While Pepco Holdings’ (NYSE:POM) single largest transmission project, the 500-kV Mid-Atlantic Power Pathway, has been delayed, work continues on other projects across the company’s service territory, according to William Gausman, senior vice president, strategic initiatives, with PHI.
According to TransmissionHub data, MAPP will enable transfer of power sources west of the Chesapeake Bay from the Delmarva Peninsula to the mid-Atlantic region. The project includes about 69 miles of AC lines and 83 miles of DC lines. One of the key components is a 39-mile cable across the Chesapeake Bay. FERC has authorized an 11.3% ROE for the project.
“We believe [the project] has tremendous value to the entire region,” Gausman said. “We are continuing to move forward on the permitting. We applied for a [certificate of public convenience and necessity] in Maryland.”
That is on hold as PJM Interconnection has established a new in-service date for the project, he said.
In August, Pepco notified the Maryland Public Service Commission and Virginia State Corporation Commission that it requested temporary delays in the commissions’ reviews of the respective applications filed by the utility’s subsidiaries, Potomac Electric Power and Delmarva Power & Light, for state regulatory approval for MAPP.
The requests were filed after notification from PJM, stating that the need for MAPP has moved from 2015 to the 2019-2021 timeframe, but that transmission planning “uncertainties could accelerate this schedule.”
“We also have new criteria that PJM is incorporating into the planning process where they are looking at the impact on the transmission system of renewable energy, primarily wind,” he said, adding that all the states in the area have “pretty aggressive renewable portfolio standards” that in the past, was not factored into PJM’s transmission planning process.
There is no other project in the works that is as big as MAPP by itself, he said, but Pepco has a significant transmission program. “If you put it all together, there are combined transmission projects over the next couple of years that are as big or bigger in value than the total MAPP project,” he added.
Maryland, being Pepco’s largest service territory, has the largest amount of transmission work overall, but subsidiaries Atlantic City Electric in New Jersey and Delmarva Power in Delaware also have transmission projects in the works. “They tend to be shorter lines, more local, but they are significant to continue to maintain the reliability of the system,” he said.
These projects are a 138-kV line in the Indian River area and a 138-kV line in New Castle County, both in Delaware, and a 230-kV line in Salem County, N.J.
Driving factors for transmission
A couple of factors driving the need for transmission involve reliability criteria and retirement of generation, Gausman said.
“Some of the smaller, older coal units are no longer finding that it’s practical for them to comply with regulations – it’s just too expensive,” he said. “As a result, they are announcing to shut down and when generation shuts down, especially these older coal units, they’re usually very close to the load centers, very close to the cities. As a result, when they retire or close, the transmission system has to make up for that additional capacity.”
As an example, he noted the retirement of the Potomac River Generating Station in Alexandria, Va.
“The owners of the generating facility over in Alexandria, just across the river from the District, just recently announced retirement and they’re closing their plant for economic reasons, which is one of the other reasons that the energy use is down,” Gausman said.
Retirement of that plant results in a significant number of upgrades in the transmission system, not just locally, but farther to the west as well, he said.
Indeed, the city of Alexandria, Va., and GenOn Potomac River (Mirant) signed an amendment to the project schedule and agreement on Aug. 29, which stipulates the retirement of the plant on Oct. 1, 2012, subject to PJM finding that the facility is not needed for reliability as of the retirement date. PJM has found no reliability issues related to the planned retirement, according to the city.
“Over the last couple of years, we have significantly expanded our 500-kV, the highest transmission level in this region so that we have more transformers connecting to the 500-kV to be able to deliver more energy into the Washington region,” Gausman said.
Pepco upgraded two 230-kV transmission lines last spring, will complete two more next year, and has several other projects in the works in the Eastern Shore. The 230 KV lines will increase the import capability in the northern portions of the Dickerson, Md., area, he said.
Reliability in the transmission system now is being driven not so much by load, but by voltage, he said.
“We are finding that the biggest problem across PJM’s transmission system is the reactive problem where voltages will reduce the amount of load that you can actually transmit before you start to lose stability of the system,” he said.
MAPP would alleviate that as it is an interstate project and has DC technology, he said.
On policy changes, Gausman said there is a need to be able to allow PJM to incorporate other factors than the “bright line” concept, which according to PJM, was formulated in 1999 as a result of the development of the generation interconnection process. PJM tests compliance with all NERC and transmission owner criteria. When a facility reaches 100% of the applicable limit under test conditions, a violation exists – at 99.9%, there is no violation, according to PJM.
“In today’s environment, where the economy changes so much, the renewable standards are changing, generation is retiring, there are so many variables [that] we can’t continue to operate the system at a bright line test,” he said. “As a result, we need the flexibility to be able to have transmission built based on more criteria than just an absolute certainty… It needs to be built recognizing that some uncertainty is what’s happening in the future, and the appropriate thing to do is build transmission to be prepared for those uncertainties.”
As for smart grid efforts on the distribution side, Gausman said Pepco is nearly done with installing advanced metering infrastructure in Delaware and is installing AMI in Washington, D.C., and Maryland.
“On the transmission system, we just activated a SynchroPhasor,” he said, noting that this was part of U.S. Department of Energy project. SynchroPhasors monitor the system at a high rate of speed, collecting information from multiple data points, allowing PJM to take action before any major event occurs, he said.
Gausman also said Pepco agrees with many aspects of FERC Order 1000, which was issued in July and reforms the commission’s electric transmission planning and cost allocation requirements for public utility transmission providers, but noted that “it’s going to take some time to fully understand the full impact” of the order.
Among other things, he said: “We really need to…understand how critical a part the transmission system plays in the overall reliability of the electric grid. We need to advance it, modernize it and build some new infrastructure.”