ITC to build big power lines in Kansas

NEW YORK, Sept 3 (Reuters) - ITC Holdings Corp's (ITC.N) ITC Great Plains subsidiary will build power transmission lines in Kansas for Mid-Kansas Electric Co and Sunflower Electric Power Corp, the companies said in a release.

ITC Great Plains will build two sections of the 180-mile Kansas V-Plan. The first section is a transmission line from Spearville, Kansas, to Comanche County, Kansas, and the second section is a line from Comanche County to Medicine Lodge, Kansas.

Mid-Kansas and Sunflower expect the project to enhance the reliability and affordability of power by allowing more imports and exports while promoting the development of renewable resources, like wind, in western Kansas.

ITC will build the sections at 765-kilovolts if Southwest Power Pool Inc, the regional grid operator, wants it, the companies said.

Construction is subject to state approvals, the resolution of cost recovery and cost allocation issues, and obtaining lender consent, the companies said.

As part of the agreement, Mid-Kansas and Sunflower offered Westar Energy Inc (WR.N), the biggest power company in Kansas, an opportunity to build the third section of the V-Plan.

The third section will go through part of Westar's service area. It will run from Medicine Lodge to Sedgwick County, Kansas, terminating just outside Wichita, Kansas.

Should Westar elect not to participate, the companies said, ITC committed to building any portion of the third section.

ITC, of Novi, Michigan, operates the high-voltage power system in Michigan's Lower Peninsula and portions of Iowa, Minnesota, Illinois and Missouri, and is developing projects in Kansas and Oklahoma.

Mid-Kansas is a coalition of six rural electric cooperatives serving in 34 western Kansas counties who organized for the purpose of acquiring the assets of Aquila's Kansas Electric Network. The cooperatives own Sunflower.

Sunflower owns and operates about 1,200 megawatts of generating capacity and transmits power to the six member cooperatives serving more than 400,000 customers in central and western Kansas. (Reporting by Scott DiSavino; editing by Jim Marshall)