American Electric Power has signed a memorandum of understanding  with Tennessee Valley Authority (TVA) to pursue extra-high voltage transmission projects designed to strengthen the transmission system in Tennessee, Virginia and Kentucky.

Through the non-binding MOU, AEP and TVA will collaboratively identify beneficial transmission enhancements along the interface of the PJM Interconnection (PJM) and TVA transmission systems. Joint development agreements would be negotiated for any potential future projects.

"This region's transmission system, which was home to some of the very first extra-high voltage transmission projects built in the United States, has not seen significant transmission investment for nearly three decades. It is time to build additional transmission in these states to maintain a strong regional grid," said Susan Tomasky, president, AEP Transmission.

"A reliable supply of electricity is critical for economic growth. Partnering with TVA will leverage our vast transmission expertise and resources to ensure that both systems have the transmission capacity necessary to power this region's economic future," Tomasky said.

Through its Pioneer Transmission LLC joint venture with Duke Energy, AEP also signed a second MOU with TVA to develop a transmission project in Indiana and Kentucky. The companies propose to build 55 miles of 765-kilovolt (kV) extra-high voltage transmission connecting AEP's Rockport Station, located east of Evansville, Ind., with TVA's Paradise Fossil Plant in Drakesboro, Ky. The project also would include construction of a new 765-kV substation at Paradise Fossil Plant. The project would cost approximately $275 million, depending on approved routing, with a projected completion date to be determined by the PJM and TVA.

AEP, Duke and TVA will submit the Rockport-Paradise proposal to the PJM for consideration in their regional planning process. Additionally, the project will require siting approval from the Kentucky Public Service Commission. Ownership shares of the final project will be determined by TVA and the PJM approval processes.

The Rockport – Paradise project complements the Greentown – Rockport transmission line that AEP and Duke proposed in August 2008. Greentown – Rockport received a final order Jan. 21, 2010 from the Federal Energy Regulatory Commission granting the project a formula rate and project incentives. AEP and Duke are working with PJM and MISO to move the project through the respective approval processes. Pioneer Transmission LLC expects to file for utility status in Indiana later this year.