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Released July 13, 2015 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Regulators at the Missouri Public Service Commission (MPSC) (Jefferson City, Missouri) voted 3-2 on July 1 to deny a license to the proposed Grain Belt Express interstate transmission project. The project, a 775-mile, high-voltage, direct-current (HVDC) transmission project, would bring up to 4,000 megawatts (MW) of wind-derived energy from western Kansas to Missouri, Illinois, Indiana and beyond. Clean Line Energy Partners (Houston, Texas), the developer of the $2 billion project, said it would seek other ways to license the project, which has been under development for several years. The project, already licensed by Kansas and Indiana, was scheduled to be operating by 2019.
Click on the image at right to view a map of the proposed Grain Belt Express transmission project.
The Clean Line Energy project was supported by Missouri business leaders and environmental groups. But it was opposed by farmers and rural property owners who worried their property could be seized under eminent domain if the project was granted a certificate of convenience and necessity--essentially becoming a utility in the state of Missouri. The Grain Belt Express was proposed as a merchant transmission project, outside the scope of a regional transmission organization (RTO). The project owners were willing to bear the financial risks of the project themselves, rather than spreading the costs and risks among parties in regional reliability organizations.
In explaining his vote against the transmission line, MPSC Commissioner Scott Rupp was quoted by the St. Louis Post-Dispatch: "You had to come down to the property rights. The fact is this did not come from a planning organization. ... This was a business model of a private company."
The paper quoted PSC Commissioner Stephen Stoll, another "no" vote: "They did not show the need for the service or that it promoted the public interest of Missourians, which I represent." Stoll said he supports wind power, but "I don't believe in giving utility status to anyone that comes along and claims that's what they're going to deliver."
The staff of the MPSC had recommended regulators reject the transmission project as it did not meet the commission's criteria for being granted a license, chiefly that there was a demonstrable need and that the project would benefit Missourians.
Clean Line Energy claimed the project would deliver about 500 megawatts (MW) of wind power to Missourians, and that the project would create thousands of jobs and spur millions of dollars of investments in the Show Me State. The project also would move up to about 3,500 MW of wind power to states located east of Missouri.
The project, fiercely opposed by rural property owners, found itself caught in the uncomfortable nexus of local, state and federal policies and politics. Federal officials have been working for years to expand the nation's high-voltage transmission system to more effectively move bulk power longer distances. States have enacted renewable portfolio standards (RPS) to encourage development of renewable resources like wind power. And President Obama's Clean Power Plan envisions a significant expansion of renewable energy.
But areas with high-quality wind and solar resources often are located far from load centers, necessitating transmission lines. Renewable energy may be popular, but transmission towers are not. Interstate transmission projects like Grain Belt Express must be licensed in each state where they do business, and state and county regulators are subject to political pressures from interest groups opposing projects--particularly one where many of the benefits would be reaped outside Missouri.
Clean Line could resubmit an application to the MPSC or it could appeal to the U.S. Department of Energy (DoE) (Washington, D.C.) to create a public-private entity to move the project forward. Clean Line is pursuing that option for another project that failed to win state regulatory approval.
The MPSC decision may throw into question the future of planned windfarms in Western Kanas, as well as the RPS compliance plans of utilities in the Midwest and Mid-Atlantic regions.
Clean Line officials have said the Grain Belt Express line could trigger about $7 billion in new investment in wind generation in Western Kansas. In response to a request for information (RFI) from Grain Belt in late 2013, wind-power developers representing 13,500 MW of projects in Western Kansas expressed an interest in potentially connecting their projects to the transmission line. That level of interest is over three times Grain Belt's capacity, the company said--clear evidence of the need for new transmission capacity.
Earlier this year, the Grain Belt Express project held an open solicitation for capacity on its line. The project received requests for more than 20,000 MW of transmission service--several times the line's capacity.
"This Grain Belt Express Clean Line is a great example of the free market working to address the energy sector's need for interregional transmission," Kansas Governor Sam Brownback said in a statement. "Kansas windfarms produce some of the lowest-cost wind power in the country, and Clean Line's open solicitation makes clear the strong demand to ship that Kansas power to markets in need of cheap, clean energy. I look forward to the project moving forward as it helps reduce our dependency on foreign energy sources."
Industrial Info is tracking 14 windfarms under development in Kansas valued at $4.63 billion. The largest projects under development in that state include:
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.
Click on the image at right to view a map of the proposed Grain Belt Express transmission project.The Clean Line Energy project was supported by Missouri business leaders and environmental groups. But it was opposed by farmers and rural property owners who worried their property could be seized under eminent domain if the project was granted a certificate of convenience and necessity--essentially becoming a utility in the state of Missouri. The Grain Belt Express was proposed as a merchant transmission project, outside the scope of a regional transmission organization (RTO). The project owners were willing to bear the financial risks of the project themselves, rather than spreading the costs and risks among parties in regional reliability organizations.
In explaining his vote against the transmission line, MPSC Commissioner Scott Rupp was quoted by the St. Louis Post-Dispatch: "You had to come down to the property rights. The fact is this did not come from a planning organization. ... This was a business model of a private company."
The paper quoted PSC Commissioner Stephen Stoll, another "no" vote: "They did not show the need for the service or that it promoted the public interest of Missourians, which I represent." Stoll said he supports wind power, but "I don't believe in giving utility status to anyone that comes along and claims that's what they're going to deliver."
The staff of the MPSC had recommended regulators reject the transmission project as it did not meet the commission's criteria for being granted a license, chiefly that there was a demonstrable need and that the project would benefit Missourians.
Clean Line Energy claimed the project would deliver about 500 megawatts (MW) of wind power to Missourians, and that the project would create thousands of jobs and spur millions of dollars of investments in the Show Me State. The project also would move up to about 3,500 MW of wind power to states located east of Missouri.
The project, fiercely opposed by rural property owners, found itself caught in the uncomfortable nexus of local, state and federal policies and politics. Federal officials have been working for years to expand the nation's high-voltage transmission system to more effectively move bulk power longer distances. States have enacted renewable portfolio standards (RPS) to encourage development of renewable resources like wind power. And President Obama's Clean Power Plan envisions a significant expansion of renewable energy.
But areas with high-quality wind and solar resources often are located far from load centers, necessitating transmission lines. Renewable energy may be popular, but transmission towers are not. Interstate transmission projects like Grain Belt Express must be licensed in each state where they do business, and state and county regulators are subject to political pressures from interest groups opposing projects--particularly one where many of the benefits would be reaped outside Missouri.
Clean Line could resubmit an application to the MPSC or it could appeal to the U.S. Department of Energy (DoE) (Washington, D.C.) to create a public-private entity to move the project forward. Clean Line is pursuing that option for another project that failed to win state regulatory approval.
The MPSC decision may throw into question the future of planned windfarms in Western Kanas, as well as the RPS compliance plans of utilities in the Midwest and Mid-Atlantic regions.
Clean Line officials have said the Grain Belt Express line could trigger about $7 billion in new investment in wind generation in Western Kansas. In response to a request for information (RFI) from Grain Belt in late 2013, wind-power developers representing 13,500 MW of projects in Western Kansas expressed an interest in potentially connecting their projects to the transmission line. That level of interest is over three times Grain Belt's capacity, the company said--clear evidence of the need for new transmission capacity.
Earlier this year, the Grain Belt Express project held an open solicitation for capacity on its line. The project received requests for more than 20,000 MW of transmission service--several times the line's capacity.
"This Grain Belt Express Clean Line is a great example of the free market working to address the energy sector's need for interregional transmission," Kansas Governor Sam Brownback said in a statement. "Kansas windfarms produce some of the lowest-cost wind power in the country, and Clean Line's open solicitation makes clear the strong demand to ship that Kansas power to markets in need of cheap, clean energy. I look forward to the project moving forward as it helps reduce our dependency on foreign energy sources."
Industrial Info is tracking 14 windfarms under development in Kansas valued at $4.63 billion. The largest projects under development in that state include:
- Cimarron Bend (Clark County) Windfarm, a 600-MW, $1.2 billion project being developed by TradeWind Energy LLC (Lenaxa, Kansas). That project is scheduled to kick off construction in August 2016 and to be operating by the end of 2019.
- Western Trail Windfarm, a 400-MW, $680 million project being developed by EDP Renewables North America LLC (Houston, Texas), the U.S. unit of Energias de Portugal S.A. (Lisbon, Portugal). Dirt is scheduled to be turned on that project next March, and the plant has a scheduled in-service date of April 2017.
- Waverly Windfarm, a 200-MW, $400 million project also being developed by EDP Renewables North America. That project was scheduled to kick off construction this past April, and to be online by next August.
- Salt Springs Windfarm, a 200-MW, $400 million project being developed by Capital Power Corporation (Boston, Massachusetts). The developer plans to begin turning dirt in late 2016, and the project is scheduled to begin operating by mid-2018.
- Hays Windfarm, a 200-MW, $380 million project, is being developed by Iberdrola Renewables LLC (Portland, Oregon), the U.S. unit of Grupo Iberdrola S.A. (Bilbao, Spain). It is scheduled to kick off in late 2016 and to be operating by late 2017.
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.
