5.6 ERMUSR 09-13-2022______________________________________________________________________________
Page 1 of 2
UTILITIES COMMISSION MEETING
TO:
ERMU Commission
FROM:
Theresa Slominski - General Manager
MEETING DATE:
September 13, 2022
AGENDA ITEM NUMBER:
5.6
SUBJECT:
Central Municipal Power Agency Services Transmission Opportunity
ACTION REQUESTED:
None, unless opposed to participation
DISCUSSION:
In 2006 Elk River Municipal Utilities (ERMU) first identified and submitted our transmission
assets for revenue return through Midcontinent Independent System Operator (MISO). These
assets are part of our substations. In 2008 we became transmission owners with the building of
the Brookings Line through the “CAPX” transmission project. ERMU participated in the CAPX
transmission project with other utilities in Minnesota and Iowa with Central Minnesota
Municipal Power Agency (CMMPA) coordinating all the participating utilities’ bonding pledges.
There were no cash resources required for investment as CMMPA secured bonds with the
utilities’ pledges and those bond proceeds were the investment. In 2010 we received our first
revenue payment and since that time we have received over $3 million.
CMMPA has since become Central Municipal Power Agency Services (CMPAS, pronounced
“compass”), although CMMPA is still the bonding entity for projects. Also, the CAPX partners
are now called Grid North Partners as they seek to build more transmission for grid resiliency
and to reduce transmission constraints in the north. CMPAS hosted a webinar August 30 to
discuss another transmission opportunity CMMPA will be embarking on. They are adding a
second circuit (no poles, just wires) to the Brookings line and anticipate the cost to be $1.2
million. With the funding of the original Brookings line there is approximately $2.5 million in
reserves that will be used to fund this project, so no additional bonding or pledging is
necessary. Currently those reserves are in savings and earn less than 1% so this would bring
additional return to the partners on existing funds. It is too early in the process to know the
exact return but is estimated to be 5-6%.
CMPAS doesn’t need any approval to move forward with these reserve funds to fund this
project, however, to be completely transparent they wanted their partners to be made aware
and give any partner the opportunity to say no. We need to let CMPAS know by September 15
that we have made our Commission aware and if there is a no. The CMPAS board will be voting
on this project at their September 21 meeting. The talking points that CMPAS shared with us
are attached for your review.
98
______________________________________________________________________________
Page 2 of 2
CMPAS also wanted us to give our Commission a heads up that there are additional billions of
dollars in transmission projects on the horizon and they are researching if there will be any
opportunities for additional transmission investments by these same partners. Information will
be provided in the future as they learn more.
Staff recommends moving forward with funding the project and increasing the return on
investment for our customers from less than 1% to an estimated 5% or more.
ATTACHMENTS:
• CMPAS Transmission Talking Points
99
Brookings Line
CMMPA 2022 TRANSMISSION INVESTMENT OUTLOOK
3 100
Brookings County -Lyon County 2nd Circuit addition
4
Brookings Owner Current PI Low End Estimate
14.4M
High End Estimate
17.3M
NSPM 67.7971% $9,762,782 $11,728,898
GRE 18.4667% $2,659,205 $3,194,739
WMMPA 5.6606% $815,126 $979,284
CMMPA 4.0756% $586,886 $705,079
OTP 4.0000% $576,000 $692,000
Brookings County-Lyon County
Brookings Owner Current PI Low End Estimate 9.8M High End Estimate
11.7M
NSPM 67.7971% $6,644,116 $7,932,261
GRE 18.4667% $1,809,737 $2,160,604
WMMPA 5.6606% $554,739 $662,290
CMMPA 4.0756% $399,409 $476,845
OTP 4.0000% $392,000 $468,000
Helena-Hampton Corners
101
Brookings County -Lyon County 2nd
Circuit addition
5
CMMPA’s existing investment in “Brookings line”.
MTEP by December 1, 2022.
In service date (ISD) expected September 1, 2025.
Intent to invest due September 26, 2022.
Funds available in Strategic Reserve,
approximately 2.5 M$ available.
CMMPA’s portion between 1.0 M$ & 1.2 M$.
102