PJM board puts brakes on Artificial Island transmission project

With costs rising, the PJM board has decided to suspend “all elements” of the Artificial Island project in New Jersey and directed PJM to perform a comprehensive analysis to support a future course of action.

“This is a very complex project, compounded by the unique design of the electrical system and geography of the area,” PJM President and CEO Andrew Ott said in an Aug. 5 letter to PJM members.

“It has become evident to all involved that the projected costs to resolve the problems at Artificial Island have increased significantly,” Ott said. “PJM has been examining alternatives in an attempt to offset some of the increases.

“In addition, questions have arisen about whether the currently proposed solution would perform as intended without further expense. Because of these concerns, PJM has come to the conclusion that a pause in the project is necessary before any new financial obligations are incurred by the project developers,” Ott added in the letter.

During the suspension, PJM will perform a comprehensive analysis of recent cost estimates that are significantly higher than originally estimated, as well as uncertainties about the changing scope and configuration of the project.

PJM has been working with transmission owners and developers to resolve voltage and stability problems at the Artificial Island generating complex in southern New Jersey. The problems require grid operators to make complex operational adjustments to ensure continued reliable electricity service in the area.

In particular, PJM cited complexities of design at the Salem and New Freedom substations that PJM did not anticipate.

In 2015, the PJM board approved a proposal to build a 230-kV transmission line under the Delaware River. It designated LS Power to build the line and Public Service Electric & Gas and Pepco Holdings for other portions of the project including electric substation work.

Changes to the scope and configuration of the project – including more robust transmission equipment and a new termination point for the transmission line – already were being explored after the board had asked PJM to find ways to offset some of the increases in estimated costs.

“In the course of its review, PSE&G and PJM identified an alternative that could significantly offset some of the increase in estimated costs.” PJM Planning Vice President Steven Herling said in a letter to PJM stakeholders.

“These reductions would result from terminating the new 230-kilovolt line in a substation at the Hope Creek Nuclear Station instead of the nearby Salem Nuclear Station. However, in reviewing this alternative, an issue arose related to one of the other components of the project, that is, whether proposed system protection and control upgrades would perform as intended,” Herling said.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.