SCE: Undergrounding portion of Tehachapi project could cost up to 5x more than overhead lines

Preliminary estimates provided to state regulators by Southern California Edison (SCE) show that undergrounding a portion of the Tehachapi Renewable Transmission Project (TRTP) through the city of Chino Hills, Calif., would cost between $486m and $807m, approximately three to five times the cost of the above-ground route initially approved by the California Public Utilities Commission (CPUC) (Docket No. A07-06-031).

The testimony was filed with the CPUC on Dec. 3, in response to an assigned commissioner’s ruling issued July 2. The original schedule was accelerated when CPUC President Michael Peevey issued an amended memo and ruling of assigned commissioner Nov. 15 in response to concerns expressed by several parties, including SCE and Chino Hills, that the original schedule could delay the project beyond its planned energization date of 2015.

“The commission has essentially moved up the whole decision process on this and, as part of that, they’ve asked us to file preliminary testimony regarding undergrounding costs and under related information,” an SCE spokesperson told TransmissionHub Dec. 7.

The preliminary estimates, which were prepared for SCE by consulting engineering firm Black & Veatch, include a 50% contingency, compared to a 15% contingency allowance for above-ground construction.

SCE said the contingency is in line with guidelines proposed by the Association for the Advancement of Cost Engineering (AACE) and the Electric Power Research Institute (EPRI), and is reasonable because the site and the project have not yet been fully evaluated.

“During construction, SCE could encounter rock or difficult material, unstable conditions, contaminated soil, or other geotechnical issues that could result in significant alignment modifications or alternative construction methods,” the utility said in its filing. “Further trenching details need to be assessed, and SCE must conduct underground utility research and surveys, investigate flood control permitting, and assess permissible impacts to city streets and traffic.”

In addition, SCE still has to develop additional information regarding cable infrastructure requirements, consider the costs of mitigating any environmental impacts, and allow for varying costs of materials and land acquisition.

While there is little question that the costs to place the line underground are considerably higher than above-ground, SCE cautioned that the numbers provided to the CPUC are likely not the final figures.

“This is preliminary information and it’s subject to change because we will be filing additional testimony at the end of February as part of the original schedule,” the SCE spokesperson added.

SCE began constructing a five-mile stretch of the 250-mile, 500-kV line through the city in May 2011, but residents objected after the first tubular steel poles were erected, claiming their visual and economic impact was far greater than previously envisioned.

The city filed an objection and, on Nov. 10, 2011, the CPUC ordered that SCE halt work on the Chino Hills stretch of the project, and provide the CPUC with information on alternate routes.

On Feb. 14, the two sides entered mediation under the CPUC’s alternative dispute resolution program in an effort to reach a mutually agreeable solution. Though several sessions were held during which proposals were presented and discussed by both sides, the parties “were not able to reach agreement on a resolution that met the needs of both parties,” the two sides said in a March 6 joint statement announcing that mediation had been suspended.

The parties returned to court on March 19 for a prehearing conference before a CPUC administrative law judge (ALJ).

In May, the CPUC announced that it had commenced confidential negotiations in “an effort by the CPUC, SCE, and the city of Chino Hills to agree upon undergrounding the line beneath the existing right-of-way in the city,” according to the statement the CPUC issued at that time.

In July, Peevey issued his assigned commissioner’s ruling, ordered SCE to conduct engineering studies and provide detailed estimates on the cost of undergrounding the portion of the line through Chino Hills.

Calls seeking comment from the city of Chino Hills were not returned by press time Dec. 7.

Once completed, the $2.5bn Tehachapi project will be capable of delivering up to 4,500 MW of wind energy from the Tehachapi area to population centers in Los Angeles and San Bernardino counties in California, according to SCE’s website.

SCE is a subsidiary of Edison International (NYSE:EIX).