Vermont Electric Power Company (VELCO) has entered into an agreement with TDI-New England that could reduce transmission costs paid by Vermont electric ratepayers. The agreement is contingent on TDI-NE’s successfully completing its New England Clean Power Link Project (Project), a 1,000-MW High Voltage Direct Current (HVDC) transmission line with in-state impacts that extend from Alburgh to Ludlow, where it will connect to the transmission grid at VELCO’s Coolidge substation. If the Project is completed, VELCO would receive annual payments at an initial rate of $2.5 million a year escalating at 1.5% for the 40-year life of the project for a total of $136 million in reduced transmission costs that would otherwise have to be paid by Vermont electric ratepayers.
VELCO believes this agreement secures substantial risk-adjusted value for Vermont electric customers in the event the Project is approved and constructed. The company’s ownership and tariffs are designed to achieve cooperative objectives through a for-profit corporate structure, and this agreement leverages VELCO’s ability to serve as the single, most cost-effective mechanism for efficiently delivering the greatest economic benefit to every ratepayer in the state.
Other features of the agreement
• Maintains VELCO’s independence in evaluating the Project’s technical merits and grid impacts.
• Does not obligate the company to support the Project in regulatory processes or public forums.
• Is non-exclusive and thus ensures VELCO’s ability to enter into agreements with other transmission developers.
• Provides that the Company’s costs of developing and administering the agreement will be paid for by TDI-NE.
The agreement further establishes a preference for VELCO to provide operation and maintenance services for the new facility if it is constructed.