The Illinois Supreme Court has dealt a punishing blow to the proposed clean-power “super highway” designed to transmit output from Iowa and Dakotas wind farms to the Chicago market.
The state’s high court today upheld an Illinois Appellate Court ruling that concluded state regulators improperly approved the Rock Island Clean Line project. (You can read the Supreme Court ruling at the end of this story.)
The $1.8 billion, 500-mile high-voltage line has been in the works for seven years. It appeared to clear a significant hurdle in late 2014 when the Illinois Commerce Commission ruled the developers had demonstrated there was a public need for their project—a necessary first step to potentially winning the right of eminent domain.
The ruling was challenged by landowners in the transmission line’s 120-mile path in Illinois, as well as Commonwealth Edison.
Opponents’ primary argument is that Clean Line Energy, the developer, isn’t a “public utility” in the legal sense of that term. Only public utilities can obtain the kind of certificate that the ICC granted the project.
In its unanimous opinion, the Supreme Court agreed with that argument, but made clear that Clean Line could reapply with the commission. A key aspect of the court’s objection was that Clean Line hadn’t yet acquired property near the proposed end of the transmission line to construct a facility that could convert the electricity for use in the power grid here. Instead, Clean Line has an option to buy the land.
Thus, the developers potentially could exercise that option and reapply with the commission. That would mean a minimum of 18 months’ delay.
“Talk about a legal hangnail,” said Hans Detweiler, Rock Island vice president of development.
They also could appeal to the U.S. Supreme Court.
Clean Line will decide on whether to continue to press ahead in the coming months, Detweiler said.
In a statement, Clean Line said, “This (ruling) causes great delay for the project and will directly impact competition in electricity markets, resulting in fewer choices and higher prices for electricity. It is unfortunate that Illinois now has higher barriers for new market entrants.”
Unlike most high-voltage lines, Clean Line’s wouldn’t require ratepayers in Illinois to pay higher electricity rates to cover the project’s costs. It’s a so-called merchant line, whose costs would be covered in fees paid by wind-farm owners to use it to transport their output to end users in more populated areas.
ComEd parent Exelon has been vocal about the negative effect wind farms to the west of Illinois have had on wholesale power prices here. That keeps electric bills relatively low in Illinois, but hurts the profitability of Exelon’s fleet of Illinois nuclear plants. A law signed late last year by Gov. Bruce Rauner subsidizes two of those six nukes via a surcharge on electric bills throughout the state that will funnel $235 million of additional revenue to Exelon.
Even if Rock Island Clean Line ultimately can win approval in Illinois, it still must do the same in Iowa. The developers haven’t begun the process necessary to get land rights in Iowa because they were waiting to see what would happen in the Illinois courts.
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