Former FERC Chair Richard Glick said Wednesday that an industry report on the estimated value of additional transmission during December’s Winter Storm Elliott only underscores what many already know: Transmission capacity makes a big difference.

It can also produce savings.

“When you reduce congestion, you’re able to bring in less costly power from other regions, and that has a big impact, certainly on prices,” Glick said Wednesday during a webinar focused on the report. “That’s a big deal because when we have these extreme weather events, we know prices are at their highest sometimes. But secondly, transmission also helps with grid resilience and reliability. Another reason is [regions] might not be experiencing that same weather at the same time … Empower[ing] other regions is a big positive.”

Former FERC Chairman Richard Glick | © RTO Insider LLC

Glick brought up ERCOT’s problems importing power from other regional operators during the deadly 2021 Winter Storm Uri because of its lack of interconnections with its neighbors. Hundreds of Texans died without power during that storm. At the same time, MISO successfully wheeled power from PJM to SPP to help the latter grid avoid Texas’ woes.

“Transmission support not only from a consumer perspective, but also for keeping the lights on,” he said.

According to a report released Wednesday by the American Council on Renewable Energy (ACORE), “modest investments” in some regions’ interregional transmission capacity would have saved electricity customers nearly $100 million during December’s five-day storm.

ACORE, which hosted the webinar, said expanding transmission ties by 1 GW between regions would have generated significant cost savings for consumers and reduced outages during the storm. It said that Duke Energy’s Carolinas region and the Tennessee Valley Authority would have yielded savings of $85 million and $95 million, respectively, had they been able to import enough power to prevent rolling blackouts.

‘Bigger Than the Weather’

The report studied transmission benefits by comparing LMPs within RTOs and ISOs and at interfaces with non-organized market areas during each hour of the Dec. 22-26 storm. The analysis conservatively used hourly average LMPs instead of prices at five-minute intervals, as current practices for scheduling transactions between regions include market seam inefficiencies that limit the ability to use transfers to address short-term fluctuations in price.

“Making the grid bigger than the weather is the key to making our power system more resilient,” said Michael Goggin, a vice president at Grid Strategies and the report’s author. “Basically, the solution here is making the grid bigger than the weather. If the grid is bigger than that event, that allows you to get that demand diversity because [regions are] not all peaking at the same time. You could bring in generation from areas where the gas supply wasn’t interrupted or the generators didn’t have failures.”

Goggin said a bigger grid is also the solution to higher penetrations of wind and solar, with the side benefit of full resource adequacy.

“If you go across a large enough area, particularly with wind, the correlation between any two wind plants drops to almost zero. They’re just experiencing different weather at different times … kind of mitigating and canceling out the variability of wind,” he said. “More importantly, you get the resource adequacy benefit. If it’s not windy here, it’s going to be windy somewhere else, and having the transmission allows you to move that power between those areas.”

ClearPath CEO Rich Powell agreed. He said the country will need “tremendously” more wires and pipes — for natural gas, hydrogen, carbon-capture — as part of an enabling infrastructure to build a net-zero economy by 2050.

“My guess is that we’re going to need a lot of renewables built on public lands further west just because we’re seeing so much opposition growing, especially in the middle of the country that’s already very dense on wind,” he said. “My suspicion is we’re going to have to build more of that further west on public lands, which itself is going to imply more long-distance transmission.”

Powell is hopeful early hearings in Congress on permitting reform proposals might be a sign of optimistic developments but allowed that “we’re at the beginning of that journey.”

ACORE CEO Greg Wetstone lamented the loss of an investment tax credit for high-voltage transmission, a victim, he said, during final negotiations over the Inflation Recovery Act (IRA).

“That is the one piece that is really important and ended up on the cutting room floor,” he said. “That kind of incentive would be helpful … [in] getting the investment we need to better connect the grid.”

Wetstone said the tax credit is one of three areas that have seen real progress in the last two years but aren’t “over the finish line.” He listed FERC’s proposal for more proactive transmission planning addressing extreme weather and siting and permitting language that a congressional parliamentarian scratched from the IRA under budget reconciliation rules.

“We need more help, more clarity in order to get these lines built,” he said. “We’re potentially in the game with this Congress to get something done in siting and permitting.”

‘Geographic Opportunity’

Glick reminded his fellow panelists that the commission’s joint task force with state regulators has been focused on interregional transmission capacity. The group holds its sixth meeting Feb. 15.

“One thing we kept them coming back to is the need for more interregional transfer capacity or transmission capacity,” he said. “Is there a need for some sort of minimum requirements between regions or something like that?”

“Interregional transmission continues to be a key missing ingredient for U.S. grid reliability in the face of increasingly frequent extreme weather events,” Wetstone said, calling for action on proposed “pro-transmission” policies and reforms in Congress and at FERC.

“It has been exceptionally difficult, if not impossible, to develop interregional transmission under the current planning processes and related rules,” he added.

“There’s quite a bit of interest among not only FERC commissioners but also state commissioners about moving forward,” Glick said. “It’s not easy to figure out who decides what gets built and who pays for all those issues, but I’m optimistic that you’re going to eventually see something.”

“The weather is getting bigger and bigger, and the grid is not keeping up with it,” former FERC and Texas commission staffer Alison Silverstein said. “We are seeing patterns where the wind goes bonkers as the front comes in, and then it dies off as the front is leaving. Being able to play the geographic opportunity is extremely valuable. We need to be able to build diversity, and we need to be able to build customer survival while all these dynamics and expansions are taking place. So it’s an extraordinary challenge and opportunity.”

That may come at the RTO/ISO level. MISO said that while it didn’t have the chance to fully review the report, the findings appear to support the grid operator’s efforts to develop more transmission to maintain reliability and manage the uncertainty and volatility of extreme weather events. The RTO pointed to its work on its four planned long-range transmission portfolios, noting that the benefits from the first tranche of projects are greater than the $10 billion costs.

In an email to RTO Insider, spokesperson Brandon Morris said MISO is a strong supporter of interregional transmission planning and “has worked diligently to improve our operations and planning with our neighbors.”

“Strong interconnections are foundational for the grid of the future,” he said. December’s winter storm “was a recent example of the benefits of interregional transfer capacity — at times during that event we were importing power from our neighbors, and at other times we were exporting power to support them.”

PJM and SPP declined to comment on the ACORE study. An SPP spokesperson said staff is currently evaluating its response to the latest winter storm to understand its impacts and how they can be mitigated in the future.