The Arizona Corporation Commission on March 24 unanimously granted permission for a private developer to build a major transmission link from the Palo Verde generation hub to California.
The move represents a remarkable reversal from the position the agency took in 2007 when it denied a similar project.
DCR Transmission LLC — a joint venture led by affiliates of Starwood Energy Group Global LLC — will build the 500-kV Ten West Link, so named because it roughly parallels a stretch through the desert Southwest along Interstate 10.
The commission approved the Arizona Power Plant and Transmission Line Siting Committee's recommended granting of a certificate of environmental compatibility and finding that the project would bring economic and reliability benefits that would outweigh any environmental impacts of the project.
The 125-mile project will run from Arizona Public Service Co.'s Delaney Substation near Tonopah, Ariz., which is about 60 miles west of downtown Phoenix, to Southern California Edison Co.'s Colorado River Substation in Riverside County, Calif. SCE attempted to build a similar project, known as the Devers-to-Palo-Verde-2 line, more than a decade ago, but the commission rejected that proposal out of fear that too much of the state's power would be sent to California, according to Siting Committee Chairman Thomas Chenal.
The dynamics of power generation have changed since then, with explosive growth of solar and wind energy in California and the Southwest. California now has so much excess power during daylight hours that it sometimes pays out-of-state utilities to take its surplus. Further, Arizona is aiming to increase its use of clean energy and has a growing appetite for renewables the new link would help provide.
During a March 24 Arizona Corporation Commission meeting, DCR Transmission attorney Meghan Grabel said local jurisdictions, communities and renewable developers along the route strongly support the project. The new line will help keep ratepayer costs low because utilities will save millions of dollars annually due to their increased access to power markets, Grabel said. Renewable energy developers already have submitted nearly 5,000 MW of interconnection requests for the project, which will provide economic opportunities and thousands of jobs to rural Arizona communities that host new solar generation resources, according to Grabel.
Further, Arizona will not pay anything for the project because it will be funded by California ISO customers, Grabel said. CAISO in a Jan. 27 letter to the commission said it had identified an economic need for the Ten West Link and selected DCR Transmission as the sponsor to finance, own, build and maintain the project. The developer will turn over operational control of the project to the grid operator and will become a participating CAISO transmission owner.
DCR Transmission largely avoided environmental controversy by routing the project so that it will completely avoid crossing the Kofa National Wildlife Refuge and instead will run through a federally approved utility corridor. After spanning the Yuma Proving Ground, the line will exit Arizona across the Colorado River into Riverside County, Calif. While the Arizona portion of the link is 103.5 miles long, with the California segment, the link will total 125 miles.
Commissioners Sandra Kennedy and Justin Olson both called it a great project that will benefit ratepayers and the state's economy. The commission approved an order drafted by the Siting Committee, without any amendments.
Arizona Public Service and SCE are subsidiaries of Pinnacle West Capital Corp. and Edison International, respectively.