Search
December 25, 2024

Posted on

Idaho PUC Declines to Join Western RTO Governance Effort

The Idaho Public Utilities Commission last week said it will not join with other state regulators in an initiative to lay the groundwork for an independent RTO designed to serve the entire Western Interconnection.

Regulators from Arizona, California, New Mexico, Oregon and Washington proposed the West-Wide Governance Pathway Initiative in July in the face of increased competition for members between CAISO’s Extended Day-Ahead Market (EDAM) and SPP Markets+.

The proposal is intended to increase the potential for establishing a single wholesale electricity market that would include the participation of CAISO and build on the ISO’s existing Western Energy Imbalance Market and EDAM, for which the ISO recently filed a tariff with FERC. (See Regulators Propose New Independent Western RTO.)

Backers of the initiative issued an open letter Aug. 29 inviting stakeholders in the Western U.S. and Canada to build “Phase 1” of the effort, which will include “deciding on the form, mission and scope of an entity with independent, West-wide governance.” (See Backers of Independent Western RTO Seek to Move Quickly.)

But in a press release Thursday, Idaho regulators said they had voted unanimously not to participate.

Among their concerns was the conclusion that the initiative “has been less than transparent concerning its creating and funding.” The Aug. 29 letter stated that work on the initiative would be backed by “funding derived exclusively from 501(c)(3) sources,” an arrangement that would “be evaluated over time and will likely require supplementation as the workload intensifies.”

The Idaho commissioners said also that “there is no evidence that the initiative’s goal of independent governance is feasible without changes in California’s legislation,” an issue which has long impeded CAISO’s efforts to expand into the wider West.

The regulators additionally called the initiative’s goal of seating a board of directors by January 2024 “premature and unrealistic” and said that “at its core, the initiative presumes economic benefits for Western states without justification or specifics.”

Idaho PUC President Eric Anderson | Idaho PUC

“As always, the IPUC respects other commission, state and stakeholder decisions concerning participation with the initiative,” Idaho PUC President Eric Anderson said in the release. “However, given the IPUC’s concerns, the inherent flaws in the creation of the initiative and the initiative’s current actions and goals, the IPUC does not see a viable path forward for the initiative or that participation would result in any specific net economic benefits for Idaho customers.”

The governance initiative was the key topic during a panel discussion among utility commissioners at CAISO’s EDAM Forum in Las Vegas on Aug. 30. The commissioners acknowledged that Phase 1 would operate outside of any existing organization or decision-making process, and they asked regional stakeholders to provide feedback on how to structure the process.

Speaking on the panel, California Public Utilities Commission President Alice Reynolds said the effort is intended to set aside the problem of CAISO’s governance and determine what an independent entity “needs to look like.”

During a separate panel at the forum, Idaho Power CEO Lisa Grow lauded CAISO’s efforts in developing the EDAM but questioned the need for the West to create a full RTO in the near term.

Grow said that, unlike utilities in Colorado and Nevada, Idaho Power doesn’t “have legislative or PUC-mandated things that we have to do towards an RTO, so we can kind of watch how this goes.”

Posted on

Maryland Moves Ahead with Advanced Clean Car and Truck Rules

Maryland upped the ante on its clean transportation programs Monday as the state finalized its adoption of California’s Advanced Clean Cars II (ACC II) rule and began the process for adopting California’s Advanced Clean Trucks (ACT) rule.

Maryland is the eighth state to adopt ACC II, which will require all new light-duty vehicles sold in the state to be zero emission by 2035.

Gov. Wes Moore (D) announced the state’s intent to adopt ACC II in May. The rule could go into effect as early as January 2026, depending on when automakers begin rolling out their 2027 models, according to a spokesperson for the Maryland Department of the Environment (MDE). For the 2027 model year, 43% of new light-duty vehicles will have to be zero emission, with the share increasing between 6 and 9% per year, reaching 100% by the 2035 model year, according to MDE. (See Maryland to Adopt California’s Advanced Clean Cars II Rule.)

Both electric and hydrogen fuel-cell vehicles are classified as zero-emission vehicles. In addition to California, other states that have adopted the rule include Massachusetts, New York, Oregon, Vermont, Virginia and Washington.

Environment Secretary Serena Coleman McIlwain called Maryland’s adoption of ACC II “a big step toward cleaner air and a more aggressive response to the threats posed by climate change.”

MDE began the process for ACT adoption with a notice of proposed action, requiring truck manufacturers to increase the percentage of new zero-emission trucks sold in the state from 2027 to 2035.

MDE will hold a virtual public hearing on the proposed rule at 10 a.m. Oct. 11. Written comments may be submitted through Oct. 11.

The rule’s targets for clean truck sales vary depending on the type or class of truck. The percentage for Class 2b and 3 trucks, which include vans and heavier pickup trucks (8,501-14,000 pounds), would start at 15% in model year 2027 and rise to 55% by 2035. For heavier-duty Class 4-8 trucks (14,001-80,000 pounds), the zero-emission requirement would be 20% in model year 2027 and 75% in 2035.

MDE’s proposed rule on ACT was mandated under the Clean Trucks Act (H.B. 230) passed by the General Assembly and signed into law by Moore in April. If the proposed rule is finalized, Maryland would be the ninth state to adopt ACT, joining California, Colorado, Massachusetts, New Jersey, New York, Oregon, Vermont and Washington.

Both rules are expected to significantly affect transportation sector greenhouse gas emissions, which account for about 40% of the state’s GHG emissions, according to MDE. By 2035, ACC II is expected to cut carbon dioxide emissions from light-duty vehicles by 63% under 2021 levels, while nitrogen oxide emissions could drop 75% and sulfur oxides 64%, according to an analysis from the Sierra Club.

‘Commonsense Rules’

Special provisions of the Clean Air Act have made it possible for California to enact clean car and truck rules that exceed the vehicle emission standards set by the U.S. EPA. During the administration of former President Donald Trump, EPA revoked the Clean Air Act waiver allowing California’s stricter rules. Under President Joe Biden, EPA reinstated the waiver in March 2022, opening the door for California and other states to adopt ACC II and ACT.

The states that have adopted ACC II will be ahead of Biden’s goal for 50% of new light-duty vehicle sales to be zero emission by 2030.

Environmental and electric vehicle advocates were quick to provide statements of support for Maryland’s adoption of ACC II in a joint press release.

“Every day, fossil fuel cars emit pollutants that intensify climate change and contribute to toxic air pollution,” said Kevin Shen, policy analyst for the nonprofit Union of Concerned Scientists. “By adopting the Advanced Clean Cars II standards, Maryland has chosen to lean into its ambitious climate goals and jumpstart the transition to electric cars, which … will only continue to become even more efficient as Maryland cleans up its grid.”

Tom Van Heeke, senior policy advisor for EV manufacturer Rivian Automotive, called the ACC II standards “commonsense rules to expedite EV adoption in the state of Maryland …  especially if combined with the Clean Trucks Act of 2023.”

Ramon Palencia-Calvo, director of the Maryland League of Conservation Voters’ Chispa Maryland program, which is focused on Latino communities, stressed the public health impacts of the new standard.

“Communities of color, low-income communities and neighborhoods near major transportation hubs bear an especially unfair burden of harmful pollution due to decades of systematic marginalization,” Palencia-Calvo said. “Increasing the number of clean vehicles on our roads will reduce respiratory illness and hospitalizations, leading to healthier outcomes.”

Maryland at NYC Climate Week

The actions on clean cars and trucks came as Maryland officials sought to raise the state’s profile as a leader at Climate Week in New York City.

On Monday, MDE announced the state had joined the international Under2 Coalition, with Environment Secretary McIlwain signing the membership agreement. The coalition includes 167 state and regional governments committed to reaching net-zero emissions by 2050. Montgomery County joined the group in 2017, according to the Under2 website.

Joining the coalition “accelerates climate action in Maryland by giving us greater access to technical support and the shared knowledge of more than 160 governments across the world,” McIlwain said. “This action underscores our commitment to building the green economy that will dominate the next century, as well as creating the resiliency to make our state stronger.”

Maryland also is part of the Regional Greenhouse Gas Initiative, a regional cap-and-trade program, and the U.S. Climate Alliance, a bipartisan group of 25 governors committed to meeting the goals of the 2015 Paris climate accords.

Passed in 2022, Maryland’s Climate Solutions Now Act (S.B. 528) sets a 2031 target for the state to cut its greenhouse gas emissions by 60%.

Speaking at the Climate Week opening ceremonies Sunday, Moore made the case for centering climate action on community economic development, especially for low-income and disadvantaged communities.

“Our communities of color — our working parents — our middle-class families: They are the ones who stand to benefit most from our aggressive climate goals. Those are the hands that will install new solar panels at the local rec center. Those are the minds that will invent next-generation wind turbines that power millions of homes,” Moore said.

“This is about whether or not we can dominate industries of the future, instead of relying on industries of the past,” he said. “This is about whether or not we can bring manufacturing jobs home, instead of relying on foreign labor. This is about whether or not the clean energy revolution will close the wealth gap, instead of being just another way to make it bigger.”

Posted on

Calif. Sues Oil Majors over Climate Impacts

California is suing five of the world’s largest oil and gas companies, saying their executives have known for decades about the dangers of fossil fuels but hid the information to protect their profits.

The lawsuit was filed in San Francisco County Superior Court and announced over the weekend by Gov. Gavin Newsom (D) and Attorney General Rob Bonta.

The defendants are Exxon, Shell, Chevron, ConocoPhillips and BP and their subsidiaries, along with the American Petroleum Institute (API), a group representing the natural gas and oil industry in the U.S.

The lawsuit accuses the companies of “creating, contributing to and/or assisting in the creation of state-wide climate change-related harms in California,” including extreme heat, drought, wildfires, storms and flooding.

It asks the court to order the oil companies to pay for the impacts their actions have had on the environment, fine them for their alleged lies and award punitive damages.

“For more than 50 years, Big Oil has been lying to us — covering up the fact that they’ve long known how dangerous the fossil fuels they produce are for our planet,” Newsom said in a statement. “California taxpayers shouldn’t have to foot the bill for billions of dollars in damages.”

Cities and counties in California have filed similar lawsuits against fossil fuel companies for their alleged contributions to climate change. But with the state’s action, California has become the largest geographic area and the largest economy to sue big oil companies, the attorney general’s office said.

API responded to the lawsuit Monday by calling it “an enormous waste of California taxpayer resources.”

In a statement, API Senior Vice President and General Counsel Ryan Meyers said the industry provides “affordable, reliable American energy to U.S. consumers while substantially reducing emissions and our environmental footprint.”

“This ongoing, coordinated campaign to wage meritless, politicized lawsuits against a foundational American industry and its workers is nothing more than a distraction from important national conversations,” Meyers said.

Internal Memo Cited

Bonta said in a statement that oil and gas companies “have privately known the truth for decades — that the burning of fossil fuels leads to climate change.”

For example, the lawsuit cites a 1978 internal Exxon memo saying that “current scientific opinion overwhelmingly favors attributing atmospheric carbon dioxide increase to fossil fuel consumption.”

“Present thinking holds that man has a time window of five to 10 years before the need for hard decisions regarding changes in energy strategies might become critical,” the memo said.

But publicly, the companies were telling a different story, the lawsuit alleged. It pointed to a 1996 publication from Exxon called “Global Warming: Who’s Right? Facts about a debate that’s turned up more questions than answers.”

Then-Exxon CEO Lee Raymond said in the document that “taking drastic action immediately is unnecessary since many scientists agree there’s ample time to better understand the climate system.”

“Directly contradicting Exxon’s own internal knowledge and peer-reviewed science, the publication ascribed the rise in temperature since the late 19th century to ‘natural fluctuations that occur over long periods of time’ rather than to the anthropogenic emissions that Exxon itself and other scientists had confirmed were responsible,” the lawsuit said.

The lawsuit accuses the companies of still deceiving the public, through ads that portray them as climate-friendly businesses.

In addition, the lawsuit alleges, the companies’ actions have slowed the development of alternative energy sources, while increasing the costs of responding to the climate crisis.

Taking Aim at Big Oil

With the new lawsuit, California continues to take aim at the oil industry from multiple directions.

Last year, the state banned the sale of gas-powered cars starting in 2035. (See Calif. Adopts Rule Banning Gas-powered Car Sales in 2035.)

And in June, a new state law intended to combat price gouging at the pump took effect. After calling a special session of the legislature this year, Newsom signed the first-in-the-nation law, which gives state regulators the power to penalize oil companies for price gouging.

The law created the Division of Petroleum Market Oversight within the California Energy Commission. Last week, the commission introduced Tai Milder, the prosecutor who will lead the division.

The division will look for irregular or illegal behavior within the industry and refer any potential violations to the attorney general’s office. The CEC has also launched a dashboard with an estimated breakdown of gas prices and margins.

“Transparency and accountability are essential to protecting California consumers, and those principles will guide the work of this division every day,” Milder said in a statement following his appointment.

Posted on

NYISO Operating Committee Briefs: Sept. 15, 2023

Stability And Voltage Studies

The NYISO Operating Committee on Friday approved three studies aimed at helping the ISO alleviate congestion on its grid.

The ISO’s Central East and Total East interfaces study reports, and its Central East voltage limit study, each sought to identify areas of the grid in need of upgrades to ensure it operates reliably under several different demand and environmental conditions.

The first two reports updated the definitions of the transmission components that make up the Central East and Total East interfaces and examined the impact of adding new 345-kV lines to the interface.

The Central East voltage limit study evaluated the grid’s performance after the addition of several new lines and found that performance improved, allowing for an increase in the minimum level of energy loss that triggers contingency operations.

NYISO expects the new interface criteria to be integrated into grid operations following the deployment of updated models and software in October.

Shortage Pricing

The OC also approved manual revisions NYISO says would improve the accuracy of transmission shortage pricing by better reflecting the actual costs of relieving constraints.

The changes involve eliminating transmission constraint “relaxation” logic for facilities and interfaces that use a demand curve mechanism and introducing a six-step mechanism for those assigned a non-zero constraint reliability margin.

NYISO argued the revisions would reduce market inefficiencies by more accurately pricing the relief services that certain transmission projects provide to the grid.

The Business Issues Committee had approved the revisions the previous day. They are expected to become effective in October after the deployment of software updates.

August Operations Report

Aaron Markham, NYISO vice president of operations, informed the OC that August saw a peak load of 24,917 MW but that the summer’s peak load of 30,200 MW occurred due to a heat wave Sept. 17.

Markham noted that the heat wave resulted in appropriately 1,500 MW of unforced outages.

He said NYISO is investigating the cause of the outages but that it had sufficient resources.

Markham also said the ISO has added 3 MW of energy storage and 66 MW of behind-the-meter solar resources since last month.

Posted on

NYISO Business Issues Committee Briefs: Sept. 14, 2023

Seasonal Demand Curves

RENSSELAER, N.Y. — NYISO on Thursday secured Business Issues Committee approval of the ISO’s proposal to create separate capacity demand curves for summer and winter beginning with the 2025/2026 capability year.

The ISO proposed the tariff revisions to better reflect winter and summer reliability risks and send clearer signals to the market about the value certain resources have in each season. It also said the changes are necessary to accommodate moving from annual capacity accreditation factors to seasonal ones in the future.

The changes are part of the latest demand curve reset, conducted every four years to update the parameters for NYISO’s capacity market. The revisions now go to the Management Committee for approval Sept. 27.

NYISO/PJM Joint Operating Agreement

The BIC also recommended approval of proposed revisions to the Joint Operating Agreement between NYISO and PJM.

The revisions are intended to improve the coordination and data accuracy between the grid operators, particularly in the areas of resource adequacy and transmission planning.

A provision NYISO considers key would remove a list of interconnection tie facilities between the ISO and PJM out of the JOA and publish it on each of their websites, which the ISO argues would make it easier to adjust and increase transparency.

Stu Kaplan, partner at Troutman Pepper, asked if the changes made to the list could in any way change who has operational control over a New York facility.

NYISO did not have an immediate answer but responded that its proposals apply mostly to low-level equipment like substations, though it added that it will consider the issue moving forward.

The MC will consider revisions at its meeting this month. NYISO anticipates implementation by the first quarter of 2024 if the Board of Directors and FERC approve them.

August Market Operations

NYISO Senior Vice President Rana Mukerji presented the August market operations report, noting that average energy prices were lower than both the previous month and August of last year. (See “July Market Performance,” NYISO Business Issues Committee Briefs: Aug. 16, 2023.)

The month’s average energy cost was 56% lower than last year, declining from $93.42/MWh to $40.13/MWh. Mukerji said lower temperatures led to lower loads.

Eclipse Preparation

At a separate meeting of the Installed Capacity and Market Issues working groups the same day, NYISO updated stakeholders about its preparations for two upcoming solar eclipses, including how it is coordinating with solar forecasters and its neighbors to mitigate the impact on New York’s energy production.

The ISO said October’s annular solar eclipse — which will most impact Texas and the Western U.S. — could reduce solar output in parts of the state by 15 to 30%, with statewide behind-the-meter solar generation declining by as much as 700 MW and front-of-the-meter down 30 MW.

Path for total solar eclipse April 8, 2024 | NYISO

Next April’s total solar eclipse will cause even greater disruption, as it will pass directly through New York. During the roughly 2.5-hour eclipse, NYISO forecasts that solar production could decline by more than 3,000 MW at the peak, as some areas of the state will be completely obscured for nearly four minutes.

The ISO also said that wind generation could be impacted by the eclipses, both because of cloud cover and the expected localized cooling that will lower wind speeds when the sun is obscured.

NYISO has said it expects to have enough resources available to cover potential shortfalls. (See “NYISO Updates & Eclipse Prep,” NY State Reliability Council Executive Committee Briefs: Sept. 8, 2023.)

Posted on

Northeast Governors Ask Feds to Assist OSW Industry

Governors of the states that have procured all the offshore wind power contracted to date in U.S. waters are asking the federal government to help the struggling industry regain its momentum.

The governors sent a letter to several ranking officials in the Biden Administration saying that offshore wind development is in danger of failing or becoming unreasonably expensive for ratepayers amid a confluence of challenging factors.

They asked for three forms of relief:

    • Updated clean energy tax credit guidance from the Internal Revenue Service — including on the Domestic Content and Energy Community bonus credits to the Investment Tax Credit and Production Tax Credit — that will ensure offshore wind developers are fully eligible for them.
    • A new revenue-sharing program so that money generated by offshore wind leases does not go only to the federal government. Developers will pass those lease payments on to ratepayers, the governors reason, so some of the resulting revenue should come back to the states where those ratepayers live.
    • Expedited clean energy permitting. Slow timelines are hampering efforts to build a clean energy economy and meet decarbonization goals to protect the climate.

The governors of Connecticut, Maryland, Massachusetts, New Jersey, New York and Rhode Island sent their letter to the secretaries of Treasury and Energy, the IRS commissioner, a deputy Energy secretary and two top energy and climate advisers to President Biden.

Offshore wind power development is a signature initiative of Biden, who has set a national target of 30 GW installed by 2030. There are just two projects totaling 42 MW in operation and two projects totaling 932 MW under construction off the New England coast.

Thousands more megawatts are in the pipeline; two major wind farms have gained final federal approval for construction and operation this year and a third may soon follow.

However, these projects all face strong headwinds from inflation, interest rates and supply chain constraints. Two developers have canceled their power purchase agreements and others are threatening to walk away from projects without more money.

Also, developers’ recent bids for state contracts apparently have come in at a very high cost. The world’s leading offshore wind developer, Ørsted, saw its stock price tank after it warned of major cost impairments on its U.S. projects.

“These pressures are affecting not only procurements of new offshore wind but, critically, previously procured projects already in the pipeline,” the governors wrote.

“Absent intervention, these near-term projects are increasingly at risk of failing. Without federal action, offshore wind deployment in the U.S. is at risk of stalling because states’ ratepayers may be unable to absorb these significant new costs alone.”

Clean energy industry advocacy group American Clean Power endorsed the governors’ request.

CEO Jason Grumet said in a prepared statement: “This letter comes at a pivotal time, with the industry seeking to scale up rapidly but meeting headwinds due to inflation, supply chain constraints and permitting delays. The success of offshore wind development in these states will go a long way towards determining whether we achieve the Biden Administration’s 30 GW of offshore wind by 2030 objective.”

Posted on

WAPA, Basin Electric Commit to SPP’s RTO West

SPP said last week that recent announcements by the Western Area Power Administration (WAPA) and Basin Electric Power Cooperative have rounded out the group of western utilities that plan to pursue membership in the grid operator’s Western Interconnection RTO market.

The announcements give SPP seven utilities interested in becoming the SPP RTO West’s inaugural full members when it begins operations in 2026. SPP will become the first U.S. grid operator to provide RTO services in both the Eastern and Western Interconnections.

CEO Barbara Sugg said on X, the social network formerly known as Twitter, “I am excited for these commitments to continue growing the RTO in the West and look forward to working together to keep the lights on!”

WAPA Administrator Tracey LeBeau issued a decision letter Sept. 8 authorizing three of its four regions — Colorado River Storage Project (CRSP), Upper Great Plains (UGP) and Rocky Mountain — to pursue final negotiations with SPP for RTO West membership. A federal agency, WAPA had to first file a recommendation report in the Federal Register and solicit public input.

LeBeau said participating in SPP RTO West is consistent with WAPA’s commitment to develop alternative ways to retain and increase the value of its resources and services.

“Taking under careful consideration our customers’ and our industry’s collective movement to adapt to a rapidly changing energy environment, I am pleased at the progress we have made as WAPA takes a further thoughtful step in pursuing final negotiations with SPP,” she said in a statement.

As part of the final negotiations, WAPA will develop implementation details to pseudo-tie CRSP customers from the Western Area Colorado Missouri balancing authority area to the Western Area Lower Colorado BAA. It said this will address CRSP customer concerns about the potential effects of RTO membership for entities outside the footprint.

If the final negotiations with SPP are successful, CRSP and Rocky Mountain will execute membership agreements and UGP will expand its participation in SPP’s eastern RTO.

Basin Electric alerted SPP of its intent to pursue RTO membership on Sept. 12. It must execute a signed commitment agreement by Oct. 10.

WAPA and Basin Electric already are members in SPP’s Eastern Interconnection footprint. Both were part of the Integrated System, which joined SPP in 2015. (See Integrated System to Join SPP Market Oct. 1.)

WAPA annually markets and transmits more than 28,000 GWh of renewable power from 57 hydroelectric power plants in 15 western and central states. Basin Electric is a generation and transmission association with 141 member cooperative systems across nine states serving 3 million consumers.

Other interested RTO West members include:

    • Colorado Springs Utilities;
    • Utah’s Deseret Generation and Transmission Cooperative;
    • Municipal Energy Agency of Nebraska;
    • Platte River Power Authority in Colorado; and
    • Tri-State Generation and Transmission Association.

SPP has been working with the utilities for almost three years to evaluate the benefits and requirements of RTO membership. A Brattle Group study has identified at least $49 million in annual savings for members of SPP RTO West.

The western RTO’s success hinges on SPP’s use of three DC ties between its two footprints to optimize energy markets and create new opportunities for energy transfers and improved system resilience for both current and future members.

“Creating multiple market options for new members will enable market designs that align with the unique needs of one or more geographic regions and provide opportunity for all to benefit,” Bruce Rew, SPP’s senior vice president of operations, said.

The potential members currently are participating in the grid operator’s Western Energy Imbalance Service (WEIS) market. SPP says the WEIS provided an estimated $31.7 million in net benefits for its participants last year and reduced wholesale energy costs by $1.35/MWh through real-time dispatch.

SPP expects RTO West to add additional members, beginning in 2027. They have a March 1 deadline to indicate their interest in membership.

The RTO has 110 member companies in the Eastern Interconnection.

Posted on

Oil Companies Resisting Climate Action, Inslee, Climate Panelists Say

Oil companies are increasingly resisting climate change measures, Washington Gov. Jay Inslee (D) and a panel of climate experts told a group of University of Washington (UW) engineering students Friday.

“They realized they are starting to lose, “said Leah Stokes, professor of environmental politics at University of California, Santa Barbara, one of four virtual panelists in the discussion.  She noted that on Thursday the Wall Street Journal published an in-depth story on Exxon privately opposing climate change efforts while publicly supporting those same efforts.

“Some energy companies like to talk the talk, but they are not doing anything,” said Leah Missik, senior policy manager for Climate Solutions, a Seattle-based think tank.

“There are going to be some industries not interested in this transition because it is not in their financial interests,” Stokes said.

“I don’t have patience with people not wanting to build a clean air economy, when you look at the costs of not having a clean air economy,” said Inslee, speaking from the UW classroom.

Lisa Graumlich, dean emeritus at the UW College of the Environment, said a massive Pacific Northwest heat wave in 2021 that killed about 650 people in the U.S. and Canada will become a routine occurrence with climate change.

Washington’s cap-and-trade program went into effect earlier this year. Since then, fossil fuel companies and some economists have linked high prices for carbon allowances to gasoline price increases of 40-50 cents per gallon in the state. Cap-and-trade critics, including Republican legislators, have slammed Inslee and state Democratic leaders for those price hikes. (See Cap-and-trade Driving up Washington Gasoline Prices, Critics Say.)

But Democratic leaders have struck back at those critics, accusing oil companies of taking advantage of cap-and-trade to gouge consumers and pad their profits. (See Inslee Challenges Cap-and-trade Role in High Wash. Gas Prices.)

Posted on

Proactive Hosting Capacity Planning is Essential for Evolving Grid

LAS VEGAS — Utilities and customers both benefit when proactive hosting capacity planning is used to get ahead of the rising demand for distributed energy resources, said panelists at the RE+ conference, held last week at the Venetian Expo and Caesars Forum.

Looking ahead at the potential for distribution circuits to handle high penetrations of DERs not only prevents unfair allocation of upgrade costs but also enables utilities to prioritize upgrades where they are needed most.

Transparency is an essential part of proactive hosting capacity planning, said Erin Ankeney, director of interconnection at residential solar installer Freedom Forever.

“Utilities should be mandated to have their information public about hosting capacities and their availability on the grid. It shouldn’t take a customer and the contractor to get through the whole contract to find out that the system size that was submitted or proposed is not eligible to be installed in that area without a costly upgrade,” she said.

Utilities need to end today’s practice of reviewing one interconnection application at a time and expecting the customer that triggers the need for a distribution grid upgrade to pay the full costs, said Radina Valova, regulatory vice president at the Interstate Renewable Energy Council.

With proactive hosting capacity planning, the utility “would begin by estimating the hosting capacity of distribution circuits in advance of setting any particular project, then analyze the circuit’s ability to accommodate the anticipated DER growth and would determine where any potential infrastructure upgrades have to happen,” Valova said. “The utility would proactively undertake those upgrades and then apply optimal recovery.”

Ankeney said antiquated rules and procedures are “not keeping up with the growth of the DERs and the scale of complexity that we’re seeing in today’s market.” She said challenges ranged from administrative pain points, to engineering screens, to grid transparency.

The result is a slow and frustrating process, Ankeney said. “We’re seeing anywhere from 20 to 30 business days just to get [a residential system] approved to install, whereas on the commercial side, we’re talking hundreds of days or years.” After the project is built, “we have to also go through those same timelines to get jobs interconnected and fully operational with permission to operate,” she said.

Utilities’ application systems are also antiquated, and delays can stem from something as petty as mis-entering a customer’s address, a problem easily eliminated by the kind of simple address validation used on every ecommerce site.

Interconnecting the DER Dots

Some states — but not enough — are already beginning to explore proactive hosting capacity planning, said Samantha Weaver, director of interconnection and grid integration policy at the Coalition for Community Solar Access. While 21 have an active proceeding on distribution system planning requirements, “only a handful of those states are looking at distribution system planning in the proactive hosting capacity planning concept. This is not a widely practiced concept yet.”

Weaver said New Jersey, Maryland and Massachusetts are engaged in the preliminary discussions. “What they all have in common is that they are all seeking to develop a framework for utilities to recover investments in distribution infrastructure in advance of projects seeking to interconnect.

“For example, both Maryland and New Jersey have proposals in the early stages that would require utilities to forecast congested areas on the distribution system and propose system upgrades accordingly. Then you get into questions around how much those upgrades cost and who pays for them. The way that Maryland and New Jersey are looking at this is they’re proposing a $1/kW hosting capacity upgrade fee. Each interconnecting customer who comes along will have to pay to interconnect under this framework.”

Weaver said both states’ proposals fail to solve one key problem related to cost allocation: “Eventually these upgrades reach a point where they become too expensive for a single project or even a group of projects to support. So even if these high costs to upgrade a substation are shared among all future interconnecting customers, they’re still too high, and nobody’s going to build a project there.”

Studies in Maryland have shown realistic hosting capacity fees would be $500 to $1,000/kW, Weaver said. “Those are project-killing costs.”

DERs with Ph.D.s: An Explainer

The grid is an ecosystem, not a science experiment: It’s impossible to hold everything constant while changing only one variable.

This means that utilities cannot assume everything else stays constant on a distribution circuit as one variable — the number of buildings with rooftop solar, for example — changes. The evolving nature of DERs means that there are many changes happening simultaneously: rooftop solar adding to the grid in the day; batteries sopping up the excess and storing it for when it’s needed; and electric vehicles plugging in and not only charging during the night, but possibly feeding into the house during peak demand.

The intersection of big data and small energy has resulted in sophistication well beyond reacting to simple demand response requests. A home battery management system, for example, may layer customer-defined parameters (always having at least 30% charge at the end of an evening) with forecast inputs (tomorrow will be sunny), predicted demands (weekend road trips mean the EV will drink a lot of electrons Saturday night) and scenario planning (hot dry summer means more likelihood of a planned blackout to lower fire risk).

Add to that the increasing sophistication of the many players in a home’s DERs, such as a bidirectional charger that can tap into an EV’s many Powerwalls worth of energy storage, or a hybrid hot water tank that can act as a thermal battery, and capacity planning isn’t simply additive. Modeling capacity today needs to account for the potential of some DERs to help smooth out or even negate the rising demand coming from electrifying homes and transportation.

Posted on

New California Law to Give State Power to Procure Renewable Energy

In a move expected to boost offshore wind development, the California legislature has passed a bill that would give the state authority to buy certain types of clean energy.

Assembly Bill 1373, by Assemblyman Eduardo Garcia (D), was passed late Thursday, the final day of the legislative session. Gov. Gavin Newsom has until Oct. 14 to sign it.

Under AB 1373, the state Department of Water Resources would be authorized to buy clean energy if the California Public Utilities Commission determines additional clean energy resources are needed to meet the state’s renewable energy goals.

Earlier versions of the bill referred specifically to procurement of offshore wind and geothermal resources. The final version of the bill replaced mentions of offshore wind and geothermal energy with “eligible energy resources.”

Those are resources that don’t use fossil fuels or combustion to generate electricity and that have a lead time of at least five years for development and construction. In addition, the CPUC would make sure load-serving entities aren’t planning to buy substantial amounts of the resource.

“Having DWR be able to buy these resources when our utilities haven’t been able to or have chosen not to is the cheapest and most efficient way to get these needed resources online,” Garcia said during a Sept. 6 meeting of the Senate Energy, Utilities and Communications Committee.

The DWR’s procurement authority would expire in 2035. As an urgency statute, the bill would take effect immediately, and a two-thirds vote was required to pass it.

The Senate also amended the bill to include a provision intended to facilitate development of transmission needed to tap the resources being procured.

“This bill would require the PUC, in a proceeding evaluating the issuance of a certificate of public convenience and necessity for a proposed transmission project, to establish a rebuttable presumption with regard to need for the proposed transmission project in favor of an Independent System Operator governing board-approved need evaluation if specified requirements are satisfied,” the provision states.

Unlocking Investment

The American Clean Power Association and other groups supporting AB 1373 said in a letter to lawmakers that the bill would provide market certainty “at a time when offshore wind developers are evaluating whether and how to make the next major investments in project development.”

On Friday, offshore wind industry groups applauded the bill’s passage.

Adam Stern, executive director of Offshore Wind California, called AB 1373 “an important milestone” that will “provide a clear path to market for large-scale clean energies like offshore wind.”

“Passage of this legislation shows California is serious about going big on offshore wind and positioning itself as a leader and global hub of this important clean energy resource,” Stern said in a statement.

The Business Network for Offshore Wind called the bill “key to unlocking new investments.”

“This new procurement authority is essential to unlocking the billions in new investments needed for port redevelopments, vessels, supply chain expansions and manufacturing facilities,” Liz Burdock, the network’s founder and CEO, said in a statement Friday.

Lawmakers who opposed AB 1373 included Sen. Brian Dahle (R), who noted that biomass, hydrogen and carbon capture technologies would be excluded from state procurement.

Dahle was also concerned about the impact to ratepayers of the state’s energy procurement.

“Every single ratepayer in California is going to pay,” Dahle said during the Sept. 6 committee hearing.

Garcia noted that utilities would still be able to buy energy from sources such as biomass.

Clean Energy Goals

AB 1373 is seen as a way to help meet California’s clean energy goals while maintaining grid reliability. The state has set a target for all retail sales of electricity to California customers to come from renewable and zero-carbon resources by the end of 2045.

Last year, the California Energy Commission adopted the nation’s most ambitious long-term offshore wind goals, targeting a buildout of up to 5 GW by 2030 and 25 GW by 2045. (See Calif. Adopts Country’s Most Ambitious OSW Targets.)

In December, the West Coast’s first offshore wind auction brought in $757.1 million for five lease areas off the California coast. (See First West Coast Offshore Wind Auction Fetches $757M.)

In an initial proposal early this year, Gov. Gavin Newsom proposed giving the state authority for procurement of wide-ranging types of energy. The idea sparked concerns from some utilities about competing with the state for buying energy, and the legislature revised the proposal to narrow down the type of energy the state could procure.

On Aug. 31, the governor announced he had reached an agreement with the legislature on the bill.

“This legislation will help us achieve a 100% clean electric grid and phase out the very pollution that causes extreme weather in the first place,” Newsom said in a statement. “We’re taking action to build the clean energy we need, faster.”