Now that a major hurdle has been cleared since the California ISO (Cal-ISO) selected LS Power subsidiary DesertLink LLC to build and own the Harry Allen to Eldorado (HAE) transmission project, NV Energy filed revised transmission usage and capacity agreements regarding the One Nevada Transmission Line (ON Line) with FERC and the Public Utilities Commission of Nevada (PUCN).
The revised agreements became necessary after FERC on Nov. 19, 2015, rejected as premature several agreements among NV Energy and LS Power subsidiaries Great Basin Transmission LLC, Great Basin Transmission South LLC and DesertLink regarding capacity rights, operation and maintenance of the ON Line and granting DesertLink a license to use NV Energy property rights and unused transmission assets in development of the HAE project.
In that order, with FERC Commissioner Cheryl LaFleur issuing a dissenting statement, FERC rejected the agreements because most of the rights within them hinged on DesertLink being selected by the Cal-ISO to develop the HAE project through a competitive solicitation process that had yet to be completed. At the time of the FERC order, DesertLink was competing against other firms looking to build the HAE project, which is an economically driven project to move power between the Harry Allen substation, which is owned by NV Energy, and the Eldorado substation, which is primarily owned by Southern California Edison.
As TransmissionHub reported, LaFleur, in her dissenting statement, asserted that FERC took too harsh of a stance on rejecting commercial agreements and that in doing so, was undermining transmission development.
The uncertainty that was the crux of FERC’s concern has been resolved since the Cal-ISO in January selected DesertLink to develop the HAE project, NV Energy said in the applications with FERC and the PUCN.
In its April 12 application with the PUCN, NV Energy said the amended transmission use and capacity exchange agreement regarding the ON Line is substantially similar to the version the PUCN approved on Oct. 2, 2015.
The 235-mile, 500-kV ON Line, which extends from the Thirtymile substation in White Pine County, Nev., to the Harry Allen substation in Clark County, Nev., began service in 2014 and is jointly owned by NV Energy and Great Basin Transmission South. It is the central leg of a three-phase transmission plan to increase capacity from southern Idaho to the Eldorado substation, NV Energy noted in its filing at FERC. The HAE project is the southern portion of the plan, with a northern portion planned to stretch from the Thirtymile substation at the northern end of the ON Line into southern Idaho, the utility said.
As part of their efforts to redefine their joint development relationship to account for the HAE project, NV Energy and the Great Basin Transmission companies have agreed to re-allocate transmission rights to grant NV Energy more rights that it currently has under existing agreements, NV Energy told FERC.
In its April 8 petition at FERC, NV Energy said the amended agreement is “a much simplified agreement” that departs from some of the complexities of the previous agreements that were rejected.
The most important element of the amended agreement for NV Energy and its customers is that it increases the utility’s minimum future transmission rights on the ON Line immediately if the agreement is accepted by FERC, NV Energy said.
While NV Energy currently controls 100% of the ON Line capacity, it can only make available on its open access transmission tariff long-term capacity up to a limit on its future rights over the ON Line under an existing agreement, with that limit being 760 MW, NV Energy said.
The amended agreement, in contrast, provides NV Energy with no less than 900 MW of rights over the ON Line, which it can make available to the market, the utility said.
“In addition to being a significant improvement to the status quo,” the amended agreement represents a change in facts in that the HAE contingency has been resolved and elements from the previous agreements that were rejected by FERC have been removed and replaced with simpler versions that can become effective upon acceptance by FERC, NV Energy said.
The revised agreement “is an amendment to a bilateral transmission development agreement to permit continued transmission development and to adapt to positive changes in regional transmission planning processes,” NV Energy said.
The utility added that it sought rehearing of FERC’s Nov. 19, 2015, order rejecting the previous agreements. If FERC accepts the amended agreement, NV Energy asked FERC to dismiss its rehearing request as moot.
NV Energy and its affiliated utilities, Nevada Power and Sierra Pacific Power, are subsidiaries of Berkshire Hathaway Energy.