Electricity Transmission Line – International Power Line
In this NEB decision, the NEB found that the Lake Erie Connector international power line project (the “Project”) to be in the public interest and to be required by the present and future public convenience and necessity. Subject to Governor in Council (“GC”) approval, the NEB directed that a Certificate of Public Convenience and Necessity (“CPCN”) be issued for the Project.
Project and Application Overview
On May 22, 2015, ITC Lake Erie filed an application under section 58.16 of Part III.1 of the National Energy Board Act (the “NEB Act”) requesting a CPCN for the Project.
The proposed Project is a transmission line for the transfer of electricity between Nanticoke, Haldimand County, Ontario and Erie County, Pennsylvania, United States. The proposed route includes a crossing of Lake Erie. The Project consists of:
• approximately 117 kilometre 1,000 megawatt (“MW”) ±320 kilovolt high-voltage direct current (“HVDC”) bi-directional electric transmission interconnection;
• a total of 48.1 km length for the Canadian portion of the Project, which includes 46.8 km constructed under the lakebed of Lake Erie; and
• two HVDC converter stations and AC lines to connect to the existing electricity grid.
ITC Lake Erie estimates the capital cost of the project to be about $1 billion USD. The Canadian portion of the Project is estimated to cost $543,536,066 CAD.
The Project will connect the Ontario electric system, managed by Ontario’s Independent Electricity System Operator (the “IESO”), to the US mid-Atlantic and Midwest (the “PJM System”). The proposed Project is proposed as a merchant line that will be supported by commitment from transmission customers who will purchase capacity on the line. ITC Lake Erie submitted that neither Ontario nor PJM System customers will be required to support any costs for the construction, operation, or maintenance of the Project.
Economic Feasibility and Need for Project
The NEB explained that in making its determination on the economic feasibility of a proposed international power line (“IPL”) and related facilities, it assesses the need for the IPL and the likelihood of the IPL being used at a reasonable level over its economic life. The NEB Board considers evidence regarding the supply of electricity that will be available to be transported on the IPL, any transmission contracts underpinning the IPL, and the availability of adequate markets to receive electricity delivered by the IPL.
With respect to the need for the Project, the NEB held that:
• the Project would improve power system reliability and trade efficiency between the Ontario and the PJM System;
• the Project is responding to market need; and
• the applicant had demonstrated sufficient benefits to the power system and economic efficiency.
Impact to System Reliability
The NEB went on to assess the Project’s impact on reliability of the Ontario electric system and on neighbouring jurisdictions. Specifically, in relation to the Project’s impact on reliability, the NEB considered whether:
• the elements in the electric system remain within their thermal limit;
• the system voltage remains within its limits in steady state for pre- and post-contingency conditions;
• there is transient stability in the system so that it remains stable following a major disturbance;
• the short-circuit levels remain within the system’s acceptable levels; and
• the incorporation of the project would have an impact on congestion.
The NEB also considered the Project’s impact on tie lines between Ontario and Manitoba.
As part of the application, ITC Lake Erie submitted a comprehensive System Impact Assessment (“SIA”), on which the NEB relied in assessing the Project’s impact on the Ontario system and neighbouring systems.
The NEB noted that the Project provides a direct HVDC connection between Ontario and the PJM System. The NEB found that enhancing the number of transmission facilities in the region enhances adequacy, a paramount aspect of reliability.
With respect to security, the NEB noted that the SIA indicated that the incorporation of the Project into the existing electric power system would not yield any thermal or voltage violations, would not affect the stability of the electric system during transient conditions nor would the short circuit level increase significantly.
The NEB was satisfied with the SIA’s assessment regarding security. Specifically, the SIA indicated that the incorporation of the Project into the existing electric power system would not compromise security.
The NEB held that it was satisfied the Project would not compromise the transmission of electric power among neighbouring jurisdictions.
Impact to Manitoba System
Manitoba Hydro raised concerns that there was a lack of consultation by the IESO in conducting the SIA.
The NEB held that the IESO, as the system operator for the area affected by the Project, was best placed to evaluate the impacts on the overall system, including impacts on neighbouring jurisdictions. The NEB also noted that the IESO is obligated by its statutory responsibilities to consider the impact of any project in Ontario over the tie lines that connect Ontario with neighbouring jurisdictions.
The NEB held that the SIA and other technical analysis had sufficient depth and breadth to reasonably demonstrate that the Project would have a marginal impact on the Manitoba and Minnesota tie lines.
Aboriginal Matters: Enhanced Aboriginal Engagement Process
The NEB explained that, through provision of its Enhanced Aboriginal Engagement (“EAE:”) process, the Board encourages Aboriginal groups to engage with the applicant so that their interests and concerns are identified early, considered by the applicant, and potentially resolved before the application is filed. The NEB noted that the applicant is often in the best position to respond to such concerns.
The NEB explained that its Enhanced Aboriginal Engagement (“EAE”) process is intended to assist Aboriginal groups to understand the NEB’s regulatory process and how to participate in it. The EAE process involves proactive contact by the NEB and project proponents with Aboriginal groups who may be affected by a proposed project. Aboriginal groups engaged through the EAE process include, but are not limited to, those groups that have publicly claimed or asserted the right to use the land in the Project area for traditional uses.
The NEB reviews the completeness of the list of potentially affected Aboriginal groups identified by a project applicant. The NEB may identify other groups who may be potentially impacted by the proposed project. The NEB’s list of groups is sent to the Government of Canada’s Major Projects Management Office (“MPMO”) or Natural Resources Canada (NRCan), and if applicable the list is updated. This list is called the Crown List.
The NEB sends a letter package which includes a summary of the project and how to obtain more information, to each potentially affected Aboriginal group on the Crown List. After issuing the letter package, NEB staff follow up with phone calls to each of the Aboriginal groups to confirm receipt, respond to questions Aboriginal groups may have, and arrange information meetings on request.
ITC Lake Erie Aboriginal Engagement
ITC Lake Erie submitted that its initial early engagement activities took place in August and September of 2013 with the two Aboriginal groups in the immediate vicinity of the proposed project. Those groups were the Mississaugas of the New Credit First Nation (“MNCFN”) and Six Nations of the Grand River (“Six Nations”).
The MNCFN and Six Nations supported the Project and noted that they both continue to engage with ITC Lake Erie on all aspects of the Project.
The MNCFN and Six Nations stated that they were satisfied with the consultation process. Both groups expressed interest in assessing the skilled trade opportunities and other potential economic development opportunities resulting from the Project. Neither the MNCFN nor the Six Nations filed an application to participate in the hearing.
Land and Environmental Matters
The NEB found that fish mortality could result from the trenching/blasting and jet plow/water jetting conducted for the in-water part of the Project. However, the NEB held that given the proposed mitigation measures, direct mortality, if any, associated with these activities would likely be limited to a few individuals. The NEB found that therefore, the magnitude of residual effects is anticipated to be low and the Project is not expected to result in effects to aquatic Species At Risk.
Fish habitat alteration could result from trenching/blasting and jet plow/water jetting. However, the NEB held that the use of hydraulic direction drilling at the shoreline would result in minimal impacts to fish habitat (the small area of the exit/receiving pit, and small area of excavated sump pit). The NEB found that any fish habitat impacted by the Project is low-quality fish habitat, and the alteration of such habitat would be of low magnitude, temporary, and reversible.
Cumulative Effects
The NEB also assessed the potential cumulative effects of the projects. The NEB defines cumulative effects as “adverse residual effects associated with the Project in combination with residual effects from other projects and activities that have been or will be carried out, within the appropriate temporal and spatial boundaries and ecological context.”
The NEB listed the following categories of potential residual effects of the Project, including:
• physical elements – physical environment, soil and soil productivity, water and water quality, air emissions, greenhouse gas (“GHG”) emissions, and acoustic environment;
• Biological elements – vegetation, aquatic species and habitat, wildlife and wildlife habitat, and species at risk; and
• Socio-economic elements – human health, employment and economy, and acoustic environment.
The NEB determined that most adverse environmental effects would be minor in nature and mostly limited to the construction period. The NEB found that these would likely be low in magnitude and their contribution to cumulative effects would be minor.
The NEB held that overall, with the implementation of ITC Lake Erie’s environmental protection procedures and mitigation and the NEB’s conditions, the Project is not likely to cause significant adverse environmental effects.
