Published: April 20, 2007 10:04 am         

Allegheny Energy to partner with AEP on power line

CUMBERLAND - Allegheny Energy and American Electric Power of Ohio have signed a memorandum of understanding to form a joint venture company to build and own new electric transmission assets within PJM Interconnection.

Allen Staggers of Allegheny Energy's corporate communications office said the project includes a portion of a proposed AEP interstate line announced last year but is completely separate from Allegheny Power's TrAIL project.

In early 2006, Allegheny Energy and American Electric Power announced proposed high-voltage power line projects intended to relieve the overload on the PJM grid that serves most of the mid-Atlantic Region with electricity.

The proposals came in the wake of a power outage in 2003 that affected some 13 states and originated in Ohio when lines overloaded and in a domino effect dropped power throughout the grid.

The Allegheny Power project, to become known as TrAIL or the Trans-Allegheny Interstate line, received approval from federal regulators and PJM Interconnection, which operates the grid. Its proposal is for a 330-mile, 550-kilovolt line from the Northern Panhandle of West Virginia and ending at a substation in Frederick County.

The utility is in the process of completing siting for the project and expects to complete it by 2011.

The AEP project proposed a 550-mile, 765-kilovolt line from central West Virginia to New Jersey; it has not received federal or PJM approval.

Under the terms of the memorandum announced Wednesday, the two utilities will build 765-kilovolt transmission lines and related facilities to link AEP's Amos substation, near St. Albans, W.Va., with Allegheny's proposed Kemptown station in Frederick County.

The joint venture will include about 250 miles of 765-kilovolt transmission lines, while an additional 40 miles of the high-voltage line from the Maryland border to Kemptown substation will be developed and owned by Allegheny.

According to Staggers, PJM is looking at two versions of that portion of the proposed line and the primary reason is to prevent overloads on the existing system.

He also pointed out that AEP has more experience with the high-voltage lines. "It just made sense for us to work together," he said.

He said it will take about a month for PJM to come up with an expansion plan related to the joint venture, which its full board will consider in about mid-June.

In making the announcement of the joint venture, AEP's chairman, president and chief executive officer, Michael G. Morris, said, "We must move forward and address the current inadequacies of our nation's existing transmission infrastructure."

He said that Congress and the Federal Energy Regulatory Commission have identified the investment in transmission as "crucial to ensure the reliability of the electricity grid."

Chairman, President and Chief Executive Officer of Allegheny Energy, Paul J. Evanson, added, "We stand ready to strengthen the transmission system in accordance with PJM's findings."

He said PJM's latest study confirms that further investment is "critical to providing dependable electric service and keeping pace with growing demand."

Staggers said that since the original AEP proposal is generally north-south and the TrAIL project is more east-west, there is a likelihood they will intersect at some point depending on the final sitings for both.

Both companies will work on siting, acquiring rights of way, regulatory approvals and operations and maintenance for the project, according to press releases by the utilities.

The earliest likely completion for the joint project is in 2012.

Mona Ridder can be reached at mridder@times-news.com.