MISO said it plans to pursue a more straightforward, 50% peak load megawatt cap to limit the number of generator interconnection requests it would accept annually.
At MISO’s July 23 Interconnection Process Working Group teleconference, the grid operator revealed the cap would be based on 50% of peak load per study region. MISO divides its footprint into West, Central, East and South regions for queue study purposes.
MISO Manager of Generation Interconnection Ryan Westphal said using 2022 study modeling, a queue cap would have been about 68 GW. He said the simpler cap would take the RTO’s future resource adequacy need into account as FERC recommended, though he didn’t offer specifics.
MISO attempted last year to enforce an annual megawatt cap on its interconnection queue. FERC rejected the attempt on concerns over too many cap exemptions, the formula to establish the cap and potential resource adequacy deficits stemming from limiting new generation onto the grid. (See MISO: New Interconnection Queue Cycle to Wait on MW Cap Filing.)
MISO’s original cap formula was intended to be rooted in its ability to develop a reasonable dispatch for studying interconnection requests based on the existing system and considering regional and subregional peak loads. The complex calculation involved landing on load remaining to be served after existing generation and higher-queued generation proposals are dispatched at the lowest possible megawatt output while remaining online.
Westphal said MISO hopes to submit a fresh FERC filing for a more uncomplicated cap before the end of the year.
NextEra Energy’s Erin Murphy asked how MISO arrived at the 50% value. Westphal said the RTO assessed its rounds of potential generation submittals prior to the 2022 “explosion” of queue requests. He said before the exponential growth, MISO was processing about 60-GW entry classes. MISO is processing 123 GW of queue hopefuls that lined up in the 2023 cycle. If all projects proceed, MISO could have a more than 300-GW queue on its hands.
Westphal said MISO doesn’t have a “specific date” for when it will close the current queue cycle. Its application portal is open for interconnection customers to submit projects for MISO to review application completeness. However, MISO is holding off on processing the queue in earnest until it secures FERC permission to administer a cap.
Stakeholders asked whether projects that don’t make the cutoff would have priority access to MISO’s next queue cycle. Westphal said any projects shut out of a queue cycle would be “first in line” for the subsequent cycle.
MISO also said a few projects put forward after the cap is reached might be selected to proceed if other projects don’t successfully clear its validation process.
MISO staff said the grid operator would use the timestamps on project submittals to determine their place in line. Westphal said MISO wouldn’t refund study deposits to developers that don’t make the cap cutoff but hold on to them to prepare for processing them during the next queue cycle.
Derek Sunderman, of Shell subsidiary Savion, said MISO’s proposal doesn’t seem to address late-stage project withdrawals. He also said the cap won’t encourage developers to only put their most promising projects forward and not “hammer” the queue with several projects to secure a position.
Westphal said MISO is open to use of a volumetric price escalation in addition to the cap, where interconnection customers’ fees and penalties rise as they submit more projects to the queue for study. He said the RTO is considering starting at $8,000/MW for the first milestone fee.
Last month, Savion suggested MISO enact escalating financial commitments to prevent a handful of interconnection customers from submitting a disproportionate number of applications. MISO said raising fees based on a corporation’s project count would introduce several new requirements.
MISO once again proposes exemptions to the cap, though not as many as in its first filing with FERC. Westphal said MISO would exempt generators with provisional generator interconnection agreements; generators seeking to replace retiring counterparts and in need of extra interconnection service; and those generators wanting to convert their unguaranteed energy resource interconnection service with the higher-quality network resource interconnection service.
MISO again plans to exempt generation singled out as necessary by state commissions, though it would limit those exemptions from an unlimited number to three apiece annually per regulatory body.
Bill Booth, a consultant to the Mississippi Public Service Commission, questioned MISO’s three-project limit on regulator-backed projects. Booth said the restriction doesn’t make sense if the RTO’s goal is to cut down on speculative projects. He said a project backed by regulators usually is a sure thing.
Westphal said MISO needs some kind of limit in place, per FERC’s 2023 rejection of the first cap.
“FERC basically said without some kind of limit, we undermine the cap. We need to put some kind of limit on here based on what we heard from FERC,” he said.
Westphal said the cap is essential to make interconnection studies more manageable. He said as more projects vie for entry, more upgrades become necessary, and the more complex and insurmountable studies become.
“The point of the cap is to speed up the queue,” Westphal said.
Murphy asked what MISO is doing beyond proposing a future queue cap to address the backlog of projects now.
Westphal said MISO will build more automation into the 2023 modeling. The grid operator has solicited help from Pearl Street Technologies to determine whether their software can speed up interconnection studies.
