PJM Interconnection staff is recommending lifting the suspension on the 230-kV transmission line from Artificial Island to the new Silver Run substation (b2633.1 and b2633.2).
As noted in a Transmission Expansion Advisory Committee (TEAC) March 3 document, the PJM Board of Managers, at its August 2016 meeting, directed PJM staff to temporarily suspend the Artificial Island project and perform a comprehensive analysis to support a future course of action due to the uncertainty around project cost estimates and the changing study parameters.
As reported, the PJM board in 2015 approved a proposal to build a 230-kV transmission line under the Delaware River. The board designated LS Power to build the line and Public Service Enterprise Group (NYSE:PEG) (PSEG) subsidiary Public Service Electric and Gas (PSE&G) and Pepco Holdings for other portions of the project, including electric substation work.
A PJM spokesperson told TransmissionHub on March 6 that PJM staff makes the recommendations to the board, and that the TEAC provides feedback on staff reports and recommendations. PJM presented its recommendations to the TEAC on March 3, the spokesperson said.
According to the TEAC document, in consideration of all of the factors, PJM staff is also recommending:
- Changing the interconnection point at Artificial Island from Salem to the Hope Creek substation (A PSE&G spokesperson told TransmissionHub on March 6 that the Hope Creek substation is located on Artificial Island in Hancocks Bridge, N.J. The PJM spokesperson said that the Artificial Island site contains the Hope Creek and Salem nuclear generating stations, and there is a Hope Creek 500-kV switchyard as well as a Salem 500-kV switchyard)
- Eliminating the New Freedom Static Var Compensator (SVC) and the optical ground wire (OPGW) relay upgrade projects (b2633.6, b2633.7, and b2633.8) from the Artificial Island project scope
- Implementing a voltage schedule for the Salem and Hope Creek units
- Revising the project in-service date to June 1, 2020
The document noted that if a future need is identified for an OPGW/relay upgrade, a solution would be pursued separately and would not be associated with the Artificial Island project.
On why the recommendation was made to change the interconnection point from Salem to the Hope Creek substation, the PJM spokesperson said: “After PSEG provided a cost estimate for the interconnection work at Salem that was $152 million, PJM initiated discussions to identify other viable alternatives, including moving the point of interconnection. We decided to move the interconnection point to Hope Creek because the estimated cost for interconnecting the line there was less than what PSEG had estimated for interconnecting at Salem. The performance was the same for either substation.”
Discussing the cost estimate and alternative Artificial Island attachment analysis, the document noted that PJM, PSE&G and LS Power held multiple meetings, and there was more granular review and reevaluation of cost and the cost components, involving, for instance, additional marine and terrestrial surveying. The document noted that there was also an evaluation of alternatives, with an investigation on alternative Artificial Island attachments at Salem and Hope Creek, as well as an evaluation of impacts to the 230-kV line.
Of the “Hope Creek Attachment – Option 2B,” the document noted that Option 2B involves expanding the existing Hope Creek substation, as well as routing the new 230-kV submarine cable from Delaware; the beach landing would be about 3,000 feet underground/overhead in New Jersey to Hope Creek.
Discussing updated project cost estimates, the document noted that the approved Artificial Island Project (July 2015) total cost was between $270m and $283m; a February 2016 cost update for the project was a total of $418m; and the current recommended Artificial Island Project Scope total cost is about $278m.
Discussing the approved Artificial Island Project estimate and timing confidence, the document noted that $6.4m in development and engineering work was completed through 2016.
The PJM spokesperson said that the $6.4m figure is the cost spent by LS Power so far.
An LS Power representative did not immediately respond with comments by press time.
The document noted that a fixed price EPC agreement for the submarine cable (material and installation) has been executed; pre-application meetings have been held with most permitting agencies; all private real estate rights have been secured in Delaware; the Silver Run substation design is complete for permitting; and permitting level designs have been completed for submarine, horizontal directional drilling (HDD) and aerial river crossings, as well as six overland routes to support Corps alternatives and analysis.
Based on the current status of the project, there is increased certainty of the current cost estimate, the document noted, adding that the current LS Power project cost estimate is $133m.
Discussing stakeholder input and Artificial Island constructability analysis, the document noted that PSE&G has proposed an alternate route for the Red Lion to Hope Creek 500-kV line (Project 7K); to avoid the Supawna Meadows National Wildlife Refuge, a portion of the new line could be built on new right of way (ROW) outside of Supawna.
According to the document, in comments relative to its Project 7K, PSE&G said that its project, while not a new development, “is a more robust solution than the LS Power Project because it provides: (1) a greater stability margin for the PJM system; (2) a greater system reliability margin; and (3) higher reliability associated with a 500 kV line compared to a 230 kV line, which provides over three times more capacity than the LS Power Project.”
The document noted that PJM analysis reflects current study parameters, while PSE&G’s comments are based on prior studies that do not reflect the current analysis parameters.
“The current recommended solution is still preferred based on consideration of overall performance, constructability, and current project cost estimates,” the document said.
PJM retained an outside firm to review the cost containment language provided by PSE&G and LS Power, and PJM’s assessment that the LS Power cost containment mechanism provides greater cost certainty was confirmed, according to the document.
The PSE&G spokesperson said: “We haven’t changed anything in our proposal. In a letter to PJM on Feb. 8, we emphasized that our solution was the lowest cost option. We also explained that our preferred route remains the 7K Route, which runs through the Supawna Meadows National Wildlife Refuge and utilizes existing right of way. At the same time, we explained that any permitting agency will require an analysis of alternatives, and that there exists an alternative route that avoids Supawna should permitting through the refuge become an issue for us.”
The spokesperson also said: “We continue to believe that PSE&G’s proposal is the best solution from both a project and cost perspective, and are therefore disappointed that PJM chose to not reconsider our project. If approved by the PJM Board of Managers in April, the work now assigned to PSE&G includes upgrades to the Hope Creek substation at an estimated investment of $132 million. We assured PJM that we will construct our parts of the project with the same skill, experience and environmental sensitivity our team has demonstrated on all of our transmission projects.”
In a March 3 statement, Delaware Gov. John Carney said: “This project, as currently financed, would place an unjust burden on Delaware residential and industrial ratepayers. Delaware businesses and families would see higher monthly electric bills, and receive next to nothing in return in the way of a direct benefit. I intend to work with members of Delaware’s federal delegation, the Public Service Commission, our Public Advocate, and the General Assembly to oppose the current cost allocation as set by the Federal Energy Regulatory Commission [(FERC)]. This is not a good deal for Delaware.”
The PJM spokesperson said that PJM does not determine the cost allocation, and that allocation is decided by FERC, where the matter will have a rehearing (Dockets EL15-0095, ER15-2563).
Among other things, the TEAC document stated that the Fixing America’s Surface Transportation (FAST) Act – which was signed into law in December 2015, and may broadly impact existing federal environmental review and permitting practices for covered projects through, for instance, standardized and enforceable schedules for environmental review and permitting – could be applicable to the Artificial Island project.
The PJM Board meeting is scheduled for April 6, and all stakeholder comments should be sent to PJM by close of business on March 31, according to the document.