Allete and transmission development company Grid United announced plans to co-develop the North Plains Connector project, a new 619.6km long high-voltage direct-current (HVDC) transmission line between central North Dakota and Colstrip, Montana in the US.

The transmission project entails an investment of nearly $2.5bn in Montana and North Dakota.

A memorandum of understanding (MoU) has been signed by Allete and Grid United to explore the potential for transmission projects. Under the MoU, the parties intend to sign an agreement for the North Plains Connector development in the first half of the year.

Allete, which is a Minnesota-based energy company, anticipates securing a minimum of 35% stake in the transmission project and would oversee its operations.

The new HVDC transmission line is said to be the country’s first transmission connection between three regional electric energy markets namely the Western Interconnection, the Midcontinent Independent System Operator, and the Southwest Power Pool.

To be opened to all sources of power generation, the new line is expected to generate a transfer capacity of 3GW between the middle of the US and all three energy markets.

According to Allete, the North Plains Connector is expected to reduce congestion on the transmission system and enhance resiliency and reliability. It will also allow quick sharing of energy resources across a large area with diverse weather patterns, said the energy company.

Allete chair, president, and CEO Bethany Owen said: “Additional investment in transmission is critically important to achieve a clean-energy future and is a key part of our ‘Sustainability-in-Action’ growth strategy as our national footprint expands.

“This innovative project is an important step toward a resilient and reliable energy grid across a wide area of the country and ties into important transmission projects being developed in the Upper Midwest and the Western Interconnection.”

The new HVDC transmission line by linking the North Dakota and Montana grids is anticipated to lessen the adverse effects of extreme weather events and meet the rising electricity demand.

Allete and Grid United expect project permitting to start this year.

Currently, the North Plains Connector project is in the development phase and subject to regulatory approvals. The project is aimed to begin operations in 2029.

Grid United CEO Michael Skelly said: “ALLETE’s superior track record of energy development in the Upper Midwest makes them the ideal partner to support this project through development into operations.

“It is no secret that the US is in desperate need of new electric transmission capacity, and the North Plains Connector will provide resiliency and reliability benefits for decades to come.”