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November 12, 2024

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ISO-NE Study Highlights the Importance of OSW, Nuclear, Stored Fuel

ISO-NE presented the final stage of its Operational Impact of Extreme Weather Events study to stakeholders at the NEPOOL Reliability Committee (RC) on Nov. 14, shedding light on how changes to the 2032 resource mix could affect reliability in the region.

The analysis built upon findings for the winter of 2032, which were originally presented to the RC in August. The new results stemmed from additional tests — or “sensitivity analyses” — based on stakeholder requests, which included adjustments to the load profile, clean energy additions, and fossil fuel and nuclear retirements.

The sensitivity analyses assessed the 2032 grid under a worse-case scenario based on historical weather patterns from a 21-day stretch in the winter of 1961, which had the highest average system risk of all similar periods considered.

The analysis used the 2023 Capacity, Energy, Loads and Transmission (CELT) report’s load forecast for 2032, with a resource mix built around the results of Forward Capacity Auction 17. It assumed the presence of the New England Clean Energy Connect transmission line, which is under construction in Maine but has faced extensive legal and political challenges.

The results “reveal a range of energy shortfall risks and highlight the increasing energy shortfall risk between 2027 and 2032, said Stephen George of ISO-NE. George qualified that the findings “are useful for highlighting directional changes in energy shortfall risk under various assumptions; [the] results should be considered in the context of the specific assumptions made and the attributes of the Jan 22, 1961, 21-day event.”

The baseline case and the sensitivity analyses looked at shortfall with and without the Everett LNG import terminal in service. (See FERC, NERC Leaders Voice Concern About Loss of Everett Marine Terminal.) Counterintuitively, the modeling indicates that the presence of Everett marginally increases energy shortfall by enabling greater injections of LNG into the gas network and causing the region to run out of its LNG stockpile more quickly.

However, ISO-NE has cautioned that this aspect of the model should not be considered a perfect representation of future LNG stockpiling behavior.

The analysis found that replacing 1 GW of fossil resources with additional offshore wind capacity reduced the projected shortfall by 37 to 42% compared to the baseline scenario. In contrast, limiting the total offshore wind capacity to 1,600 MW — compared to the 5,600 MW assumed in the baseline scenario — increased the shortfall by 165 to 193%.

The offshore wind industry in New England has seen several major project cancellations over the past year, and industry experts have expressed their worry that this could push the in-service dates of the next wave of projects in the region into the 2030s. (See Long-term Optimism Meets Short-term Concern at Offshore WINDPOWER 2023.)

The study found that replacing a gigawatt of fossil fuel generation with onshore wind and utility-scale solar also improved reliability, but to a lesser degree. Onshore wind was associated with a 25% reduction in shortfall, while solar was associated with a 3 to 5% shortfall reduction. However, replacing the same amount of fossil fuel generation with two-hour-duration storage was associated with an 11 to 19% increase in shortfall.

The analyses modeled only two-hour-duration battery storage resources; ISO-NE received requests from stakeholders to look at longer durations but was limited by the study’s time constraints.

“Future modeling enhancements will enable the incorporation of longer-duration storage,” George said.

The baseline scenario did not include nuclear retirements, but the sensitivity analysis found that retirements would increase shortfall in all scenarios considered. Replacing all nuclear capacity with the same amount of renewable qualified capacity led to a 50 to 76% shortfall increase. George noted that retiring nuclear resources without corresponding renewable replacements would also significantly increase the region’s reliance on oil and LNG.

Regarding fossil fuel resources, the study found residual fuel oil (RFO) resources to be especially helpful to maintaining grid reliability. Replacing all RFO resources with the same amount of renewable qualified capacity led to a 19 to 36% increase in shortfall.

“Energy from resources that burn stored fuels will continue to be important in terms of minimizing energy shortfall as the region transitions to higher penetrations of renewable resources,” George said.

The study found that the retirement of 1.5 GW of gas-only generators had minimal effects on the projected shortfall because of the limited amount of natural gas available during the study period. Replacing these retiring resources with an equal amount of renewable nameplate capacity decreased shortfall by 24%.

Increasing the level of electricity imports also made a significant dent in the projected shortfall; a 50% increase in imports coupled with the elimination of the cap on maximum transfer capability reduced shortfall by 66%. Demand response also boosted reliability; an added gigawatt of active demand response capacity cut shortfall by 38 to 39%.

Finally, changes to the overall load profile had a significant effect on the shortfall. Increasing the load by 10% led to a 156 to 192% increase in shortfall, while decreasing load by 10% reduced shortfall by 84 to 87%. A 20% increase in behind-the-meter solar reduced shortfall by 7 to 10%.

ISO-NE hopes to release a final report covering the results from all phases of the study in late November or early December. Following the final report, the RTO plans to use the results to begin work on a “Regional Energy Shortfall Threshold,” which will establish “the region’s acceptable level of reliability risk.”

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RMI Unveils Initiative to Lower Carbon Footprint of Homes

Clean energy transition nonprofit Rocky Mountain Institute on Nov. 14 kicked off a “soft launch” of HomebuildersCAN, a new network to accelerate decarbonization of the residential construction sector.  

The industry stakeholder group, which launches fully in January 2024, will bring together homebuilders of all sizes to lower the embodied carbon in new homes and improve reporting of Scope 3 greenhouse gas emissions — indirect emissions in a company’s supply-chain. 

“We have three overarching goals with HomebuildersCAN. One is to increase performance on embodied emissions for new homes, figuring out where we are today and how do we map to zero as quickly as possible,” said Chris Magwood, an embodied carbon and residential construction expert at RMI (founded as Rocky Mountain Institute) overseeing the initiative. 

“Our second goal is to bring alignment across the sector so that builders are approaching this the same way. Finally, for the homebuilders themselves, we want to be supporting and encouraging them to adopt and scale profitable climate smart building practices,” he said. 

Along with improving the practices and reporting within the industry, the initiative aims to bring a shared and cohesive approach to embodied carbon to the wider ecosystem of regulators, lenders, energy efficiency programs and others, Magwood said.  

HomebuildersCAN will help builders learn about embodied carbon and develop the capacity to incorporate embodied carbon reductions into strategic plans and reports, Magwood said.  

“What we don’t want this organization to be is another labeling program, so we’re not looking to get into the business of certifying homes. We want to support homebuilders in tackling embodied carbon issues in their practice,” he said. 

The Climate Action Network (CAN) for homebuilders’ goals span from education to advocacy, and it will provide a standardized table for consistent reporting at an individual building, community or portfolio level. The industry already has several green building standards such as LEED, Passive House and HERS, and HomebuildersCAN’s reports are intended to be complementary and reference existing programs where used. A proposed annual reporting template will help companies report their impact as a whole. 

The group will help homebuilders include carbon reduction in their strategic plans, Magwood said. 

“Once the program is up and running in 2024, we’ll be working with the builders to help them get on to an embodied carbon reduction pathway. That’s going to start by providing a lot of assistance to benchmark where their embodied carbon emissions are right now and then help institute a five-year plan,” he said. 

Inaction on Climate Change as the Biggest Competitor

Several North American homebuilders joined HomebuildersCAN prior to its official launch and shaped the reporting tools and other program features. 

“We don’t see our builder down the street as our competitor anymore. We see inaction on climate change as our biggest competitor,” said Phil Squires, corporate vice president of sustainability and procurement at Mattamy Homes, the largest privately owned homebuilder in North America. “We all face the same challenges regarding design, supply, execution, tracking data and, ultimately, affordability.”  

While the homebuilding industry has taken large strides toward improving home energy efficiency over the last few decades, Squires said, dealing with embodied carbon is relatively new and there is urgency in understanding and driving down that embodied carbon.  

“We see our homes today as carbon sources and through partnerships like HomebuildersCAN, we’re hoping that we can turn that into carbon sinks,” he said.  

The creation of HomebuildersCAN was prompted in part by local governments adopting climate action plans, said Aaron Smith, CEO of the Energy and Environmental Building Alliance (EEBA).  

“One of the studies we did said that most builders didn’t know it was good to have less carbon in their home,” said Smith. HomebuildersCAN will help educate those builders about why there’s a need to reduce embodied carbon in homes and how they can reduce it. 

Part of the challenge for homebuilders, Smith said, is that many products do not have Environmental Product Declarations (EPD), a declaration of the carbon embodied in a material, making it impossible for the builders to accurately measure the embodied carbon footprint of the homes they build. 

The initiative will encourage the use of the Embodied Carbon in Construction Calculator (EC3) developed by Stacy Smedley of Skanska and Phil Northcott of C Change Labs and integrated into two existing Carbon Action Networks focused on the global building industry: OwnersCAN and MaterialsCAN.  

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EPSA Releases Policy Principles for Energy ‘Expansion’

The Electric Power Supply Association (EPSA) has released a set of policy principles it hopes will inform legislators and regulators as the grid transitions to cleaner supplies and greater demand from electrification.

Many in the industry refer to the “energy transition,” but EPSA CEO Todd Snitchler said in an interview Nov. 14 the changes also include an “energy expansion,” as electricity takes on new sources of demand including transportation and heating.

“Consumer adoption of new, electrified devices, heating and cooling systems, vehicles and industrial processes will drive further demand for electricity, and accurate wholesale pricing is needed that sends demand signals to customers to respond flexibly, economically and reliably,” says EPSA’s fifth principle.

The first principle is an endorsement of wholesale competition, the development of which enabled the independent power producer business model of EPSA’s members. It says competitive wholesale markets are the most effective tool to achieve policy objectives by encouraging private capital deployment and innovation at the lowest costs, while shifting risks to investors — not consumers.

“Hopefully, this will encourage policymakers to think about these issues as they’re making decisions about policy choices and resources and timelines,” Snitchler said. “Because it’s very easy to say you want a certain outcome; it’s much more difficult to achieve it, and we hope these will help inform the ‘achieving’ part of those policy goals.”

EPSA also says existing dispatchable resources will be needed to keep the grid reliable, even as they operate less often.

“As you see a greater penetration of renewable resources, you’re going to continue to see a need for natural gas, because of the performance characteristics it has,” Snitchler said. “It will be required when the sun isn’t shining, or the wind isn’t blowing, or you have other interruptions to non-dispatchable resources. Dispatchable resources that can respond quickly, power up and remain operational, like natural gas, are going to be profoundly important because they will be the difference between the lights staying on and us having a power outage.”

Such power plants will run less often, but they will be important to maintaining reliability when they do run. Some of the market reforms will be required to ensure plants that are vital for reliability but get fewer and fewer chances to earn money from the energy markets stay online.

“Market-based solutions, like a flexibility product, or a quick-ramping product, or something that will ensure that those resources are able to earn sufficient revenue to remain on the system, when they are needed, is going to be how we’re going to have to think about it,” Snitchler said.

Stepping back, system planning is based on parameters the industry came up with in the middle of the last century, but the grid already has changed significantly, with more on the way, so new planning methods must be developed.

In the past, EPSA focused on trying to limit the impact of subsidies on wholesale power markets, but since the Inflation Reduction Act added billions of dollars more, those debates are in the rearview mirror, Snitchler said.

“We just have to figure out how to incorporate that into the policies” needed to achieve policymakers’ objectives, he added.

Many of those subsidies and the plans to decarbonize the electric industry rely on moving past natural gas eventually. While EPSA technology is agnostic, the resources that could replace gas-fired power plants aren’t ready to do so at scale, and it’s uncertain when they will be.

“In the event that we can have the breakthroughs that will help us get to where small modular reactors can be the generation resource of the future, that would be great,” Snitchler said. “The challenge is those technologies are talked about today like we are on the cusp of having it tomorrow, and it appears that we’re farther away than that.”

Just last week, NuScale Power had to cancel a proposed SMR in Utah, while other technologies like clean hydrogen have yet to be developed at the scale and price needed where they would brgin to replace natural gas. (See Pioneering NuScale Small Modular Reactor Canceled.)

Competitive markets often are where new technologies are deployed once the economics make sense, but retiring natural gas plants too early will increase reliability risks, Snitchler said. Should there be a major crisis because of policy, it easily could lead to a backlash against the energy transition.

Polling consistently shows consumers value reliability when it comes to the grid, Snitchler said.

“If we’re moving too quickly, in any one direction, and that results in power outages, or crises that happen, public support will pretty quickly erode,” he added. “So, I think that’s something that we need to be mindful of as we go through this process, because it’s not going to happen overnight, and we need to be thoughtful about how we get from here to the ultimate destination.”

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White House Releases Climate Assessment, $6B for Resilience Projects

According to the fifth National Climate Assessment (NCA5) released Tuesday, a person born in North America in 2020 will experience more climate hazards on average than a person born in 1965. 

A 2-degree Celsius (2.7-degree Fahrenheit) increase in global temperature could mean that over their lifetime, that 2020 baby could experience a potential doubling of wildfires, hurricanes and drought and a tripling of heatwaves, along with other increases in flooding and crop failures. 

At the same time, the southeastern states could experience 25-50 more days a year with temperatures over 95 degrees Fahrenheit, while most of the country could see annual precipitation rise 5-10%. A 4-degree Celsius rise in temperatures could kick that increase up to 15%, according to the report. 

Extreme weather already is taking a major toll, with 18 events — wildfires, tornados, floods, winter storms and hurricanes — causing more than $1 billion in damages each in 2022, the report says, and each of those events had an impact on the U.S. electricity system.  

Extreme heat or cold increases electricity demand while also potentially decreasing the grid’s ability to provide vitally needed power, according to NCA5.  

Winds, floods, ice and wildfires can take down power lines, while extreme heat can reduce the grid’s transmission and distribution capacity.  Cloudy or stagnant weather can reduce wind and solar production, while extreme winter storms can freeze gas supply systems, and droughts can cut hydropower output.  

The report also includes a hopeful assessment of climate action, supported by the policies of the Biden administration and the billions in clean energy and resilience funding in the Infrastructure Investment and Jobs Act (IIJA) and Inflation Reduction Act (IRA).  

The report’s chapter on energy supply, delivery and demand notes that “federal, state, local, tribal and private-sector investments are being made to increase the resilience of the energy system to climate-related stressors.  

“Ongoing investments will need to include improvements in energy-efficient buildings; technology to decarbonize the energy system; advanced automation and communication and artificial intelligence technologies to optimize operations; climate modeling and planning methodologies under uncertainties; and efforts to increase equitable access to clean energy.” 

The administration backed up that ambitious vision with an announcement of $6 billion in funding for a range of clean energy and resilience funding, as outlined in a White House fact sheet.  

The Department of Energy is opening the second round of funding for its Grid Resilience and Innovation Partnership (GRIP) program that will offer $3.9 billion from the IIJA for projects that “will modernize the electric grid to reduce impacts from extreme weather and natural disasters, increase capacity and unlock renewable energy resources.” 

The first round of GRIP funding, announced last month, awarded $3.46 billion to 58 grid improvement projects. 

EPA soon will announce a $2 billion funding opportunity through its Environmental and Climate Justice Community Change Grants program. With dollars from the IRA, projects will focus on community-driven efforts to “deploy clean energy, strengthen climate resilience and build community capacity to respond to environmental and climate justice challenges,” the fact sheet says. 

The Interior Department will get $100 million in IIJA funds for water infrastructure upgrades for drought resilience in the West, part of which will be used for hydropower upgrades.  

Choices Made Today

The release of NCA5 likely is a strategic move as the U.S. prepares for the United Nations Climate Change Conference (COP28) kicking off in the United Arab Emirates (UAE) in just over two weeks. Ahead of the conference, the U.S., European Union and UAE are trying to rally support for a global pledge to cut greenhouse gas emissions by tripling renewable energy generation by 2030, according to a Reuters report. 

A key message of the U.S. report is that the degree of warming, and its effects on Americans, will depend on choices made now.  

The energy sector is pivotal because while changes in technology can reduce emissions, they also can increase system vulnerabilities as demand increases and shifts, the report says. Climate change could drive major increases in power demand, according to the report. The western U.S. could see demand jump 50% by 2050, while demand in the eastern part of the country could rise 30-40%. 

Between 2050 and 2100, those increases could soar by as much as 200% in the Southwest and by 150-175% along the East Coast.

Portfolio of mitigation options for achieving net zero by 2050 | NCA5

 

The report’s potential solutions for promoting energy system resilience include the adoption of microgrids and storage to reduce the risk of power outages, adopting building codes that increase efficiency and cut energy demand, and decarbonizing the grid with zero-emission technologies.  

President Biden has set a 2035 goal for the U.S. electric system to be powered 100% by clean energy. But NCA5 predicts that by 2050, solar, wind, nuclear and other renewables will account for only about 75% of U.S. electricity generation, with natural gas and coal still in the mix.  

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Asia-Pacific Energy Leaders See Challenges, Opportunity in Green Goals

SAN FRANCISCO — Policymakers must invest in scaling clean energy solutions if the Asia-Pacific region is to meet climate goals, experts said at the Green Innovation and Sustainable Development Forum held by the US-China Green Energy Council and the APEC Sustainable Energy Center in San Francisco on Nov. 13.

With increasingly expensive extreme weather events brought on by man-made climate change, the cost of rapid action is lower than the cost of inaction, said Anand Gopal, executive director of Energy Innovation.

“It will be $12 trillion cheaper to have a fast transition to net zero than it would be to have no transition,” Gopal said. However, the costs of some of climate solutions are more likely to decline rapidly as they scale, he said, citing Wright’s Law, which says the declines are most likely with products that can be mass-produced and that have lower degrees of design complexity.

Government loan guarantees have proven to be an effective way to get new technologies over early scaling issues, said Nobel Laureate and former U.S. Energy Secretary Steven Chu, who now teaches at Stanford.

“The fact that a government can come in and guarantee a loan, just in case the project defaults, will drive the cost of capital way down,” Chu said. That approach has proven its value in driving down the cost of both solar and electric vehicles, he said.

“If you want to get these rapid price drops, policymakers should trust that these will happen with clean technologies and that they will eventually save their constituents money,” Gopal said. “Leaning in early on policy, doing it in such a way that knowing that your actions will lead to a cleaner and cheaper energy future for your citizens, is very important.”

APEC’s Energy Working Group Drives Regional Action

The forum was held ahead of the Asia-Pacific Economic Cooperation (APEC) Summit, where leaders of APEC’s 21 member economies will convene to discuss a range of economic issues. APEC has an energy working group that explores regional energy issues.

“The work of APEC’s energy working group matters because APEC economies account for 56% of world energy demand, 58% of world energy supply and 68% of world electricity generation,” said Rebecca Fatima Sta Maria, executive director of the APEC Secretariat.

APEC economies account for 60% of global CO2 emissions, and 19 members have committed to achieving zero carbon emissions by 2050 or 2060, Sta Maria said.

Yongxin Zhan, co-chair of Pacific Economic Cooperation Council, said the region, which accounts for a third of the world’s population but 60% of its economic output, was dynamic in its approach to addressing sustainability goals but was still falling short of meeting the UN’s Sustainable Development Goals. Three years ago, APEC member states released the Putrajaya Vision 2040, which focuses on three economic drivers: trade and investment, innovation and digitalization, and sustainable and inclusive growth.

“We have confidence that with the common efforts of APEC member economies, the Putrajaya Vision of an open, dynamic, resilient and peaceful Asia-Pacific community and the green innovative sustainable development could be achieved,” Zhan said.

APEC’s energy working group focuses on the region’s ability to meet two goals, Sta Maria said. “The first is the collective commitment to improve energy intensity by at least 45% by 2035 compared with 2005 levels. The second goal is to double the share of modern renewables in the energy mix by 2030 relative to the numbers from 2010.”

California Plays Outsized Role in Region

While APEC member economies collectively are large, California alone carries significant weight, said David Hochschild, chair of the California Energy Commission, noting the state is home to the world’s largest geothermal plant, stationary battery project and rooftop solar PV system.

Hochschild said that, despite the media tendency to paint California’s economy as a train wreck, over the last 10 years, the state had passed Russia, Italy, France, Brazil and the United Kingdom (‘thank you to Brexit’) and this year is on track to pass Germany to become the fourth-largest economy in the world. “This has been concurrent with the largest decarbonization we’ve ever done. This has been good for our economy.”

Hochschild called California’s current era “The Great Implementation” but sees speedbumps slowing the state’s decarbonization plans.

“The speed of construction of projects is a huge problem in the state,” Hochschild said. “To construct an offshore wind project, for example, is 32 different permits. We need to have as much success on process innovation as we’ve had on technology innovation. We don’t need to do landmark policies. We just need to buckle down and focus on implementation and hire the talent for that.”

California, China Share ‘Really Robust Climate Collaboration’

Despite the Biden administration’s aim to build the U.S.’s clean energy manufacturing capacity, lessening dependence on imports from China, Hochschild sees “really robust climate collaboration” between California and China. He told NetZero Insider that the two economic powerhouses shared learnings in a recent visit to China.

Hochschild said California can learn from China’s strength in offshore wind development (“where China’s built 50% of the global capacity: we’re just getting started on that today”) and high-speed rail, an infrastructure wish list item that California has struggled to deliver.

On the other side, he said, “We can help support China with lessons learned on stationary energy storage where we’re leading the fastest-growing energy storage market in the U.S. We had an opportunity to share with the Chinese our very positive experience of bringing that onto the grid.”

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Stakeholders Approve Bulk of SPP’s Markets+ Tariff

TEMPE, Ariz. — Stakeholders interested in participating in SPP’s Markets+ service offering in the Western Interconnection last week approved much of the draft tariff language they’ve developed together in recent months. 

That tickles SPP attorney Chris Nolen, whose frequent comments about building “the best tariff ever” are being repeated by SPP staff and potential western stakeholders. 

“We’ve moved, in my opinion, more efficiently, faster, better than I thought we would when we had our kickoff meeting,” he said during a break in the Nov. 7-8 Markets+ Participant Executive Committee (MPEC) meeting. “It’s been super impressive how all the market participants, everybody involved at all the stakeholder groups picked up really quickly on how it works, how it runs, how you make comments, how you get changes you want to see in the tariff language. I think we’re in an excellent spot.” 

Arizona Commissioner Nick Myers | © RTO Insider LLC

MPEC members endorsed chunks of tariff language that define how the day-ahead Markets+ will handle market transmission use, congestion management, transmission capacity obligations, market manipulation and confidentiality. The Interim Markets+ Independent Panel (IMIP), composed of three SPP directors, added its approval as well. 

However, the Markets+ Greenhouse Gas Task Force was given up to eight weeks to approve draft language incorporating GHG emissions-related information in the market’s reporting, price formation, commitment and dispatch. The group already has a conceptual framework. 

The Pacific Northwest’s only cap-and-trade program, Washington state’s cap-and-invest initiative, has a Nov. 1, 2024, compliance deadline. By that time, affected entities need to have enough allowances to cover 30% of their 2023 emissions. (See “GHG Issue: ‘Emissions Leakage’,” Markets+ Stakeholders Begin Tariff’s Development.) 

A proposed option of making a supplemental filing at FERC once the cap-and-invest program’s rules become clear failed to garner enough support. Washington’s Department of Ecology, which is overseeing the program, has an ongoing rulemaking to be completed next summer. 

Task force chair Mary Wiencke, with The Public Generating Pool, said she expects the rulemaking to be delayed by Ecology’s concerns over Markets+’s final market design. 

“There’s a real cart-before-the-horse and a real chicken-and-egg issue here,” Wiencke said. “Somebody has to go first, and so then the rules in the market design have to be jointly sort of put together. … We need a market design to have rules also. This process is going to be iterative, no matter what.” 

“When you do that four to six weeks, or four to eight weeks, the pressure is really on all of us because we know that there’s a pretty significant consequence if we don’t get there,” PowerEx’s Mark Holman said. “We’re either [filing a supplemental] or we’re into a tariff delay that affects everything in this initiative. I like that pressure being on. I think it’s worked well. We will have different resources that roll their sleeves up and not sacrifice the quality of the solution, but actually get it done.” 

The GHG delay could throw a kink in SPP’s plans to have the tariff complete in December and take it to the RTO’s Board of Directors in February. SPP hopes to receive IMIP approval Dec. 14 before taking it to the board; the tariff would be filed in the first quarter next year, assuming final approval. 

The task force will report on its progress during MPEC’s Dec. 6-7 virtual meeting, which once was a one-day call. 

“We want to have the tariff and all the policy items done by December,” said Carrie Simpson, SPP’s director of seams and western services development. “However, to the extent that we’ve got some stuff that’s still hanging around or there’s a policy item that needs extra time, I don’t know that January’s a [hard deadline].” 

No need to worry about the additional time afforded to the GHG task force, Nolen said. 

“It’s just complex, so it’s taken a little bit when you plug it in to the broader market,” he said. “It’s new. We’ve never had to plug one in yet.” 

Nolen told MPEC if SPP receives the GHG tariff language in mid-January, staff will need only a week to “holistically consider” the tariff and to file at FERC. 

“If we tried to wait and amend the filing after the fact, that brings up some of the complications with pushing this date,” he said. “When the pens go down, we need eight weeks internally to run through that tariff and be sure that we wired everything out to the baseline tariff and everything works.” 

“The degree of collaboration and consensus that’s been required to develop this volume of tariff language this quickly is tremendously encouraging,” Antoine Lucas, SPP’s vice president of markets, said after the meeting. “SPP and the Markets+ participants are striking a remarkable balance between speed and meaningful consideration in developing a market that works for all stakeholders.” 

FERC’s approval of the Markets+ design would begin the market’s second phase of development. At that point, SPP would acquire the necessary software and hardware, participating entities would fully commit to funding the market and they would be integrated into the system. 

Go-live is targeted for October 2026. 

WRAP, RTO West Advance

SPP also celebrated recent “significant” progress with the other prongs of its western expansion. It said an important element of the Western Power Pool’s Western Resource Adequacy Program (WRAP) that it operates became operational Nov. 1, and the grid operator formally kicked off its RTO West development in Denver. 

WPP says the WRAP is the first regional reliability planning and compliance program in the history of the West. Its operations program produces updated forecasts each season to help determine whether participants will have sufficient resources and enables those with a deficit to secure additional resources. 

The RTO said the program will remain non-binding for an undefined time.  

“SPP is grateful for our partnership with Western Power Pool and the opportunity to help assure resource adequacy for their member utilities,” Casey Cathey, SPP’s senior director of grid asset utilization, said in a statement. 

On Nov. 9 in Denver, SPP hosted utilities that have committed to joining as members of its RTO in the Western Interconnection. The grid operator presented its plan to coordinate the utilities’ integration into SPP’s planning, reliability coordination, market and other services before operations are targeted to begin in April 2026. (See WAPA, Basin Electric Commit to SPP’s RTO West.) 

SPP’s senior vice president of operations Bruce Rew, who leads the RTO expansion program, said the kickoff was a result of years of negotiations and planning. 

“We’re eagerly looking forward to the day that these plans come to fruition and we have the opportunity to bolster grid reliability, bring efficiency to planning processes and leverage the full potential of a single interregional market across two interconnections,” Rew said. 

Much of the RTO West’s development will be handled through SPP’s normal stakeholder process, staff said. 

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Will DOE’s Transmission Needs Study Spur New Regional, Interregional Lines?

A key difference between the draft National Transmission Needs Study the Department of Energy released in February and the final version issued Oct. 30 is a new section in the introduction spelling out what the goals of the report are and, equally important, what they are not.

“The objective is to identify pressing transmission needs across the nation,” said Jesse Schneider, a policy adviser in DOE’s Grid Deployment Office (GDO), which authored the report. “However, the study does not prescribe any specific transmission solutions to meet those needs.”

Speaking during a recent webinar on the report, Schneider further stressed “the study findings are intended to inform department transmission priorities, including implementation of funding programs, technical assistance or broader transmission planning programs.” The report is not intended “to supplant or presuppose any existing transmission planning activities,” he said.

Similarly, while the study does break down transmission needs by region, that analysis will be used to “inform” but not designate any National Interest Electric Transmission Corridors (NIETCs) ― areas where transmission constraints and congestion could be improved with federal funding and accelerated permitting. (See What Are National Interest Transmission Corridors and Why Do We Need Them?)

DOE issued a request for information on the process for designating NIETCs in May and, as with the Needs Study draft, received a range of comments. In her opening remarks at the Nov. 8 webinar, GDO Director Maria Robinson said further guidance on NIETC designation would be released by the end of the year. (See States, RTOs Caution DOE on Transmission Corridors.)

Separate from NIETCs, DOE sees the Needs Study as a resource that can be used to encourage entities “to revise their planning processes to incorporate these findings, including consideration of a wider range of transmission benefits [and] portfolios of transmission project evaluation, rather than individual project evaluation,” Schneider said.

Broader planning perspectives also might include “scenario-based planning with longer time horizons to incorporate alternative transmission solutions including grid-enhancing technologies, as well as weather data [that] better reflect future extremes,” he said.

The need to explain the study’s goals and how it should and shouldn’t be used was raised by a number of the 58 groups and individuals who submitted a total of 330 comments on the draft Needs Study. The comments were summarized, with the department’s responses, in an 80-page appendix to the final.

The range of comments and the resulting revisions made to the final study reflect the complexities of grid planning as the U.S. generation mix moves toward cleaner, renewable resources.

“I think it does send a clear message,” said Rob Gramlich, president of industry consultant Grid Strategies. “It’s a well-done and thorough report citing many dozens of studies. So, I think, as a pure piece of analysis and information, it makes a very strong case. And it is from the Department of Energy, with the authority that entails … and is supported by all the national labs, so that gives it a lot more credibility than just a report.”

The study’s topline findings were no surprise, as Energy Secretary Jennifer Granholm said in a press call preceding the release. “We need to seriously build out transmission in order to improve reliability and resilience, and of course, to lower energy costs and relieve congestion on the grid.”

The study also finds “that of all the different configurations of transmission deployment, interregional transmission results in the largest benefits,” Schneider added during the Nov. 8 webinar, with the caveat that “transmission needs will shift over time.”

The Comments

The report’s broad and general approach — and the department’s insistence on not providing solutions — left some commenters dissatisfied. Utilities, RTOs and transmission developers all argued the report omitted projects and circumstances specific to their transmission planning and operations.

New York Transmission Owners (NYTO), a utility stakeholder group in NYISO, said the report should include four of its latest projects, which are aimed at alleviating price differentials between New York City and upstate areas, an issue raised in the draft.

PJM staunchly defended its performance during the winter storm of February 2021, commonly referred to as Winter Storm Uri, noting it provided “unprecedented amounts of power” to neighboring regions and that any limits in interregional transfers were due to “constraints in neighboring systems.”

ERCOT, on the other hand, urged DOE to treat the effects of Uri as outliers, asserting the report’s call for more interregional transmission to connect Texas to surrounding areas is overstated, given system upgrades it has undertaken since the storm.

DOE’s decision to base the report on existing studies, rather than fresh research ― and the resulting underlying assumptions ― was another flashpoint. While the draft referenced more than 50 reports, DOE was deluged with recommendations for other studies to be included, resulting in the final version reviewing and citing more than 100 reports.

Given the study’s strong focus on interregional transmission, the National Renewable Energy Laboratory’s Interconnections Seam Study ― which looked at the benefits of interregional connections ― was one of the more surprising omissions from the draft, but it was included in the final. Other additions include MISO’s Long-Range Transmission Planning Process and CAISO’s 2022-2023 Transmission Plan.

A lack of up-to-date information on transmission needs on tribal lands was another gap in the draft, according to comments from the Blue Lake Rancheria Tribe, in Northern California. In this case, DOE tapped a still-unpublished survey on tribal access to reliable electricity, which found an estimated 54,000 Native Americans, including Alaska Natives, live without electricity, the majority of them in the Navajo and Hopi nations.

Of those surveyed, 23% do not have access to a centralized power grid, and 65% said existing grid infrastructure could be extended to tribal lands, the report said in a new section on tribal transmission needs.

Multiple commenters also took issue with DOE’s base case for anticipating and modeling future transmission needs, predicting high levels of renewable energy coming onto the grid, but only moderate load growth. Consolidated Edison pointed to the potential effect on demand spurred by New York’s Climate Leadership and Community Protection Act as an example of ambitious state legislation that could drive load growth.

The law calls for New York to cut its greenhouse gas emissions 85% by 2050, with an interim goal of a 40% reduction by 2030.

Advocacy nonprofits similarly called for DOE to factor in the effect on renewable energy and load growth of the Inflation Reduction Act’s clean energy incentives and EPA’s vehicle emission standards, which are expected to accelerate adoption of electric vehicles.

The Edison Electric Institute (EEI) and Public Service Enterprise Group (PSEG) faulted DOE for not taking into account FERC’s proposed rules on transmission planning and cost allocation. According to the Needs Study, EEI argued the proposed reforms “will encourage efficient, cost-effective transmission investment.”

DOE responded to EEI and PSEG by noting the Needs Study is focused on the physical limitations of the transmission system, “not jurisdictional or regulatory limitations.” FERC rulemaking, therefore, is deemed “out of scope,” DOE said. The department does acknowledge the likely effect of state and federal law, adding modeling of high renewable, high load growth scenarios to the final report.

For example, the study shows the Plains region (roughly corresponding with SPP) would need up to 119% more regional transmission under a moderate load growth, high renewable scenario, but possibly over 400% more in a high load growth, high renewable case.

The Impact

As originally authorized in 2005 amendments to the Federal Power Act, the Transmission Needs Study was called the Transmission Congestion Study, looking only at congestion on the grid. But the Infrastructure Investment and Jobs Act (IIJA) expanded the scope of the report to encompass future needs as well as congestion.

As the first such report, the Needs Study was released as part of a series of DOE announcements of new transmission programs funded by the IIJA, highlighting the department’s role as a catalyst for transmission expansion. DOE is using $1.3 billion in IIJA funds to sign on as an anchor off-taker for three interstate transmission projects, chosen in part based on regional analyses in the Needs Study. (See DOE to Sign up as Off-taker for 3 Transmission Projects.)

DOE also recently awarded $3.46 billion in IIJA funds to 58 grid improvement projects, with the largest award, $464 million, going to five transmission lines in MISO and SPP’s joint targeted interconnection queue (JTIQ) portfolio. Reflecting the Needs Study’s call for a portfolio approach to grid planning, the projects are aimed at improving interregional connections and transfers along the MISO-SPP seams. (See DOE Announces $3.46B for Grid Resilience, Improvement Projects.)

The report’s effect outside the department seems more uncertain, especially given the strong regional and local bias in the comments.

On the one hand, the study’s regional profiles are one of its strong points, laying out where more regional and interregional transmission could improve resilience and bring low-cost renewable power to urban and other areas with high electricity rates.

The study’s approach here is aligned with how RTO grid planning appears to be evolving toward the portfolio approach DOE advocates, as seen in the MISO-SPP JTIQ projects and PJM’s Regional Transmission Expansion Plan Window 3 solicitation. That initiative resulted in PJM recommending a range of projects to expand its system for new renewable generation as fossil fuel plants retire. (See PJM Recommends $5B in RTEP Transmission Projects.)

But the study also notes the majority of transmission projects that have been built in recent years are smaller lines aimed at improving local reliability. The proportion of overall transmission installed to address system reliability needs has grown from 44% in 2011 to 74% in 2020. Interregional projects that can provide multiple benefits beyond reliability ― such as getting more cheap, renewable power online ― still face formidable obstacles, including permitting and financing.

Gramlich sees the report as one piece of an incremental process ― including DOE funding, NIETC designation and FERC rulemaking ― that could drive change in transmission planning, permitting and construction.

“The report could encourage state and federal regulators to get busy … with interregional [transmission],” he said. “It can also encourage private developers ― utilities or independent developers ― to work on lines. … I would think developers building in the transmission [regions] that were highlighted in the report would get a boost with all of the stakeholders and all the utility off-takers or other subscribers to transmission lines. I would think this report would be meaningful for them to encourage their participation.”

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FERC Approves PJM RTEP Projects over State Protests

FERC on Wednesday approved a PJM proposal to add about $925 million in transmission projects to its Regional Transmission Expansion Plan (RTEP), the bulk of which would address the retirement of the 1,295-MW Brandon Shores generator outside Baltimore (ER23-2612). 

The 25 projects the commission signed off on include the $796 million Grid Solutions Package, which was determined to be an immediate-need reliability project to address the Brandon Shores deactivation, as well as $134 million in changes to existing projects — namely the New Jersey State Agreement Approach (SAA) projects — and a $4.69 million cancellation of a previously approved project.  

PJM and Talen Energy are in talks to arrive at a reliability-must-run contract to extend Brandon Shores’ operations beyond the June 1, 2025, requested deactivation date; the approved RTEP projects have an in-service date of Dec. 31, 2028. 

PJM’s proposal was protested by the Maryland Public Service Commission, the state’s Office of People’s Counsel and the Organization of PJM States Inc. (OPSI), each of which pushed against including the Grid Solutions Package. They argued the RTO improperly designated it to be an immediate need and therefore not holding a competitive process for a solution. The OPC asked FERC to reject the proposal and direct PJM to conduct a “transparent and thorough review of alternatives as well as to engage in a competitive project proposal window, where feasible, for some or all the segments of the Grid Solutions Package.” 

The commission determined its review of cost allocation filings is limited to whether the relevant tariff language has been followed, which it found that PJM had, making the protests out of scope. Responding to the argument that OPSI and the PSC made that PJM’s planning process doesn’t adequately account for potential reliability risks posed by generation deactivations, the commission said the RTO and stakeholders are making encouraging steps to consider changes to generation deactivation and transmission planning processes. In recent months, stakeholders have begun discussions at the Deactivation Enhancements Senior Task Force and the Long-Term Regional Transmission Planning Workshop. 

Commissioners Mark Christie and Allison Clements each concurred with the order, agreeing the protests were out of scope but noting they raised important issues. 

Citing PJM’s “Resource Retirements, Replacements & Risks” report — which raised concerns there will be a significant number of generation deactivations through 2030 that will not be met by currently planned resources — Clements questioned whether there are additional retirements looming that will put ratepayers in a similar bind. She suggested PJM’s Multi-Driver Project planning process could be used to be more proactive and meet potential reliability risks posed by generation deactivations while providing economic benefits and keeping costs low. 

“I wonder whether PJM’s extensive reliance on immediate-need reliability solutions such as those at issue in this proceeding is in part a symptom of the failure of the region to carry out proactive, scenario-based multi-value planning,” Clements wrote. “The record in response to the commission’s regional transmission planning proposal suggests that while some local and reliability needs may persist even with greater use of proactive planning, proactive multi-value planning processes can be leveraged to replace or defer reliability projects that would otherwise be needed, at significant value to customers.” 

Christie wrote that the growth of state policies and legislation prompting the shuttering of generators raises cost allocation questions for neighboring states in the RTO that may be saddled with a portion of the cost to build transmission necessary to meet demand in the absence of those units. He suggested that such deactivations may be better viewed as public policy projects akin to the transmission being built to interconnect offshore wind under the New Jersey SAA. 

“If the resulting transmission projects under protest in this RTEP filing are caused more by Maryland’s policy choices than by organic load growth and economic resource retirements, then a salient question that may be asked is whether these transmission projects are more accurately categorized as public policy projects, essentially the same as the transmission upgrades caused by New Jersey’s offshore wind projects,” he wrote. 

While the concerns raised in the protests are valid, Christie said the commission’s hands were tied by the need to prevent potential reliability violations once Brandon Shores goes offline. 

“So while I am deeply sympathetic to the concerns expressed by the Maryland PSC, OPSI and the OPC as to the impact on consumers, there is really no practical choice for us but to approve this filing. We simply cannot risk the potentially catastrophic consequences laid out by PJM in its filing. But the states in OPSI, as well as all states in multistate RTOs, may want to consider the broader questions this filing raises, as I have described above,” he wrote. 

The Grid Solutions Package comprises a new 500-kV line between the Peach Bottom and Graceton substations and a 230-kV line from Graceton to a new 230-kV Batavia Road substation outside Baltimore. The project also includes one new 500-kV substation. The PJM Board of Managers approved the projects during its July 10 meeting. 

The Brandon Shores deactivation is also being addressed by projects included in PJM’s recommended package of proposals submitted during the third competitive window of the 2022 RTEP, which is scheduled to go before the Transmission Expansion Advisory Committee for a second read Dec. 5. The $5 billion proposal also would address increasing data center load in Northern Virginia. (See PJM Recommends $5B in RTEP Transmission Projects.) 

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California Man Arraigned for Substation Bomb Attacks

A California man has pleaded not guilty in federal court to charges of damaging two transformers belonging to Pacific Gas and Electric in December 2022 and January of this year.

He faces a sentence of up to 50 years in prison and a $500,000 fine if convicted, the Justice Department said.

Peter Karasev, a 36-year-old resident of San Jose, was arraigned in the U.S. District Court for Northern California on Nov. 7, according to a press release, after a federal grand jury indicted him Oct. 19 on two counts of damaging energy facilities and one count of using fire and an explosive to commit a felony. Court records show Karasev was remanded to custody following the arraignment. His trial is scheduled to begin Jan. 30, 2024.

“The FBI is laser-focused on protecting the essential infrastructure that Americans rely on every day, and we and our partners … will use every lawful means to hold anyone who targets that infrastructure accountable,” FBI Director Christopher Wray said in the release.

According to the indictment, Karasev carried out his attacks on Dec. 8, 2022, and Jan. 5, 2023, in San Jose. The first incident occurred at a PG&E facility near the Westfield Oakridge shopping center; the second occurred near Santa Teresa High School about three miles away. Both occurred during the early morning hours in commercial areas occupied by stores and businesses, the department said.

Prosecutors said Karasev built, planted and ignited the explosives involved in each of the alleged attacks himself. Along with “experimenting” with explosives, the government said he also was making methamphetamine in his home during the months before the incidents. His alleged actions caused more than 1,500 San Jose homes and businesses to lose power.

San Jose Police Department officers arrested Karasev “on related state charges” in March, the government said, finding in his home multiple homemade explosive devices “in varying stages of completion,” 300 pounds of explosive precursor materials, firearms and other weapons, and “other hazardous substances.” According to media reports, the state charges include interfering with power lines, arson and child endangerment for conducting illegal activities with three children at home. He was transferred to federal custody to face the indictment.

Each count of damaging a power facility carries a maximum penalty of 20 years in prison, a $250,000 fine and three years of supervised release, while the charge of using fire and explosives carries a mandatory minimum penalty of 10 years to be served consecutively to any imprisonment ordered for the other two charges.

“Damaging our region’s critical infrastructure endangers innocent victims — including our most vulnerable citizens such as the elderly and the sick — and we will not tolerate it,” U.S. Attorney Ismail Ramsey said. “We will vigorously prosecute any malicious attempts to disrupt the power grid.”

Officials have not indicated what Karasev’s motive for attacking the substations might have been. Recent years have seen an increase in attempts to damage electric facilities, with some successful. The attackers’ reasons vary widely; some allegedly believed interfering with electrical service would serve their political ends, as with the group charged in February 2023 with planning to spark a race war by attacking the electric grid in Baltimore. (See Feds Charge Two in Alleged Conspiracy to Attack BGE Grid.)

Other incidents have more prosaic motivations, as with the rifle attacks on substations in Washington state last Christmas. In May 2023, one of the men charged in those attacks pleaded guilty, claiming he and his accomplice wanted to disrupt power as part of a burglary plot against local businesses and ATMs. (See Wash. Sabotage Suspect Pleads Guilty.)

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FERC Rejects Tri-State’s Exit Deal with United Power

FERC on Thursday rejected parts of a deal Tri-State Generation and Transmission Association had filed to allow the Colorado-based United Power to terminate its membership with the cooperative (ER23-2822). 

The firm had signed up to get at least 95% of its needs met by Tri-State through 2050 under the wholesale electric service contract, and its bylaws provide that members seeking early termination must satisfy all of their contractual obligations to the wholesale co-op. Members have to give two years’ notice and make a contract termination payment before they leave. 

FERC rejected an earlier attempt from United to conditionally withdraw in April 2022, and just eight days later, the Colorado co-op submitted a nonconditional two-year notice that it still wished to get out of the contract. (See FERC Rejects Conditional Withdrawals from Tri-State.) 

Tri-State and United did not agree on the amount of the exit fee and its true-up, the latter of which is meant to protect both sides from over- and under-payments. They also disagreed on whether Tri-State getting the payment was a precondition for United to withdraw and whether Tri-State could terminate the withdrawal agreement if United fails to pay on time. 

United argued that the fee is excessive and that because it is based on a pending proposal from FERC, true-ups could take years to come back to it as the case works its way through appeals. Even if FERC quickly approves a calculation leading to a lower fee, United claimed it may not get a refund because of risks to Tri-State’s finances. 

FERC found that Tri-State had not proven the withdrawal agreement to be fully just and reasonable, basing that on some of the provisions under the deal. 

Tri-State did not demonstrate that it is just and reasonable under the Federal Power Act to automatically terminate the withdrawal agreement and rescind United’s notice of withdrawal to the extent the generation and transmission co-op is found to be outside of FERC’s jurisdiction, which was the case before September 2019 — a decision that has been reaffirmed in court. 

“We find that Tri-State has not demonstrated that it is just and reasonable under the FPA to automatically terminate the withdrawal agreement and to automatically rescind United Power’s notice of withdrawal based on a change in jurisdictional status,” FERC said. “We further find that Tri-State has not supported the provision stating that the parties ‘mutually agree’ to rescind the withdrawal notice given that United Power has not agreed to this provision.” 

FERC agreed that the deal could be terminated for failure to pay, but it rejected language that would have denied United any chance to fix any late or deficient payment. 

The commission agreed that United will have to pay the exit fee that is effective on April 24, 2024, when it is set to withdraw from Tri-State, which currently would be nearly $1.6 billion. 

However, the withdrawal penalty calculation method could be changed by FERC in that pending case before that date. The deal also gives 90 days after April 24 for a FERC order on the new method, which would lead to a true-up to the new fee.