Clean Line wants landowners’ hearing expedited, says delays imperil $2 billion project

Plains and Eastern Clean Line Holdings LLC officials have asked a federal court in eastern Arkansas to move a fall hearing date on a lawsuit protesting a $2 billion wind energy transmission line, saying the controversial development is “time sensitive” and that legal delays could imperil the project’s financing and three-year construction schedule.

On Jan. 10, federal court filings show the U.S. District Court for the Eastern District of Arkansas in Jonesboro issued an order setting hearings for Nov. 14, 2017, on motions for summary judgment in a case brought in August by Golden Bridge LLC and Downwind LLC, represented by Little Rock attorney Jordan Wimpy of Gill Ragon Owen.

The two landowner groups, which were formed last year to protect property rights and interests of member landowners along the entire route of the proposed 720-mile project across Arkansas, had originally filed a complaint against the U.S. Department of Energy (DOE) regarding its approval and participation in the proposed project in late March.

In a court filing on Friday (Jan. 13), Clean Line attorney Michael Heister of Quattlebaum, Grooms & Tull PLLC in Little Rock protested that any delay in the project would push back the date “on which the public benefits from new renewable energy generation,” court filings show.

“(T)he completion of the Plains and Eastern transmission project is time sensitive. Many different parties – wind developers, utilities, Clean Line, and manufacturing companies, to name a few – have expended considerable resources toward a project in-service date in 2020,” Heister writes in the brief four-page court filing.

“Utilities will have to contract for energy to deliver to their customers with specific dates in mind. A delay in this matter has the potential to delay the entirety of the project as financing institutions require a high degree of certainty – meaning a low risk of legal and regulatory obstacles – prior to committing the capital to make multi-billion dollar investments required to construct the project and the wind generation that the project will enable,” Heister continued. “Because of the interconnected nature of all of the various project participants, even small schedule delays can lead to cascading impacts.”

AN AGGRESSIVE TIMETABLE
Clean Line officials recently told Talk Business & Politics they expect to begin construction on the project in the second half of 2017. Court filings show that Clean Line hopes to complete the multi-state project by 2020.

To stay on that aggressive timetable, Heister asked the federal court to schedule a second, earlier court date in October to begin hearing motions in the federal case. The court’s original schedule allows for three months between the close of briefings that begin on Aug. 14, 2017 and a hearing on the motions on Nov. 14, 2017.

“Clean Line does not lightly request that the Court set aside a second date for a hearing in this matter,” Heister argued. “In a few months it should be apparent whether the hearing can be held in October or November, and the other date can be released for use in another case.”

When asked in November whether the federal lawsuit will slow the project’s intended construction start following the delivery of a HVDC converter station in Pope County, Clean Line Founder and President Michael Skelly said the transmission project is moving “full steam ahead.”

“With a delivery converter station …, the project will bring enough low-cost clean energy to power more than 160,000 Arkansas homes each year,” Skelly said.

The three-state project to deliver electricity from the Oklahoma panhandle will enter Arkansas in Crawford County north of Van Buren and travels below Alma and Dyer before dissecting Mulberry to follow a line with Interstate 40 through most of Franklin County. From there, the transmission line travels through Johnson County, Pope County, northern Conway County, southern Van Buren County, southern Cleburne County, White County, Jackson County, Poinsett County, Cross County, and exiting Arkansas through Mississippi County north of Memphis.

Once the project is operational, a power station in the Oklahoma Panhandle will convert the incoming alternating current (AC) power generated by new wind farms into direct current (DC) power. The converter stations in Pope County, Arkansas and Shelby County, Tennessee will convert DC power back into AC power to be delivered to customers through the power grid, officials said.

LANDOWNER, CONGRESSIONAL OPPOSITION
Getting right-of-way access from Arkansas landowners has been the most controversial part of the project. Landowners have argued the project has never offered an appropriate avenue at the local and state level for due process during the DOE’s review of Clean Line’s application. The legal complaint raises concerns regarding the legality of outgoing DOE Secretary Ernest Moniz’s decision to participate in the project using Section 1222 of the Energy Policy Act.

Clean Line officials have said the new HVDC transmission lines across Arkansas are necessary to connect homes and business to less expensive wind-generation power hundreds of miles away. The Houston-based venture group has also reiterated that the company has already invested nearly $100 million of private capital to develop the project and anticipates making more than $30 million in payments to Arkansas landowners for easements and upfront transmission structure payments.

When the project was approved by the DOE 10 months ago, members of Arkansas’ Congressional delegation said the DOE overstepped its bounds and decried the Texas venture group’s use of eminent domain for the project. A month later, Sens. John Boozman, R-Ark. and Tom Cotton, R-Ark., filed an amendment to block funding to the DOE-supported project, calling the Obama administration’s endorsement of the development an “unprecedented executive overreach.”

Three months later, U.S. Rep. Steve Womack, R-Rogers, introduced legislation directing the DOE to obtain approval from a governor and state public service commission, prior to approval of any Section 1222 transmission project and subsequent use of federal eminent domain, as well as the approval of any tribal government for affected lands. Despite moving out of committee, Womack’s measure never got a full vote in the U.S. House due to veto threats from the Obama administration.

In late November, Womack and the rest of the state’s all-Republican delegation said they may reintroduce some version of earlier legislation once President-elect Donald Trump takes office. If it moves ahead as described, the Clean Line will be one of the largest-ever renewable energy infrastructure projects that includes the participation of the federal government.

Trump, who takes office on Friday (Jan. 20), has selected former Texas Gov. Rick Perry as his Energy Secretary nominee. Clean Line officials, who are based in Houston, have said they are encouraged by Perry’s nomination and believe he would be supportive of diversifying the nation’s energy mix.