Transmission progress Companies update WIA on plans, permit process
Laramie – Among the updates given at the late-April meeting of the Wyoming Infrastructure Authority in Laramie was an overview on Wyoming’s renewable energy transmission projects.
Focusing mainly on the TransWest Express line sponsored by TransWest and the Zephyr Project sponsored by TransCanada, TransWest Director of Engineering and Operations David Smith began the overview, saying his company has reached some milestones with the project, but there are California and implementation issues yet to be overcome.
The 3,000-megawatt project is proposed to start in south central Wyoming and carry wind-generated energy 725 miles to the California, Nevada and Arizona markets using high voltage direct current technology.
“We’re just starting the NEPA process for permitting, and we’re focused on that as the main critical item to get the project in service,” said Smith of the National Environmental Policy Act process, adding if the project can get the necessary permits it’s expected in-service date is approximately 2015.
“This line would meet the needs of the California and Desert Southwest renewable energy markets, and might also possibly deliver natural gas-produced energy to those markets,” said Smith.
The TransWest Express is generally aligned with PacifiCorp’s Gateway South project.
“We’re working with them on some joint meetings within the NEPA process,” said Smith. “Also, there’s a lot of coordination required in Wyoming, as both the Gateway South and the terminal for TransWest would all be connected and routed along the I-80 corridor, particularly in the Rawlins area where there’s a pinch point.”
Smith said some of TransWest’s big news is a parternship agreement made with the Western Area Power Administration (Western).
“That stems from the American Recovery and Reinvestment Act funds provided to the state in the last year. Western received over $3 billion in funding to go seek projects to leverage that money that will facilitate renewable energy development in the country,” explained Smith. “The agency issued a statement of interest last year, received over 200 applications and selected to participate with the TransWest Express.”
Smith said Western will own 50 percent of the equity, but TransWest will remain the lead developer.
“Western will participate in the NEPA compliance review as a co-lead with the BLM,” continued Smith. “To this point we’ve been working with the BLM on the NEPA application, and now Western will join the BLM and both will co-lead the process.”
Smith said TransWest looks to have a notice of intent issued in the next couple of months and to start its public scoping in August or September with over 20 meetings along the route.
Regarding the uncertainty with California, Smith said it has to do with that state’s renewable energy policy.
“These projects and Wyoming’s opportunity to provide renewable energy are policy-driven. California has renewable energy and environmental goals that they’ve adopted and steadfastly stood by,” said Smith of California’s goal to meet 33 percent of its energy needs with renewable energy by 2020.
“It’s not about how much, but how to implement the policies,” said Smith of California’s dilemma between in-state or least-cost development. “It’s very important for us as developers to participate in that and let them know about the opportunity in Wyoming, and that it can be provided at the least cost to them.”
John Dunn, Director of Power Transmission Development for TransCanada, said the Zephyr Project is in its open season, and has made significant progress.
The Zephyr is similarly configured to the TransWest Express, but instead of going into Utah it proposes to go to a converter station in Idaho and then down to the California market.
“The California market is the 800-pound gorilla,” said Dunn. “There are other markets in Nevada and Arizona, but California, particularly southern California, is critical.”
Dunn said the Zephyr is a merchant transmission project, which means there’s no utility rate base. “Just to permit the project is somewhere north of $80 million,” he said. “When we’re talking about a project like this, and with the context of the California market, this is pure at-risk dollars, with no ability to recover them unless the line is ultimately built.”
The project is the first merchant transmission line that’s been 100 percent subscribed to by renewable energy.
Dunn calls the Zephyr Project a “bullet line” offering a straight path to California.
“That’s an important issue that California regulators need to understand – they’re concerned about transactions and if any renewable energy is actually ending up in their state. This line offers a direct electron path from Wyoming renewables straight down into the El Dorado Valley,” said Dunn. “It’s a physical path right into their market.”
Dunn estimated that when employment, property taxes and other figures are totaled, over a 20-year period the line would contribute $8.5 billion to Wyoming’s economy.
The open season on the Zephyr Project just ended March 10. “We did receive bids in excess of the 3,000-megawatt capacity,” said Dunn. “That’s big news, but we’ve not yet decided to proceed to the regulatory phase until we complete some due diligence, and one of those is the California market.”
Dunn said the “NIMBY” concept is coming into play in California, or “Not in my backyard.”
“Nearly 90 percent of all delayed projects are in-state, and 75 percent of pending projects are in-state,” said Dunn. “There’s a desire to see as much of that met by in-state sources as possible, but the development of in-state renewables is not a compelling picture. The conclusion is California needs out-of-state renewables – the high quality, high capacity factor, low cost renewables from Wyoming.”
“California represents the biggest single market for Wyoming wind. Our configuration provides long-term contracts. The contracts we proposed were 20 to 25 years long,” said Dunn. “But we need regulatory certainty and stability, such that California utilities can consider long-term agreements for out-of-state renewables.”
Of the Zephyr, Dunn said, “The line relies on power purchase agreements being signed sometime in the next couple of years with generators in Wyoming so this can be built and Wyoming’s dreams of being a bigger renewable energy player in the West can be realized.”