FERC findings rule in favor of ATC’s opponents

American Transmission Co. (ATC) has found itself on the losing side of two separate ownership disputes after FERC ruled in favor of its opponents the week of Feb. 4.

The commission on Feb. 7 ruled in favor of ITC Midwest in its complaint against ATC over ownership of the Dubuque-Cardinal line, and on Feb. 4 denied ATC’s complaint against Xcel Energy (NYSE:XEL) and the Midwest ISO (MISO) over the right to own and build the La Crosse to Madison and Twin Cities to La Crosse 345-kV transmission lines (Docket No. EL13-9).

“We’re disappointed in FERC’s rulings and we’ll be evaluating our options,” Randy Satterfield, ATC’s executive vice president of public affairs, told TransmissionHub on Feb. 8.

The order concerning the Dubuque-Cardinal project results in ATC sharing ownership of the line with ITC Midwest, and the order concerning the La Crosse line segments results in Xcel Energy retaining ownership of the lines.

The proceedings were predicated both on Section V, Attachment FF of the MISO tariff that delineates how projects approved in the MISO transmission expansion plan (MTEP) should be designated, and on the interpretation of Section VI, Appendix B of the MISO transmission owners agreement, or the “share equally provision,” which stipulates that ownership of facilities that connect to two or more owners should be divided between those owners.

La Crosse finding

The Twin Cities to La Crosse line, also known as the 145-mile Hampton-Rochester-La Crosse line, is one of the five CapX2020 projects being developed in Minnesota, some of which interconnect to adjacent states. CapX2020 is an effort by 11 utilities in Minnesota, including Xcel Energy, to build out the state’s electric grid.

ATC on Oct. 1, 2012 argued in the complaint that MISO’s “share equally” provision should be applied to the two segments of the line. The complaint was filed on the heels of a FERC decision on July 19, 2012 (Docket No. EL12-28), which found in favor of Xcel Energy in an ownership dispute with ATC over the La Crosse-Madison line alone (the Xcel Order). The result of that order was for the companies to share ownership of the La Crosse-Madison line, which ATC had been unilaterally pursuing. During the course of that proceeding, ATC argued that if FERC were to find in favor of Xcel Energy, then it would stand to reason that ATC should be granted rights to equal ownership of the CapX2020 projects that interconnect to its facilities.

“The question before the commission in this proceeding is: What constitute the ‘facilities’ between ATC and [Northern States Power-Minnesota] (both MISO transmission owners) that must be shared equally between the two owners,” ATC said in its complaint.

ATC argued that the Twin Cities-La Crosse and La Crosse-Madison lines should be considered together as one project, and cited Xcel Energy’s own admission that the La Crosse-Madison segment was a “continuation of the northern 345-kV path.” 
As one line, the project would result in joint ownership because ATC owns the existing facility, the Cardinal substation, that interconnects in Madison, Wis., and Xcel Energy owns the existing facilities, the Hampton and Rochester substations, that interconnect in Minnesota. The La Crosse substation in Wisconsin is the proposed interconnection.

The La Crosse to Twin Cities segment is estimated at $445m and the La Crosse to Madison segment is estimated at $457m, according to the October 2012 complaint.

Xcel Energy in its rebuttal called ATC’s complaint an “impermissible collateral attack on the commission’s July 19 order” that sought to undo FERC’s decision.

As in the Xcel Order, FERC found that the MISO tariff had been correctly implemented and dismissed ATC’s complaint.

“We are not persuaded by American Transmission’s argument that the Twin Cities – La Crosse Line and the La Crosse – Madison Line, together, form a single interconnection based on American Transmission’s interpretation of the language of Appendix B, section VI of the transmission owners agreement,” FERC said in the Feb. 4 decision. “Rather, we find that MISO correctly implemented the transmission owners agreement and tariff in the 2008 [MISO transmission expansion plan (MTEP)] and the 2011 MTEP, in which it designated ownership and construction responsibilities based on the Twin Cities – La Crosse Line and the La Crosse – Madison Line being separate projects.” 

Dubuque-Cardinal finding

ITC Midwest on Oct. 24, 2012, filed a complaint asking that FERC direct ATC to enter into negotiations for 50-50 ownership and construction of the 136 mile, 345-kV Dubuque-Cardinal transmission line.

ATC, in response, argued that ITC misidentified the project to which it requested the share equally provision be applied by ignoring modifications that ATC had made to the facilities that comprise the Cardinal–Dubuque line. ATC removed the Spring Green substation interconnection with its existing facilities and replaced that interconnection with the Montfort substation interconnection. The company plans to build the Montfort substation instead of the Cardinal substation.

“In regard to American Transmission’s argument that it proposed changes to the Dubuque – Cardinal Line, which would reroute the project through the Montfort substation as opposed to the Spring Green substation as set forth in the original 2011 MTEP, we find that such proposed changes have been rejected by MISO in the 2012 MTEP, which was approved by the MISO Board on December 13, 2012,” FERC said in the Feb. 7 order.

ITC Midwest is a subsidiary of ITC Holdings (NYSE:ITC).  

About Rosy Lum 525 Articles
Rosy Lum, Analyst for TransmissionHub, has been covering the U.S. energy industry since 2007. She began her career in energy journalism at SNL Financial, for which she established a New York news desk. She covered topics ranging from energy finance and renewable policies and incentives, to master limited partnerships and ETFs. Thereafter, she honed her energy and utility focus at the Financial Times' dealReporter, where she covered and broke oil and gas and utility mergers and acquisitions.