Texas regulators have approved plans for a USD 4.9bn, 18.5GW transmission network intended to interconnect 11.6GW of new wind capacity in the state.

The plan was developed by the state’s stand-alone grid operator the Electric Reliability Council of Texas (ERCOT) and approved by the Public Utility Commission (PUCT). It was one of four scenarios ranging from 12GW to 24.5GW worth of wire space that the commission considered. Each plan would have to varying degrees served five ‘competitive renewable energy zones’ (CREZs) designated in the north and west of the state. ERCOT already has 6.9GW of wind projects installed or with an interconnection agreement, making the total new capacity that will be served by the new transmission 11.6GW.

The five zones will each receive an allocation of the total new transmission. Northernmost zone Panhandle B will receive 2.4GW, Panhandle A will receive 3.2GW, Central West will receive 3.05GW, Central will receive 1.06GW, and the southern and westernmost zone, McCamey, will receive 1.9GW.

With CREZ Scenario 2 now approved by the PUCT, the state’s regulated transmission and distribution operators can build accordingly. Construction costs will then be ‘uplifted to load’ – included into rate base costs passed on to all electricity consumers in the state. ERCOT expects an additional USD 580-820m in ‘collection costs’ to cover additional small lines to connect wind farms to the newly built grid, with an average of 10 miles (16km) of connection to each project.

ERCOT estimates that the 18.5GW of total wind capacity should undercut existing power prices in the gas generation-heavy state by USD 38/MWh, reducing overall electricity payments by USD 2.43bn per year.