Decision 21038-D01-2016 Downtown Calgary 138-kV Transmission System Reinforcement June 1, 2016
Alberta Utilities Commission Decision 21038-D01-2016 Downtown Calgary 138-kV Transmission System Reinforcement Proceeding 21038 Application 21038-A001 June 1, 2016 Published by the: Alberta Utilities Commission Fifth Avenue Place, Fourth Floor, 425 First Street S.W. Calgary, Alberta T2P 3L8 Telephone: 403-592-8845 Fax: 403-592-4406 Website: www.auc.ab.ca
Alberta Utilities Commission Calgary, Alberta Decision 21038-D01-2016 Downtown Calgary 138-kV Proceeding 21038 Transmission System Reinforcement Application 21038-A001 1 Decision summary 1. In this decision, the Alberta Utilities Commission must decide whether to approve an application submitted by the (AESO) for the Downtown Calgary 138-kilovolt (kv) Transmission System Reinforcement. After consideration of the record of the proceeding, and for the reasons outlined in this decision, the Commission finds the AESO s assessment of the need to be correct and in the public interest and approves the AESO s needs identification document application. 2 Introduction and background 2. The AESO filed an application with the Commission seeking approval of a needs identification document (NID) for the Downtown Calgary 138-kV Transmission System Reinforcement (the transmission development). The transmission development includes a new 138-kV transmission line between the existing ENMAX No. 2 and ENMAX No. 8 substations. The application was registered on November 18, 2015 as Application 21038-A001. 3. The Commission issued information requests to the AESO on December 14, 2015. The AESO responded to the information requests on January 21, 2016. 4. On December 14, 2015, the Commission issued a notice of application for Proceeding 21038. Submissions to the Commission in response to the notice were due on January 11, 2016. The notice was sent through unaddressed mail via postal code to all occupants, residents, and landowners located in the area where the AESO had indicated that the transmission development may occur. The notice was also sent via addressed mail to government bodies, agencies and other stakeholders identified by the AESO. The notice was published in the Calgary Herald and the Calgary Sun on December 18, 2015. The notice was also published on the AUC website and notification was automatically emailed to efiling System users that had chosen to be notified of notices of application issued by the Commission. 5. In response to the notice, the Commission received statements of intent to participate from ENMAX Power Corp. (ENMAX) and the following landowners: Mary Van Order Ray Chow Paul Featherstone Decision 21038-D01-2016 (June 1, 2016) 1
Anca Medesan Fort Calgary Preservation Society 6. The Commission issued a ruling dated February 19, 2016, granting standing to all parties that had filed statements of intent to participate. 1 7. The Commission issued a notice of hearing on March 11, 2016 informing parties that it would consider the application through a written process. The notice provided details of the application and a schedule of the remaining process steps for consideration of the application. 8. On March 18, 2016, ENMAX requested that the Commission include an information request process in the schedule because doing so may eliminate the need for ENMAX to submit written evidence. In a letter dated March 23, 2016, the Commission granted ENMAX s request and provided a process schedule for interveners to ask the AESO information requests and for the AESO to respond. 9. On April 26, 2016, after the AESO responded to the interveners information requests, the City of Calgary filed a statement of intent to participate, in which it indicated that the AESO s response to ENMAX s information request had raised a new issue that had a direct bearing on the City of Calgary. The City of Calgary requested intervener status in the proceeding. In a ruling dated April 28, 2016, the Commission granted standing to the City of Calgary. 2.1 The process for new transmission development in Alberta 10. Except in the case of critical transmission infrastructure, two approvals from the Commission are required to build new transmission capacity in Alberta. First, an approval of the need for expansion or enhancement to the Alberta interconnected electric system pursuant to Section 34 of the Electric Utilities Act is required. Second, a permit to construct and a licence to operate a transmission facility pursuant to sections 14 and 15 of the Hydro and Electric Energy Act must be obtained. 11. The AESO, in its capacity as the independent system operator (ISO) established under the Electric Utilities Act, is responsible for preparing a NID and filing it with the Commission for approval pursuant to Section 34 of the Electric Utilities Act. As stated above, this NID application was filed on November 18, 2015. 12. In Decision 2004-087, the Commission s predecessor, the Alberta Energy and Utilities Board (Board), described the NID process as follows: It is the Board s view that section 34 contemplates a two-stage consideration of an NID. In the first stage, the Board must determine whether an expansion or enhancement of the capability of the transmission system is necessary to alleviate constraint, improve efficiency, or respond to a request for system access 1 Exhibit 21038-X0029, AUC Ruling on Standing, February 19, 2016. 2 Decision 21038-D01-2016 (June 1, 2016)
14 ST. SW BLACKFOOT TR. MACLEOD TR. CENTRE ST. Downtown Calgary 138-kV Transmission System Reinforcement If it is determined that expansion or enhancement of the system is required to address constraint, inefficiency, system access requests, or any combination thereof, the Board must then assess, in the second stage, whether enhancement or expansion measures proposed by AESO are reasonable and in the public interest. 13. Facility applications are prepared by the transmission facility owner assigned by the AESO. ENMAX is the transmission facility owner in the downtown Calgary area. No application for the facilities to meet the need identified by the AESO has been received. Should the Commission approve the AESO s application, the Commission anticipates that ENMAX will file a facility application to construct and operate the facilities for the transmission development. 3 Discussion 3.1 Views of the applicant 14. In its application, the AESO explained that the need for the transmission development is predominately driven by increasing demand in the downtown Calgary area. To ensure system reliability, additional reinforcement of the existing transmission system is required. The transmission development would reinforce the downtown Calgary transmission system by connecting the ENMAX No. 2 and ENMAX No. 8 substations with a 138-kV transmission line which may be routed within the shaded area as identified in the following map: DEERFOOT TR. ENMAX NO. 8 SUBSTATION 9 AVE. S BOW RIVER MEMORIAL DR. 17 AVE. SW CROWCHILD TR. 25 AVE. SE ENMAX NO. 2 SUBSTATION APPROXIMATE AREA WHERE TRANSMISSION LINE COULD BE LOCATED 15. The AESO also proposed to modify equipment at the substations, including adding a new 138-kV circuit breaker to the ENMAX No. 8 substation. 16. The AESO submitted that system studies indicated that the transmission system in the downtown Calgary area would be prone to overload under single contingency conditions. The studies showed that in the event of an outage of transmission line 2.83L, transmission line 2.82L would experience a thermal overload of nine per cent in 2017 under summer peak loading conditions. The severity of this thermal overload would increase as time progresses and would Decision 21038-D01-2016 (June 1, 2016) 3
reach up to 42 per cent in the 20 year planning horizon as load in the area continues to grow. In addition, transmission line 2.83L would experience a thermal overload if there was an outage of transmission line 2.82L. 17. The AESO utilized a low-growth scenario because it determined that the 2014 Long-term Outlook overestimated the load growth potential for the downtown Calgary area. The AESO also utilized a sensitivity scenario that further decreased the expected load growth because of the recent historical peak load levels. The AESO stated that the constraints identified above would arise as early as the summer of 2017 using the low-growth scenario, but would not arise until the summer of 2021 when the sensitivity scenario is factored into the analysis. 18. In order to alleviate the identified constraint, the AESO considered two alternatives to expand and enhance the downtown Calgary transmission system. The AESO proposed one new 138-kV transmission circuit, with a minimum capacity in the order of 300 megavolt-ampere (MVA), between the ENMAX No. 2 and ENMAX No. 8 substations (the 138-kV option). The AESO also considered an alternative option of installing a 240-kV transmission circuit that would be initially energized at 138-kV but could be expanded to 240-kV in the future (the 240-kV option). 19. The AESO provided initial estimates that the 138-kV option would cost approximately $144 million (+/- 30 per cent, $2021) while the 240-kV option would cost approximately $148 million (+/- 30 per cent, $2021). These costs estimates included the cost to rebuild the ENMAX No. 8 substation to mitigate fault level issues within the substation. The AESO stated that the need to address rising fault levels was not part of this proceeding and that it was working with ENMAX to address this issue. The AESO filed a revised cost estimate of $101 million (+/- 30 per cent, $2021) for the 138-kV option and $106 million for the 240-kV option that did not include the cost to rebuild the ENMAX No. 8 substation. 20. To evaluate potential differences between the 138-kV option and the 240-kV option, the AESO directed ENMAX to prepare a report to consider the major aspects contemplated in Rule 007: Applications for Power Plants, Substations, Transmission Lines, Industrial System Designations and Hydro Developments 2 (Rule 007) NID requirement 13. This report compared agricultural, environmental and residential impacts of the two transmission development options. In preparing its report, ENMAX assumed that the transmission development would be constructed underground. The report concluded that there was no factor that would preclude the development of either option and there would be no difference in impacts between the two options. 21. The AESO s analysis indicated that the 138-kV option would provide sufficient capacity for the 20 year planning horizon and that the 240-kV option did not provide any additional advantages in improving system performance. However, the 138-kV option had a lower cost and, therefore, the AESO identified it as its preferred alternative. 22. The AESO consulted with ENMAX regarding the in-service date of the transmission development and determined that the earliest estimated in-service date would be in the first 2 Rule 007 effective on April 1, 2015 and replaced by Rule 007 effective on February 1, 2016. 4 Decision 21038-D01-2016 (June 1, 2016)
quarter of 2021. This would fall within the required in-service dates identified by the low-growth scenario and the sensitivity scenario. Accordingly, the AESO stated that it might be necessary to implement operational measures until the transmission development becomes operational. 23. The AESO conducted a participant involvement program to notify and provide information to stakeholders in the area where the AESO determined that the transmission facilities could be installed. The participant involvement program included mailing newsletters through unaddressed mail via postal code to occupants, residents, and landowners in its notification area. The AESO also held four open houses between September 8 and September 18, 2014. 24. Based on the results of its participant involvement program, the AESO submitted that it was not aware of any concerns or objections to the need for the transmission development. 3.2 Views of other parties 25. Mary Van Order is a resident of the East Village neighbourhood in Calgary. She submitted that above-ground transmission lines should not be located in the river valleys or parks so that they do not block views or impact the appearance and enjoyment of natural areas. 26. Ray Chow is a resident of the Ramsay neighbourhood in Calgary and requested that the Commission only consider underground solutions for the transmission development. He submitted that overhead transmission lines would have an unfavourable effect on residences, parks, and greenspaces, due to the visual impacts of the transmission line and structures. 27. Paul Featherstone submitted that the proposed development area is inappropriate to site a transmission line because it is predominantly residential neighbourhoods or river valleys. He added that the area indicated is broad in scope and quite vague as to the exact alignment. 28. Sara-Jane Gruetzner, on behalf of the Fort Calgary Preservation Society, submitted that the Commission should consider the importance of Fort Calgary to Calgary and the necessity to ensure the protection of the site, including the sub-surface artifacts and archaeology. The Fort Calgary Preservation Society argued that the Commission should consider the effects that the transmission line would have on Fort Calgary. It added that the AESO s application was very vague about the transmission line routing. 3 29. Anca Medesan is a resident of the Beltline area of Calgary. She stated that the air quality has degraded and the sulphur content in the air has increased since the time she began living in the neighbourhood 18 years ago. Further, the addition of a new 138-kV transmission line would be detrimental to the environment and to her health because it would result in additional coal generation which would cause an increase in air emissions including particulate matter, as well as mercury pollution. She also requested that the transmission line be constructed underground and shielded by an aluminum or copper mesh. 3 21038-X0022 Statement of intent to Participate, January 5, 2016. Decision 21038-D01-2016 (June 1, 2016) 5
30. ENMAX is the transmission facility operator in the service area. It requested that the Commission consider the application through a written process to allow parties the necessary time to file evidence and for the Commission to reach a decision in a reasonable amount of time. 31. ENMAX issued information requests to the AESO on March 30, 2016, regarding the potential for additional transmission development in the downtown Calgary area in the future and the costs and impacts of re-excavation in the downtown core. The AESO responded to ENMAX on April 13, 2016. By letter dated April 15, 2016, ENMAX stated that the information provided by the AESO had addressed its concerns. 32. The City of Calgary stated that the AESO did not consider any provisions, such as the installation of ducting, that would mitigate the impacts of future transmission development. Failure to consider future transmission development may result in further disturbance to roads and other public areas. The City of Calgary requested that the Commission direct the AESO to address the possibility of future capacity reinforcements in order to minimize disruption in the downtown Calgary area. 33. The AESO filed reply evidence to address the City of Calgary s evidence, where it submitted that: In exercising its legislated duty to plan the transmission system under sections 33 and 34 of the Electric Utilities Act, the AESO prepared and filed the NID, including engineering studies that assess the need for transmission capacity over the next 20 years. The NID demonstrates that there is currently no need for additional transmission capacity in the downtown Calgary area over and above the proposed transmission development for at least 20 years. In other words, the AESO s transmission system plans for the area do not require additional transmission capacity to be developed in the downtown Calgary area beyond what the AESO has already proposed. 4 34. The AESO added that even if future development is needed in the downtown Calgary area sometime after 2035, such future need may or may not benefit from the provision of ducts between the ENMAX No. 2 and ENMAX No. 8 substations. 35. The AESO submitted there was no evidence that the application is technically deficient or contrary to the public interest. 4 Findings 36. The Commission is satisfied that the NID application filed by the AESO contains all the information required by the Electric Utilities Act, the Transmission Regulation, and Rule 007. 37. The Commission finds that the participant involvement program undertaken by the AESO meets the requirements of Rule 007. The Commission has reviewed the AESO s participant involvement program materials and is also satisfied that they are sufficiently clear to 4 Exhibit 21038-X0045, May 11, 2016. 6 Decision 21038-D01-2016 (June 1, 2016)
communicate to parties the area where the transmission development infrastructure may be located. 38. Many of the parties concerns relate to the specific routing of the transmission line. Concerns such as visual impacts and site-specific impacts to properties are better considered at the facility application stage, when detailed routes have been determined. The Commission recognizes however, that in approving the application before it it is selecting a corridor within which future transmission line routes will be located and, in that sense, its decision will affect routing. Potential impacts that can be analyzed at a high level, such as environmental and residential impacts, must therefore be considered not only at the facility application stage, but also at this stage. 39. With respect to the transmission development s visual impacts, because ENMAX has stated that it anticipates that the transmission development would use underground infrastructure, the Commission considers that some of the site-specific concerns raised may be alleviated. 40. Based on the information filed, the Commission finds the NID to be acceptable from an environmental impact perspective. 41. The Commission finds that the 138-kV option provides an effective technical solution to satisfy the need for system enhancement. With respect to the 240-kV option, the Commission finds persuasive the AESO s submission that this alternative did not provide any additional advantage in improving system performance, compared to the 138-kV option. The Commission also considers the fact that the AESO s estimated cost of the 138-kV option is approximately $5 million less than the 240-kV option to be an important factor. 42. The Commission accepts the AESO s submission that for at least 20 years there is no need for additional transmission capacity in the downtown Calgary area beyond the transmission development. Consequently, the Commission finds that it is unnecessary to direct the AESO to address the possibility of future capacity requirements. 43. Based on the above considerations, no party has satisfied the Commission that the AESO s assessment of the need for the transmission development is technically deficient or that approval of the transmission development would not be in the public interest. 44. Therefore, the Commission considers the AESO s assessment of the need to be correct, in accordance with subsection 38(e) of the Transmission Regulation, and approves the AESO s NID application. Decision 21038-D01-2016 (June 1, 2016) 7
5 Decision 45. Pursuant to Section 34 of the Electric Utilities Act, the Commission approves the NID for the transmission development and grants the AESO the approval set out in Appendix 1 Downtown Calgary 138-kV Transmission System Reinforcement Approval 21038-D02-2016 June 1, 2016 (Appendix 1 will be distributed separately). Dated on June 1, 2016. Alberta Utilities Commission (original signed by) Anne Michaud Commission Member 8 Decision 21038-D01-2016 (June 1, 2016)