Dive Brief:
- Just days before the Obama administration issued final Clean Power Plan regulations with emissions cuts deeper than initially proposed, PJM Interconnection released a white paper showing compliance with the draft mandates could threaten grid reliabilty under some scenarios.
- The initial rate of retiring older generation will be key, PJM said, as historically resource replacement has been a gradual process.
- PJM examined three scenarios: One where 6 GW of capacity was at risk; one with 16 GW; and one where 32 GW of capacity must be replaced.
Dive Insight:
PJM's analysis on the possible impacts of Clean Power Plan is a bit difficult to digest, because it was released just days before the White House finalized the regulations. PJM found the amount of time given to comply with greenhouse gas limits would greatly factor into maintaining reliability, and the Obama administration wound up adding two years to the initial compliance deadline -- while at the same time calling for deeper cuts.
The EPA's rules call for a 32% reduction in greenhouse gas emissions by 2030, with initial compliance beginning in 2022 -- two years later than the proposed regulations, but also with 2% deeper cuts.
"Under certain conditions and implementation scenarios and depending on the timing of the many moving parts, new transmission and/or transmission improvements might not be completed in time to maintain reliability," PJM found.
Based on the initial 2020 interim deadline, and assuming state plans were submitted in 2017, PJM noted that all of these would need to occur in a three-year window: decisions on generation retirements and replacements, the identification of reliability criteria, and the development, design and construction of transmission solutions.
"Historical experience shows that the pace at which transmission can be completed can range from five years (the Carson-Suffolk 500 kV line) to more than 16 years (the Wyoming-Jackson’s Ferry 765 kV line)," PJM noted. "Moreover, if a number of large-scope transmission projects are required across the United States, the lack of equipment availability could increase lead-time substantially."
The grid operator also said its experience with the Mercury and Air Toxics Standards rule suggests the time to build new facilities may not match up with generation retirements. "It could depend on the notice given and the aggregate impact of all generation decisions in a given area," the paper concludes. "For example, roughly 20,000 MW of retirements required $2 billion of transmission upgrades elsewhere."
