AEA to purchase critical transmission line

Alan Bailey

for Petroleum News

On Aug. 5 the board of the Alaska Energy Authority approved AEA’s proposed purchase of the 39.3-mile electricity transmission line between the Sterling Substation and Quartz Creek on the Kenai Peninsula. And on the same day the Alaska Industrial Development and Export Authority board approved the use of up to $16 million in Sustainable Energy Transmission and Supply, or SETS, bonds in the financing of the purchase.

Currently owned by Homer Electric Association, the transmission line is critically important for the shipment of power from the Bradley Lake hydroelectric plant in the southern Kenai Peninsula to electric utilities elsewhere on the Alaska Railbelt electricity system. Tariffs for the shipment of Bradley Lake power through the line are set by the committee that oversees the operation of the Bradley Lake Project by Homer Electric. AEA owns the project. The purchase of the transmission line will place the line within the project, thus ending some litigation between HEA and other Railbelt utilities regarding energy delivery issues, AIDEA says.

AEA Executive Director Curtis Thayer commented that the six Railbelt utilities had worked cooperatively to ameliorate the situation following damage to the transmission line caused by the Kenai Peninsula Swan Lake Fire in the summer of 2019.

“I would like to extend my thanks to all the participating utilities and their efforts by working together for the benefit of Alaska ratepayers in Southcentral and on the Railbelt,” said AEA Board Chair Dana Pruhs.

AEA said that benefits from the transaction will include better cost alignment and increased line reliability, with the prospect of future line upgrades for reducing line losses and allowing the increased transmission of Bradley power.

The agency anticipates that the purchase will close in the fourth quarter of this year.

- ALAN BAILEY