The formal approval this week of the route for the massive TransWest Express transmission project clears one of the key remaining hurdles for the attempt to bring large amounts of electricity generated by Wyoming wind farms to the major cities of Southern California.
The official Record of Decision, or ROD, from the Western Area Power Administration was published in the Federal Register on April 3 after being first released in January. Along with the Bureau of Land Management’s ROD, which was released in December 2016, the WAPA approval means that the federal government has signed off on one of the most ambitious of a crop of new interstate power lines currently in development.
"The Western U.S. needs new interregional transmission infrastructure like the TWE project, which will allow California and other Desert Southwest utilities to directly access high-capacity Wyoming wind to balance and diversify their generation portfolios in a cost-effective manner," said Bill Miller, president and CEO of TransWest Express LLC, which is developing the line, in a Dec. 13, 2016, statement when the Interior Dept. signed off. "Today's important federal permitting milestone further advances the TWE project's progress and brings this critical infrastructure project one step closer to construction."
TransWest will be a high-voltage, direct current, 600-kV line that provides 3,000 MW of transmission capacity along its 730-mile route. The system is designed to bring wind power from the massive Chokecherry and Sierra Madre Wind Energy Project, in southern Wyoming, to the desert Southwest. The route extends from the Wyoming wind farms to a planned interconnection near Delta, Utah, and on to the Marketplace Hub near Hoover Dam in southern Nevada, which provides interconnections to the California, Nevada and Arizona grids.
TransWest Express is backed by Colorado billionaire Philip Anschutz, whose privately held Anschutz Corp. is also developing the Chokecherry/Sierra Madre project.
A question of financing
Major new transmission is needed to get wind and solar power from the often remote areas where the resources are abundant to the centers of demand, most of which are on the coasts. But the federal approvals by no means assure that TransWest will be completed. The sections of the line that cross federal land cover only about two-thirds of the full right-of-way; the rest is on state or private lands and requires easements and/or state and county permits—an obstacle that continues to thwart other big transmission projects, such as the Plains and Eastern line in the Southeast.
TransWest received a conditional permit from Nevada in September 2015, but has not yet applied for a permit in Wyoming. Utah and Colorado do not require state permits, but it’s possible that the project could face opposition from private landowners along the route.
Then there’s the question of financing. The Anschutz Corp. has funded the project development to date, but actual construction will require project financing from outside investors, as well.
"Construction financing and funding is in the process of being analyzed and secured," TransWest spokeswoman Kara Choquette said in an email. Questions have been raised about the financial viability of other such projects, including the Rock Island Clean Line, being developed by Clean Line Energy Partners.
An October 2016 study by the Los Angeles-based PA Consulting Group, carried out on behalf of TransWest Express, estimated that the full project will cost $3.8 billion and will deliver between $5 billion and $11 billion in net benefits to California ratepayers. That, however, does not guarantee that investors will see it as a money-making venture.
And big transmission lines require offtakers to pay for the power generated and for the transmission capacity. To date, no contracts have been signed for the power from the Chokecherry/Sierra Madre wind farm or the TransWest Express transmission capacity.
"We continue to engage and talk with utilities and other entities across the Desert Southwest that are interested in the high volumes of competitively priced renewable electricity these projects will be able to provide and to move forward with our ongoing development activities," Choquette said.