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Regulator Approves Canadian End of 72-Mile Clean Power Tie With U.S.

A mothballed Ontario coal-fired power station would turn into the northern end of a new transmission link intended to increase traffic in renewable energy between Canada and the United States under a project endorsement awarded Thursday.

ITC Holdings Corp. received approval from the National Energy Board (NEB) for the Canadian side of the proposed US$1 billion Lake Erie Connector. The wire is scheduled to go live by fourth quarter 2020 after two years of construction.

The 117-kilometer (72-mile), reversible conduit for 1,000 MW is a high-voltage direct current (HVDC) line that will be laid across the bottom of Lake Erie between the shuttered Nanticoke plant in southern Ontario and northern Pennsylvania.

The power flow is expected to be mostly exports from Ontario to the PJM Interconnection service area of 13 mid-Atlantic and Midwestern states plus the District of Columbia. But the plan includes flexibility for Ontario power imports from the United States.

At its peak, the 45-year-old Nanticoke complex stood out as North America’s largest coal-fired power station by burning mountains of imported U.S. fuel as well as domestic supplies to run eight steam-driven generators at full capacity of 4,000 MW. The site has high-capacity connections with the Ontario transmission grid, enabling the Lake Erie Connector to tap into high levels of supply from all sources.

Under the Ontario government’s policy of replacing coal-burning hardware with wind, hydroelectric and nuclear power, half of the Nanticoke generators have been dismantled. The remaining four have remained on mostly inactive standby in case of power system emergencies and are slated for demolition at a time still to be announced. Thermal power generation, using cleaner-burning natural gas, has been cut to a modest minority of Ontario electricity.

In the Canadian regulatory review of the Lake Erie Connector, NEB was told PJM faces steadily increasing requirements to supply clean, green power under state policies in its service territory as well as contested U.S. federal plans to cut coal use.

The new link will also cut power transaction costs by more than 50% to US$7.00 per megawatt hour from US$15.20/MWh, NEB was told. The underwater connection would be a merchant line, paid for by its sponsors and users rather than tacked onto regulated consumer power bills.

The NEB approval covers the C$543 million (US$407 million) Canadian side of the project as far as the international boundary line on Lake Erie. ITC predicted that U.S. approvals would be obtained by mid-20117 for the larger U.S. portion.

“The project would improve power system reliability and trade efficiency,” the NEB ruling said. “Both Ontario and PJM trade large amounts of electricity. Both markets are expected to periodically generate surplus electricity or rely on imports depending on seasonal variations in electricity generation and demand and the availability of specific generation options, among other factors.”

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