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November 25, 2024

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SE Renewable Energy Conference: Will the Southeast Rise Again?

CHARLOTTE, N.C. ― The Southeast’s traditionally risk-averse vertically integrated utilities are now embracing the clean energy transition, driven by economic development in the form of new industry and data centers.

Their regulatory and legislative policies vary, but the states are united in their focus on meeting new corporate demand for clean electrons with “all of the above” mixes of power, in which new renewables are backed up with natural gas and nuclear.

Mississippi, for example, now boasts the tallest onshore wind turbines in the U.S.: AES’ 184.5-MW Delta wind project, with blades that reach 692 feet at their highest point, Jaxon Tolbert, senior program associate for the Southeastern Wind Coalition, said at the Infocast Southeast Renewable Energy conference in October.

A long-running narrative has maintained that the Southeast does not have enough wind for onshore development, but Tolbert said, “It just depends on how tall your turbine is, and so we’re really excited to see this new commercially available tall-wind technology …

“MISO-based wind is here, and MISO South is a new market, and I think the big issue is awareness.”

MISO’s interconnection queue now includes about 20 onshore wind projects located across Arkansas, Mississippi, Louisiana and Kentucky, he said.

Under North Carolina’s new carbon plan, which the state’s Utilities Commission approved Nov. 1, Duke Energy will procure up to 3,460 MW of new solar generation and 1,100 MW of battery storage, including 475 MW of standalone storage and 625 MW paired with solar, all by 2031.

However, the new solar will be counterbalanced by 3,620 MW of new natural gas turbines that the commission approved to go online in 2030 and 2031. (See NCUC Approves Latest Duke ‘Carbon Plan’ to Expand Renewable, Nuclear and Gas Generation.)

The Louisiana Energy Users Group, an industry group with heavy participation from fossil fuel companies, has floated a proposal to allow companies locating new facilities in the state to procure their own electricity from combined heat and power plants or from MISO’s wholesale market, at their own expense.

Whether a state participates in an organized wholesale power market could be a critical differentiator for renewable project developers and their corporate customers, said David Mindham, director of regulatory and market affairs for EDP Renewables.

Organized markets have “all the structures you need to power and contract for power outside of a regulated utility,” Mindham said. “And so that drives a massive amount of demand that isn’t seen in the rest of the South, and that demand can be data center load; it can be other manufacturers.”

At the same time, he sees the Southeast’s response to economic development and the resulting growth in power demand as “driving good and intelligent development of projects and renewables” across its investor-owned, municipal and cooperative utilities.

But interconnection remains a pain point for renewable developers in MISO South, reflecting uncertainty, rather than speculation, Mindham said.

“The queue today is a reflection of the uncertainty we have in the markets we’re approaching right now … where the transmission, where the number of data centers or new industrial loads, or whatever, where they are going to site, how many they are going to be,” he said. “We’re trying to anticipate the needs of a system that is full of uncertainties 10 years out.”

The Virginia Update

The growth of renewables across the South over the past four years has been significant, with many states doubling their megawatts of utility-scale solar.

According to figures from the Solar Energy Industries Association, cited at the conference, demand from the high concentration of data centers in Virginia’s Loudoun County has more than doubled solar in the state, from 2,629 MW in 2020 to 5,799 MW in 2024. Georgia has gone from 3,249 MW to 6,147 MW, and Alabama has grown its utility-scale solar from 283 MW to 823 MW.

But demand growth projections are also increasing exponentially. With data centers still crowding into Virginia, Dominion Energy has predicted its electricity demand will grow 5.5% per year for the next decade, ultimately doubling by 2039.

Speaking at the conference’s opening panel, focusing on Virginia, Scott Gaskill, Dominion vice president of regulatory affairs, said it took the utility “about 100 years to get to 20,000 MW [of demand], and we’re going to double that in about 15 years.”

The Virginia Clean Economy Act of 2020 requires Dominion to provide its customers with 100% clean power by 2045, setting up a major challenge for state lawmakers, regulators and other industry groups on how to meet growing demand and maintain reliability and affordability while meeting the VCEA goals.

Session moderator Cliona Mary Robb, board chair of the Virginia Renewable Energy Alliance, ran down a series of reports and hearings that will be looking at the thorny issues surrounding data center growth in the state.

The General Assembly in 2023 mandated the Joint Legislative Audit and Review Commission to study the particular challenges raised by data centers and issue a report by Dec. 10. The state Commission on Electric Utility Regulation has also been holding a series of hearings on data centers, with the next one scheduled for Nov. 26.

One of the ideas being discussed by commission staff is a shift “from having utilities file an integrated resource plan to instead filing an integrated system plan,” Robb said. “The integrated system plan would include transmission planning as well as generation resource planning, and specifically … it would address the use of grid-enhancing technologies.”

Finally, the State Corporation Commission has announced it will hold a technical conference Dec. 16, looking at the impact of hyperscale data centers in the state, with a main focus on cost allocation.

The SCC has yet to accept Dominion’s 2024 IRP, filed Oct. 15, telling the utility to come back by Nov. 15 with updated modeling “to address load growth with and without data centers’ price impacts [and] reflecting … updated capacity forecasts coming out of PJM,” Robb said. (See Dominion Releases ‘All of the Above’ Integrated Resource Plan for 2024.)

Gaskill noted that the VCEA does allow the SCC to delay the retirement of fossil fuel generation to ensure reliability on the system.

But Kim Jemaine, managing director of Counterspark, a clean energy advocacy group, countered that while demand growth is largely seen as inevitable, meeting the clean energy goals of the VCEA is now being talked about as optional, as opposed to finding clean energy options.

“In our view, meeting the VCEA should be treated with the same seriousness and vigor as demand growth,” she said.

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NERC Submits IBR Standards to FERC

NERC has filed five proposed reliability standards with FERC, completing an occasionally eventful development process and taking the final step toward satisfying the commission’s mandate to develop reliability requirements for inverter-based resources. 

The standards submitted Nov. 4 address the second milestone in FERC Order 901, issued Oct. 19, 2023. According to NERC’s IBR work plan developed this year, Milestone 2 standards cover performance requirements and post-event performance validation for registered IBRs and were to be submitted by Nov. 4, 2024. Standards covering data-sharing and model validation for all IBRs are due by 2025, and planning and operational studies requirements for all IBRs are due by 2026. (See NERC Submits IBR Work Plan to FERC.) 

The following standards, and their implementation plans, were part of the Milestone 2 filing: 

    • PRC-024-4 — Frequency and voltage protection settings for synchronous generators, Type 1 and Type 2 wind resources, and synchronous condensers.  
    • PRC-028-1 — Disturbance monitoring and reporting requirements for inverter-based resources.  
    • PRC-002-5 — Disturbance monitoring and reporting requirements.  
    • PRC-030-1 — Unexpected inverter-based resource event mitigation. 
    • PRC-029-1 — Frequency and voltage ride-through requirements for IBRs. 

NERC also submitted a new definition of the term “inverter-based resource” for inclusion in the ERO’s Glossary of Terms. 

In the implementation plans for the standards, NERC requested that FERC set the effective date for PRC-024-4, PRC-030-1, and PRC-029-1 as the first day of the first calendar quarter that is 12 months after the effective date of the commission’s approval order. Because PRC-029-1 is a prerequisite for PRC-030-1, the ERO suggested an alternative effective date could be the first day of the first calendar quarter that is 12 months after the effective date of the commission’s approval order for PRC-029-1. 

For PRC-002-5 and PRC-028-1, NERC proposed the standards become effective on the first day of the first calendar quarter after the effective date of FERC’s approval order. The ERO said a “relatively short implementation period is necessary to establish … PRC-028-1 as the standard governing disturbance monitoring requirements for IBRs.” 

All of the draft standards were approved by NERC’s Board of Trustees at a special meeting Oct. 8, held after PRC-029-1 received industry approval in a ballot that ended Oct. 4. The standard was the last of the five to pass its formal ballot, and the standards drafting team’s inability to get PRC-029-1 across the finish line led the board in August to invoke for the first time its authority to streamline the ERO’s stakeholder approval process. 

Following the board’s August decision, NERC’s Standards Committee held a technical conference in September to hear feedback from industry, which the drafting team then used to revise the standard. It was this revision that finally passed the industry ballot in October. 

After the board voted to submit the five standards to FERC, NERC Vice President of Engineering and Standards Soo Jin Kim told trustees the technical conference turned out to be a big help identifying issues that had held industry back from supporting PRC-029-1. She suggested that when developing the Milestone 3 standards for next year, NERC will call for similar gatherings to “get ahead of … the technical issues” so the drafting teams can handle them proactively. 

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Eversource Exit from OSW Drives Q3 Loss

Eversource Energy’s exit from the offshore wind business drove a $118 million loss in the third quarter of 2024, offsetting increased revenue from its electric and gas distribution business relative to 2023, the company announced to investors Nov. 5.

The company had been working to sell its 50% share in the South Fork and Revolution Wind projects since 2022 and finalized its sale of the projects to Global Infrastructure Partners at the end of September. But that came at a $524 million net loss, executives said. (See Eversource Takes Another Financial Hit with OSW Exit.)

CFO John Moreira said the loss includes “approximately $365 million related to obligations under the sale terms with GIP,” encompassing “costs associated with the previously announced delay to the in-service date and higher projected construction costs with Revolution Wind.”

CEO Joe Nolan emphasized that the company is pivoting to being a “pure-play, regulated pipes and wires utility” and preached caution for the company moving forward.

“We are not going to swing for the fences anymore; we’re looking for the singles and the doubles in the regulated space,” Nolan said. “I don’t want anyone to worry that we are going to go and propose a transmission line to Canada as a merchant project.

“We are a leader in the clean energy transition, with tremendous regulated opportunities ahead of us,” he added. “As the largest utility in New England, Eversource is well positioned to meet our states’ mandated clean energy goals.”

Nolan emphasized the opportunities the company expects to see for distribution investments, along with transmission investments to interconnect new generation projects. He specifically praised Massachusetts’ electric sector modernization plan (ESMP) process, in which utilities must submit five- and 10-year plans to meet the needs of the clean energy transition. (See Mass. DPU Approves 1st Round of Utility Grid Modernization Plans.)

The stakeholder engagement process for the ESMPs, which included significant discussions before the utilities filed the final plans, enabled Eversource to submit its plan with the support of key stakeholders, Nolan said.

The Massachusetts Department of Public Utilities’ approval of the final plans received a more mixed reaction from climate and consumer advocates, with several groups arguing the plans should take a more systemwide approach.

Nolan said Eversource’s plan will enable the company to make an incremental $600 million in distribution investments and increase electrification capacity by more than 180%.

“This plan is the roadmap for clean energy in the state, and we believe it can become the model blueprint for the nation,” Nolan added.

Investors asked Nolan for his perspective on a potential deal in which Massachusetts or other New England states would purchase power from the Millstone Nuclear Power Plant, currently propped up by a contract with Connecticut.

Massachusetts officials have expressed their hope that Connecticut will join the recent multistate OSW procurement, as the state’s participation may be needed for the viability of the proposed 1,200-MW Vineyard Wind 2 project, from which Massachusetts has committed to buying up to 800 MW. (See Multistate Offshore Wind Solicitation Lands 2,878 MW for Mass., RI.)

Nolan said he has been “involved only to the extent that I understand their objectives. … I have only been privy to the fact that everybody is trying to bring something to the table.

“There’s a very strong working relationship between Rhode Island, Connecticut and Massachusetts when it comes to clean energy,” Nolan added. “I am confident that they will come to a decision or a solution that is beneficial to all customers in New England.”

Eversource officials continued to express concern about Connecticut’s regulatory environment. Utility executives have repeatedly expressed concern about cost recovery in the state under the leadership of Connecticut Public Utilities Regulatory Authority Chair Marissa Gillett.

The state’s electric utilities have particularly taken issue with PURA’s approach to implementing performance-based regulation. (See The Rocky Road to Performance-based Regulation in Connecticut.) In May, Eversource announced its plans to remove about $500 million in investments from the state. (See Eversource Announces $500M Cut in Connecticut Investments.)

Nolan told investors that he would reinvest the money in the state if “they decide they want to provide timely cost recovery and follow legal standards.” But he added that “there’s no shortage of opportunities for investment that give us timely recovery of our costs” in New Hampshire and Massachusetts.

He also expressed some concern about capital recovery in PURA’s proposal for deploying advanced metering infrastructure (AMI) in the state. “We are hopeful that the final decision will provide a clearer path to allow us to make this important investment for our customers.”

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RFF Report Evaluates Biden Effort to Help Coal Communities

As Joe Biden’s presidency nears its end, Resources for the Future (RFF) reflected on the work of the federal Interagency Working Group on Energy Communities in a report released Nov. 5, examining how the lightly funded entity worked and where it fell short. 

The IWG was established one week after Biden took office in 2021 with Executive Order 14008. It was meant to organize the federal government’s response when communities lose out on the economic activity from a retiring power plant or other fossil fuel business. Organized by the Department of Energy, it also included the White House’s Office of Management and Budget, and Domestic Policy Council; the departments of Treasury, the Interior, Agriculture, Commerce, Labor, Health and Human Services, Transportation, and Education; EPA; and the Appalachian Regional Commission. 

The White House had two main motivations for establishing the committee: showing its commitment to communities and workers that have historically powered the U.S. economy, and identifying the challenges and supporting the goals of coal-dependent communities around the country. 

“Establishing the IWG in the first week of the administration … indicated a commitment to addressing the specific challenges faced by fossil energy communities and workers in the broader context of concern for places ‘left behind’ economically,” the report says. 

Federal programs often face similar issues, but they have not developed a unified strategy to address many of them, often working in silos, according to the report. The IWG was meant to help coordinate the delivery of resources and expertise to coal communities. 

The IWG used data from the Bureau of Labor Statistics to identify areas that were highly dependent on coal, oil and natural gas for local employment (with most of its focus on coal communities). The identified areas included broad regions such as the Southwest, Gulf Coast, Intermountain West, Appalachia and Alaska. 

The group’s work focused on engaging energy communities, identifying federal investments to support job creation and economic diversification, integrating such programs across the federal government so communities could have a one-stop shop to access them, and identifying policy reforms and initiatives that would support their economies. 

It also set up rapid response teams for Wyoming, the Four Corners region, the Illinois Basin, Pennsylvania, Ohio and Kentucky, with more under development. 

“Each RRT has a coordinator from one of the IWG’s member agencies,” the report says. “RRTs meet regularly with staff from state agencies and governors’ offices and local leaders to tackle the challenges they identify. This model provides an opportunity for information to be shared across, as well as up and down, levels of government.” 

The teams allow locals to become familiar with federal agencies and what they can offer, while federal staff benefits from increased understanding of local needs. 

The IWG also focused on identifying federal funding set aside or prioritized through legislation, such as the $300 million from the Commerce Department’s Economic Development Administration dedicated to coal communities, $4 billion in tax credits for clean energy manufacturing, and bonus tax credits for clean energy projects. 

One of the challenges identified in the effort is that federal programs are not nimble enough to meet the needs in each unique community. 

“Economic reinvention is not simply a matter of identifying a new industry or new technology and inserting it into the vacuum created by the declining or departed legacy economy,” the report says. Building a new renewable energy facility, which is almost always made of components manufactured elsewhere, does little to replace lost jobs from a shuttered coal plant or mine. “Early on, IWG leadership recognized that it would be most effective when it could connect communities to tailored solutions, rather than tailor the community’s needs to a federal program.” 

Communities benefit more from help when they have identified a plausible economic future, but many of them lack the capacity to create such visions of their future. 

“These are the communities that need the most support: time-intensive tailored assistance, capacity building and nurturing,” the report says. “For example, local elected officials may need help identifying which programs are best suited for upgrading, expanding or maintaining water and sewer infrastructure, in part because different types of projects may be funded by different programs across multiple agencies.” 

That retail-scale technical assistance can stretch the IWG’s budget, but it can also provide spillover benefits to implementing federal programs in other communities. 

“Facilitating regular and direct engagement between different levels of government builds relationships and trust among community members, local leaders, federal staff and others, improving the likelihood of successful federal intervention,” the report says. “And although challenges for accessing federal funding remain in many instances, helping communities apply for federal programs has given the IWG insights into how access can be improved.” 

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MISO: Wisconsin Coal Plant to Stay Online as SSR Unless Stakeholders Offer Solutions

MISO said unless stakeholders come up with an alternative it hasn’t explored, it will have to renew its sole system support resource — Manitowoc Public Utilities’ Lakefront 9 coal unit — for another year.

At a Nov. 5 technical study task force meeting, MISO’s Huaitao Zhang said the RTO continues to find steady state thermal violations during the summer months that require mitigation.

He said MISO didn’t land on any transmission reconfiguration options, operating guide substitutions or demand-side solutions that can negate the need for Lakefront 9 staying online to sustain reliability. MISO uses system support resource (SSR) agreements to keep generation operating past planned retirement dates for the sake of system reliability.

Further, Zhang said MISO has ruled out redispatch as a solution because there are limited resources in that area of Wisconsin. Local transmission owner American Transmission Co. (ATC) also discourages manual load shed as a viable mitigation, he said.

If no stakeholders come forward with an alternative that hasn’t occurred to MISO, Zhang said MISO must begin a new SSR term with the municipal utility on Feb. 1. Zhang asked stakeholders to offer their ideas over the next two weeks.

Lakefront 9 has been operating as an SSR since February 2023, after MISO discovered that thermal overloading could occur on several nearby constraints if the plant was permitted to suspend operations as scheduled. Manitowoc Public Utilities originally sought to idle the 63-MW Lakefront 9 until 2026 and to convert it to a renewable fuel source. (See FERC Again Questions MISO Reliability Payments to Wisconsin Coal Plant.)

MISO has said ATC’s planned, 138/69-kV transmission upgrades for the area, which would improve system performance and allow it to lift the SSR agreement, won’t be completed until mid-2028.

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State Funds Support Microgrids on California’s Tribal Lands

SACRAMENTO, Calif. — Energy projects designed to accelerate decarbonization and strengthen reliability in vulnerable communities are receiving significant investment thanks to the California Energy Commission’s Electric Program Investment Charge (EPIC) program.

“This summer has been the hottest summer in recorded history in California and the hottest summer recorded globally,” David Hochschild, chair of the CEC, said at the Oct. 28 EPIC Symposium. “Yet another sign that we know the great challenge of our generation is climate change, and the solutions for that, the seed planting, is here in our state in California and in particular, this program.”

Tribal leaders, entrepreneurs, grid operators and energy officials convened to discuss the benefits and challenges of the EPIC program, which invests more than $130 million annually in clean energy research and development. The program aims to expand renewable energy, advance electrification, enable a more decentralized electric grid, support local economies and improve the affordability and health of local communities.

The California Public Utilities Commission established EPIC in 2012, and the ratepayer funded program has invested $1.2 billion into clean energy research, development and commercialization.

Hochschild highlighted many of California’s climate successes thus far, including reaching 61% clean energy on the grid, 26% of new vehicle sales being electric, and building 13 GW of energy storage in the past five years and 27 GW of clean energy capacity since 2018.

“Climate change is making it harder to fight climate change,” Hochschild said, but “there’s an opportunity to do some incredible seed planting for the future, and there’s already great momentum.”

‘Clean Energy Army’

The EPIC program helps to establish microgrids for several California tribes, which serve as a “refuge” from frequent blackouts and lack of reliability.

Early EPIC funding helped launch the first behind-the-meter microgrid in California on Blue Lake Rancheria territory, and up to nine tribes have followed suit.

“Our microgrids serve as a community refuge during times of crisis,” Jason Ramos, tribal council member of the Blue Lake Rancheria Tribe, said. Before the development of the microgrid, the tribe would experience intermittent blackouts that could affect key services like the health clinic and gas station.

The program also helps to fund the Tribal Energy Resilience and Sovereignty (TERAS) project, which is helping four tribes transform one of the state’s least reliable electrical circuits, the “Hoopa 1101.” The 142-mile-long line provides electricity to the Hoopa, Yurok and Karuk tribes, who experience some of the most frequent and longest duration outages in California. The project, in collaboration with the Blue Lake Rancheria tribe and the Schatz Energy Research Center, will establish three nested microgrids along the circuit to establish better reliability.

“It’s going to be a real game changer and is something that we absolutely need in the region,” Linnea Jackson, general manager of the Hoopa Valley Public Utilities District, said. “We look forward to having energy resiliency.”

The microgrid will cover 130 distribution circuit miles and serve 2,000 customers who experience an average of 100 hours of blackouts a year, explained Peter Alstone, faculty scientist at the Schatz Center.

“Everybody deserves reliable power, and when you have blackouts that frequent, people aren’t willing to invest in electric vehicles and electrified heating,” Alstone said. “This decarbonization challenge is just not on the table in places where the power is going out. So, this microgrid is a really important investment.”

Speakers also highlighted the importance of communicating effectively with tribes. Talking “to each other versus talking at each other” will accelerate progress, said Bo Mazzetti, chair of the Rincon Band of Luiseño Indians.

“Sovereign tribal governments are great partners,” Jackson said. “I really look forward to being a part of this clean energy army.”

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Ørsted Values Latest Revolution Wind Setback at $175M

A one-in-a-thousand problem with a key foundation component is the latest setback in U.S. waters for Ørsted and is blamed for its latest nine-digit cost impairment. 

The Danish offshore wind giant revealed the new problems with Revolution Wind in its third-quarter earnings report Nov. 5 but balanced it out with some good news: It was able to reverse significant portions of previously recorded impairments on Sunrise Wind, resulting in a net impairment for the quarter of $42 million rather than $228 million. 

Offshore work began this year for Revolution and is expected to begin next year for Sunrise. Onshore work for Sunrise is underway. 

It is the second setback in as many quarters for Revolution, a 704-MW wind farm that will feed into Connecticut and Rhode Island.  

With its second-quarter financial report in August, Ørsted announced that the environmental contamination at the site for Revolution’s onshore substation was worse than initially thought, so the cleanup would take longer. This pushed the projected completion date back from 2025 to 2026. (See Revolution, Sunrise OSW Projects Face New Delays.) 

During a Nov. 5 conference call with financial analysts, CEO Mads Nipper said there are potential problems with the monopile driven into the seabed for Revolution’s offshore substation. 

“Although it has been safely driven to the target depth, it may not be suitable for use as currently installed,” he said. “The cause is likely to be related to the resistance within the seabed soil.” 

This has happened only twice before with the more than 2,000 offshore wind foundations Ørsted has installed worldwide, Nipper said. 

“Using our extensive experience, our team [is] assessing the root cause and establishing the best part forward for the project.” 

As a precaution, the company has exercised its option to extend the contracted services of one of the installation vessels working on site. These ships typically command extremely high per-day charges, and Nipper said the cost was higher than anticipated. 

Ørsted is taking an impairment of $175 million because of these developments, raising Revolution’s total impairment for the first nine months of this year to $514 million. 

Aside from all this, Nipper said, the project is proceeding well.  

No new problems have cropped up with the onshore substation, and steady progress is being made offshore: 52 foundations, 20 array cables and nine turbines are in place. No further delays are expected in the commercial operation date. 

The team will suspend monopile installation from Dec. 1 to April 30 but plans to continue turbine installation through the winter. 

During the call, CFO Trond Westlie alluded to the many moving pieces of the offshore wind industry and world economy, and to their potential continued impact on the financials of Ørsted and Revolution Wind: “Let me remind everyone again that as we have had to recognize impairments on these projects in the past, any changes to the business case, including movement to the interest rates, are likely to lead to further adjustment to the impairments, as there is no headroom.” 

But things eventually should get better, he added: “It is important to keep in mind that once the projects are operational, they will contribute with significant earnings and cash flow throughout their lifetime.” 

When Nipper and Westlie completed their presentations, they fielded questions for nearly an hour, including: 

Q: Are you concerned that Donald Trump if elected would revoke the investment tax credit adders? 

A: We are assuming 40% and see minimal risk of that changing. 

Q: What portion of the components of Revolution Wind and Sunrise Wind are foreign, and what would be the impact of tariffs imposed by a new president? 

A: I cannot give you a percentage off the top of my head. Many of the major components of Revolution are already onshore, awaiting installation, and the phase-in period for any new tariffs should make their effects manageable. 

Q: Are there any other significant known unknowns with Revolution that could create problems in the next few quarters? 

A: We can never say that there are no risks left in a project until it is done. But with what we know now, we do feel comfortable calling this a robust project. 

Q: With all the problems so far with Revolution, do you think you have made enough contingencies for Sunrise? 

A: We, of course, are assessing that all the time. With our current knowledge, yes, we do. 

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FERC Approves SPP’s Winter RA Requirement

FERC on Nov. 4 accepted SPP’s tariff revisions that add a winter season resource adequacy requirement for load-responsible entities, effective Jan. 1 (ER24-2397). 

The commission said the requirement and its associated deficiency payment provide an incentive that will help ensure LREs proactively procure and maintain sufficient capacity during the winter season. SPP’s proposal extends its summer season resource adequacy (RA) requirement into the winter, replacing the existing winter obligation. 

FERC said SPP’s tariff revision addressed its November 2023 rejection of the grid operator’s first filing. The RTO added language clarifying that a resource can only be used to meet the RA requirement if the LRE “expects [it] will be available for the duration of the [season]” and has “no knowledge [that the resource] will become unavailable.” 

SPP’s new language included an exception for authorized outages, as long as the outage or outages do not exceed 30 days of either season. 

Protesters argued that the first revision didn’t include a requirement that resources in an LRE’s workbook are expected to be available. LREs could purposefully include generators they knew would be offline during the season, undermining resource adequacy, the protesters said. 

The commission disagreed with the SPP Market Monitoring Unit’s contention that the lack of a definition for “forced outage” renders authorized outage’s definition ambiguous and the filing unjust and unreasonable. It pointed to SPP’s argument that forced outages, though not explicitly defined in the tariff, are not studied and therefore cannot fall within the definition of authorized outages. 

“The definition states that authorized outages will be studied by SPP as the balancing authority,” FERC said. “The definition of authorized outages also only encompasses those outages that have received authorization from SPP and provides that the balancing authority does not authorize forced outages.” 

The commission noted that SPP extended the expectation of availability that previously applied only to the summer RA requirement, which it previously accepted. The RTO also imposed additional requirements, FERC said, in rejecting the MMU’s argument that the tariff must include further detail to ensure that SPP and its stakeholders know which situations disqualify a resource from the expectation of availability. 

“Having found SPP’s proposal just and reasonable,” FERC said, it didn’t need to “consider alternative proposals” in the proceeding. 

SPP added the winter resource adequacy requirement after increasing its planning reserve margin, saying the obligation was the culmination of a large amount of work by several stakeholder groups. (See “Board, RSC Endorse Winter Obligation,” SPP Board/Members Committee Briefs: July 24-25, 2023.) 

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Feds Accuse Tenn. Man of Substation Attack Plot

The FBI announced it has charged a Tennessee man with attempting to destroy an energy facility and attempting to use a weapon of mass destruction as part of a plot to cause civil unrest and spark a civil war.

Agents arrested Skyler Philippi, 24, of Columbia, Tenn., on Nov. 2, according to the criminal complaint. The arrest was the culmination of a plot several months in the making to rig a drone with explosives and fly it into an electric substation near Nashville to disrupt power to the area.

“Skyler Philippi believed he was moments away from launching an attack on a Nashville energy facility to further his violent white supremacist ideology — but the FBI had already compromised his plot,” Attorney General Merrick Garland said in a press release. “This case serves as yet another warning to those seeking to sow violence and chaos in the name of hatred by attacking our country’s critical infrastructure: The Justice Department will find you, we will disrupt your plot, and we will hold you accountable.”

Philippi first made it on the FBI’s radar in June 2024, when he allegedly told a “confidential human source” (identified as CHS-1 in the complaint) that he wanted to commit a mass shooting at a YMCA facility in Columbia. CHS-1 introduced Philippi to a second source (CHS-2) who lived closer to Philippi and could meet him in person. The FBI said both sources are “reliable [and have] previously provided accurate information to the FBI in multiple investigations.”

CHS-2 and Philippi continued to talk over the phone and via text for the next month about Philippi’s plans and beliefs. The suspect discussed his desire to “do the most damage [by attacking] high economic, high tax, political zones” in major cities. He said he was working on a “threat report” on the best way to disrupt the electric grid, including by attacking substations. He also asked for the informant’s help stealing a train de-railer to wreck a train in Tennessee.

In August, CHS-2 met Philippi in person, where he introduced the suspect to an “undercover employee” (UCE-1). Philippe told UCE-1 that he had ties to various white supremacist groups including Atomwaffen Division, whose founder, Brandon Russell, was arrested by the FBI in 2023 for plotting to attack electric substations in Baltimore. (See Feds Charge Two in Alleged Conspiracy to Attack BGE Grid.)

Manifesto Outlines Racial Beliefs

FBI agents said Skyler Robert Philippi planned to use a drone to plant explosives in a substation. | Metropolitan Nashville Police Department

Philippi shared portions of his “manifesto” with UCE-1, indicating his belief in “radical armed struggle [as] the only end to protecting and preserving our folk,” “accelerationism [as] a means to an end” and the need to destroy “the interconnected or otherwise globalized world.”

UCE-1 introduced Philippi to a second undercover employee, UCE-2, in September. Philippi told the two of his plans to cripple the power grid by attacking eight or more substations. He indicated he had studied previous attacks on the power grid in North Carolina and California with firearms. The complaint did not specify which attacks, but they may have included rifle damage to two substations in Moore County, N.C., in 2022 that knocked out power to 45,000 customers. (See Duke Completes Power Restoration After NC Substation Attack.)

However, Philippi told the undercover employees that he did not believe rifles could do enough damage to cause widespread outages. He said mounting explosives on a drone would be more effective. Philippi asked UCE-1 and UCE-2 to help him get the components to build the drone, which they provided to him later that month.

The three then drove to scout out substations in the Nashville area. During the drive the undercover employees introduced Philippi via phone to a third colleague, UCE-3, who Philippi asked to send him explosive materials including C-4 and black powder.

Philippi and the other agents then continued their scouting exercise, with Philippi outlining the plan for the others. The complaint emphasized his leadership of the plot, with Philippi suggesting the clothing the UCEs should wear to evade suspicion and telling them to wear leather gloves rather than latex and nitrile to avoid fingerprints.

Throughout October, Philippi worked on building the drone and obtaining more explosive materials. He ultimately was unable to build a working drone, so the UCEs helped him get another one at his request. He also asked the UCEs to build pipe bombs for him; the complaint said they replaced the black powder UCE-3 provided with “an inert substance” to prevent the bombs exploding.

Plot Disrupted in Final Stages

On Nov. 2, the UCEs picked Philippi up and gave him the drone, fake pipe bombs and the explosive he had ordered from UCE-3. The complaint did not specify whether UCE-3 provided actual explosive material. The UCEs drove him to a field where he conducted a test flight of the drone.

They then had lunch and drove to a hotel in Nashville where they “conducted a Nordic ritual” involving prayers to the Norse god Odin. The UCEs asked if Philippi still wanted to go ahead with the plan. He confirmed that he was “fully committed” and wanted to “do something big” that would be remembered in history. Philippi also revealed he had a handgun to shoot at police who tried to interfere with them.

After completing their preparations at the hotel, Philippi and the UCEs left to drive to the attack site. The UCEs left the vehicle, taking Philippi’s gun. Philippi went to the rear of their vehicle to prepare the drone and explosives, where law enforcement officers arrested him. The complaint said that when Philippi was arrested, he had powered up the drone, armed the explosive device and was preparing to attach the explosive to the drone.

Philippi’s charges carry a maximum sentence of life in prison. Prosecutors with the Middle District of Tennessee and the National Security Division’s Counterterrorism Section are handling the case, the Justice Department said.

“Dangerous threats to our critical infrastructure threaten every member of this community and will not be tolerated,” acting U.S. Attorney Thomas Jaworski for the Middle District of Tennessee said. “We will always work with our law enforcement partners to identify and stop any and all efforts to wreak this kind of havoc and will not hesitate in prosecuting those involved to the fullest extent of the law.”

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NERC Releases Final ITCS Draft Installments

In the final installments of the Interregional Transfer Capability Study (ITCS), released this week, NERC called for “a diverse and flexible approach” to meeting the future transfer needs of the U.S. electric grid.

NERC released the second and third draft ITCS installments on schedule Nov. 4. Part 1 of the study, released in draft form Aug. 28, comprised a transfer capability analysis summing up the current transfer capabilities between transmission planning regions in North America. (See NERC Examines Transfer Capability in Draft ITCS Installment.)

Part 2 includes recommendations for prudent additions to transfer capability that could strengthen grid reliability, while Part 3 lays out recommendations to meet and maintain total transfer capability. The three installments will be combined and submitted to FERC by Dec. 2 as ordered by Congress in the Fiscal Responsibility Act of 2023. (See Lawmakers, White House Promise More Work on Permitting After Debt Deal.) FERC will post the report for public comment and then submit a report to Congress along with recommendations for statutory changes.

A fourth document will follow in the first quarter of 2025, covering transfer capabilities and prudent additions from the U.S. to Canada and between Canadian provinces. While this plan goes beyond Congress’ mandate, NERC said earlier this year that the study “would be incomplete without a thorough understanding of the Canadian limits and available resources.”

“The ITCS emphasizes a balanced approach — one that identifies the unique needs of each region and determines where targeted and meaningful investments can make a real difference in ensuring reliability and resilience,” NERC Director of Reliability Assessments and Performance Analysis John Moura said in a statement. He added that NERC would continue “to ensure the [electric grid] is prepared for tomorrow’s challenges without taking a one-size-fits-all approach.”

NERC’s recommended prudent additions were based on the transfer capability analysis in Part 1, which used the transmission planning regions identified in FERC Order 1000 to create two different base cases covering summer 2024 and winter 2024/25. The model mapped existing interfaces, along with potential new interfaces that might be constructed in the coming decade, and used historical weather data to estimate load and resource availability for the future.

NERC defined “prudent additions” as “transmission enhancements … to mitigate grid reliability risks under the most challenging conditions.” Economic issues and cost-benefit analysis were not considered in the analysis.

ITCS authors selected the 2033 resource mix as the basis for their projections, even though interregional transmission projects typically need at least 10 years for construction, because “forecasting demand and resources beyond that time frame becomes increasingly speculative and uncertain.” The impact of added transfer capability during extreme events was then evaluated using a six-step process:

    • identify hours of resource deficiency through calculating available generation and storage, subtracting load and factoring in existing transfer capacity;
    • quantify maximum resource deficiency by calculating the yearly maximum resource deficiency across 12 weather years;
    • identify and prioritize constrained interfaces;
    • allocate additional transfer capability across constrained interfaces;
    • iterate incremental additions until all resource deficiencies are resolved, if possible; and
    • finalize prudent levels of transfer capability.

The authors recommended a total of 35 GW of additional transfer capability across the planning regions studied, with the greatest amount — 14,100 MW — found in ERCOT across the SPP-South connection (4,100 MW) and two entirely new connections to Front Range (5,700 MW) and MISO-South (4,300 MW). NERC noted that even with these prudent additions, it was still not possible to resolve all energy deficiencies “due to wide-area resource shortages.”

The same was true in the California-North region, where the report recommended 1,100 MW of additions on the Wasatch Front connection.

NERC described “various options” that entities can use to mitigate the risks identified in the report and address the recommended additions. Among these are the development of internal resources such as generation and storage, which can reduce the need for external transfers; building new transmission lines or increasing transfer capability with neighboring regions; and demand-side management and resilience initiatives.

“While the study highlights specific needs to improve resilience under extreme conditions, NERC encourages flexibility in meeting these needs through various pathways,” the ERO said, suggesting “enhanced collaboration with regional planning entities, careful alignment with FERC and state policies, and consistent stakeholder engagement to effectively assess, refine and execute strategies.”

In addition, NERC emphasized that “a one-size-fits-all approach may not be solely effective” in overcoming transmission constraints; in particular, the ERO said that a blanket universal transfer capability minimum across regions “could lead to inefficient investments” in areas where transmission capability is already adequate or excessive.

NERC said it hoped the ITCS would “foster collaboration between utilities, regional planning organizations and state regulators” to tackle the transmission challenges facing the grid. It also suggested revisiting the ITCS in the future to account for advances in technology and changes to the resource mix.