On December 29, 2009, Alleghany Energy Inc. (“Allegheny”) and American Electric Power Co. (“AEP”) announced that they are suspending the Virginia portion of their 270-mile high-voltage Potomac-Appalachian Transmission Highline project (“PATH Project”).  The Virginia portion of the project is being suspended in part after new studies showed that the PATH Project will not be needed in 2014 as initially anticipated.  The PATH Project is designed to deliver power from West Virginia to parts of Virginia and Maryland.   

Previously on December 21, 2009, Allegheny and AEP stated that they filed a new application in Maryland and withdrew their application in Virginia to realign regulatory review schedules in Maryland, Virginia, and West Virginia.  At that time, the Allegheny affiliate that withdrew the application, PATH Allegheny Virginia Transmission Corp., stated that it would file a new application for the 31-mile Virginia segment in early 2010.  Meanwhile, Allegheny affiliate Potomac Edison Co. d/b/a Allegheny Power filed a new application at the Maryland Public Service Commission (“PUC”) after the first application was rejected on procedural grounds.  As such, the Maryland PUC will continue to evaluate the 20-mile Maryland segment of the PATH project.

While considering the application, the Virginia Corporation Commission’s (“VCC”) hearing examiner asked PJM Interconnection LLC (“PJM”) to analyze the need for the PATH Project.  PJM’s analysis demonstrated that the PATH Project would not be needed as early as initially anticipated, primarily because plants in the region will run longer than initially projected and customers in the region have adopted programs that encourage demand reduction.  With the VCC ready to render a decision shortly after the new analysis undercut any arguments on the need for the project by 2014, Allegheny and AEP withdrew their application.  Allegheny and AEP now state that they will not consider the Virginia application again until the third quarter of 2010.

However, the applications for the 224-mile West Virginia segment and Maryland segment will continue with their respective authorities.  These regulatory processes have been behind the regulatory processes at the VCC.  As such, Allegheny and AEP will have the opportunity to update PJM’s analysis this summer when it completes a comprehensive annual transmission needs analysis. 
A copy of the December 29, 2009 announcement can be found at:
http://www.pathtransmission.com/PATH_VA_Press_Release_12-29-09.pdf.