Two multi-billion-dollar proposals in front of the Public Utility Commission of Texas are aimed at tapping the rich wind resources of west Texas and the Texas panhandle. Photo courtesy TXU Corp.
part of a PUCT proceeding to designate Competitive Renewable Energy Zones in Texas. If the PUCT approves the proposal, Sharyland says it will immediately take steps to construct the transmission facilities with the goal of project completion by late 2010. The Panhandle Loop will consist of three interconnected transmission lines extending from three separate points in the existing ERCOT grid. The project is expected to cost approximately $1.5 billion.
Joining Sharyland in supporting the Panhandle Loop proposal are Irish-based wind developer Airtricity Inc.; the renewable holdings arm of investment firm Babcock & Brown; chemical company Celanese Corp., which is considering electric generation as an alternative for one of its facilities in the Texas panhandle; and Occidental Energy Ventures Corp., a subsidiary of Occidental Petroleum.
The Panhandle Loop will be open access, meaning any generator—whether it is wind, coal, natural gas, or otherwise—can potentially use the loop to access the ERCOT power market. Under
Texas market rules, the Panhandle Loop’s cost would be borne by all ratepayers within ERCOT. Proponents of the proposal say it’s essential to making wind and other renewables part of the mainstream energy mix in Texas.
“The best wind in the state, and among the best in the country, is in the Texas panhandle, and it’s largely untapped today,” said former FERC chairman Pat Wood, who currently serves as chairman of Airtricity’s North American advisory board. “The only way to tap it is to build a highway out to it.”
Wood refers to the Panhandle Loop and other proposals of its ilk as operating under an “if you build it, they will come” policy.
“I think we’ll see the states that are serious about wind recognize that you have got to be proactive and build transmission out to the wind-rich zones so the wind developers will know that they have access to the market,” Wood said.
“You wouldn’t build a wind plant if you didn’t have transmission. You’ve got to put the cart before the horse in this case.”
Sharyland’s $1.5 billion panhandle proposal was big, but in a state known for one-upsmanship, it’s not surprising that an even bigger transmission proposal was announced within weeks of the Panhandle Loop news.
On Feb. 27, Electric Transmission Texas (ETT), a proposed joint venture between American Electric Power and MidAmerican Energy Holdings, filed a proposal with PUCT for the construction of approximately 1,000 miles of transmission lines to support Competitive Renewable Energy Zones. ETT also proposed an additional 900-mile, high-voltage backbone transmission system to support long-range reliability in Texas. All told, the multi-phase proposal would amount to approximately $7 billion in transmission projects, although the latter phase of the proposal is considered “ conceptual” at this point.
Phases one and two of the proposal, like Sharyland’s proposal, would serve as a “pipeline” for renewable power. The first phase would provide access for up to 8 GW of existing and planned renewable energy projects in north and central-west Texas. The second phase would support an additional 2 GW of renewable projects. These first two phases of ETT’s proposal carry a price tag of $3 billion, which, like the Panhandle Loop, would be borne by ratepayers within ERCOT.
Upon PUCT approval, ETT anticipates completing the first phase by 2012 and the second by 2015.
While Sharyland’s proposed Panhandle Loop would serve to bring renewables from the panhandle into ERCOT, ETT’s executive director Calvin Crowder explained that his company’s proposal is focused more on delivering the power to load centers once it reaches ERCOT.
“There have been proposals brought forward on how to deliver wind from the panhandle into ERCOT, but what we saw was a need to address ERCOT’s
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