In light of a recent comment about the ITC Lake Erie Connector, it’s time to return to it and ask a few questions. ITC’s documentation covers the “what it is” and “how it will be done” in great detail, but there’s very little information about who is doing it and why it’s even necessary.
- While demand for electricity has not declined, the EPA’s Clean Power Plan is forcing coal plants to shut down in the US, removing them from our electric grid without any power sources to replace them. The Lake Erie Connector, is the equivalent of running an extension cord to Canada to try to make up for what our own government, through the EPA, is taking off line.
- When the project began, a US based company, ITC Holdings, was in control, but it was sold to Fortis, a Canadian power company and GIC, a Singapore government controlled sovereign wealth fund. Currently, no companies in the United States have any ownership in the project. The economic benefits will be going to other countries, not Erie County residents.
- Enforcement of the EPA’s Clean Power Plan was halted by the US Supreme Court since the EPA assumed powers it did not have. After the election, the manner in which power plants are retired and replaced may dramatically change and this project may be entirely unnecessary.
- If the electricity delivered on this cable is designated as “renewable power,” then the cost to US consumers will likely be higher than the power removed from the grid by the EPA
Why is the Lake Erie Connector being built?
Open the environmental assessment for the Lake Erie Connector and on page 15 is this quote:
ITC Lake Erie stated that the proposed LEC Project would provide improved access to markets and could be used to support energy and environmental policy goals, enhance power system reliability, and provide substantial public benefits. These public benefits include providing the ability to use clean, renewable power, including hydroelectric power, generated in Canada to help support electric demand in Pennsylvania and more broadly in PJM to makeup capacity lost as a result of coal and other fossil fuel plant retirements in the United States (ITC Lake Erie 2015). The proposed LEC Project would also create or preserve employment during construction and operation of the Project, provide public utility services by improving the availability of the electric grid (PJM and IESO) and provide economic benefits in Pennsylvania including tax revenues over the course of the Project’s lifetime and the creation of construction and operations jobs.
Out of 204 pages filled with technical information, maps and diagrams, that paragraph is the only hint at what this underwater cable is all about, and within that paragraph those six words tell the whole story, “support energy and environmental policy goals.” What goals? The goals of the EPA’s Clean Power Plan, to “cut the carbon pollution that is driving climate change.” Their primary tactic is forcing coal fired power plants to meet extremely harsh new regulations that make it economically impossible for them to operate. The Lake Erie Connector is designed to bring power from Canada to the US to make up for power lost as coal plants are prematurely shut down by the EPA.
What Erie news stories miss that everyone else sees
If you read news accounts in Erie media, the purpose of the cable is for “strengthening the grid,” but what they neglect to mention is the weakness is being caused by our own government’s “War on coal.”
Most articles elsewhere are more forthcoming when they say the cable would be:
just in time to help fill the void left by some of the coal-fired plants that are shuttered or scaled back in the PJM Interconnection in response to U.S. EPA’s climate and environmental rules.
They also say that US markets:
will need new sources of power in the coming years as coal-fired power plants are closed to meet environmental rules.
In other words, the EPA is forcing power plants off line so fast without making any provisions for replacement power that our grid is quickly becoming weak and short of the necessary power to meet demand, so we’re running an extension cord to Canada to get the electricity we need.
Why hasn’t anyone told Erie County residents and taxpayers the rest of the story? You would hope someone in Erie County government or the municipalities involved are aware of this, but judging from comments by local officials quoted in the Erie Times article, they don’t seem to understand what this project is for or how it came about.
In February, the Supreme Court called a halt to the EPA’s Clean Power Plan because they exceeded their authority.
… a majority of the court has concerns about the EPA’s authority to impose the CPP under the Clean Air Act. The CPP, whatever its policy merits, is based on a fairly aggressive reading of the relevant provisions of the Clean Air Act, most notably Section 111. Even some liberal scholars, such as Harvard’s Laurence Tribe, have raised questions about the EPA’s authority here.
Anticipating a change in Washington that could dramatically alter the makeup of the EPA, this project is being pushed ahead before potential changes next year make it completely unnecessary.
Where did the US companies go?
Another interesting change since this project was first presented in Erie County is ownership of the operation. ITC Holdings was US based, headquartered in Novi, Michigan. Early this year, the company was purchased by Fortis, a Canadian utility and then in April, Fortis sold twenty percent of ITC to GIC, a Singapore government controlled sovereign wealth fund, so this cable connecting to our grid, running through Lake Erie and into Erie County is totally controlled by investors and organizations outside the US. The economic benefits will be going to foreign investors, not Erie County residents.
Will electricity cost more for US consumers?
It should also be noted, if the electricity purchased from Canada and delivered over this cable is designated as renewable power, which the statement in their environmental assessment suggests (as does its original name, “The Lake Erie Clean Power Connector”), then it will be more expensive than the coal fired electricity taken off line by the EPA. While Canada offloads their expensive renewables on us, their costs go down while ours go up. Thanks, guys!
Until the residents of Erie County have had more time to study the justification for this project and its potential costs, we may want to pause and get answers to some of these questions. If promoters insist on rushing ahead, we should consider whether our interests are being properly protected.