Potomac Edison: Not cost-effective to accelerate most requirements involving reliability

Potomac Edison has presented projects addressing reliability to Maryland state regulators, including an estimated $2.9m project that would involve adding a new substation in Montgomery County, but the company said “it does not seem cost effective to accelerate most of the requirements” involving reliability.

As directed by the state Public Service Commission (PSC) in a case involving the June 2012 derecho, Potomac Edison has reviewed its system performance to determine what enhancements or hardening could be completed within the next five years to improve reliability.

To identify projects that would have the greatest impact on reliability during major events, Potomac Edison said it did a cost/benefit analysis of possible improvement projects.

Five projects were determined to be most effective and would cost about $15m to complete, the company added, noting that the list of such projects “in no way represents a commitment to complete these projects.”

Reliability benefits realized upon completion of the projects have been estimated based on the impacts of historical outages on those circuits and are estimated to improve the system average interruption duration index (SAIDI) by about 25 minutes and annual customer minutes interrupted (CMI) by 6.2 million minutes as compared to the three-year average including major storm events.

This expected improvement would only be produced if the future weather exactly replicates that of the immediate past, Potomac Edison added.

“By investing in the projects…the company would expect to see a 3.8% improvement in the 3-year CMI average including major storm events; however the company would expect a much lower impact during normal conditions,” the company said.

One of the projects, the estimated $6.9m Green Valley substation, would involve adding a 230-kV to 34.5-kV substation transformer to the New Market substation in Frederick County, Md., and building about five miles of 34.5-kV line from the New Market substation to the Green Valley substation, which is currently fed by a radial 34.5-kV supply line.

Before beginning the project, Potomac Edison would need to work with property owners to secure new right-of-way and to address the vegetation management activities that would be occurring.

The company also said that the estimated $2.9m Beallsville-Poolesville project would involve widening three miles of the most heavily wooded right-of-way along the existing 12.5-kV line, as well as adding a new substation in Poolesville in Montgomery County, Md.

The project would also involve building four miles of new 34.5-kV line and clearing the associated new right-of-way.

Potomac Edison also said that the estimated $2.7m Sharpsburg-Keedysville project would include adding a new 34.5-kV to 12.5-kV substation along an existing 34.5-kV line that will split the existing circuit. The Keedysville 12.5-kV circuit is a radial distribution circuit that serves a rural area in southern Washington County, Md.

Another project, the estimated $2.4m Thayerville-Turkey Neck project, would involve building a new 138-kV to 12-kV substation near Swanton in Garrett County, Md., and building a half-mile of new 12-kV and rebuilding another 2.3 miles of 12-kV line with new conductor.

Appropriate approvals may be required from PJM Interconnection and would be required from local jurisdictions. As with the other project, it would be necessary to work with property owners to secure new right-of-way and to address the vegetation management activities that would be taking place before beginning construction.

On the estimated $350,000 Hancock-Town Hill project, Potomac Edison noted that two miles of this 12.5-kV circuit are located in an area with difficult access, which leads to extended outages to customers.

The project would involve relocating those two miles of three-phase line along Maryland Route 40 near Hancock in Washington County to make the line more accessible. The project would require two miles of new right-of-way to be cleared.

Potomac Edison also noted that it was required to review additional unscheduled improvements that could be accelerated and done over the next two years.

Two programs, at an added cost of $13.4m over two years, would replace aged infrastructure in order to reduce common outage causes not already address in other projects or programs.

An underground cable replacement would provide $5m in addition to the current $5m budget for 2014 and 2015 to the underground cable replacement program, which includes replacing larger portions of existing underground distribution systems and equipment before end-of-life.

“The expansion of this program would help reduce underground cable failures and make more resources available during major storm events,” the company added.

Another program, estimated at $1.7m annually – $3.4m over two years – could begin in 2014 and would consist of a targeted replacement of the worst 1% of overhead conductor segments on the highest CMI circuits.

Potomac Edison also noted that accelerating its distribution vegetation management program would require 2,244 additional miles to be trimmed in 2014 and 2015 and cost almost $20m, above the $8.5m per year that it currently spends.

Also, accelerating its pole inspection program – distribution and subtransmission – would require an additional 36,000 poles to be inspected in 2014 and 2015 and cost about $1.5m annually.

Comments on governor’s task force report

In its filing, Potomac Edison included comments on Gov. Martin O’Malley’s 2012 task force report involving grid resiliency.

As reported, the report contains 11 recommendations, including a four-step implementation plan that would accelerate investment designed to strengthen the electric distribution grid.

The company said changes should only be considered if they are consistent with industry best practices and reasonably capable of being achieved. Pursuit of unrealistic goals will waste the time and money of all concerned and risks encouraging unrealistic expectations about what can be accomplished, thus increasing customer dissatisfaction rather than reducing it.

Potomac Edison also said that even if a change is achievable, and passes an appropriate cost-benefit review, the costs may still be more than customers are willing to bear at this time, especially coming on top of existing and anticipated future costs for other policy mandates like renewables, state-mandated generation contracts and energy efficiency programs.

Also, the process for discussing proposed changes needs to be open-ended, both as to participation and to time frame. Excluding stakeholders from the discussions, or setting artificially short deadlines on analysis, discussion and deliberation, increases the risks of being rushed into results that will be bad for the state and its electricity customers, the company said.

Among other things, Potomac Edison said it agrees, in whole or in part, with many of the report’s recommendations, but there are “some that we don’t believe are consistent with” one or more of the three themes noted, namely, practicality, cost and openness.

For instance, the recommendation to require system-wide reliability standards for data including major outage events is misplaced on one level as several of the current reliability standards already include major outage events.

Potomac Edison is a FirstEnergy (NYSE:FE) company.

About Corina Rivera-Linares 3286 Articles
Corina Rivera-Linares was TransmissionHub’s chief editor until August 2021, as well as part of the team that established TransmissionHub in 2011. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial from 2005 to 2011. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines.