MISO Approves Billions of Dollars of Midwestern Transmission Projects

---

Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The Midwest Independent System Operator (MISO) (Carmel, Indiana) approved construction of 17 high-voltage electric transmission projects worth $5.2 billion in aggregate value. Sixteen of these projects were approved by MISO earlier this month; they join one high-voltage transmission project the group had endorsed earlier. MISO is an independent regional transmission organization that manages the high-voltage electric grid in 12 Midwestern states and the Canadian province of Manitoba.

The 17 high-voltage transmission projects are part of the group's 2011 transmission expansion plan. MISO calls these high-voltage projects "multi-value projects" (MVPs), because they have several purposes, including:

• Enhancing grid reliability
• Relieving grid congestion
• Meeting public policy mandates, such as renewable portfolio standards (RPS)
• Reducing the backlog of generation projects that are in the queue, and
• Transporting renewable electricity between the Plains and the Midwest.

MISO operates high-voltage transmission lines stretching from Manitoba and Montana to Michigan and northern Missouri. Most of the 17 MISO-approved MVPs are in the 345-500 kilovolt (kV) range, although one project is rated at 765-800 kV.

"I thank our transmission owners, state regulators and policymakers, and all our stakeholders for supporting our value- based planning process, enabling MISO to ensure reliable, low-cost energy is available for the customers our members serve. The projects in MTEP11 will make low-cost electricity accessible and create thousands of jobs in the process," John R. Bear, MISO's president and chief executive, said in a statement.

The 17 MVPs approved by MISO will cost about $5.2 billion to construct, and they will create $15.5 billion to $49.2 billion in net present value (NPV) economic benefits over a 20- to 40-year timeframe, MISO said. The MVPs will deliver benefits in excess of 1.8 to 3.0 times its costs. For retail customers, that means an $11 investment per year will yield $23 in annual benefits-- a 109% return.

MISO said the MVP portfolio would provide broad regional benefits. The portfolio of 17 high-voltage transmission projects is consistent with state and federal energy policy mandates in the group's region.

Construction of the 17 MVPs will create up to 39,800 construction jobs, the group estimated. Those projects also will benefit customers and utilities by connecting low-cost generation to the regional network and reducing line losses on the region's existing transmission grid.

Prior to review by the MISO board, a group of stakeholders that included a utility regulator from Missouri, reviewed and supported the MVP projects. Following MISO approval, utilities must receive approval from their state utility regulatory commissions before dirt is turned on a project. Transmission projects often stall at state utility commissions. However, because a Missouri utility regulator participated in MISO's Planning Advisory Committee, transmission projects in that state may have a better chance of faster approval.

Some of the largest transmission projects in MISO's MVP portfolio include:

• Palmyra 345-kV grassroot project: a 331-mile project that is part of a larger Illinois River Transmission Project between substations in Missouri, Illinois and Indiana. Ameren Corporation (NYSE:AEE) (St. Louis, Missouri) is developing the Palmyra project, which has a total investment value (TIV) of $860 million.


• Brookings County-Hampton project, a $755 million, 345-kV line between Brookings, South Dakota, and Minnesota's Twin Cities of Minneapolis-St. Paul. This 250-mile project is being developed by Great River Energy (Maple Grove, Minnesota) and will involve Xcel Energy Incorporated (NYSE:XEL) (Minneapolis, Minnesota).


• North LaCrosse-Dubuque project, a $679 million project between Wisconsin and Iowa involving Xcel, American Transmission Company (Pewaukee, Wisconsin), and ITC Holdings (NYSE:ITC) (Novi, Michigan).


• Winco-Hazelton 345-kV line, a $592 million project in Iowa proposed by MidAmerican Energy (Des Moines, Iowa), a unit of Berkshire Hathaway (NYSE:BRK.A) (Omaha, Nebraska) and ITC Holdings.


• Ellendale-Big Stone South, a $326 million, 345-kV line between North Dakota and South Dakota. This project is co-owned by Otter Tail Power Company (Fergus Falls, Minnesota), a unit of ALLETE Incorporated (NYSE:ALE) (Duluth, Minnesota) and Montana-Dakota Utilities Corporation (Bismarck, North Dakota), a unit of MDU Resources Group Incorporated (NYSE:MDU) (Bismarck).

View Project Report - 300026437 300029874

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, 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.