Project: Path 15 Transmission Project
Location: California

 

Overview:

The Path 15 transmission corridor in central California became infamous in 2000-2001 when northern California was experiencing rolling blackouts while southern California had surplus power. Because of transmission constraints along the Path 15 transmission corridor in central California, southern California’s surplus couldn’t be moved to the supply-challenged north.

The Western Area Power Administration (Western) developed a plan for a first-of-its-kind public-private partnership to resolve the bottleneck. Western, PG&E, and Trans-Elect Inc., a private owner and operator of transmission projects, joined forces to complete the $250 million Path 15 transmission corridor project. Western handled the permitting, design, and construction of the 83-mile Path 15 transmission. Trans-Elect funded the development and construction of the transmission line through a combination of senior secured notes and bank debt and equity. PG&E privately contributed to the project for its substation work.

 

E3 Services Provided:

E3 played a key role in helping to craft this innovative $250 million solution, providing the following services:

  • Due diligence review for Trans-Elect’s private placement financing
  • Construction monitoring services to Trans-Elect and its lenders during construction and startup phases of the project

 

Challenges Managed:

  • Securing private equity construction financing which included permanent debt for the first stand-alone financing of a major transmission line
  • Securing permitting for a 200-foot-wide, 83-mile-long strip of land in California
  • Completing the project with an innovative public-private ownership model
  • Completing the project using an EPC contract for the transmission that enabled private financing through a public entity following government procurement procedures

 

Project Spotlights:

  • Project was “fast-tracked,” with construction complete in just 18 months.
  • The undertaking won two project finance awards:
    • Infrastructure Deal of the Year for North America, and
    • Transmission Deal of the Year