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FERC forced to ponder claims that transporting energy by train is transmission

Some of the nation's biggest electric utility players are pushing back on a company's effort to win federal recognition for its plan to deploy charged shipping containers via rail in a way that the company claims qualifies as electric transmission.

Alternative Transmission Inc., or ATI, filed a petition with the Federal Energy Regulatory Commission on May 2 seeking an order declaring that its proposed activities are subject to regulation under the Federal Power Act because they result in the transmission of electric energy in interstate commerce. As the owner and operator of mobile "alternative transmission" facilities, ATI also asked FERC to declare the company a public utility under the 84-year-old statute.

If granted, the order would allow ATI to participate in competitive auctions to implement grid operators' expansion plans and have its projects compensated on a nondiscriminatory basis.

But multiple parties, including the Edison Electric Institute, protested the petition June 3, arguing that FERC should not address what the investor-owned utility group described as "important jurisdictional issues" through a declaratory order for a single company.

The Electric Reliability Council of Texas argued that ATI's proposed activities do not meet the Federal Power Act's definition of interstate electric transmission.

And the Electric Power Supply Association expressed concerns that "the technology and facilities described represent or include storage resources and capabilities, which are properly considered generation assets" and, therefore, not transmission.

ATI said that granting its request will address vexing transmission challenges by opening the door to new technologies that are not "tethered to century-old, costly and increasingly difficult to site wires and wire corridors."

Flow technology

ATI was incorporated in 2018 by Adam Rousselle, a 53-year-old U.S. Army veteran. With more than a decade of experience in electric transmission, Rousselle has prevailed before the commission in past proceedings.

For instance, FERC declared in December 2017 that a 500-MW pumped energy storage project of Rousselle-owned Renewable Energy Aggregators does not require a hydropower license. Rousselle also served as a key witness on behalf of Transource, LLC in a proceeding in which a FERC administrative law judge found in January 2018 that the PJM Interconnection's handling of the transmission company's upgrade requests was nontransparent and discriminatory.

"I'm a transmission expert, so what I'm trying to do is determine a way to relieve what the [independent system operators] have determined are intractable issues that are already open for public bid," Rousselle said in a June 4 interview.

ATI's petition also includes a sworn affidavit from Ross Baldick, a professor and Leland Barclay Fellow in the University of Texas at Austin's department of electrical and computer engineering. In his affidavit, Baldick noted that ATI is proposing to use "flow battery" technology, which, unlike most familiar batteries, allows an electrolyte to be removed and transferred from one battery to another.

Electrical energy would be taken from the conventional alternating current system and converted into chemical energy in the electrolyte, Baldick said. The electrolyte would then be "pumped" into rail container cars, which could be moved on the railway network. Upon arrival, the electrolyte would be pumped into a different flow battery and converted into energy again, Baldick said.

The technology could solve a number of challenges, including local landowners' opposition to high-voltage interstate transmission lines that can take years to permit and build, according to the affidavit.

For example, the technology could be deployed to bring low-cost energy generated by cheap natural gas in central Pennsylvania to existing substations in the congested northeastern Delmarva Peninsula using Norfolk Southern Corp.'s mainline, Rousselle said in the interview. "It's an interesting fact that the names of the substations mostly in the Delmarva Peninsula have the same names as the rail terminal."

'It's electric energy'

Rather than a specific "mode" of transmission such as high-voltage power lines, ATI's petition said FERC's jurisdiction over transmission is triggered by "the use of any type of mode or facility for the movement of electric energy from one state into or through another state." In addition, ATI said that declaring it a public utility under the Federal Power Act will allow it to "compete fairly with traditional wire and wire corridor modes of transmission."

However, the Edison Electric Institute said the law's legislative history, which dates back to 1935, shows that the statute did not "contemplate the movement of electric storage resources … by rail, tractor-trailer, boat, or any combination thereof." Granting ATI's petition could also sweep technologies such as electric vehicles under FERC jurisdiction "that are not intended to be subject to regulation as transmission facilities."

ERCOT said ATI's affidavit clearly indicates that the company is proposing to transport chemical energy, not electric energy. "Conflating those two concepts, as ATI would have the commission do, denies the plain language of the statute."

And the Electric Power Supply Association said ATI's petition shows that the company would function "in part or even primarily as a storage resource or electricity supplier." As such, it would be inappropriate to give ATI assured transmission treatment and cost compensation, the storage association said.

Rousselle maintained that ATI is not proposing to ship batteries. "The truth is, it's electric energy and we're going to move it from one place to another place. We want to compete under the market rules of transmission, and if we get to do that we will reduce the price and increase reliability." (FERC docket EL19-69)