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Impact on Value of New Overhead Power Distribution Line

This forum is to provide discussion, advice and assistance related to methods, or procedures, for placing a value on real property or interests in real property for right-of-way purposes. Discussion on concepts, practices and procedures related to measuring the economic impact of right-of-way acquisition, and subsequent construction, on the affected parcel and any remainder parcel are encouraged. It is also established to provide a venue to examine, monitor and report on legislation or changes in legislation pertaining to such methods or procedures.


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Impact on Value of New Overhead Power Distribution Line

Postby wallery on Fri Nov 28, 2008 1:23 am

Power company is looking to rebuild a power distribution line serving three properties. The original line was built in the 1940's and is essentially the shortest practical distance through very hilly terrain. An easement was never recorded for the original line. The proposed new line is substantially longer and follows a town road right-of-way that passes through the middle of one of the properties for over 1/2 mile. There have never been overhead lines along this scenic town road. How does this impact the value of the property adjacent to the town road? Is there any research to support diminution of value of property adjacent to a road right-of-way due to construction of overhead distribution power lines? The primary issue would be aesthetics and potentially hindering future residential development since the lines would be along the town road frontage of future home sites. Any thoughts, ideas or direction on figuring this out?
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Postby wcdicke on Wed Jan 28, 2009 9:54 am

Why is route being changed? Why not just construct the new line where the old one is?
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Postby L. Nielson on Wed Jan 28, 2009 10:18 am

I think you will have a problem obtaining data for the construction of a typical overhead distribution electrical power line in public right of way in an urban area. You indicate that there may be future development and so I assume that this is an urban or urbanizing area where your power line r/w is being changed.

I am both a lawyer and forensic real estate appraiser who has appraised numerous rights of way for power line distribution corridors. I held the blief that these large corridors would impact future development. The Southern California Edison company gave me a helicopter tour of major transmission corridors and allowed me to select any adjacent subdivision I wanted in order to study comparative values of those homes that were ajacent to the right of way versus those not so close.

To my utter surprise I discovered that those home adjacent to the right of way actually brought a premium because people enjoyed the "open space" next to them rather than being next to more houses.

As to relocation of a typical non major transmission power pole, while it may be common belief that it would or should impact the desireability of homes yet to be built, I know of no cases where that issue has been decided (at least in Southern California) and I believe that locating empirical data will be difficult. This is a common utility and I think that police power would prevent any claims against the public utility. But the research I did many years ago actually surprised me as it turned out to be contrary to my prior belief. Good luck.

L. Nielson
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Postby kathyepp on Wed Jan 28, 2009 10:28 am

Since this is a distribution line, not a transmission line, I would think this would be an asset rather than cause a decrease in value. If the new line runs along the roadside, it will serve many more properties in the future. As it is now, it is only serving the lands it runs across. Surely the land owners would like to see it taken out so they can use the land. Thr road would not ever look the same as it does now. The problem would be to get new easements from the land owners along the road. Unless of course it is the same owners, or you put it in road right of way.
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