Southern Cross transmission route

Southern Cross Transmission Project Estimates $3.9 Billion Impact to Louisiana, Mississippi

Project will create access in the Southeast to cost-competitive renewable energy and offer significant economic and reliability benefits to the regional transmission systems

Pattern Energy Group LP has announced its affiliate's proposed Southern Cross Transmission project would provide significant economic benefits to the project areas within Louisiana and Mississippi, including $3.9 billion in total direct, indirect, induced and fiscal economic impact, according to a study conducted by Moss Adams LLP. The project will have wide-ranging short- and long-term benefits on the local area economies, the study found.

Economic Benefits
The Moss Adams study found the Southern Cross Transmission project would provide the following impact to Louisiana and Mississippi:

  • Produce nearly $1.5 billion of direct economic impact from expenditures incurred in development and construction
  • Generate $633 million of direct economic impact in local operations and maintenance expenditures over the first 30-year analysis period of the project
  • Produce $1.4 billion in indirect and induced impact
  • Generate $441 million in fiscal impact via property taxes across the two states over the first 30-year analysis period of the project
  • Create more than 650 jobs throughout the project's construction and continued operation
  • Benefit electricity consumers with reduced annual wholesale electricity cost

"The Southern Cross Transmission project would be the only project to connect low-cost renewable energy in Texas to the Southeast while also creating jobs and generating strong economic impact in both the southern states and Texas," said Mike Garland, CEO of Pattern Development. "The Southern Cross project will be one of the nation's first overhead HVDC transmission lines constructed in nearly two decades. When complete, the project will provide significant reliability and economic benefits by connecting two robust systems. All of the capital investment required for the project is being provided by private investors."

The Southern Cross Transmission project is a ±500 kV high-voltage direct-current (HVDC) transmission line with a base load capacity of 2,000 MW (delivered in either direction after losses) that will link abundant and cost-competitive wind energy in Texas to the transmission grid and customers in the Southeast. The benefits of the project to both regions include the production and utilization of additional renewable energy, economic development, regional power market economic benefit, and increased electrical reliability through providing access to the diverse generation resources in each region. The project is expected to start construction in 2018 and begin delivering power in 2021.

The Moss Adams study concluded that Southern Cross Transmission is expected to generate a direct economic impact over 30 years of about $1.05 billion in Mississippi and $1.05 billion in Louisiana excluding the benefit to the Southeast of low cost wind power from Texas.  The direct economic impact included the cost incurred during development, construction, and operation of the project.  In addition, the indirect and induced impact of $1.4 billion are a result of additional economic activities resulting from the Project. The study found the project would generate annual average property tax payments of approximately $14.7 million, including $6.5 million in Louisiana and $8.2 million in Mississippi each year — totaling $441 million in property taxes in both states over 30 years. The study concluded the project would generate $3.9 billion in total direct, indirect, induced and fiscal economic impact across the two-state study area. 

The Moss Adams study does not include additional fiscal benefits from sales and use taxes, state income taxes, or the benefits of system impact resulting from the introduction of low-cost wind energy into the Southeast region of the U.S.

Project employment during the peak of the construction phase is anticipated to exceed 650 jobs, the study found. Southern Cross Transmission will hire locally whenever possible. Over the past month, Pattern Development has held vendor fairs in Louisiana and Mississippi to identify local vendors and contractors that are interested in participating.

Pattern Development has extensive experience in developing innovative solutions to complex transmission problems. Pattern Development's team of transmission experts has developed previous transmission projects, including the Trans Bay Cable project under San Francisco Bay.  The Trans Bay Cable project is a groundbreaking submarine HVDC transmission line that was completed in 2010 and is presently serving up to 40% of San Francisco's and the northern peninsula's peak energy needs.

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