MADISON, Wis. — The cost estimate for MISO’s and SPP’s package of 345-kV lines meant to facilitate the interconnection of generation at the seams has nearly doubled, the RTOs have said in the past week.
The portfolio’s costs have climbed from $1.1 billion to $1.9 billion because of the mounting cost of materials and labor and the transmission owners providing more precise routing options.
Aubrey Johnson, MISO’s vice president of system planning, updated the joint targeted interconnection queue’s (JTIQ) cost estimate during the grid operator’s Board Week in Madison, Wis., last week.
The increased amount was included in an application led by the Minnesota Department of Commerce and The Great Plains Institute for Department of Energy funds from the agency’s Grid Resilience and Innovation Partnerships program. If successful, the JTIQ portfolio could receive up to 50% funding match from the federal government. (See DOE Clears JTIQ Projects to Proceed with Funding App.)
MISO said the first cost estimate was theoretical and two years old.
“The 2023 JTIQ application to DOE reflects a higher end, broader scope, cost estimate for matching federal funds, and it is not directly comparable to the 2021 planning-level cost estimates,” MISO spokesperson Brandon Morris said in an emailed statement to RTO Insider. “Since 2021, we have also seen inflationary pressures and supply chain uncertainty.”
“Developers are having heartburn about the cost increases and would like to have some understanding and parameters around the increases,” Clean Grid Alliance’s Beth Soholt said during an Advisory Committee meeting Wednesday.
She urged MISO and its transmission owners to institute “checks and balances,” given the JTIQ’s proposed cost allocation that has generation developers responsible for 90% of costs and load picking up the remaining 10%.
MISO said it will further update stakeholders on the JTIQ’s application for DOE funding at a June 27 combined Planning Advisory Committee and Regional Expansion Criteria Benefits Working Group meeting.
During an SPP Seams Advisory Group meeting June 9, the RTO’s Aaron Shipley said staff is reviewing the cost increases and developing a more detailed breakdown of the rising prices.
“Whereas originally we were working on a conceptual cost estimate basis, as we get closer to it, we find those cost estimates from the TOs themselves,” he said. “Some of that [is] inflation impacts … but also more accurate routing of assessments, materials’ costs, the construction timeline [and] supply chain concerns. Those type of items really drove some of that cost [increase].”
Shipley said had the applicants’ DOE application used the $1 billion estimate, they would have been limited to up to half that amount should the agency award any funds.
