PGE joins Grid United and ALLETE in 3,000 megawatt east-west transmission line
Portland General Electric (PGE) has signed a non-binding memorandum of understanding with Grid United and ALLETE for the development of the North Plains Connector, a 415-mile high-voltage direct-current (HVDC) transmission line. This line will connect Bismarck, North Dakota, and Colstrip, Montana, and double the transfer capacity between the eastern and western U.S. electric grids. PGE is expected to hold a 20% ownership share and gain 600 megawatts of transfer capacity. The project aims to provide access to renewable energy, reduce congestion, and enhance wholesale markets. The estimated $3.2 billion investment will create over 600 jobs during construction.
- PGE to gain 600 megawatts of transfer capacity.
- Project expected to reduce transmission congestion.
- Enhanced access to renewable energy resources.
- Estimated $3.2 billion investment in Montana and North Dakota.
- Creation of over 600 jobs during construction.
- Increased flexibility and resource sharing across multiple time zones.
- First HVDC transmission connection among three regional U.S. electric markets.
- PGE's investment depends on regulatory approvals and permits.
- Potential financial risks associated with a $3.2 billion investment.
- Non-binding agreement; definitive terms yet to be finalized.
Insights
The North Plains Connector is a significant infrastructure project that aims to enhance the U.S. electric grid's resiliency by linking three regional markets. The additional 3,000 megawatts of capacity and 415 miles of HVDC lines will provide PGE with access to renewable energy sources and diversify its energy portfolio. This project is crucial, as it addresses transmission congestion, a significant issue in the current energy landscape.
From a business perspective, this development allows PGE to tap into renewable energy across broader geographies, thus potentially lowering the cost of energy for consumers and increasing reliability. Importantly, this aligns with increasing environmental mandates and consumer demand for clean energy.
Short-term implications include the regulatory hurdles and the approval process, which could impact timelines and potentially delay benefits. Long-term, however, the North Plains Connector could substantially improve PGE's market position by enhancing its infrastructure, thereby fostering growth and stability.
The announced $3.2 billion investment speaks volumes about the scale and ambition of the North Plains Connector project. For PGE, a 20% ownership translates to a substantial financial commitment. Assuming the project is approved and progresses as planned, this could be a profitable long-term investment. The potential to alleviate transmission congestion and access diverse energy resources is a clear economic advantage. However, the key risks lie in the regulatory approval process and the ability to manage such a large-scale investment without incurring unsustainable debt levels.
For investors, understanding the funding commitments and expected returns is critical. PGE's participation suggests confidence in the project's viability and expected economic returns. Yet, one must remain cautious about the impact on the company's balance sheet and potential shifts in cash flow. This project represents a strategic long-term play to bolster market position and infrastructure.
The North Plains Connector transmission line will more than double the transfer capacity between the eastern and western
The North Plains Connector will be the nation's first HVDC transmission connection among three regional U.S. electric energy markets - the Midcontinent Independent System Operator, the Western Interconnection and the Southwest Power Pool - providing additional flexibility and the sharing of resources across multiple time zones.
"The North Plains Connector is a key step in serving the growing needs of customers with safe, reliable, clean energy through joint collaboration," said Maria Pope, PGE President and CEO. "Additional transmission capacity will provide access to renewable energy over a wider and diverse geographic area, helping to deliver economic and environmental benefits."
The North Plains Connector is one of the ways PGE is working collaboratively across the region to find solutions to nationwide transmission congestion. The electric transmission infrastructure would provide PGE with 600 megawatts of transfer capacity, access to diverse energy resources, enhanced wholesale markets and ease congestion on the existing western transmission system.
"We welcome PGE joining us in our efforts on this historic and transformative infrastructure project for our nation," said Bethany Owen, ALLETE Chair, President and CEO. "Large-scale projects require collaborative solutions. We look forward to working with PGE and their strong team to advance this critical project."
"We are thrilled to move forward with PGE on the development of the North Plains Connector," said Michael Skelly, CEO of Grid United. "Countless studies have shown that interregional transmission dramatically enhances reliability, saves consumers money and is critical to meeting the growing demand for electricity."
The project represents an approximately
Additional information can be found at www.northplainsconnector.com
Under the terms of the memorandum of understanding, Grid United will continue to fund the development of North Plains Connector. PGE would invest when project regulatory approvals and permits are in place.
About Portland General Electric
Portland General Electric (NYSE: POR) is an integrated energy company that generates, transmits and distributes electricity to over 930,000 customers serving an area of 1.9 million Oregonians. For more than 130 years, Portland General Electric (PGE) has powered social progress, delivering safe, affordable, reliable and increasingly clean electricity while working to transform energy systems to meet evolving customer needs. PGE customers have set the standard for prioritizing clean energy with the No. 1 voluntary renewable energy program in the country. PGE is committed to reducing emissions from its retail power supply by
Statements in this news release that relate to future plans, objectives, expectations, performance, events and the like may constitute forward-looking statements. Any forward-looking statements are subject to risks and uncertainties, and actual results may differ materially from those projected in the forward-looking statements. Investors should review the risks, assumptions and uncertainties listed in the documents filed by Portland General Electric with the United States Securities and Exchange Commission.
For media inquiries contact:
PGE Communications
503-464-2067
pgecommunications@pgn.com
About Grid United
Grid United is an independent transmission company aiming to modernize
Media contact:
Ashley McGeary, Communications Director
ashley.mcgeary@gridunited.com
About ALLETE
ALLETE, Inc. is an energy company headquartered in
ALE-CORP The statements contained in this release and statements that ALLETE may make orally in connection with this release that are not historical facts, are forward-looking statements. Actual results may differ materially from those projected in the forward-looking statements. These forward-looking statements involve risks and uncertainties and investors are directed to the risks discussed in documents filed by ALLETE with the Securities and Exchange Commission.
Media Contact:
Amy
218-723-7400
arutledge@allete.com
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SOURCE Portland General Company
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