Mega international power transmission line wins federal approval

Donald Jessome, president and CEO of TDI New England, presents his company's proposal for a 154-mile hydroelectric transmission line running from Canada under Lake Champlain and into Vermont. Photo by Hilary Niles/VTDigger

Donald Jessome, president and CEO of TDI New England, presents his company’s proposal for a 154-mile hydroelectric transmission line running from Canada under Lake Champlain and into Vermont in October 2014. File photo by Hilary Niles/VTDigger

The U.S. Department of Energy gave its approval this week to a 1,000-megawatt international power line that will carry mainly Canadian hydroelectric energy to southern New England. Vermont will have dibs on 200 megawatts.

The Department of Energy awarded the project a presidential permit, which is required for all projects crossing the United States border, said the Dec. 12 Federal Register, in which the project’s approval was recorded.

The route of a proposed transmission line under Lake Champlain.

The route of a planned transmission line under Lake Champlain.

The power line, to be built by Transmission Developers Inc.-New England (TDI-NE) under the New England Clean Power Link moniker, will carry electricity produced from hydroelectric dams in Canada and wind turbines in New York to southern New England utilities that are statutorily obligated to secure portions of their energy supply from sources deemed renewable.

The project is the first of more than half dozen proposed by “merchant” electricity purveyors hoping to tap into that growing market to secure a presidential permit. The project last month was awarded certification from Independent Service Operator-New England (ISO-NE, the region’s electrical grid overseers) stating that it would be compatible with the existing New England grid.

The cable will carry 1,000 megawatts of direct-current electricity 154 miles from the Canadian border to Ludlow, where a converter station would transform the electricity to alternating current. From the Coolidge Substation in Ludlow and Cavendish, the power will flow into the ISO-New England grid, VELCO spokesman Kerrick Johnson said.

Most of the cable’s length from the Canadian border will be buried beneath Lake Champlain.

Kerrick Johnson VELCO

VELCO vice president Kerrick Johnson. File photo by John Herrick/VTDigger

The Vermont Public Service Board approved the project early this year, saying that it issued a certificate of public good to TDI because the project diversifies energy sources, reduces greenhouse gas emissions, creates new jobs, generates tax revenue and potentially supplies cheaper energy.

The $1.2 billion project will carry roughly the same amount of power Vermont consumes as a whole.

The project’s backers — financial firm Blackstone Group, which manages more than $200 billion in assets — reached an agreement last year with the Conservation Law Foundation that secures almost $300 million over 40 years for the state’s cleanup efforts in Lake Champlain. The environmental advocacy group negotiated more than $100 million in addition to what TDI originally promised, and in exchange CLF agreed not to oppose the project in the courts.

Those payments are on top of $136 million to be disbursed to the state’s electricity transmission utility, Vermont Electric Power Co. (VELCO), in annual payments over 40 years. That money will be used to keep electric rates lower than they’d be otherwise, Johnson said, and will reduce the cost of transmitting electricity to Vermont by about 10 percent.

The payments will go to VELCO because it’s the state’s electric transmission utility, of which all 17 of Vermont’s power utilities are members, Johnson said.

Although the TDI cable will reduce power costs somewhat for retail customers, electricity prices will continue to be set, in the short term at least, by the cost of natural gas, the combustion of which supplies more than half of New England’s electricity.

Although New England’s reliance on natural gas is slated only to increase over the next decade, states in the region have committed to aggressive renewable energy targets incorporating wind, hydroelectric and solar energy. The TDI cable is meant to aid New England utilities in meeting these targets, Johnson said.

Construction on the project has been scheduled to begin in 2018, and if it moves forward, the New England Clean Energy Link should carry power by 2019.

Though the cable is meant primarily to serve New England states south of Vermont, its existence will spur further, subsidiary transmission projects within the state, Johnson said.

Mike Polhamus

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