The Anschutz Corporation is targeting 2020 to begin construction of its $3bn, 725-mile (1,167km) TransWest Express transmission line that would deliver 20,000GWh/yr of low-cost wind energy from Wyoming to California and adjacent states.

Denver-based Anschutz would like to have initial phases of the 600kV overhead direct-current (DC) line in service by 2023, spokeswoman Kara Choquette told Recharge.

“That, then, would hopefully provide a pathway for the Chokecherry and Sierra Madre (CCSM) wind energy,” she said, referring to an immense two-stage 3GW nameplate capacity wind farm that Power Company of Wyoming (PCW), another Anschutz subsidiary, has under development on lands it owns in a southern segment of the state.

Construction has begun on the first 1.5GW stage of the wind farm, while the second requires certain federal approvals.

For TransWest, plans call for routing the line from the wind farm through Colorado and Utah to near the Marketplace Hub outside Boulder City in southern Nevada, which provides interconnections to electric grids in the Desert Southwest.

The project would retain an option for a future interconnection with the existing Intermountain Power Project transmission system in southwestern Utah.

The TransWest northern and southern terminals would be configured to handle an initial 1,500MW that the line would carry. “As demand grew, then you could upgrade just the terminals to the additional 1,500MW,” said Choquette.

Both terminals would include alternating current/DC converter stations and nearby AC substations, and related multiple equipment control, maintenance and administrative buildings.

Unlike most other proposed long-haul wind transmission lines in the US West, TransWest has obtained the necessary US government approvals and right-of-way – it took almost a decade – to enable routing on federally-owned lands (roughly two-thirds the distance).

The US government owns 47% of all territory in the West and much more in Nevada – a legacy from the 1800s when it purchased or took land (such as from Native Americans) that became new states.

Over time, it transferred lands to individuals and state governments, but a large swath – often arid, mountainous or remote – remains under federal control as they were not attractive to farmers and settlers. Some of that territory must be crossed by long-haul power lines to reach western load centres.

TransWest has begun the process of acquiring easements for lands that are privately held or owned by the states, which support the project.

“We started in 2017 and we’ll be working on that throughout 2018 and probably into 2019 as well,” she said.

TransWest also needs a permit in Wyoming before construction can begin there from the state’s Industrial Siting Council, which earlier approved one for the related Chokecherry and Sierra Madre (CCSM) wind farm.

The transmission developer anticipates filing for that permit in the fourth quarter and does not expect problems obtaining it. Colorado, Nevada and Utah do not require a similar approval.

The Western Area Power Administration (WAPA), a federal agency that markets and transmits bulk electric power from water projects in 15 central and western states, continues to study whether it will take an equity stake in TransWest.

California key market

Anschutz acquired development rights for TransWest in 2008 from a unit of National Grid. The UK company envisioned it as a pathway for connecting Wyoming’s immense untapped wind resources with California and southwestern states, whose booming economies were increasingly hungry for clean energy.

“There were a lot of wind generation projects proposed at the time,” recalled Choquette. “The idea for TransWest has always been to look at that broader need beyond the Chokecherry project.”

Industry growth, however, stalled several years later when the Legislature imposed a $1/MWh tax on wind energy production and some lawmakers threatened to increase it, prompting developers to take their projects elsewhere. In addition, Wyoming’s limited electrical grid was ill-suited for an ambitious wind development and export strategy.

Only in the last two years have investors led by Warren Buffett’s PacifiCorp resumed wind capacity expansion to take advantage of the federal production tax credit (PTC) before it expires at the end of 2019. PacifiCorp, which owns two utilities in the West, is building its own transmission lines to transport the wind power to customers in six states.

Third party wind farms, if they are developed, could utilise TransWest.

Anschutz, meanwhile, had bigger ideas. CCSM was expanded from a 2,000MW to a 3,000MW project and TransWest would deliver the electric power to distant points. Two critical challenges were getting federal and other approvals for the two monumental-scale projects and finding customers for CCSM.

California was always seen as the main export market as it is the number-one state economy, ranks fifth in electric power consumption and eventually wants to fully decarbonise its grid. In contrast, Arizona ranks a respectable 13 ^th among states in electricity usage, while near the bottom are New Mexico and Nevada at 37th and 38th.

Yet, sealing supply deals in California is taking more time than outside observers might have imagined or believed Anschutz would allow as it continues to invest millions of dollars to advance the projects.

The company is privately-owned and not under pressure from Wall Street analysts and investors to finalise agreements or scrap the projects – as American Electric Power did earlier this month with its $4.5bn, 2GW Wind Catcher Energy Connection project, after Texas regulators rejected it.

"If you want to make a significant contribution to meeting renewable energy goals, you have to look at utility-scale projects."

Anschutz owner Philip Anschutz is among the country's wealthiest individuals. He built his fortune in part on his deal-making skills, taking the long view on investments and an uncanny ability to spot economic value and the next big opportunities before most people.

“We don’t have commercial agreements in place yet. We continue to talk with utilities, entities in California and the Desert Southwest that are certainly interested in the energy that the Chokecherry project can provide,” said Choquette. “That is the extent of where we’re at.”

“Their requirement for renewable energy is substantial. I think people are realising that if you want to make a materially significant contribution to meeting those renewable energy goals, having the actual energy to meet those requirements, you have to look at utility-scale size projects, utility-scale solutions,” she added.

Importing large amounts of wind energy from conservative western states such as Utah and Wyoming that openly support fossil fuel development and usage is controversial and not an appealing option for some politicians and policymakers in liberal California.

Proposed regional market

Proposals to expand the California Independent System Operator (CAISO) into a regional entity have been pending in the state Legislature since 2016. CAISO serves about 80% of the state's electric load.

Supporters such as Governor Jerry Brown argue a bigger, more liquid and transparent market would enable easier integration of renewables; cut grid operational costs; improve competition and consumer choice; and intensify competitive pressure on the least-economic coal-fired power plants.

Opponents argue regionalisation would undermine control and implementation of California’s energy policies, while actually spurring demand for coal power in a larger market. California now imports about 9% of total electricity demand from coal plants in other states.

Choquette noted TransWest could also be a nice fit in a regional market by providing transmission capacity that would allow California to export its surplus solar power to other states during certain hours of the day.

"TransWest could be a vehicle for the bidirectional transfer of power," she said, much as the state now does with hydro power in the Pacific Northwest utilising the Pacific DC Inter-tie. Still, the project is not dependent on the regionalisation idea.

"TransWest is a whole new pathway providing physically deliverable supplies of renewable electricity from Wyoming or solar into the InterMountain West market," she said.

California’s energy markets are evolving in another way that could affect importation of Wyoming wind energy. Customer-owned distributed energy resources and community choice aggregation are taking off (18 in operation including in San Franciso), giving local elected officials more say over energy procurement decisions.

As a result, the California Public Utility Commission estimates that investor-owned utilities may lose 85% or more of their sales by the mid-2020s, leaving them to primarily manage electric grids.

On the other hand, CCAs could benefit from greater choice created by a regional grid operator, according to a study on regionalisation by PaulosAnalysis consultancy.

"I think you are always watching the market and how it evolves. We are certainly seeing that regardless," said Choquette, noting there is a net short of renewable energy between what is produced or contracted for now and what will be required for California to meet a 60% or 100% renewable portfolio standard.

"We think large supplies of a cost-effective resource from a very reliable windy state like Wyoming and that geographic diversity is a very compelling offering - and will be for utilities looking to meet that need," she said.

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