MISO Independent Market Monitor David Patton has made a final stand against the RTO’s $21.8-billion long-range transmission plan (LRTP) portfolio, asking MISO board members to order a postponement of the transmission portfolio and direct MISO to condense projects.
The appeal led multiple stakeholders to tell the MISO Board of Directors that the IMM should end his foray into MISO’s transmission planning and stick to supervising markets.
The showdown came as MISO advances its 2024 MISO Transmission Expansion Plan (MTEP 24) to its board of directors.
This year, MISO and members will vote on more than the traditional MTEP lineup. The MTEP 24 umbrella also officially includes the $21.8-billion LRTP and the $1.65-billion Joint Targeted Interconnection Queue (JTIQ) portfolio in partnership with SPP.
MISO staff have called the $30-billion collection historic.
In September, MISO’s Jeremiah Doner said even MTEP 24’s $6.7 billion of traditional local spending is a “sizable amount of investment occurring.” The traditional MTEP 24 includes 459 projects, with total lines spanning 932 miles.
Traditional MTEP 24 spending is smaller than last year’s $9.2 billion. And while a good chunk of MTEP 23 was devoted to local reliability needs, this year’s investment is driven by age condition projects and load growth.
However, it’s the second LRTP portfolio that’s soaking up all of the attention this year.
“Let me say at the outset: this is probably the least satisfying exercise I’ve taken part in. I take no pleasure in being critical of such an important process,” Patton told board members during an Oct. 30 teleconference of the System Planning Committee of the MISO Board of Directors. He added that he thinks transmission expansion is essential.
“We believe there are portfolios of transmission investment that will be extremely beneficial … but this portfolio is not that portfolio,” Patton said.
Patton said the “costly” portfolio represents a present value of $2,600 per family in the Midwest.
“Hence, it is critical that the analysis be objective, accurate, and unbiased,” he said.
Patton said though he’s been raising concerns with the second LRTP portfolio for two years, MISO hasn’t addressed his fault-findings. MISO and the IMM have disagreed publicly on the LRTP often over the past several months. (See MISO Affirms Commitment to $21.8B Long-range Tx Plan in Final Workshops and MISO, Monitor at Stalemate over Need for $21B Long-range Tx Plan.)
Patton said he wasn’t trying to thwart a second LRTP but that he wanted MISO to develop a leaner portfolio with downsized projects.
He said MISO’s two most flawed benefit metrics are the mitigation of reliability issues and the avoided construction of new capacity MISO estimates the portfolio will deliver on. He said if those two benefit calculations are downgraded to more reasonable outcomes, the benefit-to-cost ratio of the LRTP portfolio would be anywhere from 0.4 to 0.7:1.
MISO anticipates a benefit-to-cost ratio of between 1.8:1 and 3.5:1 over the first 20 years of the projects’ lives through reliability improvements, production costs, new capacity that won’t have to be built and environmental benefits.
Patton has said repeatedly MISO is incorrect in assuming reliability issues in the footprint would become so dire that MISO should use its $3,500/MWh value of lost load as an indicator of savings. He said a more reasonable notion is that MISO would take operational actions to address reliability risks.
Patton also said that MISO’s capacity expansion modeling is fundamentally flawed, favors intermittent resources and doesn’t consider what resources will be built and where if MISO doesn’t build the second LRTP portfolio. Patton said if MISO tested against a but-for scenario where there is no LTRP II, the footprint “rationally” would experience more capacity development in the eastern part of the footprint versus more remote, intermittent resources built in the western portion. He said any reasonable utility would choose to build deliverable megawatts without the transmission.
Patton likened MISO’s estimated benefits to trying to convince his wife to agree to buying him a new car instead of getting brake repairs performed on his existing car through the argument that his life would be at risk.
“That’s the logic you have to adopt: What is the alternative?” he said.
Planners Defend Portfolio
Senior Vice President of Planning and Operations Jennifer Curran said Patton and MISO philosophically disagree on the need for the LRTP portfolio.
“When we think about the resource expansion, we have a different idea about the goals of our customers and what our members are trying to achieve,” she said. “Where we agree is that we definitely need to do what’s best for our customers. That’s at the forefront.”
Curran said MISO requires backbone transmission and that waiting risks reliability and leaving the system expansion to less valuable, piecemeal transmission solutions.
“We cannot wait for the certainty of resource types to build transmission,” she said.
Curran said members’ stated goals provided the thrust for the portfolio. She stressed that MISO did not overstep its role as a transmission planner and not a resource planner.
“We are talking about the highway transmission and not the side streets,” she said.
Curran said MISO probably is being conservative in the reliability benefits and likely understating the help transmission would provide during extreme weather events. She said MISO stands ready to testify to the need for the transmission in front of state regulatory commissions.
Vice President of System Planning Aubrey Johnson said that the collection of 24 projects would create a backbone of mostly 765-kV transmission across the Midwest. He said MISO’s aims with the portfolio aren’t to address one NERC criteria at a time but “reliably enable” the resource planning its members have indicated. Johnson acknowledged that goal does shift the portfolio into “uncharted territory.”
Johnson noted that MISO planners made more than 500 adjustments to capacity expansion siting based on MISO members’ counsel.
Executive Director of Transmission Planning Laura Rauch said there are almost certainly additional benefits beyond those that MISO monetized in its business case, including more reliability and efficiency value and expanded transfer capability. Rauch said LRTP II will enable the sweeping flows that help keep the lights on during heat domes, derechos and ice storms.
MISO board members withheld their opinions on the LRTP and asked mostly clarifying questions on Patton’s criticisms and MISO’s process. They did not publicly address Patton’s appeal for a pause on the LRTP approval process.
“Is there a sense of, ‘don’t build and this [capacity] will evolve?’” board member Phyllis Currie asked of stakeholders’ attitudes across the 300-plus public meetings MISO held during the development of LRTP II. She said her question “strikes at the role of MISO” as a transmission planner and keeping out of resource planning.
Johnson said stakeholders generally were supportive of MISO’s direction on planning and confirmed to MISO that the proposed lines followed their burgeoning resource plans.
Board member Trip Doggett invoked a recent Grid Strategies report that placed MISO and CAISO at the top of regional planning efforts in the country, giving each a ‘B.’ Doggett asked what MISO should do to reach ‘A’ status. Curran said MISO’s grade boils down to the LRTP not yet extending to the MISO South region.
The System Planning Committee is set to hold a vote on whether to recommend MTEP 24 along with LRTP II at a Nov. 19 teleconference.
Chorus of Support, Some Detractors and Complaints that IMM has Overstepped
Most public comments after the IMM and MISO delivered their positions provided support for the LRTP, with multiple stakeholders telling MISO board members that the IMM shouldn’t be influencing transmission planning.
Michigan Public Service Commission staffer Erik Hanser said Patton is mistaken that “market forces alone” can fill the need for transmission planning.
Hanser also said Patton “bringing these issues up month after month” is not a good use of time for the Market Monitor, who he emphasized is not a transmission monitor. Hanser said he questioned how appropriate it was for the IMM to spend so much time and attention on an area outside of his market monitoring responsibilities.
Minnesota Public Utilities Commissioner Hwikwon Ham said MISO’s long-range transmission planning allows state jurisdictions to carry out their resource planning. He also said MISO’s comprehensive transmission planning saves ratepayers money over the long run.
American Transmission Co.’s Bob McKee said it’s inappropriate for the IMM to think his opinion on planning should override those of the stakeholder community. McKee invoked the LRTP as “exactly the type of long-range planning” that FERC is requiring RTOs to engage in per Order 1920.
McKee also said that LRTP II will go a long way in addressing the “new, unforecasted, historic, large-point loads” that are cropping up on the system and are requiring several out-of-cycle transmission projects.
Clean Grid Alliance’s Natalie McIntire said the IMM simply seems opposed to top-down regional planning and said MISO is leading the industry in planning. She asked board members not to entertain the IMM’s requests.
WPPI Energy’s Steve Leovy, however, seconded the IMM’s ask for MISO to test the LRTP against a future case where the second LRTP portfolio doesn’t exist. He said the additional testing from MISO wouldn’t usurp the role of resource planning or infringe on states’ rights.
“Let’s be clear: The debate we are having today is not about methodology. It’s about ideology. And it’s being driven by Dr. Patton in ways that I believe are inappropriate for his position. I believe he has abandoned his independent voice,” Union of Concerned Scientists’ Sam Gomberg said.
Gomberg said it’s a “huge red flag” that Patton presented analytics showing the LRTP falls below worthwhile investment without documentation detailing his methods. MISO and stakeholders have “repeatedly suffered through” presentations on Patton’s uncorroborated numbers, Gomberg said, while Patton at times “belittles” MISO’s and stakeholders’ perspectives.
“Throw out any number you like in a public setting as long as it’s big enough to catch attention, let the media sink their hooks into it and the headline on the front-page reads: ‘IMM Says MISO Transmission Plan isn’t Worth It’ while everyone else scrambles to explain after-the-fact why this number shouldn’t be trusted,” Gomberg told board members. “…When this happens, it makes yours and every state regulator’s job harder because it colors your and regulators’ ability to do the proper, objective due diligence necessary to weigh the costs and benefits of these projects.”
Gomberg said the IMM’s actions are “at best negligent and at worst a deliberate attempt to undermine the process.” He said he “believes it’s past time” for the MISO Board of Directors to “clearly and publicly” define the IMM’s role in MISO transmission planning and hold him accountable to transparency standards and analytic rigor.
“The character assassination of Dr. Patton is really unfortunate,” North Dakota Public Service Commissioner Julie Fedorchak said. “There’s a lot of opportunity between doing nothing and spending $30 billion in transmission planning.”
Fedorchak said MISO should listen to independent, third-party critiques that its LRTP business case is overblown.
“With these benefits, you could justify building just about anything,” Fedorchak said, reminding board members that North Dakota doesn’t have clean energy goals and it’s unfair for the state to shoulder a portion of LRTP costs.
Kavita Maini, a consultant representing MISO industrial customers, also said she appreciated the IMM’s request to take a hard look at the LRTP.
“We need an independent voice, and we appreciate the IMM’s efforts,” Maini said.
But Google’s Tyler Huebner, said Google’s view that MISO’s “effective, multi-value transmission planning” is vital and serves as proof that not all members in the end-use sector agree with one another.
Clean Grid Alliance’s David Sapper said board members should “strongly” consider Google’s support since the LRTP is rooted in a future view of the grid, implying that Google should know better than most what’s to come.
ITC’s Brian Drumm said MISO assembled the second LRTP portfolio with industry-tested practices and planning tools that are crucial to maintaining reliability as the clean energy transition and load growth knock on MISO’s door.
“Now is not the time for us to slow down,” he said, endorsing the LRTP.
Drumm also said Patton’s “is just one voice” among hundreds of stakeholders who contributed to the multiyear development of the LRTP.
Great River Energy’s Priti Patel said she likewise was lending support to LRTP II. She said Great River Energy independently tested the LRTP’s business case and found that proposed lines in Minnesota best meet technical needs while minimizing impacts to communities across GRE’s electricity cooperative.
“We see this is a significant and necessary step to maintaining future reliability,” Patel said.
Xcel Energy’s Drew Siebenaler encouraged MISO and its board to proceed with the LRTP as soon as possible.
“In my professional career, I’ve never encountered a stakeholder process that has had more hours and engagement as this,” Iowa Utilities Board Member Josh Byrnes said of the journey to the second LRTP portfolio.
Byrnes said though “not everyone got what they wanted,” the LRTP has struck a good balance in planning.
“I truly believe that doing nothing is probably not a good option for us,” Byrnes said.
System Planning Committee Chair and MISO board member Mark Johnson thanked stakeholders for their perspectives.
