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Author: Ethan Howland       Published: 7/9/2024      Utility Dive

Electric power lines cross a scrubby desert with a mesa in the background.

The Federal Energy Regulatory Commission approved a plan on Friday to sell capacity on the $2.4 billion RioSol transmission project, set to run about 550 miles between New Mexico and Arizona.

FERC also granted Southwestern Power Group, or SWPG, the project’s developer, the right to sell capacity at negotiated rates on the roughly 1,600-MW merchant line, which would run next to the under-construction SunZia transmission line. SWPG sold the SunZia project to Pattern Energy in 2022.

SWPG, owned by MMR Group, is co-developing the 500-kV, alternating current project with the New Mexico Renewable Energy Transmission Authority. The project includes at least five substations along its route so power can be moved on and off the line.

SWPG hired Energy Strategies to run the solicitation process, which the company expects to start in the fourth quarter this year, according to FERC. SWPG plans to use customer commitments from the solicitation to finance the project, the agency said.

Pattern Energy Group subsidiary Pattern Renewables intends to participate in the solicitation, according to FERC.

Agua Fria Energy, an SWPG affiliate, is developing wind, solar and energy storage projects in New Mexico and Arizona and may also seek transmission service on the RioSol project by participating in the open solicitation process, according to FERC. If Agua Fria takes part in the solicitation, SWPG committed to showing the affiliate wasn’t given special treatment, the agency said.

Meanwhile, on Friday the California Independent System Operator asked FERC to approve an agreement that would allow the SunZia transmission project to be integrated into the grid operator’s interconnection and transmission planning process.

In May, the CAISO board approved SunZia Transmission’s application to become a “participating transmission owner” in the grid operator’s territory.

Pattern Energy’s SunZia subsidiary is building a 552-mile high-voltage, direct-current transmission project that is designed to connect up to 3,021 MW of wind generation in New Mexico, with 2,131 MW set for delivery to California via the Palo Verde substation, CAISO said. SunZia expects to energize the project in December 2025, according to the grid operator.

FERC okays NextEra Lake Erie capacity sale

Separately, on Monday FERC conditionally confirmed that capacity can still be sold on the Lake Erie Connector project between Canada and Pennsylvania at negotiated rates, even though the project was sold to a NextEra Energy subsidiary by an ITC Holdings subsidiary.

NextEra bought the project from ITC on Jan. 31, according to FERC. If built, the project will be operated by the PJM Interconnection.

The 1,000-MW, 72-mile merchant transmission project is slated to run between Nanticoke, Ontario, and Erie County, Pennsylvania, connecting the PJM and Ontario wholesale power markets, FERC said.