PPL (NYSE:PPL) continues to make progress on major infrastructure projects, including on the Susquehanna-Roseland transmission line, PPL Chairman, President and CEO William Spence said on Feb. 6 during the company’s consolidated 4Q13 earnings call.
The project remains on budget and on time for a mid-2015 in-service date, he said.
According to TransmissionHub data, the 500-kV project has been approved by state regulators in Pennsylvania and New Jersey and its route runs north from Berwick, Pa., past Wilkes-Barre and Scranton, then east to Hawley and southeast to Bushkill, where it crosses the Delaware River. The route follows an existing right-of-way for more than 90% of its 101-mile distance in Pennsylvania.
The route also runs through the Delaware Water Gap National Recreation Area (NRA) along an existing power line that was in place before the area was designated an NRA. The cost of the project is divided between Public Service Enterprise Group’s (NYSE:PEG) Public Service Electric & Gas, which is responsible for $790m, and PPL, which is responsible for $630m.
Spence also noted that Pennsylvania state regulators have approved construction of the $335m reliability upgrade, Northeast Pocono Reliability Project.
“This is a key step towards strengthening reliability in the region,” he said.
As TransmissionHub reported, the state Public Utility Commission (PUC) on Jan. 9 approved PPL Electric Utilities’ proposed project, which involves building new electrical substations and a new approximately 60-mile, 230-kV line, mainly in Lackawanna and Wayne counties in Pennsylvania.
Paul Farr, executive vice president and CFO of PPL, said during the call that the company’s revised plan reflects incremental transmission investment of more than $650m in Pennsylvania through 2017, including $400m for its improved system reliability programs that identify areas to strategically approve system performance, such as adding more automation to its transmission assets, as well as $250m for the company’s asset optimization programs to enhance or rebuild existing transmission assets to ensure their continued reliable performance.
A PPL spokesperson told TransmissionHub on Feb. 6 that the capital expenditure amount for Pennsylvania transmission that the company discussed last quarter was about $1.7bn through 2017, and now, it is about $2.3bn
Spence noted that the company improved its transmission and distribution combined regulatory return on equity (ROE) in Pennsylvania to 10.42% through effective cost-management and higher revenues.
Of other major infrastructure projects, he said that PPL continued progress on environmental upgrades at its Kentucky power plants and construction of a combined cycle natural gas generating plant at a facility in Louisville.
In January, the company filed a request with the Kentucky Public Service Commission for approval of a second natural gas combined cycle power plant, as well as a 10 MW solar energy facility. Those generation projects, Spence added, total more than $700m and will provide Kentucky customers with reliable, low-cost generation that meets the latest U.S. Environmental Protection Agency (EPA) regulations.
Among other things, Farr noted that the company’s Pennsylvania regulated segment earned 31 cents per share last year, a 9 cent increase over 2012, due to higher distribution rates that went into effect on Jan. 1, 2013, higher transmission margins and lower O&M, mainly due to lower storm and other costs, partially offset by higher depreciation and dilution of 4 cents per share.
PPL announced on Feb. 6 reported earnings for 2013 of $1.13bn, or $1.76 per share, compared with $1.53bn, or $2.60 per share in 2012, and an increase in its common stock dividend.
Earnings from ongoing operations were $1.59bn, or $2.45 per share. PPL also said that that result exceeded the 2013 forecast range of $2.30 to $2.40 per share, as well as 2012 earnings from ongoing operations of $1.42bn or $2.42 per share.
PPL added that earnings from ongoing operations are adjusted for special items, which for 2013 included an after-tax charge of $413m, or 62 cents per share, for the termination of the Colstrip power plant lease. The lease termination will facilitate the previously announced sale of PPL Montana’s hydroelectric assets, the company said.