State regulators today accepted a revised application for a high-voltage power line between Holmen and Madison, triggering what’s likely to be a year-long review of the proposed project with a price tag of up to $580 million.

The move comes just over five months after the Public Service Commission rejected the initial application as incomplete, outlining 153 deficiencies. Concerns ranged from missing or broken elements in electronic mapping files to requests for additional explanation of the project need -- a key issue for project opponents, who argue that local energy demand has been dropping.

A joint venture of ATC and Xcel Energy, the proposed 345-kilovolt line would connect to CapX2020, another high-voltage line under construction between the Twin Cities and Holmen.

“We appreciate the public’s active involvement over the past several years in helping us evaluate possible routes,” ATC Manager of Environmental and Local Relations Greg Levesque said in a news release. “The PSC’s regulatory review phase allows further opportunity for stakeholders to submit comments directly to the PSC and be part of the process.”

Rob Danielson, a spokesman for one of several citizen groups opposing the project, said he still considers the application incomplete, because it fails to answer all the PSC’s questions and doesn’t address alternative solutions or the declining energy demand.

“We will continue to respond to requests for information,” said ATC spokeswoman Kaya Freiman. “It’s a totally normal part of the process.”

But Danielson was encouraged by the number of questions regulators asked.

“PSC questioning and persistence has supplied some important new information for ratepayers, including a report showing energy use in the Midwest has declined much faster than previously known … five times the recently reported national rate of decline,” he said.

The project includes two proposed routes out of the La Crosse. One would go through Onalaska, the other between Holmen and Galesville, putting a second line of towers alongside those to be built for CapX.

ATC says it will provide lower cost electricity and enhanced reliability for Wisconsin customers while also providing a pathway for renewable energy.

The project has prompted opposition and calls for a comprehensive study of alternatives from dozens of municipalities and counties in western Wisconsin. Business groups – including the state’s chamber of commerce and grocers’ association – have come out in support.

The PSC now has 180 days to approve or deny the application, with the possibility of a six-month extension.

If approved, ATC anticipates construction would begin in 2016 and to have the line in service by the end of 2018.

Costs and savings

The project’s cost – now estimated at $540 million to $580 million depending on the route – would be borne by ratepayers across the Midcontinent Service Independent Operator service area, which includes Wisconsin, Minnesota and parts of a dozen other states.

According to ATC, a new transmission line would offset the need for about $160 million to $180 million in lower voltage upgrades in western Wisconsin and provide local utilities with increased access to the wholesale energy market.

And ATC estimates the line could create $118 million to $700 million in net economic benefits to electric consumers over the life of the line.

But using ATC’s business as usual model, based on 0.8 percent annual growth, Danielson estimates the net savings over 40 years will work out to about 1 cent a month for residential consumers.

More than 90 Wisconsin municipalities and 2,000 ratepayers have submitted concerns and requests to the PSC for information about the project.

A coalition of business and labor groups applauded Wednesday’s ruling, saying the project will support industry and jobs.

“Energy-intensive operations, like the manufacturing industry, recognize the importance of a robust transmission system -- helping utilities access lowest-cost sources of energy means more affordable and reliable electricity for Wisconsin businesses,” said Eric Bott of Wisconsin Manufacturers and Commerce. “We are glad to see that the state review process is moving forward for Badger Coulee."

Source: Tribune calculations based on ATC data 

Energy use falls

Opponents of Badger-Coulee and similar high-voltage projects continue to question the need, pointing to recent trend toward decreased consumption.

National electricity use peaked in 2007 at 3.76 billion megawatt hours, according to data compiled by the U.S. Energy Information Administration. Sales rebounded in 2010 but have since declined by about 2 percent.

Within the Midcontinent Service Independent Operator (MISO) service area, use declined by more than 8 percent during the same period, according to data included in the project application.

Freiman said the need projections – based on anticipated annual growth rates of 0.22 percent to 1.25 percent – take into account recents drop in demand.

“Demand forecasting is done by not just looking at historical numbers,” she said.

Danielson said Wisconsin ratepayers would be better served if the money was spent on additional energy efficiency measures.

“Any sane, unbiased engineer would look at the proposal and say why are we looking at this?” he said. “There must be another alternative.”

Source: U.S. Energy Information Administration

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