Our progress

We have invested more than $2.8 billion in transmission infrastructure within our service area since we began operation in 2001. In addition to realizing improved reliability locally and, increasingly, regionally, we are seeing other economic benefits from this investment.

Traditional cost-benefit analysis of reliability projects focused on relatively easy-to-quantify production costs. The emergence of the wholesale market, along with evolving regulatory policy, has resulted in a new approach to determining other benefits of transmission investment. Planning activities that encourage investments in broader, regional projects are seeing returns in areas other than just reliability: decreased costs in generation and reduced transmission congestion, as well as integration of renewable energy, also are being seen. Transmission planning models are beginning to capture and quantify these non-traditional metrics to determine the true value of investments in the transmission system.

When factoring in all the benefits of transmission expansion, project sponsors are recognizing the value of developing wind energy in resource-rich areas of the country and building transmission to deliver the energy to load centers. These types of transmission investments will become increasingly important as new air quality rules cause retirements of older coal‑fired generating units. Transmission build-outs or reconfiguration of the system will play an important role as changes are made in generation.

Transmission remains a good value for the electricity consumer. Transmission costs within our service area remain at about 8 to 9 percent of a retail customer’s electric bill. (Retail customers pay for the generation, transmission and distribution of electricity, plus fuel costs, through regulated utility rates. Generation and fuel make up the major portion of the bill, followed by distribution infrastructure.) We don’t anticipate that percentage to change in the near future; and, as noted earlier, the costs of projects installed in the last three years, including projects built solely for reliability, are expected to save about 99 percent of their total costs due to savings in energy prices.

Managing our existing assets goes hand in hand with our planning strategy for maintaining and improving reliability and cost-effectiveness. Equipment life cycles and replacement plans are driven by safety, regulatory compliance, reliability performance and environmental stewardship.

We achieved a record in reliability performance in 2012, reducing overall unplanned outages by 17 percent, and ranked in the top 10 percent of our peer group for reliability performance on lines greater than 100 kV. This improvement is due to monitoring leading failure indicators and targeting maintenance and equipment replacement programs.