Within the Southwest Power Pool (SPP) footprint, Oklahoma, Kansas and Texas are rife with transmission opportunities, ITC Great Plains President Kristine Schmidt told TransmissionHub on Feb. 15.
“Oklahoma has tremendous opportunity right now,” Schmidt said. “There is so much demand for the shale gas play that is developing in Oklahoma, … and so, as a result, there are a lot of companies coming in to extract gas and oil to export to other parts of the country. As a result, you have increased supply requirements, so you need the transmission to support that.”
Both Oklahoma and Kansas are pro-business, pro-energy and pro-infrastructure states, Schmidt said.
“They do everything they can to not only build up enough to support their own infrastructure sources, but they believe it’s important to set up infrastructure to export the excess power into other parts of the country that don’t necessarily have the access to such wonderful natural resources,” Schmidt said.
The Texas Panhandle also provides a lot of opportunity for grid development. SPP is identifying more projects for the Texas Panhandle, Schmidt said.
The other states in the RTO are Arkansas, Louisiana, Mississippi, Missouri, Nebraska and New Mexico.
“Within the SPP footprint we think that the transmission planning process that SPP is pursuing, they actually have identified long-range requirements for the region to build out enough infrastructure to support the economy, as well as the energy policies in the region, over the next decade or two decades,” Schmidt said.
ITC Great Plains is the only ITC Holdings (NYSE:ITC) operating company with a business model that is not predicated on acquiring other companies’ systems.
“ITC Great Plains actually is a greenfield business,” Schmidt said. “We’re building this business up project by project as opposed to buying an entire system.”
Though ITC Great Plains is theoretically smaller than the other operating companies, like ITC Midwest and ITC Michigan, being a greenfield company offers benefits that acquisitions lack.
“Within ITC Holdings, we are basically the growth engine because everything we do is starting from scratch, so nothing’s depreciated,” Schmidt said. “It’s a brand new system every time we do something.”
She added that partnering with other entities has been instrumental in ITC Great Plains’ efforts. The company’s first completed project was the Hugo to Valiant line, an 18-mile, 345-kV transmission line in Oklahoma on which it partnered with Western Farmers Electric Cooperative. The $37m project was brought online in July 2012, according to TransmissionHub data.
“We were established to be one of first new utilities in the past 100 years that has developed and built a greenfield transmission business, and it’s because we’ve been able to partner with strategic partners,” Schmidt said. “Through those partnerships, we’ve built up these projects.”
At the end of 2012, ITC Great Plains completed its second greenfield line, the Kansas Electric Transmission Authority (KETA) project, on which it partnered with Sunflower Electric Power Cooperative, Mid-Kansas Electric and Nebraska Public Power District.
ITC Great Plains completed the first phase of the 227-mile, 345-kV transmission KETA line in June 2012, and the second phase in December 2012.
Schmidt noted the capacity on the line is already fully subscribed. “We’re already looking at new projects in Kansas and in the SPP footprint because the need … to move power in different regions or across region is becoming more and more important,” she said.
ITC Great Plains is working on two projects that are in different stages of development: the Kansas V-Plan project, on which the company broke ground in November 2012, and the Elm Creek to Summit project, on which it has partnered with Westar Energy (NYSE:WR).
The V-Plan project is a 122-mile, 345-kV transmission line that originates in Spearville, Kan., and terminates at Thistle substation near Medicine Lodge, Kan. The company has partnered with Sunflower Electric Power Cooperative, Mid-Kansas Electric and Prairie Wind Transmission on the $300m line, which is scheduled to enter service in 2014.
“That’s a critical line,” Schmidt said. “Instead of being single-circuited, we’re double-circuiting the V-Plan project, and that means we’ll have two 345-kV circuits running along those lines. That’s more east-west, where KETA was north-south.”
The $105m Elm Creek to Summit project is a 60-mile, 345-kV line that will run from the Summit substation to the Elm Creek substation in Kansas. ITC is building 30 miles of the line and will jointly own that length of line with Sunflower, Schmidt said.
“For those 30 miles, we’re going through the process for getting the applications before the [Kansas Corporation Commission (KCC)] set up in 2013,” Schmidt said. “We just had open houses on that project with landowners to determine the appropriate route that we need to be taking and then we’ll be recommending [a route] to the KCC in our applications for siting approval.”
The other half of the line will be built and owned by Westar.
Cost estimates for the line are being reevaluated, although the line’s costs will not be split 50-50, as Westar is responsible for building a substation, Schmidt said.
SPP in April 2012 issued to ITC Great Plains and Westar a notice to construct with conditions.
“The conditions were to come up with a better cost estimate, so both sides are working on refining the numbers,” Schmidt said.
The condition response is due at the end of February, at which point a more detailed cost estimate will be available. Schmidt said she hoped to begin construction in 2013, and energize the line in 2014 or 2015.
The company has a number of other projects in progress, Schmidt said.
“We have generator interconnections that are underway and we’re constantly looking at different development opportunities that, until we can go public, are highly confidential,” Schmidt said.
She added ITC Great Plains is also conducting feasibility studies as part of SPP’s interconnection queue process to see what kind of transmission is necessary as more generation supplies enter service.
ITC Great Plains in October 2012 identified five 345-kV lines under SPP’s ITP20 planning cycle, which evaluates the region’s possible transmission needs in 20 years. The five lines comprise more than 2,700 miles of line and address a scenario under which 7,000 MW to 8,000 MW of new generation would need to move from the western part of SPP to the east.
“We have not been directly named as the builder of those lines, but through partnerships and alliances we may be able to participate in some of those projects,” Schmidt said.
The lines would span from east-central Nebraska to north-central Iowa; western Kansas to southern Iowa; southwest Kansas to south-central Missouri; western Oklahoma to south-central Missouri; and the Texas Panhandle across southern Oklahoma to southwest Arkansas.
For the lines that cross over into the Midwest ISO (MISO), ITC Great Plains has reached out to ITC Midwest to discuss how to get the projects it has identified into MISO’s planning processes, Schmidt said.
“With the projects we’ve built, KETA and Hugo-Valiant, we brought them in on time or early and under budget, so we believe we’ve got the greatest capability to compete on these projects,” Schmidt said. “We have got this process of building new transmission lines down to a science.”