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February 13, 2024

CISA Highlights China Threat in 2024 Priorities Report

Defending America’s critical infrastructure against threats from the People’s Republic of China will be a major focus of cybersecurity operations in 2024, the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA) said Feb. 12.

CISA’s warning came in the 2024 Priorities document released by the agency’s Joint Cyber Defense Collaborative, which CISA established in 2021 to “drive unified efforts across public and private partners” to accomplish its security goals. The JCDC includes participants from state, local and international governments, along with infrastructure operators, cybersecurity companies, service providers and other stakeholders from various critical infrastructure sectors.

JCDC called the 2024 priorities “a critical step in [our] maturation [because] for the first time, we are aligning our priorities under three broad focus areas” that will help CISA and other participants create their strategies and direct their resources:

- defend against advanced persistent threats (APT), particularly those backed by the PRC.
- raise the cybersecurity baseline.
- anticipate emerging technology and risks.

Discussing the first area, JCDC observed that many malicious cyber actors — notably those working for China — have pivoted from focusing on “espionage and data theft” to “destructive attacks designed to cause real-world harm.”

The document did not list any specific attacks or groups. However, in a blog post on the 2024 priorities, CISA Associate Director Clayton Romans noted that U.S. intelligence agencies saw a rise in APT activity targeting U.S. critical infrastructure.

Romans went on to call on JCDC to assist critical infrastructure organizations to prepare for malicious activity involving “living off the land techniques.” This is a clear reference to Volt Typhoon, a PRC-sponsored hacking group first identified last year but now believed to have been actively infiltrating U.S. infrastructure for “at least five years,” according to a recent CISA cybersecurity advisory.

Volt Typhoon’s malware has been discovered in the information technology environments of companies in the energy, communications, transportation, and water and wastewater sectors in the U.S. and its territories. The “living off the land” strategy refers to hiding inside a target’s system using only existing resources disguised as legitimate traffic, and CISA has expressed “high confidence” that the group hopes to move from IT networks to the utilities’ operational technology assets, potentially giving the PRC the ability to disrupt operations.

CISA Director Jen Easterly, along with FBI Director Christopher Wray and other cybersecurity officials, warned members of the House of Representatives’ Committee on the Chinese Communist Party last month that China’s strategy in a conflict with the U.S. or its ally Taiwan likely would include attempts to disable critical infrastructure and cause “societal panic” among the civilian population. (See China Preparing to ‘Wreak Havoc’ on US, Cyber Officials Warn.) At the same hearing Wray called Volt Typhoon “the defining threat of our generation.”

Ransomware, AI Also Key Topics

In addition to identifying and neutralizing APTs like Volt Typhoon, the JCDC’s priorities document emphasizes planning for major cyber incidents that could result when such actors are not intercepted in time. CISA’s goals for the year include updating the U.S. National Cyber Incident Response Plan, currently under development in coordination with the Office of the National Cyber Director and industry partners, to address “significant changes in policy and cyber operations” since the NCIRP originally was released.

Additional priorities include reducing the impact of ransomware on critical infrastructure. That topic reached new levels of urgency in 2021 with the hack of Colonial Pipeline, which caused the company to shut down a major source of petroleum products for the East Coast for several days.

Cybersecurity experts say ransomware attacks have become easier than ever because of the rise of the ransomware-as-a-service model, in which a core group develops and operates a ransomware package while recruiting affiliates to hack into networks and deploy the app. Users of this model include DarkSide, the group federal officials believe was behind the Colonial attack. (See Robb Says Collaboration Key to Maintaining Cyber Vigilance.)

The remaining priorities are to help state and local election officials secure their infrastructure against cyber threats, to encourage technology manufacturers to incorporate security into their designs and to reduce the risk of artificial intelligence to critical infrastructure. The last area includes the “Guidelines for secure AI system development” document, released by CISA and several of its international counterparts in November to provide guidance for AI developers on preventing security breaches in their technology.

February 13, 2024

Constellation Reaches Agreements to Keep Everett LNG Terminal Open

Eversource and National Grid have reached agreements with Constellation to keep the Everett Marine Terminal (EMT) open for six more years, pending approval from the Massachusetts Department of Public Utilities (DPU). The gas utilities said the contracts would boost the reliability of their distribution systems and help meet winter gas demand.

Everett, a major LNG import facility located just outside of Boston, faces potential closure with its main customer, the Mystic Generating Station, set to retire this spring.

“These contracts, together with others that we hope to soon finalize, will help ensure the [EMT] continues to serve its vital role in supplying natural gas to the New England region, especially during the coldest winter conditions,” Constellation said via statement.

National Grid estimated its contract would increase customers’ gas bills approximately 1% year over year for the six years, while Eversource said its agreement would amount to “a 5 to 7% increase in the typical residential natural gas heating customer for next winter” (D.P.U. 24-26).

“This six-year agreement is critical in allowing the company to continue to provide gas supply in a safe and reliable manner to customers in the immediate term on peak days through the use of existing gas infrastructure,” National Grid wrote in its pre-filed testimony (D.P.U. 24-25).

The company noted Everett is located downstream of a bottleneck in the gas distribution system, making it “uniquely positioned to support the company’s gas system reliability during the demand seasons and demand days due to both its location and significant sendout capacity.”

Constellation declined to disclose the other companies that remain involved in contract negotiations related to Everett. ISO-NE confirmed with NetZero Insider that it is not involved in the negotiations to keep Everett open. The RTO facilitated a cost-of-service agreement to keep Mystic operating for the winters of 2023/23 and 2023/24, with the costs passed through to electric ratepayers.

The New England Power Generators Association applauded the agreement, writing in a statement that “the long-awaited contracts now being filed by [local distribution companies] ensure that the Mystic power plant shuts down, while a unique fuel resource remains in service to serve heating needs.”

In June, FERC convened a forum that focused on the future of Everett, and the heads of FERC and NERC issued a joint statement in November stressing the importance of the facility to the region’s gas network. (See NE Stakeholders Debate Future of Everett at FERC Winter Gas-Elec Forum and FERC, NERC Leaders Voice Concern About Loss of Everett Marine Terminal.)

Eversource and National Grid wrote that there were no alternatives to meet the reliability and peaking needs. Both companies project their gas demand to increase in the coming years. National Grid projects an 11% increase in gas demand between 2023/24 and 2029/30, while Eversource projects its gas load will increase by nearly 5% between 2023/24 and 2027/28.

The agreement with Constellation will help meet the growing demand, Eversource and National Grid said. The companies emphasized that the agreements would address near-term needs without requiring additional gas infrastructure.

“Incremental pipeline capacity requiring pipeline construction is not a realistic alternative to the company’s immediate reliability needs served by the proposed agreement, which are available to the company without construction of any new infrastructure,” Eversource wrote.

The DPU issued an order in December based on its three-plus-year investigation into the future of gas in the state. The order sets the stage for the state’s long-term transition away from natural gas and discourages additional investment in the gas system. (See Massachusetts Moves to Limit New Gas Infrastructure.)

Throughout the state, regulators and lawmakers hope a series of recently enacted and under-development laws and regulations will begin to turn the tide against growing gas demand. (See Mass. Lawmakers Aiming for an Omnibus Climate Bill in 2024 and Report Outlines Cost Savings of All-electric Buildings in Mass.)

However, both Eversource and National Grid left the door open to longer-term pipeline expansion to address regional gas constraints. In the fall of 2023, Enbridge announced a new project to significantly expand the capacity of its Algonquin gas system, dubbed “Project Maple.” (See Enbridge Announces Project to Increase Northeast Pipeline Capacity.)

Eversource wrote that Project Maple “could be an alternative to the proposed agreement in the long term, but the project would not be in-service until 2029 or later if it were to proceed.”

The company added that “a large-scale expansion to completely replace the EMT functionality does not seem feasible given the current policy initiatives in the state.”

Eversource confirmed to WBUR in January that it submitted a bid for firm service in the “open season” for Project Maple, a required process for Enbridge to assess the demand for the pipeline expansion. National Grid has not said whether it participated in the open season.

The DPU now faces a tight timeline to approve the agreements; the utilities requested that DPU rule by May 1. The Mystic agreement with ISO-NE is set to expire at the end of May, and the utilities’ agreements with Constellation would run from the beginning of June 2024 to the end of May 2030.

“In the event that the company does not receive timely approval of the proposed agreement, either party may terminate the proposed agreement,” Eversource wrote.

February 13, 2024

BOEM Designates Wind Energy Areas off Oregon Coast

Federal regulators have finalized two Oregon wind energy areas they hope someday will host floating wind turbines with a combined capacity of up to 2.4 GW.

The potential development has drawn the same criticisms leveled by opponents of East Coast proposals: It is ugly, expensive and potentially harmful to the ocean ecosystem and those who rely on it for their livelihood.

But the U.S. Bureau of Ocean Energy Management said the Oregon WEAs incorporate adjustments made to reflect extensive feedback from the state, local residents, tribes and other stakeholders.

BOEM said the WEA boundaries are drawn to avoid conflict with other ocean users, particularly commercial fishers. They exclude 98% of areas recommended for exclusion because of their importance as commercial fishing grounds.

BOEM next will prepare an assessment of the potential environmental impact of placement of turbines and their electrical infrastructure within the WEAs.

The Coos Bay WEA totals 61,204 acres and stands 32 miles offshore; the Brookings WEA is 133,308 acres and is about 18 miles from the coast.

BOEM is following the framework it used in developing other WEAs, gradually refining the geography through multistep review and public comment.

It identified two call areas totaling 1.15 million acres for initial consideration in April 2022, then narrowed them down to two draft WEAs totaling 219,568 acres in August 2023. The final WEAs total 195,012 acres.

BOEM received roughly 1,150 comments on the draft WEAs, many of them form letters but 691 with unique content. They run the gamut from opposition to support, with impact on fishing raised as a frequent concern by opponents.

The local opposition has been strong enough that Gov. Tina Kotek (D) and four members of Oregon’s congressional delegation in June 23 asked BOEM to pause its runup to the leasing process so that state officials could better identify, understand and respond to local concerns.

In November, the Tribal Council of the Confederated Tribes of the Coos, Lower Umpqua and Siuslaw Indians unanimously declared opposition to wind energy development off the Oregon coast.

BOEM notes that the wind off the Oregon coast is strong and consistent, offering a theoretical capacity of up to 62 GW.

But the sea floor slopes off sharply on that portion of the outer continental shelf, limiting the siting options. BOEM considers 1,300 meters to be the limit for economically competitive offshore wind installations with existing technology.

The water depth in the two WEAs ranges from 567 to 1,531 meters, too deep for the fixed-bottom foundations being used in the early stages of East Coast offshore wind energy development. But the technology and design of floating alternatives still are being developed.

BOEM flags another hurdle facing development of the two WEAs: The Oregon Department of Energy indicated significant investment likely would be needed in the onshore grid to handle the output of any large-scale offshore projects — no single interconnection point on the Oregon’s coast grid can accommodate 2 GW. But such an investment would benefit development of onshore renewable energy, as well.

After BOEM’s announcement Tuesday, Kotek responded with a prepared statement that was neutrally worded.

But she said offshore wind likely is to be an important component of meeting the state’s 2040 goal of 100% renewable energy, and potentially also an economic boost for coastal communities.

“As BOEM moves forward with establishing a federal offshore wind leasing process this year, Oregon is committed to developing a robust and transparent state roadmap to inform offshore wind opportunities,” Kotek said. “This state roadmap will also ensure that coastal communities and Tribal nations are consulted throughout the process

February 12, 2024February 13, 2024

Md. Lawmakers Load up on Clean Energy Bills

Depending on which bill you are looking at — Senate Bill 1065 or House Bill 913 — Maryland drivers of both electric and gasoline-powered vehicles could soon be paying an extra registration fee to top up the state’s Transportation Trust Fund, a main source of operating income for its Department of Transportation.

But under SB 841, any extra fees based on how many miles vehicles actually drive on state roads would be prohibited.

The competing bills are just three of more than 70 energy-related proposed laws introduced in the first month of the Maryland General Assembly’s 2024 session, as tracked by the Maryland Clean Energy Center. The state’s legislative session officially lasts from Jan. 10 to April 8.

The pace of introductions reached semi-fast-and-furious in the past week — 43 bills in total — as lawmakers raced to meet the Feb. 5 deadline for new bills in the Senate and the Feb. 9 deadline in the House of Delegates. Bills can be introduced after these deadlines but will require approval from the Rules committees in their respective houses.

The range of bills and issues covered ― from registration fees for EVs, to tough emission-reduction targets for data centers, cryptocurrency miners and cannabis growers ― reflect the challenges policymakers face as they seek to balance the state’s ambitious clean energy goals and potentially growing budget deficits.

The bills on EV registration fees, both sponsored by Democrats, are a case in point. The Maryland Department of Transportation in December announced projected budget cuts of $3.4 billion because of falling revenues.

SB 1065, sponsored by Sen. Guy Guzzone, would add a $100/year registration fee for zero-emission vehicles to fill at least part of that gap and make up for falling gas taxes. If passed, Maryland would join the growing number of states across the country — almost 30, according to POLITICO — that have extra registration fees for EVs.

Del. David Fraser-Hidalgo’s HB 913 would keep the $100 fee for EVs but up the ante with a $75/year charge for other, non-electric vehicles.

A vehicle-miles-traveled tax is an additional strategy for raising revenues for transportation infrastructure being tried by a small number of states, but Sen. Justin Ready’s (R) SB 841 would cut off that option.

Other Republican bills similarly seek to slow or sidetrack action on the state’s transition to clean energy.

SB 1063, sponsored by Sen. Steve Hershey, would push back the state’s adoption of California’s Advanced Clean Cars II (ACCII) until the 2030 model year. ACCII requires all new vehicles sold in a state to be zero-emission by 2035, and Maryland’s adoption of the rule in September would allow it to go into effect for the 2027 model year, when 43% of new cars sold would have to be zero-emission. (See Maryland Moves Ahead with Advanced Clean Car and Truck Rules.)

HB 1240, sponsored by Del. April R. Rose, would ban the Department of the Environment (MDE) or the Department of Housing and Community Development from prohibiting natural gas or propane appliances in new construction or buildings undergoing renovations affecting 50% of their square footage. The bill also would ban any extra registration fees on gasoline-powered vehicles based on their use of gasoline.

With Democrats in solid control of both houses of the General Assembly, it is unlikely such bills will pass. But with budget deficits and other economic priorities taking precedence, clean energy laws may have a rough road to passage.

While Gov. Wes Moore (D) has committed the state to cut its emissions by 60% by 2031 and to provide residents with 100% clean power by 2035, only minor climate initiatives have been included in his fiscal year 2025 budget and the legislative agenda he brought to the General Assembly as part of his State of the State address.

The only major energy-related line item mentioned in his budget message Jan. 17 was $90 million for implementing Maryland’s Climate Pollution Reduction Plan. Issued by the MDE on Dec. 28, the plan’s topline message is that reaching those goals will require $1 billion in new state funding every year through 2031. (See Md. Emission-reduction Plan: High Ambitions, No Funding.)

Similarly, while the governor’s recently launched State Plan includes “making Maryland a leader in clean energy and the greenest state in the country,” the only energy-related bill (SB 474/HB 579) in his accompanying legislative agenda proposes to streamline the permitting of “critical infrastructure,” such as backup generators for data centers.

“The Moore-Miller administration is continuing to work with the state legislature to meet Maryland’s energy goals while also protecting the state’s environment,” an administration spokesperson said in an email to NetZero Insider. “The governor looks forward to supporting legislation, and initiatives that will help Maryland secure its clean energy future.”

The General Assembly’s recent track record includes some major climate and clean energy wins, such as the Climate Solutions Now Act of 2022, which set the state’s 60% emissions reduction target. In 2023 the legislature passed laws making Maryland’s community solar pilot program permanent (HB 908) and adopting a Clean Trucks rule (HB 230) that, similar to ACCII, phases in sales of zero-emission medium- and heavy-duty trucks.

Democrats Go Big

This year, Democrats have once again introduced ambitious bills now waiting for committee hearings.

HB 1112, sponsored by Del. Lorig Charkoudian, would require the Maryland Public Service Commission to “determine whether the deployment of energy storage devices could help to avoid or limit a reliability-must-run agreement with an energy generating system or facility in the state under certain circumstances.” The PSC could require utilities to acquire storage, either as owner or through a third-party contract, as an alternative to keeping fossil fuel-fired generation online.

The bill is clearly aimed at circumventing situations like PJM’s current efforts to keep the Brandon Shores coal-fired plant online past its planned 2025 closure.

SB 861, sponsored by Sen. Karen Lewis Young, aims to cut emissions at “high-energy-use facilities,” such as data centers, cryptocurrency operations or cannabis growing farms. These facilities tend to have high energy demands that can put stress on local distribution systems.

The bill would set a baseline emissions level of 0.428 metric tons of carbon dioxide per megawatt-hour of electricity used and require these facilities to cut emissions 60% by 2027, 80% by 2030, 90% by 2035 and 100% by 2040.

HB 1272, sponsored by Del. Dana Stein, would take a first, small step toward funding the Climate Pollution Reduction Plan with its authorization for the MDE to establish an economywide cap-and-invest program. Maryland already receives millions of dollars from its participation in the Regional Greenhouse Gas Initiative, the regional cap-and-trade program that sets limits on greenhouse gas emissions from power plants in New England and the Mid-Atlantic. An economywide program could cover all major industrial emitters in the state.

SB 959, cross-filed with HB 1256, is a complex package that combines the introduction of time-of-use rates as the default choice for electric utilities’ residential customers with demand-management strategies, such as the use of aggregated residential energy storage and managed charging of EVs or electric school buses. The goal, according to the bills’ sponsors, Fraser-Hidalgo and Sen. Brian Feldman (D), is to promote “beneficial electrification” by encouraging consumers to shift energy use to off-peak hours, thus cutting peak loads on distribution systems and their own energy bills.

But not all bills sponsored by Democrats may be considered climate-friendly. A second bill sponsored by Stein, HB 990, would exempt manufacturing facilities in the state from complying with any emission-reduction rules, such as Maryland’s Building Energy Performance Standard, which requires buildings larger than 35,000 square feet to cut their emissions 20% below 2025 levels by 2030 and reach net zero by 2040.

The bill would prohibit state agencies from establishing rules requiring manufacturers to cut emissions below 2023 levels, especially if doing so would cause significant cost increases above 2023 levels for the state’s manufacturing sector. However, the bill would not exempt manufacturers from complying with greenhouse gas reporting requirements or emission reductions related to RGGI.

February 12, 2024February 12, 2024

DC Circuit Hears Arguments on FERC LNG Plant Approval

The D.C. Circuit Court of Appeals on Feb. 12 heard oral arguments on FERC’s approval of the Commonwealth LNG facility in Cameron, La.

The case proceeds after the Biden administration paused new applications for liquified natural gas (LNG) export facilities in the U.S. (23-1069).

FERC approved the Commonwealth project in late 2022. It would consist of 9.3 billion cubic feet per day of export capacity on 150 acres along the west bank of the Calcasieu Ship Channel, near three existing LNG export facilities and others being planned.

In approving the project, FERC disregarded its potential to raise Louisiana’s greenhouse gas emissions by 1.7% on its own. The commission also ignored the environmental justice impact of the facility, which would be located on a heavily industrialized slice of the Gulf Coast, according to environmental groups Natural Resources Defense Council, Sierra Club, the Center for Biological Diversity and Healthy Gulf.

FERC’s rules around approving projects that influence climate change are far from clear, but it has ruled on such impact before, Sierra Club attorney Nathan Matthews said during the hearing. In a case involving Northern Natural Gas Pipeline, it said 315 tons of GHG emissions per year was well below any threshold it would consider.

“FERC could have done the same here where the 3.6 million tons per year of emissions are 36 times FERC’s draft threshold, which itself was equal to or higher than every other threshold any other agency proposed,” Matthews said.

The commission has drafted rules amending how it processes natural gas projects, but they have not advanced since former Chair Richard Glick released them in 2022 and then had to withdraw them after criticism from the industry and Capitol Hill.

The proposed facility would release 550 tons per year of nitrogen dioxide, which is harmful at any level and will cause the area around the terminal to exceed EPA’s limit for the gas in air quality standards, Matthews said.

“FERC simply misunderstands cumulative effects,” Matthews said. “FERC concluded that there would be no cumulative impact problem here because the individual incremental impact of this project was individually insignificant. But the central thrust of the cumulative impact regulation and doctrine is to guard against the death of 1,000 cuts.”

‘Incremental Impacts’

Judge Bradley Garcia asked whether the issue was FERC’s failure to label the nitrogen dioxide emissions as significant, which would have at least required it to explain why the facility should move forward regardless.

“For every impact you identify as significant, you have to discuss mitigation of that impact,” Matthews said. “And here, we think that they could have redesigned the terminal to reduce these emissions, even if they were going to still approve the terminal.”

A decision from the D.C. Circuit last year in a case the Center for Biological Diversity brought against FERC’s approval of an LNG facility in Alaska clearly laid out what the regulator had to do under the Natural Gas Act in its review of Commonwealth LNG, said FERC Attorney Susanna Chu.

“Because, like this case, it’s a purely Section Three terminal case, there’s no Section Seven pipeline involved,” Chu said, referring to relevant sections of the Natural Gas Act. “So, the standard here is that the commission must approve the terminal proposal unless it makes a finding that the terminal is actually inconsistent with the public interest.”

Chu was asked why FERC did not follow its finding in Northern Pass and determine that the 3.6 million tons of annual CO2 emissions from Commonwealth LNG are significant. The 100,000 tons per year threshold was only a draft proposal and FERC has not adopted it, Chu said.

Judge Florence Pan asked whether there was any chance FERC would pick a threshold more than 36 times its proposal.

Chu said that FERC has yet to make any final decisions on the question, but Pan pressed on — asking whether the project’s emissions would be significant if it increased the state of Louisiana’s emissions by 20%.

“The issue with global climate change, as the commission explained in the environmental statement, is that there are incremental impacts,” Chu said. “And … you can’t attribute physical … global climate change impacts, such as sea level rise or other specific impacts, to a particular project. At least, the commission has not yet been able to identify a methodology that would allow it to do so.”

FERC actually did more work than it had on previous projects in quantifying the emissions from Commonwealth. Garcia asked whether any of that influenced its decision-making when it came to mitigating pollution.

The commission discussed climate change, but said it was unable to determine whether an individual project such as Commonwealth LNG would have a major impact on it, Chu said. Pan then said that it would seem easier to make an actual finding of significance and assess ways for the project to mitigate those impacts than to wind up in more litigation.

“It’s been something that the agency has been grappling with,” Chu said. “I mean, this is a bipartisan, independent commission. And we see from the different, the evolution of the cases, the commission is moving [toward] more and more information in the environmental analysis.”

February 12, 2024February 12, 2024

WPP: Cold Snap Showed ‘Tipping Point’ for Northwest Reliability

High imports from the Desert Southwest and Rocky Mountain balancing areas (BAs) helped the Northwest survive extreme weather from Jan. 12 to Jan. 16, showing the region’s reliability is at a “tipping point,” the Western Power Pool said.

A report released by WPP on Feb. 8 outlined the actions taken by the RC West Reliability Coordinator and quantified the interchanges that allowed the Northwest to avoid outages.

BAs in the Northwest reported lower-than-normal temperatures for a sustained period, contributing to high loads and the need for imported energy. Starting the morning of Jan. 13 and lasting through the evening of Jan. 15, the reliability coordinator placed four entities in either an Energy Emergency Alert Watch (EEA), EEA 1 or EEA 3. The report said the Northwest imported an average of 4,900 MWh of energy per hour over five days, underscoring the continued call for an interregional resource adequacy program that can provide support across BAs during extreme conditions.

By summing and averaging interchanges between Northwest BAs and Nevada Power Co., PacifiCorp East and Western Area Power Administration, and Upper Great Plains West, the report found that 2,067 MW of power that was delivered to the Northwest originated from the Eastern/Rockies AC system.

Using the same interchange data, the report also demonstrated that while CAISO was exporting to the Northwest during this time, the ISO and other BAs were net importers, receiving more energy from the Desert Southwest than they were exporting to the North.

“The Desert Southwest/Rockies BAs were net exporters of approximately 5,334 MW on average,” the report reads. “Those exports from the Desert Southwest/Rockies region supported CAISO and other California BAs as well as 2,833 MW of imports to the Northwest on the Pacific AC Intertie.”

Call to Action

WPP emphasized the need for initiatives like the Western Resource Adequacy Program to strengthen reliability during extreme weather events.

During the cold snap, “temperatures and loads were at or near historic peaks, BAs were managing through energy emergencies in real time and there was a significant amount of support required from BAs outside of the Northwest Region, particularly from the Desert Southwest and Rockies regions,” the report reads. “All these factors point to the need to act quickly to address potential capacity challenges in the Northwest and realize the benefits afforded by full, binding implementation of a nearly WECC-wide resource adequacy program like WPPʼs WRAP.”

CAISO is expected to release a report the week of Feb. 19 analyzing the response to January’s extreme weather.

February 12, 2024

New York Approves Final Rule on Inverter-based Resources

The New York State Reliability Council’s Executive Committee on Feb. 9 approved a final rule for interconnecting inverter-based resources (IBRs) larger than 20 MW (PRR-151).

The rule aims to reliably integrate large-scale IBRs into New York’s power grid by establishing minimum interconnection standards. It requires developers attest that their facilities comply with the IEEE 2800-2022 standard, which set uniform minimum requirements for the interconnection, capability and performance of IBRs.

According to the council’s Reliability Rules Subcommittee (RRS), over 120 GW of large IBRs are currently in NYISO’s interconnection queue. This bottleneck, coupled with the increasing number of IBRs seeking interconnection in New York, prompted the council to act. (See New York Considering Standards for IBRs.)

The committee spent more than a year working on the rule, including multiple stakeholder meetings, establishment of an IBR working group and two rounds of stakeholder comment periods. The approved rule incorporated stakeholder feedback to refine attestation requirements and exemptions for evolving technology to ensure flexibility for future IBR integration. (See “PRR-151,” NY State Reliability Council Executive Committee Briefs: Jan. 12, 2024.)

Illustration of inverter-based resources (IBRs) connecting to grid | NERC

During the committee’s meeting, Richard Bolbrock, former EC chair, asked about the evaluation process for PRR-151 exemption requests.

Roger Clayton, chair of the RRS, responded that the process “will have to be developed” because it is “highly technical,” and “making those sorts of evaluations is going to be a challenge.” He reminded the EC that “this is the first phases of our effort” and that the purpose was to standardize the rules surrounding IBRs “so that we don’t have a hodgepodge of designs” and “get ourselves into a situation like Texas did.” (See NERC Repeats IBR Warnings After Second Odessa Event.)

Glenn Haake, vice president of regulatory affairs at Invenergy, raised concerns about the feasibility of adhering to the IEEE standard, saying, “The models that the OEMs (original equipment manufacturers) have, in many cases, are a work in progress.” Haake emphasized the need for a process that accommodates evolving equipment capabilities without hindering project development. “There needs to be a way to recognize the reality that this equipment is evolving and being improved to meet these standards, but currently, we don’t have the models, and I don’t know what models are available that do comply,” he said.

Clayton responded that there are risks that a project could be found noncompliant with IEEE 2800 without the required attestation, but it is on developers to comply with the new rule.

Zach Smith, vice president of system and resource planning at NYISO, applauded the council for the new rule, saying, “I think it is really valuable that New York is taking a lead on this, and I think it is going to inform NERC, as well as the rest of the industry in terms of the implementation of IEEE 2800.”

PRR-151 will be incorporated in NYISO’s future interconnection review processes, excluding ongoing Class Year 2023 projects, to guide the ISO in incorporating IBR performance criteria and model validation methods into its interconnection studies.

February 12, 2024

CAISO Seeks FERC’s OK to Shut 2024 Interconnection Window

CAISO is seeking FERC approval to scrap its process for taking on new interconnection applications this year as it works through the “unprecedented volume” of requests submitted for the previous interconnection study period.

CAISO’s tariff requires it to open a new window for interconnection requests each year on April 1. But in a Feb. 8 filing with the commission, the ISO asked permission to forgo the process for 2024 to give it more time to study existing requests representing more than 350 GW of capacity — about seven times greater than CAISO’s peak load.

“Adding new interconnection requests at this time would exacerbate current challenges and delay studies further,” the filing stated. “Forgoing the 2024 window is a just and reasonable solution to prioritize the huge volume of existing interconnection requests on time.”

Like other RTOs and ISOs, CAISO uses a “cluster” approach to dealing with interconnection requests whereby multiple resources are studied together to assess their impact on the existing grid and determine the need for transmission upgrades.

For each cluster of resources, the two-year process consists of a Phase I interconnection study that determines what interconnection facilities and reliability and delivery upgrades will be needed by each potential interconnection customer. A Phase II study refines the cost estimates in the first study “based upon changes in queue and deliverability allocation results,” according to CAISO.

“Because the most common change in queue is an interconnection customer’s withdrawal, both the Phase II interconnection study and the annual reassessment typically remove no longer needed upgrades from interconnection customers’ studies and cost responsibilities, reducing costs,” the ISO noted in its filing.

In the Cluster 14 window of 2021, the number of CAISO interconnection requests skyrocketed to 373, up 241% over the previous — record-setting — cluster. To manage the volume, the ISO was forced to cancel its 2022 interconnection window.

And on top of the sheer growth in volume, the ISO also saw that just 40% of resources dropped out of the queue after completion of the Phase I study, compared with a typical drop-out rate of 60%, which the ISO attributed to financial strength in the industry.

In 2023, Cluster 15 set yet another record, reaching 541 interconnection requests.

“Even accounting for the year without a cluster application window, Cluster 15’s extreme volume represents the low bar to submit an interconnection request and the high level of financial opportunity in generation development,” CAISO wrote in its filing. “Developers submitted these interconnection requests understanding they would face an extended study process and longer construction timelines. In [an] accurate but self-fulfilling prophecy, developers also submitted multiple interconnection requests because the CAISO would be unlikely to be able to open another interconnection request window in 2024.”

CAISO last year proposed to forgo the 2024 interconnection window when it began its Interconnection Process Enhancements stakeholder initiative, but deferred to stakeholder wishes to hold off on that move.

“Since then, stakeholders and the CAISO have focused their efforts on necessary reforms to enable meaningful study of cluster 15. The CAISO subsequently reproposed deferring the 2024 interconnection request window. No developer, transmission owner or other stakeholder opposed the proposal,” the ISO noted in its filing.

CAISO has asked FERC to approve the change effective March 31.

February 12, 2024February 13, 2024

PJM: ‘Conservative Operations’ Maintained Reliability During Jan. 2024 Storm

VALLEY FORGE, Pa. — PJM last week presented two deep dives into how the grid performed during the January 2024 Winter Storm Gerri, highlighting changes to how it committed generators to reduce risk. The RTO’s out-of-market actions cost $53.5 million. (See PJM: Grid Performed Well During January Winter Storm.)

Much of the discussion during a Feb. 7 presentation to the Market Implementation Committee centered on PJM’s use of conservative operations to commit generators to operate throughout the storm. PJM’s Joe Ciabattoni said conservative operations were used to maintain transmission security that could not be accomplished with the resources committed through the day-ahead market alone.

A subset of those resources whose start-up parameters would have prevented dispatchers from ramping them up and down throughout the storm as needed were given multiday commitments, as were gas-fired generators that might have difficulty procuring fuel without certainty regarding how long they would be expected to run.

Around 98,000 MW of resources were identified for conservative operation commitment Jan. 12, of which 58,000 MW received multiday commitments. Two-thirds of the committed resources were gas-fired, while just over a quarter were coal. Conservative operations peaked at 15,189 MW of resources committed Jan. 16.

Senior Dispatch Manager Donnie Bielak said fuel type was not a major focus in which resources were selected under conservative operations. PJM started by looking at which units were needed for reliability, and analysis of fuel security followed, he said.

Uplift payments between Jan. 12 and 22 totaled over $53.5 million, with over half of that concentrated on the 15th and 16th. PJM’s Lisa Morelli said there is a correlation between the number of resources operating on multiday commitments and the amount of uplift paid, but there were other contributors to the amount of uplift as well.

During an Operating Committee presentation Feb. 8, Bielak said committing resources for multiple days proved valuable to dispatchers in mitigating the risks associated with fuel insecure resources.

Bielak said PJM also modified its practice around committing gas resources to treat flexible combustion turbines as if they were inflexible. The RTO normally commits inflexible combustion turbines earlier in the day than other resources to provide additional time for them to procure fuel, which also has the added benefit of giving dispatchers more reaction time if that generator is unable to obtain gas. Bielak said PJM is considering standardizing the procedure going forward by adding triggers for when it may be initiated and transparency around how it will be used.

Senior Vice President of Operations Mike Bryson said the storm presented unique challenges, including the worst weather manifesting at the end of a holiday weekend. Instead of buying one day’s worth of gas on a weekday, generators must buy for an entire weekend — a full three days if it’s a holiday.

Gas must be purchased as a package over weekends, with the commitments largest during holiday weekends.

Michelle Bloodworth, president of coal lobby America’s Power, questioned whether using a special dispatch process for inflexible resources undermines PJM’s incentives for generator investments in fuel security and winterization. Committing them early could also suppress prices for generators that have made those investments, which she said may further weaken the incentive to perform.

Reviewing the load forecast performance, PJM’s Stephanie Schwarz said some of the underforecasting in valley periods was due to lower-than-forecast temperatures and snow cover suppressing behind-the-meter solar generation.

The number of forced outages during Gerri was significantly lower than the December 2022 Winter Storm Elliott, peaking at 16,119 MW on Jan 16. Elliott peaked at 46,124 on Dec. 24, 2022.

PJM’s Ray Lee said most outages experienced during Gerri were due to plant equipment failures, followed by gas procurement problems and freezing, which each contributed to a lesser extent than during Elliott.

More generation owners submitted real-time temporary exceptions at least 24 hours in advance of being dispatched during Gerri than during Elliott. However, PJM’s Chris Pilong said generators are still underreporting constraints. He said that throughout the storm, all pipelines reported constraints to PJM, while only 22% of generators subsequently submitted temporary exceptions.

February 12, 2024May 5, 2024

Ex-PUCO Chair, Ex-FirstEnergy Execs Indicted in Ohio

Three former Ohio utility and regulatory officials face dozens of new charges in the House Bill 6 scandal.

The Ohio Attorney General’s Office on Feb. 12 announced the latest developments in the long-running fallout over H.B. 6, which granted subsidies for the operation of two FirstEnergy Corp. nuclear power plants and locked in profits for the utility.

Indicted on charges ranging from theft to bribery to telecommunications fraud were Samuel Randazzo, former chair of the Public Utilities Commission of Ohio; Charles Jones, former CEO of FirstEnergy; and Michael Dowling, FirstEnergy’s former senior vice president of external affairs.

Charles Jones, former CEO of FirstEnergy | FirstEnergy

The new state indictment brings the first criminal charges against Jones and Dowling, who were fired by the company in 2020 after allegations of wrongdoing surfaced. (See FirstEnergy Fires Jones over Bribe Probe.)

A federal indictment announced in December brought bribery, fraud and other charges against Randazzo, who resigned as PUCO chair in late 2020. (See Former Ohio PUC Chair Charged with Bribery.)

The indictment runs 50 pages. It alleges that from 2010 to 2021, the three men “were literally as thick as thieves. Together, they would steal money from FirstEnergy, write legislative provisions worth unearned millions of dollars to FirstEnergy, legally guarantee … FirstEnergy’s [continued] profitability and take over the state government in a way that allowed FirstEnergy to regulate itself.”

Ohio Attorney General Dave Yost said a multiagency task force formed under the framework of the Ohio Organized Crime Investigations Commission prepared the case against the trio.

“This indictment is about more than one piece of legislation,” Yost said in a news release Feb. 12. “It is about the hostile capture of a significant portion of Ohio’s state government by deception, betrayal and dishonesty.”

Michael Dowling, FirstEnergy’s former senior vice president of external affairs | University of Akron

These are not the first charges brought in connection with the H.B. 6 scandal.

A federal jury convicted former Ohio House Speaker Larry Householder (R) of racketeering conspiracy in March 2023. He was sentenced in June to 20 years in prison but appealed his conviction. (See Former Ohio House Speaker Householder Sentenced to 20 Years in Prison.)

There have been numerous civil actions as well. Yost said his office has averted nearly $2 billion in charges to FirstEnergy customers over the period covered by H.B. 6.

FirstEnergy itself agreed to pay a $230 million federal fine for its role in H.B. 6. (See DOJ Orders $230 Million Fine for FirstEnergy.)

The Allegations

FirstEnergy was alleged to have spent $61 million in bribes, campaign contributions and advertising to advance Householder to the speakership. He then supported H.B. 6, which provided more than $1 billion in subsidies for the nuclear plants the company owned at the time.

The indictment paints a picture of a decadelong scheme that “all began with a well-lawyered theft in 2010.” The paperwork states and alleges that:

- Randazzo was simultaneously a consultant for FirstEnergy; a representative of a group of large commercial electric users who thought they were paying too much for electricity; and the operator of two shell companies, Sustainability Funding Alliance of Ohio and IEU-Ohio Administration Co.
- Randazzo subsequently skimmed $5.4 million of the $13.2 million he obtained for his commercial clients from FirstEnergy.
- FirstEnergy paid out Randazzo’s consulting fees in full shortly before he was nominated to head the PUCO; Randazzo lied about the relationship in his testimony to the General Assembly and failed to disclose the millions of dollars he had received from the company he soon would regulate and would continue to work for as an unregistered lobbyist.
- Randazzo wrote portions of H.B. 6 that subsidized the nuclear plants, which FirstEnergy said were losing money.
- Also in H.B. 6, Randazzo scuttled a 2024 rate case that likely would have resulted in a PUCO order to lower FirstEnergy’s rates; this maintained FirstEnergy’s profits at the levels of 2018, a very good year for the company.
- All the while, Jones and Dowling directed and funded Randazzo and other lobbyists. They profited personally as First Energy stock rose from $28.83 in May 2017 to $50.47 in January 2020.
- Jones texted Randazzo a screen shot of the stock price in November 2019 with a two-word message: “Thank you!!”

The Charges

Randazzo was indicted on 22 felony counts: one count each of engaging in a pattern of corrupt activity, grand theft and bribery; two counts of aggravated theft; three counts of telecommunications fraud; six counts of tampering with records; and eight counts of money laundering.

Jones was indicted on 10 felony counts: one count each of engaging in a pattern of corrupt activity and bribery; two counts each of aggravated theft of $1.5 million or more and telecommunications fraud; and four counts of money laundering.

Dowling was indicted on 12 felony counts: one count each of engaging in a pattern of corrupt activity and bribery; two counts each of aggravated theft of $1.5 million or more, telecommunications fraud and tampering with records; and four counts of money laundering.

Sustainability Funding Alliance of Ohio is included in 11 of the criminal charges; IEU-Ohio Administration is included in five.