San Jose Power Hub Breaks Ground

LS Power Grid California broke ground on May 20 on the Power Santa Clara Valley and Power the South Bay projects, starting construction on a set of transmission upgrades that San Jose and LS Power say are meant to bolster the South Bay grid. The work includes a downtown San Jose terminal site known as Skyline, next to PG&E’s San Jose B substation, and a broader buildout that city officials approved in March. San Jose said construction is expected to finish by December 2028. LS Power said the Bay Area program represents a $2 billion investment across three transmission projects. The city and LS Power have framed the work as a response to rising electricity demand and reliability needs in Silicon Valley. San Jose said the new lines will create high-capacity connections between critical substations, add redundancy and allow bidirectional power flow during peak demand or outages. LS Power’s project materials say the work is intended to improve reliability, support economic development and provide access to diverse generation resources. (lspower.com) ### What exactly is being built in downtown San Jose? The Skyline terminal is the northern terminal for the Power Santa Clara Valley project, according to LS Power’s application materials and the California Public Utilities Commission’s environmental review page. A public notice for the project places the site west of State Route 87 at Santa Teresa Street and Ryland Street, immediately south of PG&E’s San Jose B substation. The CPUC describes the project as including an approximately 13-mile underground high-voltage direct current line between the southern Grove terminal and the Skyline terminal, plus a short connection from Skyline into San Jose B. (sanjoseca.gov) LS Power and city materials describe the San Jose work as part of a larger package with the Power the South Bay project. Engineering News-Record reported the two projects together will add about 2 gigawatts of transmission capacity through roughly 17 miles of new infrastructure, including a 12-mile underground section between existing substations. (powerthebay.com) ### Why did San Jose back the LS Power buildout? San Jose approved a franchise agreement with LS Power on March 24, saying the projects would strengthen grid reliability, support economic development and advance the city’s climate and electrification goals. City Manager Jennifer Maguire said in the city release that “a modern, resilient energy grid is foundational” to San Jose’s role as an innovation center. Mayor Matt Mahan said the expansion would power “decades of economic growth and opportunity” while the city holds partners to environmental and community standards. (enr.com) The city also tied the added transmission capacity to specific types of future load. San Jose said the expanded system would help accommodate advanced manufacturing, artificial intelligence and large-scale data centers, while supporting electrification of buildings, transportation and industrial operations. LS Power’s project site similarly says Silicon Valley’s growing electric demand is being driven by housing growth, vehicle electrification and economic development. (sanjoseca.gov) ### What approvals were needed before construction started? The California Public Utilities Commission opened its review after LS Power Grid California filed its application for a certificate of public convenience and necessity on April 29, 2024. The CPUC’s project page says the agency runs both a public-interest review and an environmental review under the California Environmental Quality Act for utility proposals like this one. (sanjoseca.gov) The California Independent System Operator also played a central role in shaping the buildout. The CPUC page says CAISO’s board approved a modified version of the Power Santa Clara Valley project on Nov. 12, 2024, and Engineering News-Record said the projects were selected to meet critical South Bay reliability needs. ### How does this fit into the next round of Bay Area grid expansion? (ia.cpuc.ca.gov) CAISO selected LS Power Grid California on April 17 to develop another Bay Area transmission project, a separate 230-kV underground line between Silicon Valley Power’s Northern Receiving Station and PG&E’s San Jose B substation. LS Power said that project is expected to cost $150 million to $200 million and has a required in-service date of June 1, 2030. Following energization, PG&E is expected to own, operate and maintain that line, LS Power said. (ia.cpuc.ca.gov) San Jose’s franchise agreement with LS Power covers 10 years and includes automatic renewals for up to 40 years, according to Engineering News-Record. Once the current projects are operating, the city expects annual franchise-fee payments of about $500,000 to $750,000, and construction on the transmission upgrades now underway is scheduled to run through December 2028. (enr.com) (prnewswire.com)