US Power Grid Connection Wins First Approval; Texas Unresolved
March 18 2010 - 11:04AM
Dow Jones News
A transmission project to link the nation's three major electric
grids won an initial approval Thursday from federal regulators, but
fell short on its bid to resolve a thorny jurisdiction issue.
The so-called Tres Amigas superstation planned for New Mexico
would allow power to flow among the eastern, western and Texas
electric grids. Linking the regions could give wind and solar
generation greater access to customers and back up power, while
eliminating often wide disparities in wholesale prices between
different areas.
"Tres Amigas is a prime example of the creativity and pioneering
thinking that our country needs to expand the ability of the
transmission grid," said FERC Chairman Jon Wellinghoff before the
votes.
The commission gave the project the authority to sell
transmission access at negotiated rates to generators and other
firms that would move power through the proposed facility, while
including provisions to protect consumers.
At the same time, FERC declined to wave its authority over
transmission connections the facility would have with the Electric
Reliability Council of Texas, or Ercot. The jurisdictional issue is
critical to Ercot's involvement because the commission doesn't have
jurisdiction over the Texas grid. The commission said it didn't
have enough information to make a decision, but recommended a
future filing by the project to resolve the jurisdictional
issue.
Winning FERC approvals are important to move the project forward
as Tres Amigas looks to raise additional funding and reach
agreement with transmission companies that would connect into the
facility. The project's developers are talking with a range of
high-voltage line builders including American Electric Power Co.
(AEP), ITC Holdings Corp. (ITC) and Xcel Energy Inc. (XEL), said
David Raskin, a partner at the law firm Steptoe & Johnson LLP
who represents Tres Amigas in an interview Wednesday.
He said the project could be operational as early as 2013, but
the timeline largely depends on the transmission companies
connecting to the facility.
The project would use super-conductor technology to synchronize
power among the three major interconnections. A mismatch exists
among the grids preventing power from flowing among states such as
Texas and Arizona.
-By Mark Peters, Dow Jones Newswires; 212-416-2457;
mark.peters@dowjones.com
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