Notes

By Tom Tiernan, Senior Analyst, TransmissionHub

DOE Approves TDI New England Clean Power Transmission Line

TDI New England received the final environmental impact statement from the U.S. Department of Energy (DOE) for its $1.2 billion Clean Power Link transmission project designed to move power from renewable resources in Canada to Vermont, TDI-NE said in a statement.

The final EIS said DOE’s preferred alternative “is the issuance of a Presidential permit that would authorize the construction, operation and maintenance of the project,” which would cross the U.S. border with Canada.

Construction is scheduled to begin in the summer of 2016. The planned 154-mile project will be a high-voltage, direct current line that capable of delivering 1,000 MW into the ISO New England system at a substation in Cavendish, Vermont..

It includes a 97-mile underwater segment in Lake Champlain and a 57-mile underground segment in Vermont to move power from Quebec, Canada, to a converter station in Ludlow, Vermont.

The final EIS noted that TDI-NE developed environmental mitigation measures to minimize environmental impacts before, during and after construction.

Cable installation on the Lake Champlain segment would occur between June 1 and Nov. 1 to avoid icy conditions on the lake, although installation in the southern portion of the lake could occur up to Dec. 31 if needed, DOE said.

Installation in shallow water depths would result in temporary, local effects on water quality during construction, with cables buried underwater at different depths using jet plowing and shear plowing methods, with shear plowing resulting in less sediment suspension and dispersion, DOE said.

At water depths of more than 150 feet, the cables would be laid on the lakebed and allowed to self-bury, and the route within Lake Champlain is designed to avoid the possibility of anchor snags from boats, the final EIS noted. Even so, it directed TDI-NE to follow certain steps if an anchor snag occurs, including notifying the U.S. Coast Guard, repairing the cables and recovering the snagged anchor, if possible.

The final EIS “marks another milestone in the permitting of the project,” TDI-NE CEO Donald Jessome said in the Oct. 29 statement. “We are confident that, once built, the New England Clean Power Link will deliver environmental and economic benefits to the people of Vermont and New England and do so in a way that minimizes impacts to communities and helps meet the region’s growing energy and environmental challenges,” Jessome said.

TDI-NE said it expects to have all major federal and state permits for the project secured by the end of the year.

In previous statements, TDI-NE has said it anticipates completing a financial close on the project by July 2016, with an in-service date in mid-2019.

Centrica buys Panoramic Power to Partner With U.S.-based Direct Energy

Retail electricity provider Direct Energy and its parent company Centrica have agreed to acquire Israeli energy management firm Panoramic Power for $60 million.

Houston-based Direct Energy’s acquisition builds on an existing and exclusive partnership with Panoramic Power that began in June 2014. The partners are focused on expanding the U.S. energy services business.

Direct has 5 million residential and business customers in North America, while Panoramic offers technology to help customers lower energy consumption, reduce operating costs and increase overall operational efficiency.

“The commercial industry trend is moving toward more centralized energy management solutions with a focus on automated energy data collection and reporting, which is why Direct Energy aims to seamlessly incorporate Panoramic Power’s technology and analytical expertise into what we offer our growing customer base,” John Schultz, president of Direct Energy Business, said in a statement. “Customers will be able to see energy insights, such as once unpredicted device failures, energy-related infrastructure investment ROI and other valuable information that can inform and affect major business decisions in the future.”

Panoramic Power , which has offices in New York, Israel and the United Kingdom, was founded in 2009. The firm has deployed 25,000 sensors at 700 sites in 30 countries.

British-based Centrica has owned Direct Energy since 2000. Centrica is focused on oil and gas, power generation and smart grid devices.

Plains & Eastern Clean Line Project Moves Ahead With Environmental Impact Statement

The U.S. Department of Energy (DOE) released its final environmental impact statement (EIS) for the proposed Plains & Eastern Clean Line transmission project, marking an important step toward the construction of America’s largest clean energy project.

The multi-billion dollar infrastructure project is a nearly 700-mile overhead direct current (DC) transmission line that will create thousands of construction jobs in Oklahoma, Arkansas and Tennessee, support hundreds of manufacturing jobs in those states, and deliver 4,000 MW of low-cost clean power from the Oklahoma Panhandle region to customers in Arkansas, Tennessee and other states in the Mid-South and Southeast.

DOE’s release of the Final EIS marks a key milestone for the Plains & Eastern Clean Line. The Final EIS presents a thorough analysis and comparison of the potential environmental impacts of the proposed project, responds to public comments DOE received regarding the Draft EIS, and identifies DOE’s participation in the project through Southwestern Power Administration (Southwestern) as its preferred alternative.

Based on the analysis presented in the Final EIS, DOE identified a preferred route for the direct current transmission line. DOE also identified its preferred locations for a delivery converter station in Arkansas as well as a converter station and associated project facilities in Oklahoma. DOE’s participation in the project would be limited to states in which Southwestern operates.

Southwestern does not operate in Tennessee, therefore, in the Final EIS DOE does not indicate a preference for the location of the DC transmission line or the converter station in Tennessee.

The Final EIS “did not identify widespread significant impacts as a result of construction or operations and maintenance of the Project.” DOE also concluded that implementation of the environmental protection measures that Clean Line included as an integral part of the project would avoid or minimize the potential for significant environmental effects.

“The release of the Final EIS marks the culmination of more than five years of work and the consideration of thousands of stakeholder comments,” said Michael Skelly, Clean Line Energy’s president. “We are pleased to have reached this important project milestone and appreciate DOE’s careful environmental review and analysis of the Plains & Eastern project. We look forward to DOE’s Record of Decision.”

“We are very encouraged by the release of today’s Final EIS because it brings us one step closer to expanding our nation’s interstate electric transmission backbone and meeting the growing demand for wind energy in the United States,” said Tom Kiernan, CEO of the American Wind Energy Association.

“The Plains & Eastern Clean Line is a critical component of this needed transmission expansion and will deliver low-cost, reliable wind power from the Oklahoma Panhandle, where an enormous amount of potential wind farm capacity is waiting to be developed, to Americans in the Mid-South and Southeast United States,” Kiernan said.

“The line by itself will carry four times more electricity than the Hoover Dam generates, so this is a very big development indeed in American clean energy,” he added.

Aclara Technologies Unit Buying GE’s Meter Business

A unit of Aclara Technologies, a supplier of smart infrastructure technologies signed a definitive agreement to buy the electricity meters business currently operating within GE Energy Management’s Grid Solutions (GE Meters) subdivision.

The transaction is expected to close by the end of the year subject to standard conditions, regulatory approvals, consultation processes with employees as applicable and completion of business processes satisfactory to both parties. Terms of the transaction were not disclosed.

“This acquisition significantly enhances Aclara’s offering for electric utilities across North America and around the globe, creating a comprehensive portfolio of leading-edge products,” said Allan Connolly, Aclara’s CEO and president. “The combination of Aclara’s industry leadership in advanced metering infrastructure (AMI) technology with GE Meters’ 130 years of operating experience, technology development and commercial expertise will enable us to accelerate development and delivery of advanced smart infrastructure solutions.”

Aclara will acquire more than 300 employees along with GE Meters’ global headquarters in Somersworth, New Hampsire, a satellite manufacturing facility in Chicago and a center of excellence in Bilbao, Spain, focused on the rapidly growing international regions. Aclara also will acquire a significant intellectual property portfolio of active patents and patent applications.

“Aclara will greatly benefit from GE Meters’ deep technology foundation and its seasoned engineering group,” said Brian Urbanek, managing director of Sun Capital and member of the Aclara Board of Managers. “This expertise will support Aclara’s focus on addressing key technology trends including AMI integration, cyber security and standards, design for cost and field upgradability, all of which are important aspects of a smart infrastructure environment.”

EYE ON the world

Rampion Offshore Wind Project gains new investor in Enbridge

Canadian energy company Enbridge joined the Rampion offshore wind power project by acquiring a 24.9 percent interest. Enbridge will become one of three shareholders in Rampion Offshore Wind.

E. On will remain the controlling shareholder at 50.1 percent, with the UK Green Investment Bank continuing to hold a 25 percent interest.

Rampion is a 400 MW offshore wind farm project in the English Channel, to be located off the Sussex coast south of Brighton and remains set to become the first offshore wind farm off the south coast of England.

E.On will manage construction and operation of the Rampion Offshore Wind Farm. The project received the final investment decision in May 2015, started construction in September and is expected to be fully operational in 2018.

“Offshore wind is a natural next step for Enbridge’s significant wind business,” said Enbridge President and Chief Executive Officer Al Monaco. “We have a well-established renewables business and growing expertise in wind power technology, construction and operations and this project provides an attractive opportunity to partner with E.ON, an industry leading constructor and operator of offshore wind projects, and Green Investment Bank with its experience of supporting offshore wind ventures. Further developing our expertise in this business will position Enbridge to participate in future offshore developments.”

“Our investment in Rampion Offshore Wind is a strong fit with our investor value proposition and advances a number of key corporate priorities,” added Monaco. “Rampion provides a timely and effective entry point to the European offshore wind business and it supports our objective of developing new platforms that extend and diversify our industry leading growth beyond 2019. The European offshore wind business comes with strong market fundamentals, sound commercial underpinnings and attractive returns. Once the project goes into service in 2018, we expect it to be immediately accretive to available cash flow from operations and earnings per share.”

Under the terms of the agreement Enbridge will become one of three shareholders in Rampion Offshore Wind Limited which owns the project. The UK Green Investment Bank plc holds a 25 percent interest, and E.ON will retain the balance of 50.1 percent.

E.ON will manage construction of the project under a construction management agreement. Rampion Offshore Wind Project is E.ON’s 10th offshore wind project worldwide and its sixth in the UK. It will be operated by E.ON under a 25-year management and operations management agreement.

E.ON currently operates a 4 GW wind portfolio across the globe. Enbridge and E.ON are partners in the 200 MW Magic Valley Wind Project in Texas and the 200 MW Wildcat Wind Project located in Indiana. Enbridge holds an 80 percent interest in both projects; both are operated by E.ON.

E.On and Enbridge are already partners in the Magic Valley wind farm located in Texas and the Wildcat wind farm in Indiana. Enbridge holds an 80 percent interest in both 200 MW onshore projects; both are operated by E.On.

By Tom Tiernan, Senior Analyst, Transmission Hub

Sempra sees transmission investment opportunities in Mexico

Sempra Energy officials highlighted transmission investment opportunities in Mexico starting in 2016, including some cross-border transmission lines in a plan from the Ministry of Energy in Mexico, during the company’s Nov. 3 conference call on 3Q15 earnings.

Debra Reed, chairman and CEO, also mentioned that the new 50 percent renewable portfolio standard in California would require both natural gas and power infrastructure investments to meet the needs of a changing generation landscape.

“We will have to make investments to integrate additional renewables” under the revised RPS, Reed said during the call.

The new RPS law calls for California to increase its use of renewable resources from the current 33 percent level to 50 percent by the end of 2030. On Oct. 28, Tony Earley, chairman, president and CEO of PG&E Corp. asserted that the higher RPS in California should create transmission investment opportunities in the state.

South of the border, Reed said “we see a wealth of opportunities in Mexico” that Sempra’s Mexican unit IEnova and other businesses will seek to develop. Those include liquids pipelines in association with Pemex and power transmission and generation plans from the Comision Federal de Electricidad.

Market rules for transmission investment are being finalized and are expected to be open for competing proposals within the first half of 2016, Reed said, adding “we’re very interested in participating in that market.”

The Ministry of Energy’s long-term plan for the development of a national electric system includes where power plants and transmission lines are being planned for different regions of Mexico, Sempra said in its slide presentations accompanying its 3Q15 earnings report.

The plan lists nine transmission line projects, including three along the U.S.-Mexico border, an interconnection of the Baja grid to the Mexican National grid in the state of Sonora in 2019 and a high-voltage, direct-current line of 600 km that would connect renewable energy projects in Oaxaca to central Mexico, according to the presentation.

Addressing questions on Sempra and IEnova competing with other firms to build such projects, Reed said “we have some outstanding experience building major transmission projects in difficult areas.” She also mentioned that Sempra has worked with CFE on other projects, and it may be able to use some shared rights-of-way on pipeline or infrastructure projects it already owns.

“We should be in very good standing to be competitive in that market,” added Sempra President Mark Snell, who noted that the company has experience developing transmission projects in Chile and Peru, so working outside the U.S. is not as daunting compared with other companies lacking such experience.

Sempra officials and the 3Q15 earnings materials did not include any dollar figures for the transmission investment projects in Mexico.

Siemens signs renewable energy transmission deal with Bolivia

Siemens has signed a far-reaching agreement with the Hidrocarbon and Energy Ministry of Bolivia on energy cooperation and future collaboration in the field of products and services for the oil & gas industry.

Furthermore, this includes a focus on renewable energy as well as transmission and distribution.

“With this major agreement we further strengthen the energy partnership between Bolivia and Siemens,” said Willi Meixner, CEO of Siemens’ Division Power and Gas. “Our products and solutions will help our partner ENDE to significantly increase the efficiency in electricity production and support the future plans of energy export. By cooperating in the fields of renewable energy as well as transmission and distribution, we are supporting the country’s ongoing efforts to improve access to electricity of its population.”

The agreement was signed in the presence of the president of Bolivia, Evo Morales, during his visit to Germany. Under the terms of the exclusive agreement, Siemens intends to supply gas turbine combined cycle equipment for a substantial expansion of three existing thermal power plants of the state-owned utility ENDE ANDINA in Bolivia per the government’s 2025 Patriotic Agenda. The agreement is covering a long-term volume worth over $1.07 billion.

ENDE owns and operates three thermal power plants with a total capacity of about 460 MW: Entre Rios, Termoelectrica del Sur and Termoelectrica de Warnes, all equipped with Siemens gas turbines. According to the agreement, each of these power plants will be expanded.

Over the course of the last few years, Bolivia’s GDP growth was one of the biggest in South America. The country has the second-largest reserves of natural gas in the region. Furthermore it is situated in the center of the continent, offering promising opportunities for power exports to its neighboring countries such as Argentina, Brazil, Peru, Paraguay or Chile.

UC Berkeley Economist Says Net Metering Changes Could Impede Solar Adoption

A study by Professor Justin McCrary of the University of California, Berkeley, an economist with Berkeley Law and the National Bureau of Economic Research, found that proposals at the California Public Utilities Commission (CPUC) on the future of solar net metering by the state’s monopoly utilities and the CPUC’s Office of Ratepayer Advocates (ORA) would severely impede the adoption of rooftop solar in the state.

McCrary’s report, titled “Impacts of Rooftop Solar Adoption from Proposed Changes to California’s Net Metering Policy,” evaluated proposals from Pacific Gas & Electric, San Diego Gas & Electric, Southern California Edison, as well as the ORA according to economic principles of consumer decision-making.

“One of the main characteristics of the current (net metering) program is its simplicity: it is easy to understand that no matter how the energy produced by the solar system is used, it will result in a deduction on a consumer’s total bill,” the report said. “The proposed changes to California’s California’s (net metering) program by the (utilities) and ORA will greatly increase the complexity of the decision that consumers face when considering rooftop solar adoption… In short, consumers will be discouraged from adopting by the sheer complexity of the choice they face.”

According to McCrary, the methodology used by CPUC staff to help evaluate different proposals does not account for consumer behaviors specific to an economic decision like going solar, including: Discount rates and present orientation (consumers may undervalue the long-term benefits of rooftop solar); risk aversion given uncertainty; and limited attention and bounded rationality (consumers have limited attention and capacities to perform complex calculations and trade-offs).

Given the long-term nature of the rooftop solar investment and the dynamics of consumer demand, McCrary recommends that the CPUC consider how any changes to the net metering tariff will affect the riskiness and complexity of the homeowner’s decision to install solar.

In fact, he warns that policy uncertainty can have an outsize impact on such complex consumer decisions, and thus the CPUC must be cautious and measured in its decision. The study says that the CPUC should “move deliberately and incrementally in order to avoid fully and durably throttling consumer adoption of rooftop solar.”

The report compared the California utility proposals to new fees and rate structures for new rooftop solar adopters in Arizona’s second largest electric utility territory, Salt River Project. The changes adopted by that utility caused rooftop solar applications to collapse in its territory.

Rice wins $2.4 Million to study many-antenna wireless

Rice University researchers have won $2.4 million from the National Science Foundation (NSF) to conduct the most extensive experimental research yet of wireless technology that uses 100 or more antennas per base station to send tightly focused beams of data to each user, even as they move.

The research at Rice’s campus in Houston will help the wireless industry determine whether and how to include the many-antenna technology-known in industry parlance as “massive multi-user, multi-input multi-output,” or massive MU-MIMO-in upcoming 5G wireless standards.

“Early tests of many-antenna technology at Rice and elsewhere suggest that wireless carriers could use this technology to serve many times more data than can be served with today’s 4G networks,” said Lin Zhong, associate professor of electrical and computer engineering and of computer science at Rice and the principal investigator on the new grant. “But there are still many questions about how to scale this technology for real-world implementation. Those are the challenges we’ll be tackling with the new research.”

The research will make use of ArgosNet, a many-antenna experimental test bed that Zhong’s Efficient Computing Group is building thanks to a 2014 NSF infrastructure grant. ArgosNet will eventually include up to a half-dozen programmable base stations, each with 100 or more antennas. Zhong’s team will be able to reconfigure each to emulate cell-tower base stations or other types of wireless network nodes. The many-antenna technology being investigated leverages a large number of base station antennas to serve many users at the same time. When the number of base station antennas is significantly larger than the number of users, the technology is also referred to as “massive MIMO.”

“Large-scale multi-user MIMO technology is a key enabler in meeting the 1,000x data challenge — that of increasing spectrum efficiency by a factor of 1,000 when compared to current 4G data networks,” said Thyaga Nandagopal, NSF program director. “The National Science Foundation has funded basic research in this area for several years now, and this project will advance this research to the next level by addressing the system-level challenges that can hinder the realization of this technology’s full potential.”

According to a 2014 study by Cisco, wireless carriers increased the average mobile network downstream speed from 1,387 kilobits per second (kbps) in 2013 to 1,683 kbps in 2014. That’s a notable improvement, but nowhere near the growth that is needed to meet demand. The same report found that smartphones generated 22 times more demand for mobile data than did nonsmart devices, and 88 percent of the 497 million new mobile devices added worldwide in 2014 were smart.

Rice professor Lin Zhong (standing) and graduate student Clayton Shepard with ArgosNet base station. Photo by Jeff Fitlow, Rice University

Zhong said the new experimental research with ArgosNet, which draws its name from the many-eyed giant of Greek mythology, could provide the answer that wireless carriers need for the coming bandwidth crunch. ArgosNet uses its many antennas to beam information directly to numerous users simultaneously on the same frequency. It does this by constantly computing where each user is and altering the signal to each antenna to direct a focused beam directly to each user.

Among the ArgosNet team members is Clayton Shepard, a Ph.D. student who is building the ArgosNet base stations and mobile clients, and who’s already worked with NASA to test massive MIMO designs using specialized facilities that were originally built to test spacecraft communications systems.

“ArgosNet is a very flexible platform,” Shepard said. “We’ve designed it to work like Lego blocks; we can add or subtract antennas and other components to construct any kind of node that we want. The wireless test units also can be configured to act like everything from a laptop to a wireless handset.”

Shepard said the team is exploring how to make ArgosNet compatible with existing smartphones and wireless devices, but the current base stations are not compatible with existing technology. For Rice’s tests, Shepard and other members of Zhong’s team will use reprogrammable, battery-powered test units.

Revenues, Debts Rising in Tandem at Nation’s IOUs, EEI reports

Rod Walton, senior editor

The double-edged swords were raised high with the nation’s investor-owned utilities last year. Revenues, dividends and capital budgets were up, up, up, but so was long-term debt and pressure to deliver more flexibility and choice to customers.

The Edison Electric Institute’s (EEI’s) 2014 Financial Review annual report was released this fall, detailing the multitude of ways that publicly traded utilities spent and earned their money last year. Overall, total operating revenues rose 7.2 percent to $376.9 billion nationwide, while those utilities in the EEI index also increased dividends by 3 percent to a combined $21 billion.

The pace of change is quickening in the 130-year-old electricity industry, EEI President Thomas Kuhn said in his letter leading off the 2014 Financial Review.

“Today, our industry is working at a breakneck speed to integrate new technologies and new innovations onto the electric power grid as they come to market,” Kuhn noted. “They want to be able to plug in all of their new devices or access new services.

“They expect us to continue to sustain a power grid that supports their needs, while also giving them flexibility and choice in how they use energy,” he added.

So far, so good. The industry’s net income rose slightly to a collective $28.2 billion in 2014, but long-term debt nearly hit $500 billion, an all-time high. Overall, the total long-term debt has risen 39 percent, or nearly $137 billion, since 2007.

Those debts are financing consistently high levels of capital expenditures by the utilities. The capital spent by investor-owned utilities combined on projects hit a record high of $98.1 billion in 2014 and is expected to top $108 billion this year, according to the EEI.

Fortunately, interest expenses fell 5.3 percent. The industry’s average credit rating improved to BBB+ from BBB, the first such change in 11 years, the report reads.

Those risk assessments and interest rates could change in coming years, even as utilities are under persistent pressure to meet stringent environment regulations. Rating agencies believe expenditures focused on meeting the EPA’s Clean Power Plan final rules will stress utilities in states which have to make the biggest reductions in CO2 emissions.

“S&P and Moody’s both expect the eventual credit impact of the CPP to be significant but not uniform across the U.S. electricity sector,” the report reads. “On June 3, Moody’s described the EPA’s draft rule as “credit-negative for coal-dependent utilities, power projects and merchant power generators because . . . the rule will likely result in reduced power volumes and higher costs for generation.”

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The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

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