On January 18, 2016

TDI New England approved for $1.2 billion transmission project ending in Ludlow

By Mike Polhamus, VTDigger.org

The Public Service Board on Tuesday, Jan. 5, approved a $1.2 billion utility transmission project from Canada to Ludlow.

TDI New England plans to build a 1,000-megawatt transmission line under Lake Champlain that will feed the southern New England power grid. The board said it issued a certificate of public good to TDI because the project diversifies energy sources, reduces greenhouse gas emissions, creates new jobs, generates tax revenue and potentially supplies cheaper energy.

The Montpelier-based Conservation Law Foundation agreed last year not to oppose the project after it was able to negotiate large payments from the utility for Lake Champlain cleanup.

“TDI New England did a good job of showing that large energy projects can meet high environmental standards,” said CLF Senior Attorney Sandra Levine. “There are a number of transmission projects in the region being evaluated and considered; this isn’t an endorsement of this project, it’s just a recognition that they did a lot of things right, and I think they have set in some ways a model for other projects.”

An instructive comparison can be made between this project and the Vermont Gas Systems natural gas pipeline proposed for Addison County, Levine said.

The pipeline has met steady opposition from AARP and landowners, she said, because Vermont Gas has done a poor job of evaluating the pipeline’s impacts and hasn’t been transparent enough with ratepayers and the board about costs.

“When you look at the two side by side, Vermont Gas is still facing problems with permitting, and the TDI project has received its permits,” she said.

The firm merely followed sound business practices, said TDI New England’s CEO Donald Jessome.

The project is being built not out of necessity, as is the case with some power projects, but rather for economic reasons, and as such “there’s no question we have a higher burden to the states we’re traversing to demonstrate public good,” Jessome said.

Early in the project’s development, the firm reached out to stakeholders, including environmental organizations, state regulatory bodies and others, Jessome said. “We totally understand that in the development world we have to listen to all the stakeholders,” he said.

TDI plans to pay hundreds of millions of dollars toward environmental cleanup efforts over the project’s lifespan, and Jessome said, “We see that as a cost of doing business.” Large portions of those monies were secured through negotiations with the Conservation Law Foundation.

The cable will run from the Canadian border to Ludlow, sunk for most of that length beneath Lake Champlain.

The cable will carry 1,000 megawatts, roughly the amount of power consumed by the entire state of Vermont. If it is constructed, Vermont will host the cable, and most of the electricity will be transmitted to southern New England. Vermont will have the option to purchase up to 200 megawatts from the cable.

The cable is expected to carry power from dams and wind turbines.

TDI has agreed to pay a minimum of $283.5 million over the 40-year lifespan of the project for Lake Champlain phosphorus cleanup, habitat restoration and recreational improvements—$121.5 million more than was originally proposed. Some of that money would also go to the state’s Clean Energy Fund.

TDI has also agreed to pay the state’s transmission utility, Vermont Electric Power Co. (VELCO), $136 million–$2.5 million annually–over 40 years. That money is expected to be used to reduce electric rates, according to state officials.

TDI New England is a subsidiary of financial firm Blackstone Group, which manages more than $200 billion in assets. The firm anticipates permitting will take until mid-2016, with major construction beginning in 2018. If  the project moves forward, then the 1,000-megawatt transmission line is expected to carry power by 2019.

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