsors of Pioneer have spent four years, countless hours of planning and engineering time, and several million dollars in order to create, study, promote, and ultimately obtain MISO’s approval of a Pioneer Project segment located within the MISO footprint as a MISO Multi-Value Project (MVP) in the 2011 MTEP,” the complaint said. “NIPSCO played no role in the development or approval of the Pioneer Project or any portion thereof.”

In addition, Pioneer is asking FERC to set aside MISO’s determination that Pioneer is not currently eligible to become a party to its TOA. Setting aside MISO’s interpretation, the complaint says, would provide Pioneer “the right to charge for transmission services under the MISO Open Access Transmission, Energy and Operating Reserve Markets Tariff (OATT).”

A NIPSCO representative could not be immediately reached for comment Feb. 15.

The complaint requests “fast-track” processing by FERC, noting that the project cannot move forward until the issues raised in the complaint are resolved.