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near their city boundaries and for the affected public. Many MMTG members own <br /> transmission within the MISO footprint in order to advance public benefits. <br /> Among the relief that the Association of Businesses Advocating Tariff Equity <br /> ("ABATE") et al. seek in this proceeding is a capital structure cap applied to named <br /> respondents in setting Midcontinent Independent System Operator rates in which <br /> respondents' allowed equity component does not exceed 50 percent of respondents' total <br /> capital structure. ABATE Complaint2 at 1-2. In considering this Complaint, which is <br /> addressed to investor owned utilities, and in any resulting Commission order, MMTG calls to <br /> the Commission's attention that municipal utilities, such as and including its members, often <br /> invest in new, necessary transmission using mostly or entirely debt capital. In these <br /> circumstances, for such municipal transmission financings and transmission investments to <br /> be viable payment of debt and debt costs must be assured by some form of municipal <br /> payment guarantees or purchases of services. <br /> Municipal transmission owners have comparable needs for returns and have <br /> comparable risks as investor owned utilities. However, where potential municipal investors <br /> have limited or no explicit equity, any allowed equity returns become illusory because an <br /> "allowed" equity return multiplied by zero or close to zero is close to zero or at zero. It must <br /> be stressed that allowing municipal systems, including municipal power supply agencies, <br /> hypothetical capital structures that provide for comparable equity tends to be substantially <br /> rate reducing for all transmission users compared with financing by investor owned utilities. <br /> Cent. Minn. Mun. Power Agency and Midwest Mun. Transmission Grp., 134 FERC¶61,115, <br /> P 31 (2011). <br /> 2 eLibrary No.20131112-5303. <br /> 3 <br /> 111 <br />