Panel OKs controversial Tucson Electric plan for high-voltage power line route

State regulators on Friday recommended Tucson Electric Power’s preferred route for a planned high-voltage transmission line through midtown that would put lines and tall power poles through or near several historic neighborhoods.

But the Arizona Power Plant and Line Siting Committee also recommended three alternative segments — including a route down North Campbell Avenue opposed by the City of Tucson but favored by some neighborhoods.

And the panel included language intended to prompt the city and TEP to reach a compromise on whether some parts of the new line may need to be installed underground to comply with city ordinances or area plans.

After 10 days of hearings, the line-siting committee approved the amended Certificate of Environmental Compatibility for TEP’s 130-kilovolt Midtown Reliability Project on a 9-0 vote.

The panel’s recommended certificate will now go before the Arizona Corporation Commission for possible amendment and ultimate approval as soon as the commission’s next open meeting on Aug. 13.

Campbell alternative

The utility’s preferred route, identified as “B4” in project materials, connects DeMoss-Petrie to the proposed Vine Substation near Banner-University Medical Center via Grant Road, North Park Avenue, East Adams Street and North Vine Avenue.

The route connects the Vine Substation to the substation at South Kino Parkway and East 36th Street using Vine, Adams and Park before turning west on East Speedway and then south on South Euclid Avenue. After crossing Barraza Aviation Highway, the route continues on South Toole Avenue, Euclid and 36th Street.

TEP says the route minimizes crossing of residential neighborhoods, though opponents noted that some stretches are purely residential and streets like Euclid host a mix of homes and businesses.

But that route mostly avoids running afoul of a city ban on overhead lines on North Campbell and concerns Banner expressed about medical helicopter operations and operational disruptions should TEP use a route that includes North Campbell or a private drive on the hospital’s north side.

As alternatives, the committee recommended a northern route (D) that runs from West Grant directly south on North Campbell, jogs west just north of Banner-UMC on East Lester Avenue to link to the Vine Substation and a southern segment (1) that runs south on Campbell all the way to the Kino substation.

In light of Banner’s concerns, the panel also offered as an alternative for a hybrid route that heads west of the hospital campus, using Vine, East Mabel Street and East Speedway to link up with North Campbell and points south.

TEP says the planned transmission line from the south side to a substation near Interstate 10 and West Grant Road, originally proposed in 2020, is badly needed to meet surging power demand as midtown’s current 46-kV transmission system in the central Tucson area was built in the 1950s and 1960s and is nearing capacity.

Long road

TEP has been working since 2019 to plan and win approval for the new, 138-kilovolt line to link the DeMoss-Petrie substation on Grant at I-10 to a substation at East 36th Street and South Kino Parkway, via a new substation next to Banner-UMC.

The utility withdrew its original line-siting application for the Kino-DeMoss-Petrie project in 2022 after being rebuffed by the city for needed zoning approvals and facing a firestorm of opposition from neighborhood groups.

The city cited ordinances prohibiting the installation of overhead power lines in designated “gateway corridors” including North Campbell.

Neighborhoods including Sam Hughes, Jefferson Park and West University contend overhead transmission lines would create a visual blight that could significantly cut property values in affected areas.

But TEP opposed undergrounding the line as prohibitively expensive and refused to propose to pay for it through electric rates.

The utility contends that state law allows it to place overhead lines wherever it needs to, and has refused to consider requesting raising rates to pay for undergrounding costs it has pegged as 10 to 20 times the cost of overhead lines.

Working with TEP, the city added transmission lines to an existing process of “special exceptions” that would allow overhead lines on a case-by-case basis.

To help pay for undergrounding, the City Council referred a ballot measure to voters in May 2023 to extend TEP’s 25-year city franchise agreement, with a new underground utility fee for TEP customers in the city, but the proposition was rejected.

The company says it must complete the transmission project, which includes the planned removal or undergrounding of some 19 miles of existing lower-voltage distribution lines, by mid-2027 to assure safe and reliable service in the area.

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TEP, which presented evidence showing that undergrounding takes much longer than overhead installations, says that if it doesn’t meet its self-imposed in-service deadline, it would have to pay some $10 million to shore up its existing 46kV system, and tens of millions more amid longer delays.

But the City of Tucson is sticking to its guns, with more ammunition thanks to a July 8 court ruling upholding the city’s authority to require undergrounding of transmission lines.

TEP hasn’t yet said whether it will appeal the ruling by Pima County Superior Court Judge Kyle Bryson.

Seeking compromise

The line-siting committee didn’t settle that dispute, nor where the new line may need to be undergrounded, or who pays for it.

But in the so-called findings of fact included to support its recommendation, the panel recognized the legal dispute over the undergrounding restrictions and gave TEP and the city a deadline to encourage an agreement.

TEP had asked the line-siting panel to find that the city’s requirement for undergrounding transmission lines is “unreasonably restrictive and compliance therewith is not feasible in view of technology available.”

The inclusion of that language in the state’s line-siting law could justify a narrow exemption from local laws, allowing TEP to build overhead lines as planned.

Instead, Line Siting Committee Chairman Adam Stafford and other committee members urged TEP and the city to come up with language that would allow the parties to preserve their legal rights and encourage a compromise.

After negotiations late Thursday, TEP and the city proposed a finding later adopted by the committee that the city disagrees that the state law applies and contends that an underground project is feasible and that the city ordinances are “not unreasonably restrictive.”

Underground Arizona, a nonprofit group supported by concerned neighborhoods that contends TEP must underground the lines, later signed onto that finding.

But the committee also approved another conditional finding that the state law applies and Tucson’s ordinances can be overridden, citing a Corporation Commission policy against ratepayers funding overhead lines adopted last December.

Without that finding, TEP is concerned that the city could require undergrounding in other circumstances, TEP attorney Meghan Grabel said.

That finding would take effect if the city and TEP fail to find a means to fund the extra cost of undergrounding aside from TEP or its customers within six months of the ACC rendering its siting decision, or if TEP fails to get special exceptions or variances allowing it to build lines overhead.

Grabel said the city has been unable to assure the company it could qualify for special exceptions or variances that would allow it to cross three gateway corridor routes as part of its preferred route.

Assistant City Attorney Roi Lusk said the city recognizes the transmission project is critical for Tucson and is committed to moving the project forward.

But Lusk said he could not speak for city officials who must ultimately decide on any needed special exceptions or variances.

Murky legal waters

But TEP’s plan faces potential legal challenges from other quarters.

Officials of Banner-UMC said they will challenge any condemnation proceedings by TEP to use its northern campus road and remains concerned about the use of Lester Street just to the north, as well as any route using Campbell.

In Arizona as in many states, utilities can use eminent-domain laws to condemn property for use in public projects.

Separately from Banner, which was a formal intervenor in the case, the University of Arizona said it didn’t take a position on the proposed routes but as the largest landowner in the area would be concerned about bearing the cost of an underground improvement district that would tap property owners to pay the added cost of installation.

And residents of affected neighborhoods near the route say they could sue to recover losses in property value they say cold range from 5% to 40% from the installation of overhead lines.