SunZia begins seeking anchor tenants for Southwest Transmission Project

SunZia Transmission on Nov. 1 began soliciting anchor tenants for the planned Southwest Transmission Project between central New Mexico and southern Arizona. The project, approximately 500 miles of two 500-kV lines and associated substations, will connect and deliver renewable energy resources in Arizona and New Mexico to population centers in the Desert Southwest. 

A spokesperson for the project’s developers told TransmissionHub that the economic conditions in the Southwest are looking more promising for delivering renewable energy than in other areas of the country, so the time is right to begin seeking subscribers.

In October the project was one of the seven selected for the Obama Administration’s fast-track pilot project to streamline federal approvals. Although physical construction has not yet begun, the spokesperson says the project is progressing well with federal permits and will soon be launching the state permitting process.

A draft environmental impact statement is expected from the U.S. Bureau of Land Management in mid-January 2012.  The $800m project is expected to be in service in 2016, a year later than previously estimated, due to delays into the permitting process.

At present, the line is planned to connect five substations: the proposed SunZia East, the SunZia South, and the Hidalgo II in New Mexico, with the Willow and Pinal Central substations in Arizona.

The company is looking for anchor tenants to reserve future transmission capacity and subsequently purchase long-term transmission rights.  SunZia is offering approximately 1,350 MW of transmission capacity, which is 50% of the line’s merchant capacity. Ten percent of the total 3,000-MW capacity has been set aside for use by the project’s owners.

Anchor tenant criteria is available to interested parties through Nov. 30. Interested parties should contact Jeff Rutland via email at jrutland@southwesternpower.com.

An open season process for the remaining capacity will be scheduled after the anchor tenant process is concluded.