Profile: ITC Holdings Corp. (ITC.N)

ITC Holdings Corp. (ITC Holdings), incorporated in 2002, is a holding company whose business consists primarily of the operations of its Regulated Operating Subsidiaries, International Transmission Company (ITCTransmission), Michigan Electric Transmission Company, LLC (METC) and ITC Midwest LLC (ITC Midwest). Through its Regulated Operating Subsidiaries, the Company is engaged in the transmission of electricity in the United States. The Company’s Regulated Operating Subsidiaries’ transmission facilities are located in the lower peninsula of Michigan and portions of Iowa, Minnesota, Illinois and Missouri, and have agreements with other utilities for the joint ownership of specific substations and transmission lines. The Company also has other subsidiaries focused primarily on business development activities, and a holding company whose activities include corporate debt and equity financings and general corporate activities.

ITCTransmission owns the assets of a transmission system and related assets, including approximately 2,800 circuit miles of overhead and underground transmission lines rated at voltages of 120 kilovolts to 345 kilovolts; approximately 18,200 transmission towers and poles; station assets, such as transformers and circuit breakers, at 163 stations and substations, which either interconnect the Company’s transmission facilities or connect ITCTransmission’s facilities with generation or distribution facilities owned by others; other transmission equipment necessary to operate the system, such as switching stations, breakers and metering equipment; an approximately 188,000 square-foot corporate headquarters facility and operations control room, and an approximately 40,000 square-foot facility in Ann Arbor, Michigan that includes a back-up operations control room.

METC owns the assets of a transmission system and related assets, including approximately 5,500 circuit miles of overhead transmission lines rated at voltages of 138 kilovolts to 345 kilovolts; approximately 36,200 transmission towers and poles; station assets, such as transformers and circuit breakers, at 93 stations and substations, which either interconnect the Company’s transmission facilities or connect METC’s facilities with generation or distribution facilities owned by others, and other transmission equipment necessary to operate the system. ITC Midwest owns the assets of a transmission system and related assets, including approximately 6,800 miles of transmission lines rated at voltages of 34.5 kilovolts to 345 kilovolts; transmission towers and poles; station assets, such as transformers and circuit breakers, at approximately 254 stations and substations, which either interconnect ITC Midwest’s transmission facilities or connect ITC Midwest’s facilities with generation or distribution facilities owned by others, and other transmission equipment necessary to operate the system.

As transmission-only companies, the Company’s Regulated Operating Subsidiaries function as conduits, allowing for power from generators to be transmitted to local distribution systems either entirely through their own systems or in conjunction with neighboring transmission systems. Third parties then transmit power through these local distribution systems to end-use consumers. The transmission of electricity by its Regulated Operating Subsidiaries is a central function to the provision of electricity to residential, commercial and industrial end-use consumers. The operations performed by its Regulated Operating Subsidiaries fall into categories, such as asset planning; engineering, design and construction; maintenance, and real time operations.

The Company’s Asset Planning group uses detailed system models and long-term load forecasts to develop its system expansion capital plans. Asset Planning works with Midwest Independent Transmission System Operator, Inc. (MISO) in the development of its annual system expansion capital plans by performing technical evaluations and detailed studies. As the regional planning authority, MISO reviews regional system improvement projects by its members, including the Company’s Regulated Operating Subsidiaries. The Company’s Engineering, Design and Construction group is responsible for design, equipment specifications, maintenance plans, and project engineering for capital, operation and maintenance work. The Company works with outside contractors to perform some of its engineering and design and all of its construction.

ITC Holdings develops and tracks the preventive maintenance plan to promote a reliable system. Its Regulated Operating Subsidiaries contract with Utility Lines Construction, which is a division of Asplundh Tree Expert Co., to perform the bulk of their maintenance. From the Company’s operations control room facility in Novi, Michigan, transmission system coordinators monitor the performance of the ITCTransmission and METC transmission systems. Under the functional control of MISO, ITCTransmission and METC operate their electric transmission systems as a combined Local Balancing Authority (LBA) area, known as the Michigan Electric Coordinated Systems (MECS).

The Detroit Edison Company (Detroit Edison) operates the electric distribution system, to which ITCTransmission’s transmission system connects. Consumers Energy Company (Consumers Energy) operates the electric distribution system, to which METC’s transmission system connects. METC is a party to a number of operating contracts with Consumers Energy that govern the operations and maintenance of its transmission system. Interstate Power and Light Company (IP&L) operates the electric distribution system, to which ITC Midwest’s transmission system connects. ITC Midwest is a party to a number of operating contracts with IP&L that govern the operations and maintenance of its transmission system.