Eversource CFO: Company’s transmission investment totaled $360m in first half of 2016

Eversource Energy’s (NYSE:ES) transmission investment totaled $360m in the first half of 2016, and the company continues to target transmission and capital investments of about $910m for the full year, Eversource CFO Phil Lembo said on July 29 during the company’s 2Q16 earnings call.

“[W]e continue to move ahead on our major transmission reliability projects across the system,” he said. “We are making solid progress on our two large families of reliability projects: the Greater Boston Reliability Solution and the Greater Hartford – Central Connecticut Solution.”

In 2Q16, Eversource received Connecticut Siting Council approval for a new $50m transmission line west of Hartford and a series of improvements north of Hartford, he said, adding that both of those projects are part of the Greater Hartford – Central Connecticut project.

Construction is expected to begin in 3Q16, and to date, Eversource has invested $80m in Greater Hartford projects and continues to expect to invest $350m by the time they are completed in late 2018, he said.

He also noted that the New Hampshire Site Evaluation Committee (SEC) approved the 345-kV Merrimack Valley Reliability Project, which Eversource and National Grid are building in Massachusetts and New Hampshire. Eversource’s share of that project is $37m, and the company expects to begin construction this fall, he said.

The estimated total cost for the Greater Boston suite of projects has increased from $544m to $565m, and the company continues to expect to complete those projects by the end of 2019, he said.

“We have invested approximately $78m on these projects to date,” he said.

Lembo also noted that the SEC in June accepted as complete the company’s application to build the $77m Seacoast Reliability Project in southeastern New Hampshire.

“We expect the Site Evaluation Committee decision on this application by mid-2017, and to complete the Seacoast project by the end of 2018,” he said. “We have invested nearly $10m in this project to date.”

Also speaking on the call was Lee Olivier, Eversource executive vice president for Enterprise Energy Strategy and Business Development, who noted that there have been a number of developments involving the Northern Pass project since the company’s last earnings call in May.

In June, the SEC approved a detailed schedule for its review of the Northern Pass project, with intervenor testimony due in November, supplemental testimony due in mid-March 2017, and a final pre-hearing conference by the end of March 2017.

That schedule, Olivier added, supports a final decision by September 2017.

He also noted that Eversource and Hydro-Québec, as reported, have reached an agreement that ensures Eversource customers in New Hampshire will receive a substantial supply of clean energy from the Northern Pass project.

Olivier further stated that the New Hampshire Superior Court in May granted a summary judgment in favor of Northern Pass, determining “that the state Department of Transportation – not project opponents – had exclusive authority to allow the project to be buried in the public right of way in a small section of state highway.”

Those opponents have appealed that decision in the New Hampshire Supreme Court, Olivier said, adding that the company expects that the lower court’s decision will be upheld.

Among other things, he also noted that ISO New England earlier this month issued its “I.3.9” approval for Northern Pass, finding that the project, as now proposed, will not have a significant adverse effect on reliability of the region’s grid.

If the “SEC issues a written order approving the 192-mile New Hampshire section by September of 2017, we would be in a position to receive our U.S. Department of Energy approval that fall and commence construction by the end of 2017,” Olivier said. “Based upon that schedule, we should be in a position to complete the project in 2018 and ‘19, and … bring it into service by the end of 2019.”

Earnings report

Eversource on July 28 reported earnings of $203.6m, or 64 cents per share, in 2Q16, compared with earnings of $207.5m, or 65 cents per share, in 2Q15. In the first half of 2016, Eversource said that it earned $447.8m, or $1.41 per share, compared with earnings of $460.8m, or $1.45 per share, in the first half of 2015.

The company also noted that its transmission segment earned $92.5m in 2Q16, and $178.2m in the first half of 2016, compared with earnings of $80.4m in 2Q15, and $147m in the first half of 2015. The improved results were primarily due to an increased level of investment in Eversource’s transmission system, as well as the absence in 2016 of a 1Q15 charge related to an order issued by FERC concerning the return on equity allowed New England transmission owners, the company said.

About Corina Rivera-Linares 3159 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 15 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines. She can be reached at clinares@endeavorb2b.com.