Policy paper sees little need for new major power lines in New York 

Source: Colin Sullivan, E&E reporter • Posted: Wednesday, June 17, 2015

The last thing New York needs is a new multibillion-dollar power line that crisscrosses the state, according to a policy paper by the Washington, D.C.-based National Institute for Science, Law & Public Policy.

The paper, authored by research fellow Timothy Schoechle, argues that the momentum that led to proposals like the Champlain Hudson Power Express, which would connect hydropower in Quebec to New York City, is outdated and no longer supported by evidence of need for such a project.

Schoechle cited the Empire State’s drift toward a more decentralized grid under its “reforming the energy vision,” or REV, proceeding. He said REV is the wave of the future and would supplant the need for the $2.2 billion Champlain Express project or any others like it.

“The ongoing capital spending trajectory of the utility industry places it on a collision course with the technology and economics of distributed renewable energy,” he wrote in the paper, titled “The Hudson Valley ‘Energy Highway’ transmission project: An idea whose time has passed?”

Schoechle believes the cost of such projects will be borne mostly by downstate ratepayers who paid 40 percent more for electricity over the last decade, even as the cost of natural gas — the principal fuel used for generation in the state — dropped by 39 percent.

Utility capital spending of about $17 billion over that period is the cause of the high power bills, Schoechle added, so he believes more of the same is afoot “to save an obsolete electricity system” that he sees as mostly serving the interests of utilities and suppliers.

“It makes no sense to maintain centralized control of an inherently decentralized and simpler technology,” he wrote. “The transformation underway should not be impeded by the excess baggage of a progressively obsolete and superfluous centralized grid.”

The group bills itself as an organization that seeks to bring law and science under the same roof to advance better public policy.

The paper comes less than two months after Transmission Developers Inc., a Blackstone Group subsidiary, won approval from the Army Corps of Engineers for a 333-mile cable to be buried under the Hudson River on its way to New York City. The line has achieved all the federal and state permits it needs to begin construction but still has to secure its financing (EnergyWire, April 23).

At the time, TDI CEO Donald Jessome insisted the company will bear all the risk of the project, given Blackstone’s deep pockets. He said 85 to 90 percent of the financing has been nailed down.

Click here to see the policy paper.

Another transmission project moves ahead

Nearby in New England, efforts to build a similar power cable from Canada to the six-state market by the same developer appear to be moving forward.

TDI New England recently got a favorable draft environmental impact statement from the Energy Department, and yesterday announced an agreement with the Conservation Law Foundation that may help move along the New England Clean Power Link.

The agreement could bolster the permit process in Vermont, where TDI has filed for state approval and has technical hearings on tap this fall.

CLF agreed as part of the pact that the Vermont Public Service Board “has sufficient information to approve the project and issue a certificate of public good.” In exchange, TDI agreed to:

  • Increase the combined monetary value of the Lake Champlain Phosphorous Cleanup Fund, Lake Champlain Enhancement and Restoration Trust Fund, and Vermont Renewables Programs Fund from the originally proposed $162 million to a minimum of $283.5 million over the 40-year life of the project.
  • Include CLF on the advisory board for the lake’s trust fund.
  • File with the PSB, after the company wins the permit, all contracts with energy suppliers that utilize NECPL to confirm that the energy shipped on the line is from hydro, wind or other renewable energy sources.

The DOE draft EIS was notable in one respect: In several places, the document appeared to signal a preference for building a power line into New England mostly underground, as NECPL would be constructed. Some in the region saw this as a subtle criticism of the competing Northern Pass project through New Hampshire from Eversource Energy, which would be built mostly aboveground to avoid drilling into granite.

In a recent op-ed in the New Hampshire Union Leader, senior reporter Dave Solomon said that EIS may be a sign that the Clean Power Link has leapfrogged Northern Pass in the public view.

“The application for the 154-mile, 1,000 megawatt transmission line through Vermont, which is mostly under water or underground, was only filed a year ago on May 22,” wrote Solomon of the TDI proposal. “Northern Pass opponents say this shows how fast an electric transmission project can proceed when it is underground, and that Eversource should take notice.”

That said, DOE is reviewing a number of options in addition to Northern Pass and NECPL, and Northern Pass redesigned its route nearly two years ago so it effectively hit “reset” on the process recently. A spokeswoman noted geographic differences between the projects as well.

“While these projects propose similar solutions to New England’s energy challenges, they also have notable differences,” Eversource media specialist Lauren Collins wrote in an email. “The NECPL route uses primarily waterways while Northern Pass proposes to use existing transmission corridors for the majority of the route. Northern Pass remains the only large-scale transmission project in development in the region with a confirmed supplier of power and an interconnection approval.”

Click here to read Solomon’s piece.