Clean Line Signs Pact With Paris-based Manufacturer To Support Wind Energy Project

A French manufacturer plans to set up shop in West Memphis to supply glass insulators for a multi-state renewable energy project that is expected to deliver wind powered electricity from Oklahoma to markets in Arkansas and other southern states.

Executives with Clean Line Energy Partners LLC and the Paris-based Seves Group announced the agreement Monday between their respective subsidiaries, Plains & Eastern Clean Line and Sediver, at a signing ceremony in West Memphis.

The deal is another step in the extended progression of the so-called Clean Line project – an electric transmission line project that officials say will deliver up to 3,500 megawatts (MW) of wind power from the Oklahoma Panhandle region to communities in Arkansas, Tennessee and other states in the Mid-South and Southeast.

The pact signed on Monday calls for Sediver to build and operate a manufacturing facility and test lab in West Memphis that will make high voltage electrical insulators and glass blocks for use in electricity lines, substations and other power grid applications.

“We are thrilled that, at our request, Sediver is opening a manufacturing plant in Arkansas and will be supplying the insulators for our Plains & Eastern Clean Line. This agreement furthers our commitment to purchase as many of the needed materials and services as possible from local companies in the Plains & Eastern Clean Line project area,” said Clean Line President Michael Skelly. “This project will propel Arkansas forward by bringing new manufacturing and construction jobs and a low-cost renewable energy to the Natural State for years to come.”

For its part, Sediver’s Arkansas operations will employ more than 70 workers when the manufacturing facility comes online in late 2016, company officials said.

“We are excited to be back in the United States and to be able to contribute to cutting edge renewable energy infrastructure projects like the Plains & Eastern Clean Line,” said Rene Tabouret, CEO of Sediver. “We selected West Memphis for our new assembly plant and testing laboratory to serve the Plains & Eastern Clean Line, along with other American utilities, and the global transmission and distribution industry.”

Both Sediver and Clean Line officials said that the West Memphis facility is positioned to serve other utilities across the country. In past few years, the French manufacturer has restructured its core businesses to strengthen its global reach and return operations to the U.S., where it has maintained “a sustained double-digit growth over the last five years,” company officials said.

HOLDING PATTERN
Besides the Sediver agreement, Clean Line said it also has a pact with General Cable in Malvern to manufacture conductor parts for the project. That agreement has been in place since in 2011, but the Malvern plant is still waiting to begin production as the multi-state project continues to move through necessary state and federal regulatory and permitting approvals.

Clean Line’s commitment to purchase all of the insulators and conductors for the transmission project from the West Memphis and Malvern manufacturers represents more than $160 million in projected procurements for Arkansas-made products, company officials said.

The Clean Line project has been in the works now well over five years. In May 2010, Plains and Eastern Clean Line filed an application with the Arkansas Public Service Commission to become a public utility in Arkansas as a first step in the development of the multi-state transmission project.

In 2011, the Arkansas PSC denied Clean Line’s application without prejudice and cited the language of the relevant statutes limiting the jurisdiction of the PSC. However, the order recognized the importance of transmission infrastructure to facilitate the delivery of renewable energy and praised Clean Line’s efforts as “laudable and its work is to be commended.”

In August, Plains and Eastern Clean Line LLC obtained regulatory approval from the Federal Energy Regulatory Commission (FERC) to sell transmission service to customers at negotiated rates and to negotiate bilateral agreements for 100% of the line’s capacity.

In addition, Clean Line has proposed an intermediate delivery converter station in Central Arkansas that would have the capacity to deliver up to 500 MW of power, but that has yet to receive regulatory approval.

When first announced, Clean Line officials said the project would take five to seven years to complete and cost nearly $3.5 billion. Clean Line has said it expects to fund all development costs, but does not plan to seek cost recovery through the electric rates paid by consumers in the state.

While supporters of the project tout its environmental upside – the transmission of wind energy, opponents are fighting it in part due to the eminent domain issues related to land acquisition for the project.

If built, the project will enable an additional $12 billion in investments in new wind projects which today cannot be built because of the lack of transmission, officials have said. Those projects could possibly power over 2.1 million American homes, they said.

Based on current estimates, company officials said the project is expected to begin construction as early as 2016. Under that scenario, it could be commercially operational as early as 2018.

ALTERNATIVE ENERGY
The Clean Line project was one of the first full-scale renewable energy projects that will affect Arkansas power consumers in the next decade. The Arkansas Electric Cooperative Corp. (AECC) has also recently inked several long-term agreements to bring Oklahoma-based wind power to Arkansas.

The latest came in May when the Arkansas electric cooperation said it was purchasing 108 megawatts of wind energy from the planned Drift Sand Wind Farm, located 60 miles southeast of Oklahoma City. It is scheduled to be in service by Dec. 31, 2016.

There have also been major developments in the area of solar energy in Arkansas. Last week, Silicon Ranch Corp. began construction on a 12-megawatt (MW) solar energy project planned for the Highland Industrial Park in East Camden. The South Arkansas solar facility, which officials said will support between 250 and 350 direct and indirect jobs, is expected to come online in late 2015.

In April, Entergy Arkansas announced plans to build an 81-megawatt photovoltaic solar energy generating facility in Arkansas County. That emissions-free solar energy facility is not expected to be connected to Entergy Arkansas’ transmission grid until the end of the decade.