North American Transmission and Distribution Project Spending Expected to Soar

Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Spending on power transmission and distribution (T&D) projects across North America is expected to surge over the next 24 months, with more than $55 billion of projects scheduled to begin construction during that time, according to Industrial Info's North American Project Platform.

The North American T&D buildout is accelerating compared to early 2016, when Industrial Info was tracking about $32.2 billion of projects scheduled to kick off in calendar years 2017 and 2018. For more on that, see January 18, 2016, article - North American Transmission Developers Plan Three Busy Years of Projects.

Over the next 12 months, about 485 T&D projects are scheduled to begin construction across North America. The aggregate value of these projects is approximately $24.73 billion. In the subsequent 12-month period, August 2018 through July 2019, 411 T&D projects are scheduled to begin turning dirt across North America. The total investment value (TIV) of those projects is roughly $31.58 billion.

Over the next 12 months, T&D project activity is expected to be particularly brisk in these regions: Rocky Mountains, Quebec, Northeast, Mid-Atlantic and West Coast. On a state or province basis, New Mexico, Quebec, Virginia, New Jersey and California are expected to see the highest dollar-value of construction kickoffs between now and July 2018.

Click on the images at right to see which regions, states and provinces are expected to see the highest dollar value of T&D project activity over the next 12 months.

By contrast, the regions with the least amount of scheduled T&D kickoffs over the next 12 months are Atlantic Canada, the Southeast, New England, Midwest and Ontario, according to the Project Platform. The North American states or provinces expected to see the lowest dollar value of T&D projects turning dirt over the next year are Tabasco, New Brunswick, British Columbia, Coahuila, Nuevo Leon, Sinaloa and Hidalgo. Only one T&D project in each of those states or provinces is expected to begin construction between now and July 2018.

Over the next five years, from August 2017 to July 2022, developers plan to break ground on about 1,083 T&D projects across North America valued at about $67 billion. By contrast, the earlier five-year period envisioned about 442 projects valued at roughly $54.85 billion beginning construction between January 2016 and December 2020.

Industrial Info is tracking seven billion-dollar T&D projects scheduled to begin construction over the next 12 months, including:

• Montreal 345kv Champlain Hudson Power Express Underground Transmission Line, a $2.2 billion project being developed by Hydro Quebec TransEnergie (La Prairie, Quebec). AECOM (NYSE:ACM) (Los Angeles, California) is providing engineering services to this project, a high-voltage direct current (HVDC) line capable of transmitting up to 1,000 megawatts (MW) of electricity about 333 miles from Montreal, Quebec, to the Harlem River in New York. This route includes traveling underneath Lake Champlain and the Hudson rivers. This project is scheduled to begin construction in July 2018 and be operating by yearend 2021.
• Phase 1 of the Clovis Tres Amigas Super Substation, an oft-delayed project scheduled to be built in New Mexico. This project, expected to be constructed in several phases, envisions a 5,000-MW HVDC-to-AC transmission substation that will connect the Western, Eastern and ERCOT transmission grids and move renewable energy more easily across those grids. This project, valued at $1.9 billion, is expected to begin construction this October. Phase 1 construction is scheduled to be completed in May 2021.
• Phase 1 of the Bergen New Jersey Energy Link Transmission Line, a $1.7 billion project to bring offshore windpower to the mainland. This project is being developed by Public Service Electric & Gas Company (PSE&G) (Newark, New Jersey), a unit of Public Service Enterprise Group Incorporated (NYSE:PEG) (Newark, New Jersey). It will include 155 miles of subsea transmission line along the New Jersey coast. Construction is scheduled to begin in mid-2018 and be completed by mid-2020.

"T&D project spending continues to rise as power plant closures, severe weather and renewable energy projects are driving the need to strengthen, rebuild and expand the grid," said Britt Burt, Industrial Info's vice president of research for the Global Power Industry. "We don't expect all of these projects will begin or finish construction according to their schedules. But the high level of scheduled project spending is another sign of how dramatically the industry is changing."

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.