April 7, 2016 Christopher Lawrence United States Department of Energy
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POWER April 7, 2016 Christopher Lawrence United States Department of Energy 1000 Independence Avenue, SW Washington, DC 20585 Re: Nogales Interconnection Project Presidential Permit Application Dear Mr. Lawrence: Nogales Transmission, L.L.C., a subsidiary of Hunt Power, L.P., hereby submits an Application for a Presidential Permit to the Department of Energy for a proposed high-voltage direct current ("HVDC") interconnection between the electric grid in southern Arizona and the electric grid in the northwestern region of Mexico (the "Project"). The Project would consist of three components: (I) a new I 0-15 acre Gateway Substation on land currently owned by· Tucson Electric Power, where HVDC equipment would be located (with the HVDC tie initially sized at ISO MW, but capable of expansion, in phase two, to 300 MW); (2) a new, approximately 3-mile overhead 138 kV transmission line segment originating at Un iSource Energy Services' Valencia substation in Nogales, Arizona, and extending west and south to the new Gateway Substation; and (3) a new, approximately 2-mile overhead 230 kV transmission line segment extending south from the new Gateway Substation and across the US-Mexico border to interconnect with a transm ission line to be constructed in Mexico. Included in package are four documents: • Application of Nogales Transmission, L.L.C. for Presidential Permit • Environmental Assessment in support of a Presidential Permit • Biological Report • Cultural Report Nogales Transmission respectfully requests DOE to review the Presidential Permit Application and attached support documents. Please contact me if you have any questions or would like additional information. nrique Marroqui Senior Vice President Nogales Transmission, L.L.C. emarroquin@ huntpower.com Nogales Interconnection Project Nogales Transmission, L.L.C. April 4, 2016 TABLE OF CONTENTS Application of Nogales Transmission, L.L.C. for Presidential Permit Environmental Assessment in Support of a Presidential Permit Biological Field Report A Class III Cultural Resources Survey for the Nogales Interconnection Project, Nogales, Santa Cruz County, Arizona UNITED STATES OF AMERICA BEFORE THE DEPARTMENT OF ENERGY OFFICE OF ELECTRICITY DELIVERY AND ENERGY RELIABILITY APPLICATION OF NOGALES TRANSMISSION, L.L.C. FOR PRESIDENTIAL PERMIT Docket No. PP-_________ April 4, 2016 TABLE OF CONTENTS PAGE NO. I. INTRODUCTION ...............................................................................................................1 A. The Project ...............................................................................................................1 II. INFORMATION REGARDING THE APPLICANT .........................................................2 A. Legal Name of the Applicant [10 C.F.R. § 205.322(a)(1)]......................................2 B. Legal Name of All Partners [10 C.F.R. § 205.322(a)(2)] ........................................2 C. Communications and Correspondence [10 C.F.R. § 205.322(a)(3)] .......................3 D. Foreign Ownership and Affiliations [10 C.F.R. § 205.322(a)(4)] ...........................3 E. Existing Foreign Contracts [10 C.F.R. § 205.322(a)(5)] .........................................3 F. Opinion of Counsel [10 C.F.R. § 205.322(a)(6)] .....................................................3 III. INFORMATION REGARDING THE PROPOSED TRANSMISSION FACILITIES ........................................................................................................................4 A. Project Overview .....................................................................................................4 B. Technical Description [10 C.F.R. § 205.322(b)(1)(i)] .............................................4 1. Number of Circuits ......................................................................................4 2. Operating Voltage/Frequency ......................................................................4 3. Conductors ...................................................................................................5 C. Additional Overhead Line Information [10 C.F.R. § 205.322(b)(1)(ii)] .................5 1. Wind and Ice Loading Design Parameters ...................................................5 2. Description and Drawing of a Typical Structure .........................................5 3. Structure Spacing with Typical Ruling and Maximum Spans .....................5 4. Conductor (Phase) Spacing ..........................................................................5 5. Line-to-Ground Design and Conductor-Side Clearance ..............................6 D. General Area Map [10 C.F.R. § 205.322(b)(2)] ......................................................6 i E. Bulk Power System Information ..............................................................................6 1. Expected Power Transfer Capability ...........................................................6 2. System Power Flow Plots ............................................................................6 3. Interference Reduction Data ........................................................................6 4. Relay Protection ...........................................................................................7 IV. INFORMATION REGARDING POTENTIAL ENVIRONMENTAL IMPACTS ............7 A. Introduction ..............................................................................................................7 B. Water Resources [10 C.F.R. § 205.322(c)(1)] .........................................................7 C. Cultural Resources [10 C.F.R. § 205.322(c)(2)] ......................................................8 D. Minimum Right-of-Way Width [10 C.F.R. § 205.322(c)(3)] ..................................9 E. Biological Resources [10 C.F.R. § 205.322(c)(4)] ..................................................9 F. Practical Alternatives to the Project [10 C.F.R. § 205.322(d)] ..............................10 V. VERIFICATION................................................................................................................11 VI. SUMMARY OF EXHIBITS..............................................................................................11 VII. CONCLUSION ..................................................................................................................11 EXHIBITS Exhibit A - Opinion of Counsel Exhibit B - Technical Drawings Exhibit C - Overall System Map Exhibit D - International Border Crossing Map Exhibit E - Verification Exhibit F - Environmental Assessment in Support of a Presidential Permit - Nogales Interconnection Project (Hunt Power; Nogales, Santa Cruz County, Arizona; April 4, 2016) ii UNITED STATES OF AMERICA BEFORE THE DEPARTMENT OF ENERGY OFFICE OF ELECTRICITY DELIVERY AND ENERGY RELIABILITY NOGALES TRANSMISSION, L.L.C. Docket No. PP-____ APPLICATION OF NOGALES TRANSMISSION, L.L.C. FOR PRESIDENTIAL PERMIT Pursuant to Section 202(e) of the Federal Power Act (“FPA”), 16 U.S.C. § 824a (e), Executive Order No. 10485 as amended by Executive Order No. 12038, and 10 C.F.R. §§ 205.320, et seq. (2015), Nogales Transmission, L.L.C. (“Nogales Transmission”) hereby applies for a Presidential Permit authorizing it to construct, operate, maintain and connect facilities for the transmission of electric energy at the international border between the United States and Mexico. As demonstrated in this Application, the proposed Presidential Permit is in the public interest. In support of this Application, Nogales Transmission states as follows: I. INTRODUCTION A. The Project Nogales Transmission proposes to construct a high-voltage direct current (“HVDC”) interconnection between the UNS Electric (“UNSE”) system near Nogales, Arizona and the Mexican National Electric System in Sonora, Mexico (the “Project”). Nogales Transmission intends to construct the Project in two phases. The first phase would consist of a 150 megawatt (“MW”) HVDC tie located at a new substation located on property currently owned by Tucson Electric Power (“TEP”) (the “Gateway Substation”); a new 3-mile 138 kilovolt (“kV”) transmission line that would originate UNSE’s Valencia Substation in Nogales, Arizona and extend to the west and south to the new Gateway Substation; and a new approximately 2-mile 230 kV transmission line that would extend south from the Gateway Substation to the U.S.- 1 Mexico border where it would interconnect with a transmission line to be constructed in Mexico. The second phase would expand the HVDC converter capacity to 300 MW. Although the timing of the second phase is not yet certain, Nogales Transmission requests authority to construct the entire 300 MW project. Nogales Transmission will notify DOE prior to undertaking construction of the second phase of the Project. Nogales Transmission has discussed the Project with both Comision Federal de Electridad (“CFE”) and Central Nacional de Control de Energia (“CENACE”). CFE is the Mexican state-owned electric utility and the entity that directly, or via an affiliate, would own the transmission assets that would interconnect to the Project south of the border. Furthermore, through other subsidiaries, CFE would be a market participant in Mexico, and would enter into wholesale power transactions with US and Mexican-based entities interested in buying and/or selling power across the Project. CENACE is the Independent System Operator (ISO) of Mexico’s electrical grid. Its functions are similar to those of other known US-based ISOs such as CAISO, ERCOT, or PJM, including the safe and reliable operation