The Midwest has the electricity equivalent of a freeway traffic jam.
With rising demand for power, combined with old lines and lost energy, the current grid isn’t large enough to support the proposed influx of renewable energy startups, despite calls from state and national leaders to increase reliance on green energy.
Chicago moved closer to getting this much-needed upgrade to its aging grid as the Federal Energy Regulation Commission approved rate incentives Monday for the “Green Power Express,” a power line project that would transmit energy from wind farms in the Dakotas, Minnesota and Iowa.
The Federal Energy Regulation Commission granted the contractor, ITC Holdings of Novi, Mich., a 12.38 percent incentive return on common equity and a regulatory asset for development and pre-construction costs. The new power lines, projected for the year 2020, would cover 3,000 miles in seven states, sending 765 kilovolt, extra high voltage capacity to Chicago, Minneapolis and southeastern Wisconsin. ITC does not create its own power, but its grid would create a channel for renewable energy to travel to across the region to consumers. Local utilities could then hook into ITC’s electrical grid system.
This type of project could bring the state closer to meeting its renewable energy portfolio standard, which mandates that 25 percent of the state’s power come from renewable energy sources by 2025. It also requires that 75 percent of the renewable energy come from wind farms, as opposed to solar or hydroelectric plants.
The 12 gigawatt capacity of the Green Power Express would help relieve congestion of the region’s overtaxed grids, which according to ITC cannot handle the proposed 62.8 gigawatts of wind energy in the connection queue of the Midwest Independent System Operator, an organization that supports electrical availability in 15 Midwestern states including Illinois. New power lines would also increase the robustness of the existing grid, reducing the probability of cascading outages and blackouts.
“Anything that’s going to increase wind power and make the grid more efficient and stable is a wonderful thing,” said Larry Merritt, spokesman for the Chicago Department of Environment.
The Green Energy Express, said ITC spokeswoman Cheryl Eberwein, also dovetails with President Barack Obama’s plans for renewable energy, citing his statement last October that he wanted to bring wind power from the Dakotas to population centers such as Chicago.
But despite the federal boost and the coherence of its project with long-term government objectives, ITC still has the difficult task of coordinating agreement among the seven states through which it hopes to run these lines. “It’s going to be a complicated process,” Eberwein said.
One problem is getting different state legislators and regulatory agencies to agree on where a power line will cross state lines, according to Carl Dombek, spokesman for the Midwest Independent System Operator. Compound that across seven states and you clearly have a much larger problem.
In Illinois, the decision will rest in part with the Illinois Commerce Commission. “I think [the Green Power Express] has merit,” said commerce commissioner Sherman J. Elliott. “Whether that will justify the economics and is sufficient to overcome traditional ‘not-in-my-backyard’ syndrome, that remains to be seen.”
Property owners and utility providers have a history of clashing over eminent domain and projects that might harm property value. “We all want to see the benefits of green energy, but we don’t want to see any of the infrastructure needed to bring it to us,” said Melissa McHenry, spokeswoman for Columbus, Ohio-based American Electric Power.
Upon being proposed two months ago, the Green Energy Express also met resistance from state governments and energy providers. Chicago-based energy provider Exelon, which filed an intervention in February, said ITC’s proposal was premature and did not go through the proper channels, a concern they still hold according Exelon spokesman Paul Elsberg.
An influx of wind energy from out of state could impact wind farm plans in the Chicago area, according to Elliott. He also noted that the Dakotas and Iowa are simply better suited for wind power generation. “I would say to the extent that they can produce more wind at a lower price, in a pure economics sense … they are going to have more of an advantage,” Elliott said.
Chicago-based wind company Invenergy said their own wind projects are expected to come online in the next few years, long before Green Energy Express’s projected 2020 completion. “Certainly you’re going to have a circumstance where other states are developed because of their better wind resources,” said Invenergy spokesman Joel Link. “At some point in the future those could become competitive with the home-grown enterprises.”
American Electric Power proposed a transmission project similar to the Green Energy Express in December, but McHenry said the extra lines are less a matter of competition than cooperation to clear the energy traffic jam. “There’s not just one interstate moving across the country,” McHenry said, “so there’s going to be a need for multiple projects to fully tap the renewable energy resources of this region.”