Eversource 2012 Annual Report Download - page 27

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planning process in New England, based on FERC’s previous approval of transmission owners’ rights under the Transmission
Operating Agreement with ISO-NE, and the superiority of the current planning process, which has resulted in major transmission
construction, large reliability benefits and reduction of market costs. The filing also contains a new process for public policy
transmission planning that incorporates opportunities for competing, non-incumbent projects and cost allocation among the supporting
states. In mid-January 2013, ISO-NE and the majority of New England transmission owners filed answers to various stakeholders that
submitted protests to the compliance filing. We cannot predict the final outcome or impact on us; however implementation of FERC’s
goals in New England, including within our service territories, may expose us to competition for construction of transmission projects,
additional regulatory considerations, and potential delay with respect to future transmission projects.
Transmission Projects
NEEWS: GSRP, a project that involves the construction of 115 kV and 345 kV overhead lines by CL&P and WMECO from Ludlow,
Massachusetts to Bloomfield, Connecticut, is the first, largest and most complicated project within the NEEWS family of projects. The
$718 million project is expected to be fully placed in service in late 2013. As of December 31, 2012, the project was approximately 93
percent complete and we have placed $298 million in service.
The Interstate Reliability Project, which includes CL&P’s construction of an approximately 40-mile, 345 kV overhead line from Lebanon,
Connecticut to the Connecticut-Rhode Island border in Thompson, Connecticut where it will connect to transmission enhancements
being constructed by National Grid, is our second major NEEWS project. All siting applications have been filed by CL&P and National
Grid. On January 2, 2013, the Connecticut Siting Council issued a final decision and order approving the Connecticut portion of the
project. Decisions in Rhode Island and Massachusetts are expected between the end of 2013 and early 2014. The $218 million project
is expected to be placed in service in late 2015.
Included as part of NEEWS are associated reliability related projects, approximately $70 million of which have been placed in service
and approximately $30 million of which are in various phases of construction and will continue to go into service through 2013.
Through December 31, 2012, CL&P and WMECO had capitalized $212 million and $518.1 million, respectively, in costs associated with
NEEWS, of which $79.4 million and $183.4 million, respectively, were capitalized in 2012.
Greater Hartford Central Connecticut Project (GHCC): In August 2012, ISO-NE presented its preliminary needs analysis for the GHCC
to the ISO-NE Planning Advisory Committee. The results showed severe thermal overloads and voltage violations in each of the four
study areas now and in the near future. A combination of 345 kV and 115 kV transmission solutions are being considered to address
these reliability concerns and a set of preferred solutions are expected to be identified by ISO-NE in 2013. Approximately $300 million
has been included in our five-year capital program for future projects being identified to enhance these reliability concerns, which have
recently been confirmed by ISO-NE.
Cape Cod Reliability Projects: Transmission projects serving Cape Cod in the Southeastern Massachusetts (SEMA) reliability region
consist of an expansion and upgrade of NSTAR Electric's existing transmission infrastructure including construction of a new 345 kV
transmission line that will cross the Cape Cod Canal (The Lower SEMA Transmission Project) as well as a new 115kV transmission line
and other 115kV upgrades in the center of Cape Cod. All regulatory and licensing and permitting is complete for the Lower SEMA
Transmission Project. Construction commenced in September 2012 and is expected to be completed by mid-2013. The total
estimated construction cost for the Cape Cod projects is approximately $150 million.
Northern Pass: Northern Pass is NPT's planned HVDC transmission line from the Québec-New Hampshire border to Franklin, New
Hampshire and an associated alternating current radial transmission line between Franklin and Deerfield, New Hampshire. Northern
Pass will interconnect at the Québec-New Hampshire border with a planned HQ HVDC transmission line. Effective April 10, 2012, as a
result of the merger, NUTV owned 100 percent of NPT. NPT has identified a new route in the northern-most part of the project’s route
where PSNH did not own any rights of way. We expect to file the new route with the DOE in the first quarter of 2013, and we believe
that NPT will be completed in early 2017.
We estimate the costs of the Northern Pass transmission project will be approximately $1.2 billion (including capitalized AFUDC).
Greater Boston Reliability and Boston Network Improvements: As a result of continued analysis of the transmission needs to enhance
system reliability and improve capacity in eastern Massachusetts, NSTAR Electric expects to implement a series of new transmission
initiatives over the next five years. We have included $479 million in our five-year capital program related to these initiatives.
Transmission Rate Base
Under our FERC-approved tariff, transmission projects generally enter rate base after they are placed in commercial operation. At the
end of 2012, our transmission rate base was approximately $4.2 billion, including approximately $2.2 billion at CL&P, $960 million at
NSTAR Electric, $412 million at PSNH, and $620 million at WMECO.