Dive Brief:
- The California Independent System Operator’s new approach to coordinating transmission planning, interconnection queuing and resource procurement in specific geographic zones could have a significant impact on clean energy planning and paring down interconnection requests in the queue, according to experts.
- The strategy was outlined in the system operator’s latest transmission plan, approved by its Board of Governors last week, and essentially tries to give preference to interconnection requests that have, or will have, available transmission, Seth Hilton, partner with Stoel Rives, explained.
- The transmission plan, developed along with the California Public Utilities Commission and California Energy Commission, includes 45 transmission projects that are estimated to cost $7.3 billion over the next decade or so.
Dive Insight:
California energy experts generally agree that the state’s interconnection processes need a broad overhaul, since CAISO’s queues are overwhelmed with hundreds of requests every year from potential developers. The latest window for applications was this April, and the system operator received a total of 546 applications, amounting to 354,000 MW of new resources.
While a previous proposal from CAISO called for 46 transmission projects estimated to cost $9.3 billion, the final version approved by the board of governors last week left out one project pending additional analysis. The vast majority of these projects will be built in California and each costs between $4 million and $2.3 billion, according to the ISO.
Last December, California energy agencies signed a memorandum of understanding that “tightens the linkages between resource and transmission planning activities, interconnection processes and resource procurement,” amid state efforts to generate more electricity over the next 10 years. CAISO’s latest transmission plan includes what the agency says is a more strategic and proactive approach to power, transmission and interconnection planning.
The plan calls for transmission capacity in specific geographic zones where development makes the most sense. Meanwhile, the CPUC will direct power providers in the state to focus on procuring energy in those transmission zones. The ISO will also give priority to interconnection requests for projects in these same zones.
The new zonal model could present a solution to interconnection challenges.
“It could really be significant, but the devil is in the details – do the rules allow them to speed up the processing, are the preferences they are setting, preferences for the right projects? So there are a lot of challenges there, but if they get it right, it could really be significant,” Hilton said.
The new zonal approach is an important innovation in the forward-looking planning of clean resources, as well as in terms of accelerating transmission development, Brian Turner, director with Advanced Energy United, said.
Last week, CAISO’s board also approved the first track of a separate initiative to reform interconnection processes, which essentially allows the system operator to finish reviewing applications submitted during the previous window, before progressing to the ones submitted this April. Next, the system operator will focus on the second track of that initiative, which looks at more robust and longer-term changes to the interconnection process itself.
“Track two will really be where they adopt these interconnection rules that reflect that zonal approach,” Hilton said. While previous efforts to change interconnection processes have resulted in moderate tweaks, “it really hasn’t had a significant effect on their ability to process these interconnection requests, so there needs to be dramatic change,” he added.
Separately, the CPUC on Thursday launched a new proceeding to revamp electric utility transmission siting regulations, currently laid out in a general order that was adopted by the agency in 1970 and updated most recently in 1995. The proceeding stems from Senate Bill 529, legislation passed by the state last year, and is aiming to modernize the rules under which the CPUC reviews transmission and other projects.
“[T]he agencies are throwing a lot of spaghetti at the wall right now to see what might help – because there’s no silver bullet … it’s great to see the activity on multiple fronts,” Turner said.
