ON Line project enters service; merger of utilities still pending

NV Energy (NYSE:NVE) energized its 500-kV One Nevada, or ON Line, transmission project late on Dec. 31, 2013, marking the completion of a project that connects the service territories of Nevada Power Company (NPC) in the south and Sierra Pacific Power Company (SPPC) in the north.

The line, which connects substations near the cities of Las Vegas and Ely, Nev., also “opens the pathway for 13 remote renewable energy projects in Nevada to get their energy to where our customers need it,” an NV Energy spokesperson told TransmissionHub Jan. 9.

The project connects the Harry Allen substation north of Las Vegas with the newly constructed Robinson Summit substation 20 miles west of Ely. Total project cost is estimated at $552m, according to the company’s most recent testimony filed with the Public Utilities Commission of Nevada (PUCN).

Now, the company is going through the final stages of the commissioning process including testing and fine-tuning of the main and back-up communications systems along the 231-mile line. The project includes a fiber optic cable system as well as a microwave communications system that enable substations along the project to communicate with each other.

The company will provide additional details regarding the project at a ceremony scheduled for Jan. 23. That ceremony, which is planned to include Senate Majority Leader Harry Reid (D-Nev.), representatives from the U.S. Department of Energy (DOE), and other dignitaries, will celebrate the completion of the line connecting the two utilities’ service territories.

Completion of the line was not without its challenges.

Construction began during 2Q11 but tower construction was halted in February 2012 due to damage caused by the wind. The company was given permission to resume construction 10 months later by the PUCN.

The project’s completion helps clear the way for NV Energy to consolidate its two utilities into a single jurisdictional utility. Company officials have said the ON Line project must be in service before the two operating companies merge. Once the commissioning process is complete, the line will connect the two service territories under an interim joint dispatch agreement filed with FERC, pending PUCN action on the merger application filed on May 31, 2013.

That application, filed jointly by NPC and SPPC, seeks permission to merge the service areas of the two utilities, thereby enhancing the efficiency of the company’s electric system (Docket No. 13-05056).

Action on the request is at least six months away. The PUCN on Dec. 17, 2013, issued an order amending the procedural schedule for testimony and hearings in the matter to allow parties additional time to “develop and incorporate new information into the analysis required,” the PUCN said in its order. The order directs that a supplemental filing with the new information be made “no sooner than June 1, 2014,” with a prehearing conference to be held within 30 days of the filing.

The ON Line project is the first phase of a joint project between NV Energy and Great Basin Transmission South (GBT-South), a subsidiary of Great Basin Transmission. NV Energy, which has rights to 100% of the line’s capacity, owns a 25% interest in the project and has contracted with GBT-South for its 75% interest in ON Line until GBT-South completes other projects, according to NV Energy’s project fact sheet.

The other projects, the second phase of the build, comprise two transmission segments at either end of ON Line. GBT-South would finance and own 100% of those joint projects if it elects to pursue construction, NV Energy said in its 1Q13 Form 10-K. NV Energy subsidiaries Nevada Power and Sierra Pacific Power would have rights to transmission capacity on the northern segment.