Q: What is a merchant power transmission tie line?
A: Most transmission lines are built by local utilities. The related costs of are included in the “rate base” and paid by regional users of power (i.e. industrial and residential consumers). A merchant transmission line is built by the private sector and the related costs are paid by the actual users of the line.
Q: What are the benefits of the Saskatchewan-Alberta Tie Line (SATL)?
A: The SATL project will provide a range of benefits to Saskatchewan and Alberta related to increased system reliability and power price stability. In addition, SATL will provide increased operational flexibility to manage the integration of greater renewable resources into both provinces.
The Alberta Electric System Operator (AESO) has summarized its view on interties as follows:
“Transmission interconnections, or interties, with neighbouring jurisdictions are essential to a well-functioning Alberta electricity market as they support reliability, market diversification, generation development and continued economic growth in Alberta. Albertans benefit from these interconnections by having the ability to import and export power as needed with physical access to diverse markets, achieving the most efficient, economic and environmentally beneficial exchange for a resource.”
Q: How will the SATL project generate revenue?
A: SATL will enter into Transmission Service Rights (TSR) agreements with energy shippers using the tie line. SATL intends to use an “anchor shipper” model to contract for up to 50% of the total SATL capacity with one or more power shippers via a negotiated agreement. The remaining SATL capacity will be sold via an “open season” to ensure all potential shippers have an equal opportunity to reserve capacity on the line. The TSR tariff will be determined by the market in the anchor tenant negotiations and the open season process. Any tie line capacity that is not presold will be made available through an Open Access Same-time Information System (OASIS) on a daily basis once the tie line is operational.
Q: What technology will be used?
A: SATL will utilize DC technology called Voltage Source Converter (VSC). VSC technology can be used to provide added support the power system because it can control voltage, stabilize frequency and provide black start service. The VSC technology is ideally suited for the asynchronous connection of a DC system between two AC systems, which is the case between Alberta and Saskatchewan.