Westar Energy, Inc. (WR) has received route approval from the Kansas Corporation Commission to implement a transmission project. The company will invest $66 million in this venture. The project is expected to be completed in the end of 2016.
Westar Energy and ITC Holdings Corp.’s (ITC) unit ITC Great Plains along with Mid Kansas Electric will jointly build the high-voltage 345-kilovolt transmission line. Westar Energy will construct southern half of the transmission line. The transmission line will link Westar Energy’s Summit Substation, located approximately 5 miles northeast of Assaria in Saline County, to the Elm Creek Substation, nearly 4 miles northwest of Aurora in Cloud County.
We note that Westar Energy has conducted an engineering study and discussed with local landowners to ascertain the probable transmission routes. After finalizing the route map, the company submitted the proposal to the Kansas Corporation Commission.
One of the main reasons to invest in this project is to improve reliability of electricity supply. The project will enable the expansion of the industrial, commercial and residential loads and help to redress possible failures of the existing line. The transmission line will benefit the regional electrical grid, administered by the Southwest Power Pool. These initiatives will subsequently improve consumer confidence and public safety.
Apart from boosting electric reliability, Westar Energy’s current project will also create employment opportunities during construction, which will subsequently improve local economy.
Westar Energy will recoup the project expenditure from Southwest Power Pool’s customers, which will in turn boost the confidence of the company to invest more on infrastructure upgrades.
Westar Energy invests regularly for the improvement of its utility transmission and distribution operations, as well as for the installation of modern technologies. During the first six months of 2013, the company invested $0.4 billion under its capital spending program. The company is in the middle of several projects, including the Post Rock Wind Farm project, Ironwood Wind Power project and Prairie Wind joint venture. We believe the successful completion of these projects will enable Westar Energy to serve more customers, which will improve its future results.
Westar Energy currently has a Zacks Rank #3 (Hold). However, other stocks in the industry that are worth considering include Huaneng Power International, Inc. (HNP) with a Zacks Rank #1 (Strong Buy), and Alliant Energy Corp. (LNT) with a Zacks Rank #2 (Buy).
Topeka, Kan.-based Westar Energy is an electric utility, which engages in the generation, transmission, and distribution of electricity in Kansas.
More From Zacks.com