Xcel Energy expects to invest about $1.2 billion in transmission projects in Minnesota and Wisconsin that are in the Midcontinent Independent System Operator’s transmission expansion plan, company officials said in a recent earnings call with analysts.
Xcel could also spend up to $1 billion on transmission projects in Colorado, on top of its $1.7 billion Power Pathway project, which state regulators approved in February, according to the utility company.
“We feel very confident and excited about the transmission build-out opportunities we have,” Bob Frenzel, Xcel chairman, president and CEO, said during the call July 28, noting that those opportunities total about $3.5 billion.
Xcel’s planned transmission build-out will enable the company’s utilities to add renewables and meet the company’s goal of cutting its greenhouse gas emissions 80% by 2030, according to Frenzel.
Xcel’s Colorado integrated resource plan, approved in June, calls for adding 5,200 MW of renewable energy capacity. Its Minnesota resource plan, approved in February, envisions installing 5,750 MW of renewables, according to the earnings call presentation.
Xcel plans to issue requests for proposals for the renewable energy additions later this year. From those solicitations, it plans to file preferred portfolios and file with preferred portfolios from those solicitations with state regulators in mid-2023, with decisions expected by the end of the year, Frenzel said.
Xcel’s expectations for the MISO region are based, in part, on “right of first refusal” laws in Minnesota, North Dakota and South Dakota that give incumbent utilities the right to build transmission, Frenzel said.
Also, the Federal Energy Regulatory Commission recently approved a MISO proposal that grants incumbent utilities the right to build certain upgrade projects, such as the ones Xcel expects to build in Wisconsin, Brian Van Abel, Xcel chief financial officer, said during the call.
Xcel expects it will take about a year to receive permission for the projects from Minnesota and Wisconsin utility regulators.
Xcel, with utilities operating in eight states, anticipates spending about $7.4 billion on transmission over five years starting in 2022, which would help drive an expected 6.5% compound annual rate base growth, according to the presentation. The capital expenditure plan doesn’t include up to $2.5 billion in potential incremental transmission investments tied to the approved resource plans, the company said.