Willmar Municipal Utilities hopes to increase transmission ownership with joint project
Willmar Municipal Utilities and Great River Energy are planning a joint project to upgrade the power transmission system in Willmar. The two utilities will split ownership of the project, that could cost around $8 million. The Municipal Utilities Commission gave staff permission to go ahead with planning the project, as well as re-appropriate capital improvement dollars to pay for it.
WILLMAR — With a new project, Willmar Municipal Utilities wants to increase its investment and ownership in transmission infrastructure, with the goal to be closer to revenue neutral when it comes to transmission costs.
"The big factor is revenue neutrality," said Jeron Smith, staff electrical engineer, at the March 23 commission meeting.
Willmar Municipal Utilities both pays to use transmission assets owned by other utilities and receives payments when others use its assets. Currently, Willmar pays more than it earns. Increasing its transmission ownership will get Willmar Municipal Utilities closer to even between the two.
The utilities and Great River Energy would split ownership of the project with the negotiations between the two parties ongoing.
"There are a lot of moving parts to it," said Commissioner Bruce DeBlieck.
The project would see the addition of a 230/115-kilovolt transformer and breakers to the Willmar substation. This would also require the acquisition of additional land and a new control building. Additional 115-kilovolt breakers would be brought to the Priam substation and the 115-kilovolt transmission line between the Priam and Willmar substations would be connected.
The commission, at its March 23 meeting, authorized staff to move ahead with the ownership split, enter into an agreement with Great River Energy to do the substation engineering design and hire DGR Engineering as the owner's representative.
The project is estimated to cost around $8 million. To pay for it, Willmar Municipal Utilities will change the order of its capital projects. The old capital budget had the transmission and substation happening in 2025 and 2026. Now those have been moved up to 2021, and a new Willmar Municipal Utilities office building and a generation project have been pushed back to 2025 and 2026.
"Because priorities have changed, we have a new proposed budget," Smith said.
The commission approved the changes to the capital budget.
Smith said he expects the Great River Energy board to approve the agreement, and in January 2021 Willmar Municipal Utilities will begin procuring the materials for the projects. It could take nearly a year for the transformer to be delivered. The plan is for the new transmission assets to be in service by spring 2022.