Page 1354 – RTO Insider

January 11, 2017

Cuomo Proposes 2,400 MW of Offshore Wind by 2030

By William Opalka

New York Gov. Andrew Cuomo has proposed the development of 2,400 MW of offshore wind generation off Long Island by 2030, the largest commitment to that energy source in the U.S.

Cuomo said the roadmap for developing offshore wind projects will be laid out in a master plan to be completed by the end of the year.

New York last year adopted a Clean Energy Standard that commits the state to generating 50% of its electricity from renewables by 2030.

The offshore wind commitment would provide enough power for 1.25 million homes and projects would be built out of view of onshore communities, according to Cuomo.

The announcement came a day after the governor took credit for the early closure of the Indian Point nuclear plant north of New York City by 2021, although plant owner Entergy cited low natural gas prices as the reason for shuttering the facility. (See Entergy to Shut Down Indian Point by 2021.)

Cuomo said a combination of transmission upgrades, energy efficiency and new renewable energy resources would replace lost generating capacity from Indian Point. Still, other clean energy sources would be needed to fill the gap before an adequate volume of offshore wind production could be put in service.

One proposed project 30 miles southeast of Montauk Point, the first phase of the massive Deepwater ONE project, would deploy about 90 MW of offshore generation by 2022.

The governor called on the Long Island Power Authority to approve that project, which has been stalled for months. State energy officials last summer requested a delay in project negotiations just as an agreement appeared to be in sight, and the agency’s board of directors failed to take up an expected vote on the project in December. (See LIPA Delays Vote on Offshore Wind Project; 90-MW Project Would be Largest in US.)

But Cuomo’s statement indicated that the project could be back on track, with the board now expected to consider a contract with the developer at its Jan. 25 meeting.

The project’s developer, Deepwater Wind, operates the nation’s first offshore wind farm off the coast of Rhode Island.

The governor’s proposal also calls on state agencies to ensure environmentally sensitive development in a 79,000-acre federally leased area capable of siting about 800 MW of offshore wind off the Rockaway Peninsula. The project area 17 miles south of the peninsula was the subject of a federal auction in December, which attracted a record $42.5 million bid by Norwegian energy company Statoil Wind US.

Cuomo said agencies should work with affected stakeholders — such as fishermen, maritime industries, coastal communities and labor groups — to ensure proper development.

He also directed the Department of Environmental Conservation and the New York State Energy Research and Development Authority to undertake a comprehensive study to determine the most rapid, cost-effective and responsible way to reach 100% renewable energy for the entire state.

“Gov. Cuomo’s plan to build 2,400 MW of offshore wind power by 2030 makes New York a national leader of this new clean energy industry,” Liz Gordon, director of the New York Offshore Wind Alliance, said in a statement. “The governor’s powerful endorsement will spur billions in investment, create thousands of skilled jobs and generate clean, affordable and reliable electricity for New York.”

She added: “The myriad benefits of offshore wind power have attracted the vocal support of a broad, diverse and growing coalition that unites business, labor, environmentalists, developers, academics, community leaders and environmental justice advocates.”

Environmental groups last month called on Cuomo to commit to developing offshore wind off Long Island.

“We applaud Gov. Cuomo for listening to New Yorkers and committing to large-scale, long-term offshore wind in New York and moving New York’s first offshore project forward,” said Lisa Dix, senior New York representative for the Sierra Club.

January 11, 2017November 9, 2023

FERC Clarifies Western Energy Crisis ‘Pricing Umbrella’ Theory

By Robert Mullin

FERC has affirmed a previous ruling stating that evidence of price reporting deficiencies by power sellers during the Western Energy Crisis of 2000-2001 cannot constitute the sole basis for a finding of market manipulation during the event.

The commission’s Jan. 9 order clarified a key element of an October 2016 decision that gave credence to California’s contention that a failure of some power sellers to file compliant price reports with FERC may have helped conceal market manipulation, which in turn created a “pricing umbrella” under which California’s Department of Water Resources was compelled to sign overpriced contracts near the conclusion of the crisis (EL02-71). (See FERC to Consider Western Energy Crisis ‘Umbrella Pricing’ Theory.)

That decision opened the door for the California parties to the ongoing proceeding — which include the Public Utilities Commission, the state’s attorney general’s office, Pacific Gas and Electric and Southern California Edison — to introduce evidence of reporting deficiencies as part of the examination of factors that enabled sellers to charge the state exorbitant contract rates.

The October ruling prompted Shell Energy North America, TransCanada Energy and Hafslund Energy Trading, collectively referred to as the “indicated respondents,” to ask the commission to affirm a previous finding that “evidence supporting a pricing umbrella argument cannot in and of itself establish liability” for any sellers still involved in the energy crisis proceeding.

“Out of an abundance of caution, indicated respondents respectfully seek clarification and confirmation of the commission’s ruling,” the companies said in a November 2016 filing with the commission.

The three companies said that they assumed the commission would only permit the introduction of pricing umbrella evidence as a means to “provide greater context and depth to actual probative respondent-specific evidence regarding the California parties’ claims for remedies against respondents.”

Pricing umbrella evidence would not in and of itself represent such probative evidence, the companies contended.

“Therefore, for example, no pricing umbrella evidence can alleviate the California parties’ burden to establish that a reporting deficiency ‘masked an exercise of market power or other overt manipulation [by a respondent] in order to demonstrate the required nexus between an unlawful act and an unjust and unreasonable rate,’” the companies said, citing the commission’s previous finding.

FERC’s Jan. 9 order confirmed the companies’ understanding of how the pricing umbrella theory will be applied in the proceeding.

The order notes that the commission will “continue to find that evidence of a third party’s conduct [in filing deficient reports] is not relevant to this showing because the focus of the Mobile-Sierra inquiry [into the contracts] is the conduct of the seller and whether that conduct directly affected contract prices.”

That language echoed the commission’s previous determination that evidence of a reporting violation alone could not overcome the Mobile-Sierra presumption of the “justness and reasonableness” of a contract. Such a finding would require evidence of an actual intent to manipulate markets.

“We clarify that, while we will permit the introduction of pricing umbrella evidence solely for the purpose of providing greater context and depth for probative, seller-specific evidence, this evidence should not be treated as evidence that can be the basis of a finding of refund liability,” the commission said. “We thus affirm that pricing umbrella evidence is not an element upon which a finding of refund liability may be based in this proceeding.”

January 11, 2017

Massachusetts Legislators Pass Electric Vehicle Bill

By William Opalka

Massachusetts legislators last week passed a bill that seeks to remove barriers to electric vehicle ownership and allows utilities to invest in charging infrastructure.

Gov. Charlie Baker is expected to sign the bill, which moved through the legislature last year but was left out of an omnibus energy bill that addressed several clean energy items. (See Massachusetts Bill Boosts Offshore Wind, Canadian Hydro.) The bill passed in the legislature’s informal session, a day before the start of the regular session.

massachusetts electric vehicle bill — | *Mass*

The new law prohibits charging station operators from requiring subscription fees from EV drivers and allows towns to create EV-only parking spaces. It also codifies regulations that would allow cost recovery for utilities’ EV infrastructure and promotes studies of issues such as the electrification of the state vehicle fleet.

The bill additionally requires “fair” rates for public charging, a detail that will be left to state regulators to determine.

Supporters said the final bill eliminated a provision directing the state Board of Building Regulations and Standards to amend building codes in order to require that new residential and commercial buildings be pre-wired for EV charging — instead leaving that as a recommendation.

“Massachusetts consumers want electric cars, but convenient access to charging stations is a barrier to getting more electric vehicles on the road,” said Megan Herzog, staff attorney at the Conservation Law Foundation. “This bill helps communities promote the charging infrastructure necessary to support increased electric car sales in the state.”

Herzog noted that transportation is the single largest contributor to Massachusetts greenhouse gas emissions. The sector is responsible for nearly 40% of in-state emissions, making their reduction crucial to meeting the targets of the state’s Global Warming Solutions Act.

“We must be mindful of our greenhouse gas emissions, especially those emitted by our transportation sector,” Senate President Pro Tempore Marc R. Pacheco (D), cosponsor of the bill, said in a statement. “We need to lessen our dependence on fossil fuels and make it easier for owners of electric cars to use their vehicles while incentivizing the transition to zero-emission transportation.”

Mark LeBel, a staff attorney at Acadia Center, said the bill’s provision to allow utility investment in charging station infrastructure codifies language from an existing Department of Public Utilities order.

“The specifics of utility proposals will be important to determine whether the three statutory criteria for approval are met,” LeBel said. “The proposals must be in the public interest, meet a need regarding the advancement of EVs and must not hinder the development of a competitive EV charging market.”

The Baker administration recently committed $14 million to the Massachusetts Offers Rebates for Electric Vehicles (MOR-EV) program, which offers state residents rebates of up to $2,500 for qualified vehicles.

January 10, 2017

FERC Conditionally Approves PJM’s Excess Capacity Plan

By Rory D. Sweeney

FERC has approved PJM’s proposal for selling back excess capacity in this February’s third Incremental Auction for the 2017/18 delivery year.

The commission, however, agreed with objectors on several points, prompting it to require key revisions to the plan (ER17-335).

“While we acknowledge deficiencies in PJM’s filing … we also agree with PJM that it is just and reasonable for PJM to alter the shape of its sell-back offer curve to a straight line, eliminating the potential that the relevant Incremental Auction could clear at or near $0/MW-day,” the commission said.

The proposal dealt with PJM’s transition to the Capacity Performance market construct, which was approved in 2015 and gradually implemented over the 2016/17 and 2017/18 delivery years. The RTO had already obtained capacity for those years under previous rules, so the approval also established two transition auctions to procure any additional capacity needed.

The transition auction for the 2017/18 delivery year saw the RTO procure 10,017 MW of previously uncommitted capacity. PJM holds three IAs following the initial Base Residual Auction for a specific delivery year, during which committed capacity resources can buy back their supply obligations and PJM can acquire or release capacity in response to updated load forecasts. The IAs for the transition years also covered the results of the transition auctions.

The methodology PJM used for releasing excess capacity from the 2016/17 delivery year resulted in 4,818 MW sold at an average price of $4.79/MW-day, and PJM warned that using the same process to release any of the 10,017 MW for 2017/18 would potentially result in an offer of $0/MW-day — with no money flowing back to load.

To better reflect the capacity’s value, the grid operator proposed an alternative approach that would identify any necessary changes to the amount of capacity the RTO had already procured and create a price curve for selling any excess.

pjm excess capacity — FERC modified PJM’s proposed sell-back curve for excess capacity for the 2017/18 Delivery Year to top out at the BRA clearing price for that year.

PJM additionally proposed that any excess that doesn’t sell at the auction would not be eligible to become excess-commitment credits. PJM creates the credits from excess capacity that doesn’t clear IAs and allocates them to load-serving entities, who can trade them or use them to replace existing capacity requirements. (See “Proposal Chosen for Capacity Release,” PJM Markets and Reliability and Members Committees Briefs.)

FERC approved PJM’s plan but ordered several changes in recognition of objections made by American Municipal Power. The commission directed PJM to revise the price curve so that it begins at the lowest price point on the current sell-back offer curve and ends at the BRA clearing price for that delivery year. It also ordered allocating uncleared excess capacity as excess-commitment credits and consolidating separate capacity sellbacks into the single auction.

“Performing two auctions in this manner will result in creating two prices for the same product in the same auction, without any justification for the different price,” the commission said.

FERC clarified that the approved changes to the sell-back procedure only apply to the third IA in February.

PJM Independent Market Monitor Joe Bowring was surprised the commission put so much effort into what he felt was a minor detail, but he was still disappointed that his office hadn’t intervened in the docket. During discussions to secure stakeholder endorsement of PJM’s proposal, the Monitor repeatedly objected to the plan.

January 10, 2017

WAPA, SMUD Extend Scoping Period for Colusa-Sutter Project

By Robert Mullin

The Western Area Power Administration and Sacramento Municipal Utility District (SMUD) have extended the scoping period for a proposed transmission line intended to increase SMUD’s ability to import power from the Pacific Northwest and export from the Sacramento area.

The scoping period for the Colusa-Sutter (CoSu) line will be extended an additional 60 days, from Jan. 6 to March 7, to elicit public comment on environmental issues related to the proposed project, which would create a new 500-kV link between the California-Oregon Transmission Project (COTP) and SMUD and WAPA facilities on the east side of the Sacramento Valley.

colusa-sutter project — The proposed Colusa-Sutter transmission project is intended to improve SMUD’s access to Pacific Northwest renewable resources via the California Oregon Transmission Project. | *WAPA*

Federal power marketing agency WAPA sells power to publicly owned utilities such as SMUD, but its existing transmission facilities do not have enough capacity to meet SMUD’s increasing need for energy, the agency said. The new line would connect the COTP system in Colusa County with the Central Valley Project system in Sutter County, improving access to renewable energy generated in the Northwest.

“A recent California Energy Commission study makes the case for projects like this that enhance transmission capability to import valuable out-of-state renewable resources for California to meet its 50% renewable energy goals by 2030,” WAPA and SMUD said in a statement.

That study pointed out that a shortage of available transfer capacity on the California-Oregon Intertie would inhibit California’s ability to import additional carbon-free energy from the Northwest. (See California Tx Policy Must Foster Resource Diversity, Report Shows.)

WAPA and SMUD said the project will provide additional bidirectional transmission capacity to improve SMUD’s ability to participate in CAISO’s Western Energy Imbalance Market (EIM).

SMUD last October announced its intent to enter negotiations with the ISO to join the EIM, the West’s only real-time energy market. (See Sacramento Utility to Join EIM; Other BANC Members May Follow.)

The extended scoping period for the line will include review of an additional study area located about 20 miles south of the three other study areas previously scoped over the past couple years. The newly considered corridor would connect to the COTP in Yolo County and terminate near the Elverta Substation in northwestern Sacramento County, crossing directly into SMUD’s service territory.

“The new study area will help us make a more informed choice about how to best meet our future energy needs, while minimizing impacts on the environment and surrounding communities,” said Kim Crawford, SMUD’s California Environmental Quality Act project manager.

Six public meetings about the line are planned for January and February. Comments received during the meetings will be considered in the preparation of the draft environmental impact report. Any other comments must be submitted by March 7.

WAPA said it will take no action on the proposed project until after the environmental review is completed in 2020.

January 10, 2017

DOE Issues Recommendations on Cyberattack Protections

By Ted Caddell

When the Obama administration released its first version of the Quadrennial Energy Review two years ago, it addressed a hypothetical concern about threats to the nation’s oil and natural gas pipeline infrastructure.

The second review from the Department of Energy, released last week, turned its attention to risks facing the nation’s electric grid — progressing from the hypothetical to the real.

“In the current environment, the U.S. grid faces imminent danger from cyberattacks,” the report said. “Widespread disruption of electric service because of a transmission failure initiated by a cyberattack at various points of entry could undermine U.S. lifeline networks, critical defense infrastructure, and much of the economy; it could also endanger the health and safety of millions of citizens.”

The review is especially timely, coming amid a national discussion about the possibility that cyber breaches influenced the 2016 presidential election. It noted examples of such attacks in the electricity sector, including attacks on three Ukrainian utilities in December 2015 that left 200,000 customers without power, and highlighted the need to take decisive action to enact protections.

The report called for using the Federal Power Act to “develop preparation and response capabilities that will ensure [FERC] is able to issue a grid-security emergency order to protect critical electric infrastructure from cyberattack,” as well as from natural threats such as geomagnetic storms.

cybersecurity doe — Graphic illustrates the many ways in which utility IT systems leave the electricity grid vulnerable to cyber attacks, including unpatched networks, exposure to the public internet and insider threats.

The department also calls for an expansion of FERC authority to modify NERC-proposed reliability standards or develop its own standards “to protect national security in the face of fast-developing new threats to the grid.”

FERC’s expanded role in developing grid safety standards would supplement the department’s efforts at implementing protective measures in times of emergency.

“This approach would maintain the productive NERC-FERC structure for developing and enforcing reliability standards but would ensure that the federal government could act directly if necessary to address national security issues,” the report said.

“FERC should consider having existing regional organizations undertake such planning, as it deems appropriate,” the review said. “FERC should evaluate whether the costs of implementing security measures identified in the integrated electricity security plan are appropriate for regional cost allocation, where such measures are found to enhance the security of the regional transmission electric system.”

However, the department would not saddle grid operators with full financial responsibility for fulfilling the recommendations. Noting that the cost of protecting the nation’s grid against cyberattacks could run as high as $500 billion, the report calls for federal assistance in the form of an expanded DOE loan guarantee program used to encourage innovative grid technologies, going beyond the current emphasis on loans for new generation methods.

“A relatively low-cost permanent federal financing system could be established by setting up a revolving loan fund with one-time seed capital,” the report states. A loan guarantee program would be crucial for smaller utilities that lack the access to capital, unlike larger companies.

In all, the 494-page report makes more than 70 recommendations for policymakers to consider. It remains to be seen how many will be undertaken. The first QER outlined 63 recommendations — 21 of which were enacted by Congress.

January 10, 2017

PJM Analysis on Artificial Island Project Delayed Again

PJM announced that its comprehensive analysis and recommended solution for issues related to Artificial Island won’t be ready until April.

Staff had expected to present the plan at the February meeting of the RTO’s Board of Managers.

“While PJM’s analysis is progressing well, during discussion of preliminary results with stakeholders, several questions and considerations were raised,” PJM’s Steve Herling said in an emailed announcement. “More time is needed to evaluate and respond to these questions and considerations.”

Following complaints over cost allocation and a near doubling of the estimated costs, the board suspended the Artificial Island project, PJM’s first Order 1000 competitive solicitation, pending a “comprehensive” staff analysis to be completed by next month. (See PJM Board Halts Artificial Island Project, Orders Staff Analysis.)

PJM presented preliminary results of its analysis at its Planning Committee meeting in December and concluded that several elements of the scope of work would change. Stakeholders raised concerns about the changes and questioned whether PJM planned to re-evaluate all of the proposals in light of the updated criteria. Herling said at the time that the RTO was only “realistically” focused on the finalists. (See “PJM Review of Artificial Island Bid Elements Completed,” PJM Planning/TEAC Briefs.)

Independent Market Monitor Joe Bowring characterized the decision as a “tough call” and said the extra two months “is not that big a deal.”

– Rory D. Sweeney

January 10, 2017

MISO Reliability Subcommittee Briefs

MISO told stakeholders last week that its own data set might have been partly to blame for generators not responding efficiently to dispatch instructions.

Steve Swan, MISO senior manager of dispatch and scheduling, said part of the problem was the timing of the RTO’s unit dispatch system, which previously captured generator output measurements prior to the end of a five-minute settlement interval in order to inform the next dispatch. Swan said MISO moved the timing forward about 40 seconds — but still prior to the end of the five-minute period — to ensure that results contain the most up-to-date dispatch information to avoid improperly restricting generator movement.

The RTO hopes the new timing will reduce the likelihood that a generator mistakenly appears to be lagging based on a dispatch estimate that lacks the most up-to-date information. The change took place Dec. 15.

“I don’t know if it’s going to solve all of the problems, but at least now when they see a generator not moving at the offered ramp rate, it’ll not be because of MISO instructions,” Swan said during the Jan. 5 Reliability Subcommittee meeting.

MISO currently marks generators off-control — online but not dispatchable — if they fail to follow set point instructions and do not move on their offered ramp rate.

Swan said MISO will compare data before and after the change to determine whether any lags remain and the RTO needs to pursue the issue further.

Independent Market Monitor staff member Michael Wander said that — even after the change — there will be some degree of lag that will be “practically impossible” to eliminate. Still, he thinks the change will bring an improvement.

The Monitor’s 2012 State of the Market Report suggested that MISO develop better tools to identify units that are derated or not following dispatch so that they may be placed off-control. That suggestion was included among other recommendations for improving thresholds for uninstructed deviations. (See Monitor Again Criticizes MISO’s Uninstructed Deviation Rules.)

MISO Reports Successful November

MISO reported a smooth November in its latest monthly operations roundup, with markets performing as expected.

Above-average temperatures during the month contributed to an average 68 GW of load and a peak load of 81.9 GW on Nov. 21. November gas prices averaged $2.44/MMBtu, down 16.2% from October.

The month was free from any minimum or maximum generation events or warnings, but MISO on Nov. 12 earned the lowest unit commitment performance rating for the month, with committed but unnecessary resources remaining online to meet minimum run-times.

The RTO on Nov. 28 hit a new 13.3-GW wind production record, which was surpassed Dec. 7 when output reached 13.7 GW.

FERC Liaison: No Commission Disruptions

Chris Miller, FERC liaison to MISO, told stakeholders that the commission will continue to operate as a three-person panel in the near term.

“They all work very well together and have gotten a lot of work done,” Miller said of commissioners Norman Bay, Colette Honorable and Cheryl LaFleur.

Honorable’s term ends in June, but she is eligible to serve until the end of the year under a grace period if the Senate is unable to confirm a replacement, Miller noted. He said FERC staff are prepared for the impending leadership change, and as direction changes are the norm at the commission, the agency expects no delays in work output. (See CPP, FERC’s Bay, Honorable Among Losers in Trump Win.)

— Amanda Durish Cook

January 9, 2017

UPDATE: Entergy to Shut Down Indian Point by 2021

By William Opalka

The embattled Indian Point nuclear plant will close by 2021, owner Entergy and New York Gov. Andrew Cuomo said Monday morning.

An agreement between the governor’s office and Entergy calls for the company to shorten its pending license renewal applications to six years, with both sides ending litigation they have filed against each other as part of the deal. The state reserved the right to begin new litigation if necessary.

Unit 2 would shut down in April 2020, followed a year later by the closure of Unit 3.

“For 15 years, I have been deeply concerned by the continuing safety violations at Indian Point, especially given its location in the largest and most densely populated metropolitan region in the country,” Cuomo said in a statement. “I am proud to have secured this agreement with Entergy to responsibly close the facility 14 years ahead of schedule to protect the safety of all New Yorkers.”

Cuomo said that his administration has been “aggressively pursuing and incentivizing the development of clean, reliable energy” and that the state is “fully prepared” to replace Indian Point’s output at a “negligible cost” to ratepayers.

An agreement to close the two units — which combined have more than 2,000 MW in generating capacity — was first reported by The New York Times on Friday.

Entergy said energy economics driven by low natural gas prices forced the closure, which will mark the company’s exit from the merchant power generation business.

“Key considerations in our decision to shut down Indian Point ahead of schedule include sustained low current and projected wholesale energy prices that have reduced revenues, as well as increased operating costs,” Bill Mohl, president of Entergy Wholesale Commodities, said in a statement. “In addition, we foresee continuing costs for license renewal beyond the more than $200 million and 10 years we have already invested.”

Mohl noted that regional power prices have fallen by about 45% over the past 10 years to an average of $28/MWh, largely the product of record low gas prices stemming from increased supply out of the Marcellus Shale formation.

“A $10/MWh drop in power prices reduces annual revenues by approximately $160 million for nuclear power plants such as Indian Point,” Mohl said.

The agreement would allow the plants to operate for two additional two-year increments — with final closure slated for 2025 — if an emergency affected reliability in the New York City area.

Both units, whose permits expired in 2013 and 2015, have applied for 20-year license extensions from the Nuclear Regulatory Commission, which has granted the extensions pending review. Under the agreement, Entergy will instead apply for a six-year license renewal.

The plant has had a series of mishaps in recent years, intensifying pressure from state officials.

“Shutting down the Indian Point power plant is a major victory for the health and safety of millions of New Yorkers and will help kick-start the state’s clean energy future,” Attorney General Eric T. Schneiderman said.

Among the many challenges he has filed against the facility, Schneiderman has sought to deny Indian Point state water quality permits. (See Loss on Water Permit a Setback for Indian Point Extension.) New York will issue a coastal zone certificate and water quality permit for the plant as part of the settlement.

Schneiderman and environmental group Riverkeeper were also parties to the settlement.

“This agreement is a win for the safety of our communities and the health of the Hudson River, and it will pay big dividends in new sustainable energy sources and the well-paying jobs that come with them,” Riverkeeper President Paul Gallay said in a statement.

Other aspects of the agreement include:

Annual safety inspections by the state, along with the transfer of used fuel to protective storage in dry casks, the preferred method of safely storing spent fuel;
A commitment by Entergy to offer plant employees new jobs at other facilities, while the state will offer employment assistance and worker retraining, including for new skills needed for employment in the renewable energy sector; and
A requirement that Entergy establish a new emergency operations center in nearby Dutchess County, as well as create a $15 million fund for environmental projects.

Entergy’s previous agreements to make payments in lieu of taxes to local government entities and school districts will continue through 2021. Those agreements will persist before being gradually stepped down at a negotiated level following shutdown. The state will also work with local communities to address potential revenue shortfalls, enacting programs similar to those implemented for other communities affected by plant closures through the existing fossil fuel plant retirement fund.

New York has committed to a 50% renewable energy power mandate by 2030, with nuclear power seen as a bridge until clean power sources can be built at sufficient scale.

“With the news that the Indian Point nuclear power plant will close by 2021, New York should look to wind power, solar power and offshore wind to meet electricity needs, rather than relying more on natural gas,” said Anne Reynolds, executive director of the Alliance for Clean Energy New York. “New York essentially has five years to get new renewable energy online to meet this demand, and the renewable energy industry is more than ready.”

The state Public Service Commission has said the closure will have minimal impact on customer bills, with adequate resources expected to be online by 2021. Transmission upgrades and energy efficiency measures totaling 700 MW are already in place, officials said. (See FERC OKs Settlement for NY TOTS Projects.)

“The NYISO is required to perform an electric system reliability impact analysis after receiving an official retirement notice for any bulk system generation asset,” NYISO spokesman David Flanagan told RTO Insider. “Additionally, the NYISO’s Comprehensive Reliability Plan, to be issued in July 2017, will consider future grid reliability needs and generation capacity margins over a 10-year time horizon under expected system conditions.”

Indian Point’s closure will mark Entergy’s exit from the merchant power business. In little more than two years, the company has shuttered the Vermont Yankee nuclear plant in Vermont and announced the closures of two other nukes, including Pilgrim in Massachusetts and Palisades in Michigan. The sale of New York’s James A. FitzPatrick nuclear plant to Exelon is pending. The company has also sold a natural gas-fired power plant in Rhode Island.

Entergy said it will record a non-cash impairment charge of approximately $2.4 billion pre-tax and $1.5 billion after-tax in the fourth quarter of 2016. It also expects additional charges totaling about $180 million for severance and employee retention costs by the end of 2021.

The company said it has invested $1.3 billion in Indian Point in the 15 years it has owned the plant.

January 9, 2017January 18, 2024

Mountain West to Explore Joining SPP

By Robert Mullin

Mountain West Transmission Group has said it will enter discussions with SPP to explore the possibility of joining the RTO.

The announcement comes eight months after Mountain West issued a request for information to CAISO, MISO, PJM and SPP regarding tariff administration and market operator services to support a new — and independent — organized market for the region. (See Mountain West RTO Could Pose Competition for CAISO.)

“By exploring membership with an existing RTO, the Mountain West participants would have the advantage of an existing electricity market design,” the group said in a statement issued Friday.

“We have enjoyed working with the Mountain West Transmission Group on preliminary analysis and look forward to the next phase of more detailed discussions on specific terms of membership in the SPP organization,” SPP CEO Nick Brown said.

An independent effort would put Mountain West in direct competition with CAISO’s plans to expand into the interior West through the possible inclusion of PacifiCorp as a member. SPP’s westward movement could have a similar impact on CAISO’s expansion.

Mountain West — a partnership consisting of seven different transmission-owning entities within the Western Interconnection, including the Western Area Power Administration’s Loveland Area Projects and Colorado River Storage Project — has been investigating the benefits of implementing a common transmission tariff across multiple states and developing an organized market.

Mountain West’s footprint covers most of Colorado and Wyoming, along with smaller areas of Arizona, Montana, New Mexico and Utah. WAPA operates nearly 5,000 miles of transmission lines within the area.

Other members of the group include Basin Electric Power Cooperative, Black Hills Energy, Colorado Springs Utilities, Xcel Energy’s Public Service Company of Colorado, Platte River Power Authority, and Tri-State Generation and Transmission, which together control about 11,000 miles of transmission.

“Participation in a regional market can provide operational efficiencies through economies of scale and increased opportunities to bring lower-cost renewables into our system,” Platte River CEO Jason Frisbie said.

“Like our decision to join SPP for our east-side power supply, this announcement reflects years of diligent work and analysis by our employees and the Mountain West team,” said Paul Sukut, CEO of Basin Electric.

Steve Beuning, Xcel’s director of market operations, said the discussions will be a “crucial step in evaluating the potential benefits of a regional energy market.” Xcel has been a strong advocate for an organized market in the interior West to improve integration of its generation portfolio heavy in wind resources.

Mountain West expects to reach a decision whether to join SPP by midyear and is targeting 2019 for market implementation, subject to stakeholder input and necessary approvals.

“While Mountain West is optimistic that an RTO may benefit its entire membership, each Mountain West participant will ultimately need to evaluate for itself whether potential membership makes sense,” the group said.

In the event that negotiations with SPP are unsuccessful, Mountain West could pursue similar discussions with MISO and PJM, the group said.