The Brookings County-Hampton transmission line, a section of the proposed CapX2020 project, could receive a multi-value project (MVP) designation by the Midwest Independent Transmission System Operator (Midwest ISO) as early as this summer, giving wind projects a much-needed boost.
MVP projects must support public-policy requirements or address reliability and/or multiple economic issues in multiple transmission zones. An MVP designation means that the project would be able to take advantage of the cost-allocation method of payment, which was approved by the Federal Energy Regulatory Commission in December 2010.
‘If Brookings was designated as a multi-value project, it would finalize the cost-allocation method for the project – so, the means by which the cost of the project could be shared,’ says Jennifer Curran, executive director of transmission infrastructure for the Midwest ISO.
Instead of generators paying for development, 100% of the cost of developing the transmission would be spread across the entire Midwest ISO footprint under the cost-allocation method.
The Brookings line is currently being evaluated by the Midwest ISO as a part of the organization's ongoing 2011 Candidate MVP Portfolio study. In January, the organization held a meeting to discuss the study and indicated that a June approval was probable.
‘Brookings has had a longer evaluation history than some of the projects in the portfolio, and, as a result, it looks like it might be ready for approval in the June time frame,’ says Curran.
According to the recent presentation, ‘Project investors have construction and other commitments that require a June approval if possible and justified.’
Areas of the Midwest are reaching a saturation point in terms of transmission capacity, but the proposed CapX2020 (short for "capacity expansion by 2020") might be able to provide some relief. The goal of this project is to boost grid reliability and ease congestion.
CapX2020, which is being developed by 11 transmission-owning utilities in Minnesota, including Xcel Energy, plans to add lines over the next 20 years. The project includes four segments, but it is the 240-mile, 345 kV line between Brookings County, S.D., and Hampton, Minn., that will benefit wind development the most because it includes 19 wind projects from 14 developers.
‘Some projects, like the Brookings line, have been around for a while, waiting for some of the cost-allocation stuff to be settled, and it looks like some of that is going to move forward in June for approval by the [Midwest ISO] board,’ says Jamie Karnik, communications manager at Wind on the Wires.
An MVP designation is critical, says Randy Fordice, spokesperson for CapX2020.
‘Our obvious desire is that the Brookings project is approved in June,’ he notes. ‘It does seem to meet pretty much all of the MVP qualifications.’
The selection of Sargent & Lundy LLC to provide engineering and design services for the Brookings line is another sign that construction is the next step.
Sargent & Lundy's scope of work will include the finalization of the project-specific design criteria, complete detailed design of the line, foundation design and support for material procurement.
The Midwest ISO's board is scheduled to meet on June 16.