Executive Q&A: Clean Line Senior Vice President Wayne Galli

Executives with Clean Line Energy Partners LLC and the Paris-based Seves Group recently announced a deal to locate a glass insulator manufacturing plant in West Memphis that would support a multi-state wind power project that has been in the works since 2010.

The deal is another step in the extended progression of the so-called Clean Line project – a $2 billion electric transmission line privately-financed venture 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.

When first announced, Clean Line officials said the project would take five to seven years to complete. The Houston-based renewable energy group has also 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.

More recently, the U.S. Department of Energy published a Notice of Application for the project requesting public comment on Clean Line’s application and supporting materials that was to end on June 12. At the behest of Arkansas’ congressional delegation, the DOE extended the deadline for public comments to July 13.

Talk Business & Politics Business Editor Wesley Brown recently sat down for an extended interview with Wayne Galli, Clean Line Executive Vice President of Transmission and Technical Services, to talk about the controversial project and Clean Line’s hopes to begin construction on by 2017. Here are a few excerpts from that interview:

TB&P: The Clean Line was first originally expected to take five to seven years to complete. What is the project timetable now, as you await environmental approvals from the federal government?

Wayne Galli: Obviously, permitting a multi-state project line like Clean Line is a challenge. We are in the middle of a federal environmental review process right now. The draft EIS (Environmental Impact Statement) has been published along with alternative analysis of the potential environment affects with the Department of Energy (DOE), in concert with all the local and state agencies. The first comment period on that is closed, and the comment on part two of that application closes on July 13. We expect that by the end of the year, we will have a final environmental impact study as published by the DOE. That will be the final major regulatory hurdle before we can start construction.

Right now, our goal and our target is to proceed in 2017 with construction and completion sometime in 2019.

TB&P: You’ve have mentioned that Clean Line has met with over 500 stakeholders at meetings in Arkansas and Oklahoma, including landowners and grassroots groups who wish to block the project. Has there been any progress?

Galli: With any infrastructure project, we have a belief that there is a big reservoir of support. But obviously, there is always opposition to projects …, but we really have a modus operandi of continuous outreach and very open communication – more than any other company that I have ever worked for. Our best laid efforts have been to go out and talk to landowners on a one-on-one basis and go above and beyond in terms of what is required in holding public meetings.

We also believe we have a very attracted compensation package, (but) ultimately our goal is to have an agreement with each and every landowner that we are dealing with.

TB&P: What about eminent domain?

Galli: As in any linear infrastructure, whether it is water pipes, natural gas, liquids or transmission lines, in order to (transport) it to market we have to have sovereign interest. Our goal as a company is to exercise “zero cases of eminent domain.” The reality is there are parcels (of land) out there that are in probate or you can’t get in contact with the landowner. But, again, the goal is zero eminent domain.

TB&P: What can you tell the people of Arkansas about this project? Why is in important to Arkansas and what are the benefits to the state?

Galli: First, in the short term, the direct impact in our relationship with Sediver (in West Memphis) and bringing them to the state and our first prior relationship with General Cable (in Malvern), we will be purchasing more than $160 million in components directly from Arkansans. Longer term, Arkansas will benefit from low cost energy that we will be bringing to the state, as well as continued ad valorem taxes north of $5 million a year to the 12 counties where distribution and transmission lines are located.

Those are two major ways this project with impact Arkansas, but there will also be a lot of ongoing maintenance that ends to be needed from local labor. You don’t want to import someone from out of state to maintain your right of ways. It makes sense to use local labor and resources.

TB&P: Is there a scenario the Clean Line project doesn’t happen?

Galli: Look, I believe in this project and I am part of the founding management team. You know, there is always that scenario where something blows up on a project. These are challenging projects, and there has not been a project of this magnitude attempted in the U.S. since the late 1960s and early 1970s.

There are a lot of risks and a lot of hurdles, and yes, could it blow up on us? There is that probability. But, definitely these are historic projects.