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Tuesday, January 30, 2018 by Jack Craver

Austin Energy gears up to ‘repower downtown’

As Austin grows, so must its utility.

Austin Energy plans a nine-figure investment over the next eight years on improvements to its system of substations and transmission lines.

In a presentation Wednesday to the Austin Energy Utility Oversight Committee, AE officials showed off a list of projects whose estimated cost totals $150.2 million. And that’s without taking into account an undetermined number of other substation projects (with an undetermined cost) that AE says it will undertake to support the Resource Generation Plan approved by City Council last year that aims to significantly boost renewable power generation by 2027.

The centerpiece project, which the utility has dubbed “Repowering Downtown,” is a $60 million effort that will include a new substation located at 55 East Ave., in the Rainey Street district.

Of AE’s roughly 70 substations throughout its service area, only two – the Brackenridge substation and the Seaholm substation – are located downtown. Substations receive the high-voltage power generated by power plants and, with the use of transformers, significantly reduce the voltage so that the power can be distributed to homes and businesses.

Not all substations are created equal, noted Dan Smith, AE vice president of electric service delivery. The ones downtown are “larger in capacity,” which helps explain why there are fewer in the area.

Still, the utility has been planning for a third downtown substation for two decades. In 1999, it purchased the East Avenue parcel of land to use as a site for a future substation. City Council later included a third substation as part of the Downtown Austin Plan it adopted in 2012.

The new substation will not only increase the AE’s downtown capacity, but it will allow the utility to make needed improvements to the existing facilities. It plans to add a new transformer to Seaholm and significantly renovate Brackenridge.

Absent the new facilities, downtown “will be at an increased risk of recurring power outages,” the utility says.

There are still a number of steps to take before breaking ground, which is not envisioned until at least 2020. Council must approve a rezoning of the property, and that will only happen after the utility’s proposed development is reviewed by the Zoning and Platting Commission, the Electric Utility Commission and the Downtown Commission.

AE also plans to engage in an extensive public input process to determine what the new facility should look like. Council also already approved hiring a consulting firm to lead a series of “design charrettes,” intensive planning meetings where members of the public and other stakeholders exchange ideas about the project’s design and try to come to a consensus about what the final product should look like.

In December, Council approved a $1.4 million contract with Austin-based Stanley Consultants to do “preliminary engineering, design, bidding, construction and warranty phase services” for the new substation, as well as to facilitate the charrettes.

“We’re trying to be open and transparent,” said AE spokesperson Robert Cullick. The utility wants people to know in advance if “we’re going to be drilling holes and pouring concrete,” he added.

AE plans to build two other new substations, one in Northeast Austin and one in Southeast Austin, which will cost an estimated $8.1 million and $11 million, respectively. It also has plans to make $3.5 million of upgrades to the existing Ashton Woods substation and $5.9 million of improvements to the Winchester substation.

Upgrading transmission lines is another critical component of the utility’s long-term plans. Many of the utility’s lines are 69,000 volt lines built 50 years ago, said Cullick. The utility plans to upgrade them to 138,000 volt lines.

“You can move a lot more electricity safely,” said Cullick.

The transmission projects, noted Cullick, are paid for by every ratepayer in the Electric Reliability Council of Texas, the grid that covers almost all of Texas and which AE is a part of. Every utility within ERCOT is assigned a portion of the cost of all the transmission lines within the grid based on its average peak usage.

AE’s peak usage is far lower than that of most other Texas utilities, so it pays less for transmission, allowing it to charge lower rates to its customers. The low peak usage, as well as the low overall electricity consumption, is a product of the efforts the utility has undertaken to promote energy conservation, said Cullick.

While ERCOT’s average load has increased by 1 percent a year, said Cullick, Austin Energy’s has only increased 0.7 percent annually. The smaller increase comes despite the fact that the city’s population has been growing faster than the state’s.

“This is not about more power,” he said of the new projects. “This is about more reliable and safer power.”

Photo courtesy of Austin Energy.

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Key Players & Topics In This Article

Austin Energy: As a municipally-owned electric utility, Austin Energy is a rarity in the largely deregulated State of Texas. It's annual budget clocks in at over $1 billion. The utility's annual direct transfer of a Council-determined percentage of its revenues offers the city a notable revenue stream.

Austin Energy Utility Oversight Committee: The Austin City Council committee on Austin Energy was created in May 2013 to provide oversight of the city's electric utility. It's creation was marked by political maneuvering that ultimately resulted in a committee comprised of every member of the Austin City Council.

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