Cost of building thousands of miles of transmission lines to carry wind, other power across Texas jumps in three years by 38% to nearly US$7B due to rerouting, inflation, according to recent project update filed with state utility regulators

Bdebbie Garcia

LOS ANGELES , August 25, 2011 (Industry Intelligence) – Building transmission lines to carry wind and other power across Texas is now expected to cost US$6.79 billion, up 38% from the $4.93 billion estimated when the project was first proposed in 2008, according to a recent filing with the Public Utility Commission (PUC), reported The Texas Tribune on Aug. 24.

The latest project update indicates that expenses increased when the calculation for the lines was changed from straight-line distances to a route following fences and roads in order to minimize the intrusion, as requested by the PUC.

The new route could cause the lines to be 10% to 50% longer than in the original plan, according to the update, which was published in July.

The new estimated cost is subject to change, as “costs may fluctuate over the next year,” according to the report, which was prepared by engineering services company RS&H, The Texas Tribune reported.

The lines, which are all expected to be completed by December 2013, would run for several thousands of miles carrying wind-generated electricity from West Texas to large cities across the state.

The project is expected to spur further development of wind farms in Texas, which is by far the largest producer of wind-generated electricity in the U.S. Other forms of energy will also be allowed access to the transmission lines.

Construction is under way along the route, but varies, reported The Texas Tribune.

Next month, Wind Energy Transmission Texas LLC plans to start building a 378-mile section. The company is a joint venture of Toronto-based Brookfield Asset Management and Madrid-based Grupo Isolux Corsan SA subsidiary Isolux Corsan Concesiones SA.

Transmission companies must first get approval from the PUC before they can pass along their costs to energy consumers, The Texas Tribune reported.

The first application for “rate recovery” might be filed before the end of this year, said Terry Hadley, a PUC spokesperson. This could result in an eventual increase in Texas electric bills of $4-$5 per month for years.

Project delays have occurred because of controversy, particularly from those trying to prevent the lines from going through their properties.

Hill Country landowners were able to stop the lines from going through their area, after grid officials determined that another route would be just as effective but less costly, reported The Texas Tribune.

The primary source of this article is The Texas Tribune, Austin, Texas, on Aug. 24, 2011.

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