Regulators approve power line application
Friday, December 9, 2011
KANSAS CITY, Mo. (AP) — A Houston-based company has received initial approval from Kansas regulators to develop a high-voltage transmission line across the state to carry electricity from wind farms to Missouri and states farther east.
The Kansas Corporation Commission on Wednesday approved an application from Clean Line Energy Partners to do business as a public utility in Kansas. The KCC decision is a big step in the company’s efforts to get regulatory approval in three states to build a $2 billion, 700-mile transmission line from western Kansas to just over the Indiana border.
“It’s clear that Kansas is serious about taking a leading role in shaping the future of the energy landscape in the United States,” Clean Line President Michael Skelly said.
The transmission line, dubbed the Grain Belt Express, is one of four massive Clean Line projects in various stages of regulatory approval across the country. Company officials said the Kansas line, which will start around Spearville, will help resolve a shortage in transmission capacity that has kept some wind farm projects from getting off the ground.
Electricity that runs through the Grain Belt Express won’t be sold in Kansas, and there will be no cost to taxpayers or electric ratepayers, the company said, nor is it getting any incentives from the state.
“We haven’t asked for them, and we’re proud of that,” Mark Lawlor, director of development for Clean Line, said of incentives. “In this day and age, we’re not looking for any handouts or special treatment. There are a lot of benefits to the state without them having to fork up anything, which is rare.”
Lawlor said energy buyers in Missouri, Illinois and Indiana will have access to the power shipped from Kansas. Customers in several other states also will be using the Kansas electricity because of regional affiliations that jointly develop power grids.
The KCC said in a written statement that the Clean Line project is a “major step” in helping Kansas become a leader in renewable energy production.
“The project is projected to bring good paying jobs, and open Kansas’ wind resources to new markets,” the statement said. “Transmission projects like this are key to establishing Kansas as a leading wind state.”
Kansas and the western half of Missouri are part of the Southwest Power Pool, which will not be getting electricity from the Grain Belt Express. The eastern half of Missouri, along with most of Illinois and Indiana, are affiliated with MISO, or the Midwest Independent Transmission System Operator, which will be purchasing some of the power.
For years, Kansas governors have been talking about the need to expand the state’s transmission capacity in order for more wind farm companies to invest in the state. Two years ago, more than 100 energy policymakers met in Lawrence to discuss expansion of Kansas wind resources.
At that meeting, leaders were told the state’s current transmission lines were near capacity, making it difficult to move electricity from wind farms in the west to larger cities and towns in the east.
Gov. Sam Brownback, who took office this year, has listed wind energy expansion as one of the top priorities to boost the state’s economy. Wednesday, he praised the KCC’s decision to grant Clean Line public utility status.
“The Grain Belt Express Clean Line will provide a vital boost in Kansas’ efforts to lead the nation in renewable energy production,” Brownback said in a statement. “This project will bring well-paying jobs, generate revenue for landowners and local communities, and open Kansas’ abundant wind resource to new markets.”
Clean Line officials said the transmission line will make it possible for $7 billion in new wind energy development in the state, mostly new wind farms, along with manufacturing opportunities to supply those projects.
In its application to the KCC, Clean Line estimated the 3,500-megawatt transmission line will create more than 4,700 jobs during a three-year construction period and 120 permanent jobs to operate and maintain transmission facilities.
Construction and operation of associated wind farms, the company said, will create more than 16,500 full-time equivalent jobs over a one-year construction period and more than 480 permanent jobs associated with running those facilities.
Even though Kansas residents won’t be using power from the new transmission line, the state will benefit from increased tax revenues linked to the project and landowners will receive royalties and other compensation for easements to their properties.
Skelly said the Clean Line projects are just a part of a rapidly developing U.S. clean energy industry that’s beefing up electric grids to handle the new power. He noted that in Texas, thanks to “competitive renewable energy zones,” there are about $6 billion in transmission line projects currently under way.
“From a financial perspective, there’s a lot of capital in this country that is very interested in investing in energy infrastructure,” he said. “Once they get the permits and regulatory approvals, that capital is looking to get deployed in projects like CREZ, ours and others.”
Lawlor said his company still must get regulatory approval in Missouri and Illinois, then come back to Kansas for a second time to get its proposed route approved. All of that must happen before any construction work can begin on the power line, he said.
Lawlor said regulatory approval for the Grain Belt Express in all affected states could take 18 months to two years to receive. The company anticipates commercial operations could begin as early as 2017.
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