Building on the Department of Energy’s (DOE) ongoing efforts to modernize the grid and accelerate the deployment of renewable energy, today U.S. Secretary of Energy Ernest Moniz announced that DOE will participate in the development of the Plains & Eastern Clean Line Project (Clean Line), a major clean energy infrastructure project.
The Clean Line project will tap abundant, low-cost wind generation resources in the Oklahoma and Texas panhandle regions to deliver up to 4,000 megawatts of wind power via a 705-mile direct current transmission line — enough energy to power more than 1.5 million homes in the mid-South and Southeast United States.
This marks the first use of Congressional authority conferred to DOE as part of Section 1222 of the Energy Policy Act of 2005 with the objective of promoting transmission development. Congress passed this provision when it was becoming clear that our nation’s transmission infrastructure was beginning to show its age and needed modernization. Congress recognized the need for a modern and resilient grid that could accommodate increasing demands for power with newly available resources. Based on our thorough review of the Clean Line project, it satisfies the goals for which Congress established DOE’s authority.
“Moving remote and plentiful power to areas where electricity is in high demand is essential for building the grid of the future,” Secretary Moniz said. “Building modern transmission that delivers renewable energy to more homes and businesses will create jobs, cut carbon emissions, and enhance the reliability of our grid.”
The project will, if built, address infrastructure challenges outlined in the 2015 Quadrennial Energy Review (QER), which focused on Energy Transmission, Storage and Distribution Infrastructure. The QER acknowledged the importance of establishing transmission lines to facilitate remote generation development of renewable energy. The QER found that new long-distance transmission capacity like Clean Line has the potential to enable lower-carbon electricity, enhance system reliability and operate at a reasonable cost to consumers.
The project is expected to create supply chain jobs in Arkansas and Oklahoma to build the new infrastructure that will be constructed, operated and maintained in both states. Clean Line has announced a $300 million agreement with Pelco, an Oklahoma company, to build the project’s tubular steel transmission structures. Clean Line has also identified three Arkansas companies to build infrastructure that supports the project, such as transmission conductors and glass insulators.
Through its rigorous review and lengthy negotiations to build in protections for landowners and the local communities, the processes insisted upon by the Department go well beyond the provisions established by Congress in Section 1222. Before obtaining land for the project from landowners, commercial viability will need to be demonstrated. This means Clean Line will need to execute significant firm transmission service agreements and complete key technical studies required by the Southwest Power Pool, Midcontinent Independent System Operator and Tennessee Valley Authority.
This announcement marks the conclusion of a review process that began in 2010 that included 15 public meetings and provided multiple opportunities for the public to submit written comments as part of the review process. As a result, protections for taxpayers, ratepayers and land owners have been put in place:
- The federal government will only exercise eminent domain as a last resort — after the project has met significant milestones to prove its viability — and the process will provide every opportunity for the land owner to maximize the value of their land in a transparent and fair manner;
- DOE will enter an agreement with Clean Line that ensures that all of DOE’s costs will be paid by Clean Line in advance and that Clean Line will contribute two percent of project revenues to offset the cost of federal hydropower infrastructure improvements;
- In response to public input, the Clean Line project will include a 500 megawatt converter station in Arkansas to ensure that consumers in the state can benefit from the renewable energy delivered by the project;
- Protections have been built into the participation agreement to ensure that no liability falls on the ratepayers if the project were ever to fail;
- And, Clean Line will also make payments to counties in Arkansas and Oklahoma for land and assets owned by the federal government that would otherwise be taxable.