Cost of Artificial Island power line doubles to $272M
The proposed cost for a new power line connecting the Artificial Island nuclear complex to Delaware has nearly doubled to $272 million, an expense that many state electricity customers will end up paying.
“Delaware’s ratepayers will be paying 99 percent of the cost … for New Jersey’s ratepayers,” said Delaware Public Advocate David Bonar.
PJM, an Audubon, Pennsylvania-based operator of electronic power systems throughout the Midwest and East Coast, is overseeing the construction of a transmission line across the Delaware River connecting Artificial Island to the First State. The 230-kilovolt power line is part of a stability fix for Artificial Island – home to both the Salem and Hope Creek nuclear plants – that is expected to improve reliability and increase the plant’s power output.
Initially, PJM estimated the transmission line would cost $137 million, but last month a company executive told the Transmission Expansion Advisory Committee its price tag is now $272 million. The additional $135 million will be added to the cost of other upgrades at Artificial Island, increasing the project’s costs from $280 million to more than $400 million.
Costs for the overall project, including the transmission line, will be borne by Delaware’s residential, commercial and industrial consumers, including customers of Public Service Electric & Gas and Delmarva Power & Light, operated by Pepco Holdings.
In a filing with the Federal Energy Regulatory Commission, the Delaware Public Service Commission said that only 10 percent of the project’s benefits would go to Delaware customers. The DPSC predicted the costs would add a few extra dollars per month to residential customers’ bills, but could cause “hundreds of thousands” in additional payments for businesses and other industrial customers.
“Delaware ratepayers don’t deserve to be footing the bill,” Bonar said. “We think that it is inherently unfair.”
Bonar is not the only state official outraged over the project’s cost increases and proposed rate increases. Gov. Jack Markell has spoken out against the transmission line cost increase. A spokesman for the governor, Johnathon Dworkin, said in a statement the transmission line costs “unfairly subjected Delmarva ratepayers to almost 90 percent of the costs of the project, even though Delmarva residents would not receive the majority of the benefits.”
Dworkin said the cost of the overall project would be shared more equitably, but conceded there are still reasons to be concerned.
“The governor has reached out to PJM to share his concerns with the project moving forward,” he said in an email.
Artificial Island is co-owned by PSE&G and Exelon, the parent of Delmarva Power. The plant provides power largely to New Jersey customers.
“Part of the project is located in Delaware waters, and part of it will be in a tiny portion of Delaware, but none of it will benefit Delaware ratepayers,” Bonar said. “It will be primarily benefiting New Jersey ratepayers.”
PJM spokeswoman Paula DuPont said the company is working with PSE&G to identify cost reduction opportunities.
“The PJM estimated cost was prepared without the knowledge of specific site conditions at Artificial Island that have substantially increased the projected cost,” DuPont said in an e-mail. “Despite the cost increase and the difficulty of construction at an operating nuclear power plant, PJM staff believes the project is the best solution to address the issues.”
New York-based LS Power, the company selected to build the transmission line, returned requests for comment. Nicholas Morici, a spokesman for Delmarva Power, declined to comment.