[EDITOR’S NOTE: A previous version of this story incorrectly referred to as being with the Clean Grid Alliance. She is now with the Sustainable FERC Project.]
CARMEL, Ind. — MISO says it will file in October to put stronger obligations and more monetary risk on queue entry to weed out speculative generation projects and take pressure off its overcrowded interconnection queue.
However, the grid operator has softened elements from last month in its plan to place an annual megawatt limit on project proposals, collect higher entry fees, enact escalating penalty charges and require developers to prove they have land to situate projects on.
“We’re getting way too many projects that just aren’t ready yet because our rules allow it,” Director of Resource Utilization Andy Witmeier said at an Aug. 30 Planning Advisory Committee meeting. “… We want to make sure we’re encouraging viable projects that have done their due diligence, have found land from where they can connect to the system.”
Despite that, MISO no longer is proposing an automatic, 73-GW cap (derived from a 60%-of-peak-annual-load) on the total number of new interconnection requests per year. (See MISO Aims for Manageable Interconnection Queue.)
Witmeier said MISO believes it still needs caps, but said it likely will pursue less specific, fluctuating megawatt limits year-to-year. Those limits will account for regional and subregional peak load in the study model, an anticipated level of project withdrawals and MISO’s “ability to develop a reasonable dispatch” model based on the existing system and proposed generation in a given queue cycle, Witmeier said.
MISO plans to post an annual limit by region on its website ahead of opening queue cycles to developers’ submittals.
Witmeier said MISO needs “better, bite-sized sections that we can study more easily.” He said MISO has “engineering concerns” that its queue studies don’t produce realistic results when they incorporate too many interconnection requests. Witmeier said MISO won’t build a dispute process of the annual megawatt limit into its FERC filing.
Stakeholders voiced concerns that FERC would have to blindly accept a megawatt size limit that is subject to change every year.
Clean Grid Alliance’s Rhonda Peters argued that the caps should be a temporary measure until MISO can process the queue faster or even allow multiple queue cycles annually.
Witmeier argued that the crux of the issue lies in unprepared projects entering the queue in the first place. He said he hoped a reduced queue leads to speedier processing and that MISO’s 70% project dropout rate “goes away” because only higher-quality projects enter.
“Let’s implement these and see if we’re better able to meet the timelines that we have,” Witmeier told stakeholders.
MISO’s queue currently contains almost 241 GW across more than 1,400 projects. Its 2022 queue cycle saw 171 GW worth of new entrants clamoring for spots on the grid. MISO hasn’t yet closed its 2023 application window because it wants the new rules in place first, so it doesn’t risk a queue class as high as 200 GW.
Witmeier said MISO consistently re-examines its study inputs to make sure they reflect future system needs.
MISO axed a previous provision that would limit the number of megawatts that any one developer can submit per annual cycle.
Witmeier said MISO won’t move ahead with the megawatt cap on individual developers because FERC might block it on discriminatory treatment concerns or might see it as stifling competition. He said it may be perceived as a “solution in search of a problem.”
MISO also said it will hike its $4,000/MW first milestone fee to $10,000/MW, instead of the originally proposed $12,000/MW.
If FERC accepts even the lowered $10,000/MW, MISO will have the highest entry cost of any other RTO.
Witmeier said the economics of the Inflation Reduction Act “has changed the game,” necessitating a higher entry fee to enter MISO’s queue.
And that fee increasingly will be at risk of MISO keeping a larger share depending on when a project developer chooses to drop out of the queue. At the first decision point early in the queue study process, a developer will risk 25% of its first milestone payment; that increases to 50% by the second decision point, 75% by the time the project reaches the third and final phase of the queue and finally, 100% if they drop out during the negotiation stage of the generator interconnection agreement (GIA). MISO will disperse the milestone proceeds among lower queued projects that are negatively affected by the withdrawals.
The RTO also will require interconnection customers to secure 100% site control from their generators to the point of interconnection prior to execution of a GIA. However, MISO will grant a 180-day extension from the GIA execution on a case-by-case basis.
Witmeier said MISO views the altered package of rules as “necessary to processing the MISO queue.” He said the filing is independent of a future compliance filing in response to FERC’s Order 2023.
Invenergy’s Sophia Dossin urged MISO to take more time to make sure MISO’s stricter queue rules won’t interfere with the directives laid out in Order 2023. She said she worried that MISO’s proposal “wouldn’t pass FERC muster in ways that we can’t see.”
Witmeier said MISO has examined Order 2023 and has been in communication with FERC staff. He said MISO still believes its best course of action is to file in the fall.
“Because of all the rehearing requests on Order 2023, we can’t be sure what the final rule will look like,” Witmeier added.
MISO will schedule a special PAC meeting in late September to continue hashing over its proposition.
