Midwest Power Companies Objecting to Cost of New Transmission for Land Based Wind Power

Regular readers of The Power Line are familiar with my point that land based wind power companies are now dependent on getting someone else to pay for the massive transmission investment required to bring new Big Wind electricity to population centers.  Here is one of my posts on the subject.

Now, Midwest power companies are objecting to the cost of new transmission lines that they are being pushed to build to bring their land based wind power hundreds, if not thousands of miles to both coasts.

How many past themes from The Power Line can you find in this section of the recent AP story:

The original estimate from power pool planning staff was based on simplistic assumptions about the lowest-cost route, he said, and those estimates changed when the utility’s staff began studying the actual routes.

“I would say that there are members of the Southwest Power Pool that are disappointed in the lack of rigor used in the initial cost estimates,” he said.

Some members of the pool question whether utilities that don’t directly benefit from the lines should have to pay for them.

The Southwest Power Pool adopted a formula in April 2010 that assesses the cost of building the pool’s largest lines, called “highway” lines, equally across all pool members because they can transfer energy between utilities.

That means Kansas ratepayers will pay about 20 percent of all the approved projects, including those in Oklahoma, Nebraska and Missouri, according to Harrison.

If Kansas ratepayers had to pay the entire costs of the “V Plan,” it might have shut the project down, effectively ending the prospect of wind power in the state.

But the Omaha Public Power District was dismayed last year when, shortly after it joined the power pool, the organization adopted the policy that spread the costs to everyone in pool. In April, its board of directors said that it was considering withdrawing from the power pool over the issue. The board must make a decision by Aug. 25.

“We’ll be required to pay a considerable amount of money for little benefit,” said utility spokesman Jeff Hanson.

Empire Electric and Lincoln Electric System have also expressed unhappiness, the Eagle reported.

Harrison said all utilities in the power pool will benefit when wind power begins flowing through its lines. And he said Westar customers will someday pay for “highway lines” in other states.

The federal government apparently agrees that only those who benefit should pay. In a July 21 statement on new rules about to go into effect, Federal Energy Regulatory Commission chairman Jon Wellinghoff said, “Among those principles are that costs must be allocated at least roughly commensurate with estimated benefits; those that receive no benefits should not be allocated costs.”

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