Despite opposition, Arizona regulators approve $2bn SunZia project in 3-2 vote

As the Arizona Corporation Commission (ACC) meeting stretched over two days Feb. 2-3 in consideration of the SunZia transmission line application and other issues, the ACC approved the SunZia Southwest Transmission Project (SunZia) Feb. 3 on a 3-2 vote.

An order from the ACC was not available at press time Feb. 5, and likely will be issued the week of Feb. 8, a spokesperson for the ACC told TransmissionHub Feb. 5.

SunZia said the ACC approval, following approval of a certificate of environmental compatibility by the Arizona Power Plant and Transmission Line Siting Committee in November 2015, represents a significant milestone in the development of critical infrastructure in the Southwest.

“Securing this important state permit is another major accomplishment for the project, having already secured federal approval,” SunZia said in a Feb. 3 statement.

“Once the few remaining approvals are secured, SunZia will proceed with financing, design and engineering activities,” SunZia said.

The next step for developers is to file a permit application with the New Mexico Public Regulation Commission later this year and coordinate with New Mexico state agencies over state trust lands affected by the preferred route alternative approved by the Bureau of Land Management, SunZia said.

If all approvals are secured, construction is planned to begin in 2018, and the planned in-service date is in 2021, SunZia said.

A consortium of five companies is sponsoring the SunZia project. Three of those companies – Southwestern Power Group II/MMR Group, Shell WindEnergy Inc., and Tucson Electric Power – are sponsoring 86% of the project. Salt River Project has a 13% stake and Tri-State Generation and Transmission Association has a 1% interest.

The 515-mile project is designed as a pair of single-circuit, 500-kV transmission lines adjacent to one another, beginning at a new SunZia East substation in New Mexico and stretching west to end at a new substation near Coolidge, Ariz. Significant portions would run parallel to I-25 and the Rio Grande River in New Mexico, and then follow pipeline and utility corridors in Arizona.

SunZia has said that the project will aid integration of renewable resources, and First Wind Energy in 2013 signed a letter of intent to reserve up to 1,500 MW of transmission capacity to provide service to one of its high-capacity wind energy projects under development in New Mexico.

Among the heated issues of debate in Arizona was that the project would pass through the San Pedro River Valley, which ACC Chairman Doug Little called “one of the crown jewels of Arizona’s unspoiled wilderness.”

Commissioners Bob Stump, Bob Burns, and Andy Tobin voted to approve the project, while Little and Commissioner Tom Forese voted against it, according to the ACC spokesperson.

The public comments portion of the ACC meeting took up all of the meeting Feb. 2, with the decision on SunZia reached on Feb. 3, according to a webcast of the ACC meeting.

In a statement following the meeting, Little said that the ACC “took an unprecedented step in approving the SunZia merchant transmission license” and that the decision marked “the first time any merchant transmission line has ever been approved in Arizona.”

Little acknowledged that the siting and evaluation process was lengthy, but said “granting approval to site two [500-kV] transmission lines through the environmentally sensitive San Pedro River Valley is a mistake of the first order.”

Little said, “I am extremely disappointed in the outcome of this decision and believe there were better alternative routes with significantly less environmental impacts that unfortunately were not approved during the route evaluation process undertaken by SunZia.”

In a separate statement Tobin said that the project will strengthen the power grid without cost to taxpayers, and that “a bipartisan coalition of rural county supervisors” from areas affected by the project testified how much their counties would benefit from the line.

“Governor Doug Ducey sent me to the commission to protect Arizona’s resources and grow an economy,” Tobin said. “The SunZia project aligns with those goals.”

As TransmissionHub reported, the project has faced opposition from landowners and communities in Arizona and New Mexico.

“We’re very disappointed” with the ACC decision, landowner Norm Meader told TransmissionHub Feb. 5.

Meader owns property in Cascabel, Ariz., that would be affected by the SunZia project, and he said more than 20 people spoke at the ACC meeting in opposition to the project.

SunZia opponents were encouraged by the comments of Little and Forese, Meader said, adding that they are waiting for an order to be issued to decide whether to seek rehearing at the ACC.

“We haven’t decided what we’ll do at this point,” he told TransmissionHub.