LANCASTER - South Central Power Company will receive almost $255 million in loans from the U.S. Department of Agriculture's Rural Development’s Electric Loan Program to connect about 6,400 customers, build and improve 320 miles of line and transmission system projects in 14 counties.
South Central is one of 64 electric cooperatives and utility companies across 26 states that will share $2.7 billion in federal money to expand and modernize the country's rural electric grid and increase grid security. Each cooperative applied for the loan.
South Central is headquartered in?Lancaster and serves 124,000 customers and 11,729 miles on line in 24 counties in south central Ohio. Its service area spans from near Cincinnati in the western part of the state to the eastern part near the Ohio River.
The local loan includes various smart grid projects for $94,713,300 including the installation of 1,130 miles of fiber cable to establish reliable communications between the cooperative's offices, substations, and some remote-operable line devices.?
"In each of the 24 counties that we serve there's going to be benefits from this loan," South Central communications manager Mark Owen said. "All of our consumers will benefit in some way from this loan."
In the region, South Central has customers in Fairfield, Franklin, Pickaway, Perry, Licking and Ross counties.
"President Biden has a view that we really need to strengthen the middle class in this country, and to do that requires investment in infrastructure," USDA Secretary Thomas Vilsack said. "Because it's the infrastructure that creates the economic opportunity to give people good-paying jobs and really to build the middle class from the bottom up and the middle out."
He said having reliable, efficient and cost-competitive electric utilities will help do that.
"That's why the Department of Agriculture has worked so cooperatively over the years with the rural electric cooperative associations across America, including South Central Power company," Vilsack said. "Essentially, we're strengthening that partnership today. What we're doing with South Central is one of 64 projects in which we're investing up to $2.7 billion in loans across 26 states. These projects will help 1.2 million people have that more reliable, safe, secure electric system."
The loans are for 35 years and Vilsack said the interest rate depends on when a company's loan is finalized.
"So, for example, if you did the loan today the interest rate might be somewhere in the neighborhood of 3.6% or 3.7%," Vilsack said. "It could be less tomorrow or it could be more tomorrow. Or it could be the same. It depends on what the treasury rate is that particular day."
Owen said the biggest benefit is that it will allow the company to improve on its transmission and distribution systems.
"It's going to be a more reliable grid and a smarter grid," he said. "It's going to mean our average outage time will be shorter in the future than it is today. With the investments we're going to be able to make, sometimes outages will be able to be restored remotely.
"That's even the case today. But I think we'll see an expansion of that type of technology so that people won't be waiting always on a person to come out and restore their power. It might be something the system does automatically from our office."
Owen said South Central will be able to connect its substations with high-speed internet which may save customers money and take advantage of smart technology in their homes.
"So there's really a lot of things that will be possible because of this investment," he said.
Owen said South Central trustees and leadership are grateful to the USDA for the loans.
"We know that this investment will help everyday Ohioans as they try to compete in a global economy, as they try to grow communities and grow our economy," he said. "We think it will improve the quality of life for the people here in Ohio."
This article originally appeared on Lancaster Eagle-Gazette: South Central Power receives almost $255 million in federal loans for improvements