14  EnErgyBiz magazinE  March/April 2007

our Takeletters

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Jose Delgado is president and CEO of American Transmission Co. He was recently elected chairman of the Transmission Owners and Operators Forum of North American Electric Reliability Corp. and is co-chair of Edison Electric Institute’s CEO task force on electric system reliability.

aTCThe American Transmission Co. owns and operates 9,100 miles of transmission line and 480 substations in portions of Wisconsin, Michigan, Minnesota and Illinois.

uPgRADIng THe quAlITY of operations across a massive transmission system will require significant efforts in two general areas. The industry must improve its practices, methods, procedures and tools to achieve widespread improvements in security. It must upgrade existing facilities and build needed transmission lines.

The north American electric Reliability Corp. now provides a venue for establishing and spreading best practices in transmission operations. However, the indus-try must rebuild and expand the grid to meet growing customer needs.

Transmission owners face many challenges in strengthening the transmission grid and two of them are critical. The first is to make a clear, understandable case to public officials, regulators and local citizens for the needs and benefits justifying a project. The second is to establish a “line-of-sight” connection between those who benefit and those who are going to pay for the project. Both challenges call for an ongoing engagement with the public, public officials and regulators. This calls for skills that frankly are seldom found among utility employees and often must be obtained elsewhere.

As anyone involved in power line siting can tell you, those who will benefit from a project will generally, with adequate facts and time to digest them, accede to tolerat-ing the construction and bearing its cost. It essentially becomes a matter of communication. However, if those who must bear the impact — either of the costs or the physical presence, or both — of the line do not perceive that they receive some commensurate benefit, then transmission proponents face a determined opposition in public decision-making processes.

Cost allocation that significantly dilutes the tie between those who pay and those who benefit tends to pit state regulators against each other as they seek to avoid retail rate increases caused by transmission construction too remote to bring an obvious benefit to the in-state consumer. The situation only gets worse as the area affected by the price averaging gets bigger.

Public utilities and regulatory agencies together must agree on a cost-allocation mechanism that identifies those who benefit across state and company jurisdictions and allocates the costs to them equitably.

To the extent that cost-allocation mechanisms move away from assigning the costs to the obvious beneficia-ries of a project, they will become an awesome impedi-ment to the construction of transmission projects.

It is imperative for transmission owners to con-tinuously engage the public in a meaningful way. landowners, local officials, environmental organizations,

neighborhood groups, and conservation and renewable energy advocates must be directly and consistently engaged in the conversation about needs and siting. This approach builds a track record and ultimately a reputation that makes siting a regular process rather than a sudden obstacle. In today’s environment, these efforts are vital not only to corporate reputation, but also to the successful construction of the proposed facilities. The marketing skills used by candidates for public office in political cam-paigns are ideally suited for this purpose. We are electing poles and wires to public office.

ATC’s narrowly constrained service area is bounded on two sides by great lakes. Since our formation in 2001, we have built or upgraded more than 800 miles of line in a heavily regulated environment. A continuous public discussion about what we’re doing and why, along with clear ties between local needs and benefits have been important components of our success.

By José Delgado

Meeting Challenges

chinasOLar

A leading solar power company based in Changzhou, China, has signed a long-term supply agreement with Wacker Polysilicon, the polysilicon division of Wacker Chemie.

Under the agreement, Wacker has agreed to supply Trina Solar with high purity polysilicon over a six-year period beginning in 2009, enabling Trina Solar to produce more than 150 megawatts of solar modules.

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