“UPDATED: AEP Cancels Wind Catcher Following Texas Rejection”
American Electric Power on Friday announced it is canceling its proposed $4.5 billion Wind Catcher Energy Connection project, one day after receiving a negative ruling from the Public Utility Commission of Texas.
The PUC on Thursday denied AEP subsidiary Southwestern Electric Power Co.’s request to acquire a 70% interest in the project, which was scheduled to be completed in 2020 to take full advantage of the federal production tax credit.
…Thompson & Knight attorney Rex VanMiddlesworth, who represented the Texas Industrial Energy Consumers trade group, said SWEPCO’s “unnecessary $4.5 billion investment of ratepayer money” was built on a series of improbable assumptions that included $4.75/MMBtu gas prices in 2021, a federal carbon tax by 2026 and the cancellation of most other wind projects in SPP’s interconnection queue. The Energy Information Administration predicts Henry Hub gas prices will be $3.66/MMBtu in 2021, not reaching $4.75/MMBtu until 2046.
VanMiddlesworth also said Wind Catcher was “burdened” by the $1.6 billion generation tie across Oklahoma.
“That made the project 40% more expensive to construct than other wind projects, while delivering 8% less energy,” he told RTO Insider. “The commission properly found that this was not a risk that should be imposed on Texas ratepayers.”