Missouri Gov. Nixon backs $2B Grain Belt Express project

By Jeffrey Tomich | 06/30/2016 07:30 AM EDT

Missouri’s governor is wading into the battle between rural landowners and developers of the Grain Belt Express transmission line by endorsing the project as Clean Line Energy Partners gears up to submit a new request to state regulators.

Missouri’s governor is wading into the battle between rural landowners and developers of the Grain Belt Express transmission line by endorsing the project as Clean Line Energy Partners gears up to submit a new request to state regulators.

Gov. Jay Nixon, who is in the final year of his two terms as governor, issued a statement yesterday afternoon backing the $2 billion direct-current, high-voltage line that would cross the state.

The Missouri Public Service Commission last summer voted down the Grain Belt Express project by a 3-2 vote (EnergyWire, July 2). But current PSC Chairman Daniel Hall encouraged Clean Line to refile its application, and the company indicated it would do so. Regulators in Kansas, Illinois and Indiana have already approved it.


Missouri’s Democratic governor, who appointed all five current PSC members, said he’s giving the project his blessing only after Clean Line committed to a series of landowner protections to assuage the fears of farmers and other landowners.

"With these new protections for landowners and millions of dollars in savings for consumers, the Grain Belt Express Clean Line is a good deal for Missouri," Nixon said in a statement. "I appreciate Clean Line for answering my call for these enhanced landowner protections and for ensuring the transmission line is built in a way that creates jobs and saves money for Missourians."

Nixon’s endorsement is the latest milestone for Houston-based Clean Line, which has been working for years to develop the 770-mile transmission line connecting a rural windy area in southwestern Kansas with larger cities to the east.

The line would deliver 3,500 megawatts to the PJM Interconnection energy market covering parts of 13 states in the Midwest and Mid-Atlantic. It would also deliver 500 MW through a converter station in eastern Missouri.

Last week, the Grain Belt Express project won the endorsement of the Missouri Chamber of Commerce, citing the economic benefits it would bring the state.

Perhaps most importantly, a public power agency representing Missouri municipal utilities agreed to buy long-term transmission service on the Grain Belt Express if it is built.

The transmission agreement and a power purchase agreement with a western Kansas wind developer would allow some Missouri cities to secure wind energy at a delivered cost of less than 3 cents per kilowatt-hour for the next 25 years, according to the Missouri Joint Municipal Electric Utility Commission, which serves 67 small cities.

"This agreement, along with a PPA for wind energy, will save our member utilities more than $10 million annually, since it is timed to replace more costly power contracts for fossil fuel-fired generation that will expire as this project is scheduled to come online," said Duncan Kincheloe, the power commission’s president.

The power agency is expected to testify in support of the Grain Belt Express when Clean Line refiles its application at the PSC.

Nixon said the additional landowner protections he sought are unprecedented for any infrastructure project in Missouri.

Agreed-to terms include the offer of binding arbitration to resolve any compensation disputes, establishment of a decommissioning fund for the transmission line and establishment of guidelines to avoid or mitigate agricultural impacts.

Clean Line also agreed to have a local firm update land values, and the company will pay landowners the higher of the two values.

The company estimates the project will generate more than $7 million in property tax revenue in the first year of the line’s operation for schools and local governments. The project is also forecast to support 1,500 jobs during construction, Nixon said.

The developer has pledged to use Missouri-based labor and manufacturing. A Kansas City-based company will be the construction contractor, and Clean Line has chosen three Missouri companies to manufacture components.

The PSC voted down the project 3-2 a year ago on the grounds that Clean Line didn’t satisfy the criteria needed for approval.

The Grain Belt Express project faced fierce opposition from rural landowners and farmers throughout eight rural counties who feared a drop in property values and the threat of being forced to sell easements through eminent domain proceedings if Clean Line were given utility status.

Block Grain Belt Express, one of two landowner groups that opposed the project, has vowed to continue fighting the project, as has the Missouri Farm Bureau.

"We are so disappointed that our governor has turned his back on farmers and ranchers, and on property rights," Jennifer Gatrel, a spokeswoman for Block Grain Belt Express, said last night. "The evidence was clear in round one at the PSC that the benefits were outweighed by the harm done to farmers and ranchers."