After a year of debate, semiconductor manufacturer GlobalFoundries has agreed to comply with Vermont’s Renewable Energy Standard if regulators grant its request for self-managed utility status.
The company filed a request last March to oversee its own electricity purchases through the ISO-NE market to power its manufacturing operations in Essex, Vt. In its petition (21-1107-PET), GlobalFoundries claimed that it should be exempt from RES compliance because it would not be reselling electricity. (See Negotiations Stall in GlobalFoundries’ Bid for Vt. Utility Status.)
On Feb. 17, the Public Utility Commission issued an order finding that it does not have the statutory authority to grant that exemption.
“GlobalFoundries’ exit from [Green Mountain Power’s] service territory would either make GlobalFoundries a public service company … or an entity that is not currently authorized under Vermont law,” the order said. “There is no statutorily authorized third option for what GlobalFoundries seeks: to operate with some of the functions of a public service company but without the statutory obligations of a public service company.”
The PUC gave the company three weeks to decide how it would proceed with the application.
GlobalFoundries filed a proposed certificate of public good (CPG) Friday that indicates it will, as a self-managed utility, comply with the RES and any forthcoming changes to it. A bill (S.264) currently before the state legislature proposes to increase the state’s RES from 75% by 2032 to 100% by 2030.
“GlobalFoundries will continue to work with the state to meet the greenhouse gas reduction targets set by the [2020] Global Warming Solutions Act,” Shapleigh Smith, an attorney with Dinse, Knapp & McAndrew, said in a letter Friday to the commission. “This includes, among other things, GlobalFoundries’ commitment to an entirely carbon-neutral electricity supply for its Essex facility.”
If approved, the proposed CPG would obligate GlobalFoundries to:
make payments to offset the loss of gross revenue taxes it would have paid as a utility customer;
continue to participate in Vermont’s energy efficiency program; and
pay into the state’s Home Weatherization Assistance Fund.
The CPG would also exempt the company from “requirements applicable to traditional public utilities that are intended to protect ratepayers and other members of the public but which are not necessary in the context of a self-managed utility.” Those requirements include, for example, rate setting and least-cost integrated planning.
The Conservation Law Foundation, a party to the case, filed a memorandum Thursday seeking clarification of the scope of the PUC’s order regarding an RES exemption. GlobalFoundries believes that the order establishes that the commission has the authority to grant the company’s request to become a self-managed utility, CLF said in the memo. CLF, however, disagreed with that assessment.
The company’s “ongoing effort to establish a ‘self-managed utility’ appears to flout the commission’s order,” CLF said.
In its order, the commission said that there is no concept in Vermont statute for a self-managed utility. As such, CLF said, the commission made it clear that by discontinuing service with GMP, GlobalFoundries would either be a regulated public service company or an entity not authorized by Vermont law.
In a separate memo filed Thursday, AllEarth Renewables (AER) agreed with CLF’s reading of the order, adding that the commission failed to take the order to its “clear conclusion.”
By finding that the PUC can authorize a public service company but not create a utility entity as described by GlobalFoundries, the commission “has effectively and correctly decided the entire case,” AER said. Given that finding, AER said, the PUC should dismiss the case.
GlobalFoundries filed a proposed docket schedule that calls for technical hearings in June and a final order from the PUC on the petition by Sept. 1.
The head of Maine’s Public Utilities Commission called for better regional coordination and governance changes at ISO-NE during the Consumer Liaison Group’s meeting Thursday.
Phil Bartlett — who was giving the keynote address because it was Maine’s turn to host the quarterly meeting, which has turned virtual during the pandemic — emphasized that energy consumers “are going to be footing the bill” for many of the changes occurring in the region’s energy transition.
“We need to come together as a region to plan and effectively communicate what we’re trying to accomplish,” Bartlett said.
He also warned that New England needs to be thoughtful about its transmission planning, especially in light of the failure of the New England Clean Energy Connect, shot down by Maine voters in a decision that is still in court.
“That’s something we need to confront head on and think about how to tackle,” Bartlett said, warning that it would be hard to build any infrastructure if every new transmission line faces opposition from incumbents.
Bartlett also said he sees an impending clash between state energy contracts and the region’s markets.
“There’s a real risk that markets won’t be sustainable,” he said. “If states are putting so much under contract, the markets, which are designed to provide competitive pressures, are going to have a difficult time doing that. We need to have these honest discussions.”
And lastly, Bartlett reiterated calls for ISO-NE to improve its transparency and involve states more in its process.
“At this point, any sort of market reform or transmission planning is going to implicate state policies, and it’s important that states be at the table,” he said. “We also need to make sure that consumer costs are getting better attention and consideration as decisions are going to be made.”
Order 2222
A panel of speakers also discussed ISO-NE’s approach to complying with FERC Order 2222, which directed RTOs to facilitate distributed energy resource aggregations’ participation in their markets.
“Bundled together, we see them as something that could respond to price, to be the balancing resource, to change production or change load on the system in conditions of over- or under-generation,” said Henry Yoshimura, the RTO’s director of demand resource strategy.
“Our members have told us they don’t think ISO-NE’s proposal will allow them any more avenues than they already have,” Jeff Dennis, managing director of Advanced Energy Economy, told the CLG.
Ian Burnes, program manager at Efficiency Maine Trust, noted that a challenge with tapping into the benefits of demand resources is consumer awareness.
“Most consumers don’t care about their energy. They don’t care until the bills get high, or their hot water isn’t on, or their house gets cold, or their light bulb has burnt out,” he said. “So we have a real challenge of delivering on this great promise of aggregating loads to reduce the cost of decarbonizing our economy.”
“I look forward to working with everybody at ISO, in the markets and in New England to make sure we can get this right, but it’s going to take a real attention to detail and a real commitment to make it work so we can meet customers where they are,” Burnes said.
RTO Update
Anne George, ISO-NE’s vice president for external affairs and corporate communications, gave an update on what the grid operator has been working on.
She highlighted numerous studies and initiatives the RTO is undergoing to improve its forecasting and adjust to the energy transition. George also gave a summary of the messy process of completing February’s Forward Capacity Auction. And she ran through the events of January, which included near-record prices and increased emissions, because of cold weather and higher electricity demand.
“It was a pretty interesting January. But thankfully, some of the issues we saw take place didn’t result in any sort of emergency procedures,” George said.
Leadership Change
Rebecca Tepper is stepping down as chair of the CLG’s Coordinating Committee after seven years and 25 quarterly meetings.
She’s handing the duty over to Elizabeth Mahony, an assistant attorney general in Massachusetts.
HOUSTON — Taking his turn in the CERAWeek by S&P Global’s briefing room Friday, U.S. Sen. Joe Manchin (D-W.Va.) wasted no time as a reporter began to ask a question about possible negotiations to reconfigure the Build Back Better Act.
Cutting the journalist off, Manchin said, “There is no Build Back Better.”
An awkward silence fell over the room. Manchin, whose announced opposition to the $2.2 trillion reconciliation package in December effectively killed the legislation, took notice.
“Look, I don’t mean to be sarcastic. That bill was as a major, mammoth piece of legislation, OK? I had concerns from Day 1 that we shouldn’t be doing that much policy,” he said.
Manchin said the Democrats’ use of reconciliation to pass the bill was wrong, saying the process was not designed for policy but to “get our financial house in order.”
“Here we are changing the whole social restructuring of our society, and that was the biggest thing that I had with it,” he said, acknowledging there are “many good things” in BBB. “Our debt grows every day, every day. You’ve got to change that trajectory. Get a tax code that’s competitive and fair and allows us to compete and grow and be prosperous, but pay the bills and then use the revenue from that to pay down debt and get your finances in order.”
Manchin was joined by Sen. Lisa Murkowski (R-Alaska), his former partner on the Senate Energy and Natural Resources Committee, and 900 other speakers during CERAWeek. The global energy gathering, often called the “Davos of energy,” attracted a record 5,800 delegates, bettering the attendance for the most previous in-person CERAWeek in 2019.
Most speakers addressed Russian’s invasion of Ukraine and the alarming upheaval in energy, commodity and financial markets it has created. They discussed energy independence, supply chain disruptions, new business strategies and an accelerated “pace of change” brought on by the economic and geopolitical turmoil.
“My hope is that with [the] situation in Ukraine … all the eyes in the world [are] truly focused on energy in a concerted and directed way that we have not seen before,” Murkowski said. “Now everybody’s talking about it. I think we have an opportunity, we have an avenue, but it’s not something that we can just talk about. We’ve got to be acting in administration. Let’s acknowledge that we have resources that are available to us, and let’s focus on what we have here. Why are we going to places where they hate us? It makes no sense. There are no good answers.”
“We are on the cusp of things we’ve never seen in my lifetime. I’m more concerned right now that this thing will take off, and we have no idea what the endgame is going to be,” said Manchin, who remembered clearly the Cuban Missile Crisis in 1962. “We’ve allowed [Russian President Vladimir] Putin to weaponize energy. … You better have a weapon just as good, if not better. By God, we’ve got to start using that, and that’s energy, energy independence, energy productivity in this country.”
“It is very sobering, and it’s a reminder to us of the leadership responsibilities that we have and how we, again, step into those roles,” Murkowski said. “How we assume that leadership, how we take the tools that we have at our disposal, to not only make us less vulnerable, but to help our friends and allies, which again, takes us back to energy and the role that the United States can play. I think there is a moral obligation here.
“If we can, we should do that in a responsible way that recognizes that climate is still a very, very serious issue for us,” she added. “We don’t have to put it off the table. Again, what we can do to contribute to the safety and the security and the resiliency of people that we care about who are fighting for their own freedom and democracy?”
Granholm Asks Industry to Work with DOE
During a luncheon address to CERAWeek’s attendees, U.S. Energy Secretary Jennifer Granholm placed her remarks in historical context.
“We could not be having this conversation at a more intense, troubling, shocking time in world history … with enormous consequences for the future of energy,” she said. “I’m in a mood to cut to the chase here and tell you what I really think about where we are at as a country and as a part of the energy sector. We are on a war footing — an emergency — and we have to responsibly increase short-term supply where we can right now to stabilize the market and to minimize harm to American families.”
Granholm said releases from the world’s strategic oil reserves will help, but she also asked energy companies to produce more now, where they can. But she said that doesn’t mean she is setting aside climate change concerns or the clean energy transition, which is already happening.
“You all know that. You’re wrestling with it yourselves. You’ve got businesses to run and employees who are nervous about the change,” Granholm said. “We have to do this right, with the right timing, the right technologies, the right partnerships. But we can’t do it if we are fighting internal battles. Some people here seem to think this is the time to recycle old talking points.”
She pointed out that natural gas and LNG are at record levels, and that oil production will be there by next year. She also reminder her audience that 9,000 onshore drilling permits “are sitting unused.”
“We’ll walk and chew gum at the same time. So yes, right now, we need oil and gas production to rise to meet current demand,” Granholm said. “We are here to work with anyone and everyone who’s serious about taking a leap toward the future, by diversifying your energy portfolio to add clean fuels and technologies … by creating good-paying jobs for your talented workforce in the energy industry of the future, and by reaping the rewards of a clean-energy market that will exceed $23 trillion by the end of the decade.”
Granholm said the Department of Energy is ready to partner with the private sector through the $62 billion the agency received last year from the Infrastructure Investment and Jobs Act.
“The truth is, the U.S. government has always partnered with the energy industry in times of need. For over 100 years, the oil and gas industry has powered our nation and gotten us where we are today,” she said. “We are eternally grateful for that, and we want you to power this country for the next 100 years with zero-carbon technologies.”
Bringing her hands together, Granholm closed by saying, “Aren’t we ready to finally work together to confront this moment of crisis and come out stronger on the other side?”
Glick: FERC Investigating ‘Market Anomalies’
FERC Chairman Richard Glick said the commission is investigating whether natural gas operators may have manipulated the market during the February 2021 deep freeze.
“We are investigating potential allegations of manipulation that may have happened in jurisdictional electricity markets, and we did find some anomalies,” Glick said. “Those are being further investigated.”
Glick told reporters investigations like this one take time and that no conclusions have been made.
“One thing that I have tried to make clear under my chairmanship is that if wrongdoing occurs, we’re going to go after that, and that’s certainly going to be the case in this in this situation too,” he said. “It just takes a while to go through the evidence.”
FERC isn’t looking at market manipulation claims within ERCOT, as it is not within the commission’s jurisdiction. It is also limited in its regulation over interstate gas pipelines in Texas once they are operating.
“We have authority over pipelines when they’re sited, and we also have authority over the rates that [interstate] pipelines charge throughout the life of the project,” Glick said.
Asked his thoughts about ERCOT’s market-redesign efforts, he said in that instance, he was glad the commission doesn’t have jurisdiction over the Texas grid operator.
“We have enough problems in terms of market redesigns and the ones we actually overseeing. I wish them luck,” Glick said.
EPA Offering ‘Regulatory Certainty’
EPA Administrator Michael Regan countered several speakers that argued the Biden administration is actively discouraging investments to increase U.S. energy production by pointing out 90% of natural gas extraction is done on private land.
“That continues to move forward,” he said, “I think this president is very smartly focused on a transition that is equitable but also that is cognizant of the current state of play in the world. We all want affordable, reliable, energy and electricity, and I think the smart regulatory approach is to capture where the private sector has been going on for the last decade is the right way to get 80 to 90% of capacity coming online this year.”
Regan said he remains confident the U.S. will eliminate emissions from fossil fuels in the power sector by 2035 and promised to present a “suite of rules” to the industry.
“Obviously, as we develop these rules, we actually quantify the performance of these rules. We will do sort of the quantification to look at the reductions we would get from those targeted pollutants. … By presenting all of these rules at the same time to the industry, the industry gets a chance to take a look at this suite of rules all at once and say, ‘Is it worth doubling down in investments in this current facility or operation? Or should we look at that cost and say now it’s time to pivot and invest in a clean energy future.’
“If some of these facilities decide that it’s not worth investing in and you get an expedient retirement … that’s the best tool for reducing greenhouse gas emissions. The industry wants us to keep our eyes on all of the balls that are up in the air so that they can have regulatory certainty and they can make the best investment strategies possible.”
Ukraine Nukes’ Safety ‘at Risk’
In a hastily arranged addition to CERAWeek’s agenda, Nuclear Energy Institute representatives held a briefing on the state of play in Ukraine following the Russians’ capture of Chernobyl and the Zaporizhzhia nuclear power plant, the largest such facility in Europe.
International Atomic Energy Agency Director General Rafael Mariano Grossi has said several of the IAEA’s seven “indispensable pillars of nuclear safety” are already at risk following the Russian takeover of Zaporizhzhya. Those pillars include allowing the operators to fulfill their safety and security duties and be able to make decisions “free of undue pressure.”
“We understand the Ukranians are continuing to operate all these power plants,” NEI CEO Maria Korsnick said Wednesday, noting a “military structure” is in place over Zaporizhzhya’s staff.
Nuclear units in Ukraine. | Energoatom
The plant “continues to operate safely,” she said. “We have verification that operators are changing shifts, so those are healthy indications that it is operating well during these stressful times.”
Zaporizhzhya has six reactors. NEI said one unit is operating at 60% power as of March 9; two have undergone controlled shutdowns; two others are being held “in reserve” in low-power mode; and the sixth is down for maintenance.
The last undamaged reactor at the Chernobyl nuclear plant was shut down in 2000, with spent fuel rods placed in cooling water and “sufficiently cooled,” said John Kotek, NEI’s senior vice president of policy development and public affairs.
Kathryn Higley, a professor at Oregon State University’s School of Nuclear Science and Engineering, said Chernobyl’s radiation monitors have not shown any releases. Ukranian regulators say diesel generators continue to provide backup power at the plant and to the spent fuel storage facilities at the 1986 accident’s site after transmission lines were severed Wednesday; additional fuel supplies were delivered Friday.
Ukraine’s nuclear utility, Energoatom, continues the operate the country’s other nine reactors at three different sites.
MISO said last week that the transmission line linking its Midwest and South regions has been out of commission since December and is expected to remain offline until July, raising the cost of energy transfers.
The RTO said it will replace the contract path capability between its regions with non-firm service on April 10 until the line returns to service. It said members should prepare for “financial and operational implications.”
The 1,000-MW contract path, a 500-kV Associated Electric Cooperative Inc. line, went offline Dec. 10. The line, which stretches from southern Missouri into northern Arkansas, is MISO’s only physical tie between its Midwest and South regions. MISO said it expects the line to remain on an extended outage through June 30, leaving it dependent on non-firm transfers from neighboring grids.
During a Thursday Market Subcommittee meeting, senior adviser Jack Dannis said a Dec. 10-11 tornado outbreak that bombarded the central and southern U.S. took out 17 towers and four miles of the line. He did not specify which state the line damage occurred in.
The tie was originally expected to be back in service by the end of February. Dannis said he couldn’t speculate on whether the work requiring the outage would be extended beyond June.
Clean Grid Alliance’s Natalie McIntire said she was surprised that MISO waited so long to report the status of the contract path.
“This happened in December, and the first I heard about it … was yesterday,” she said. “I’m wondering why MISO hasn’t alerted stakeholders to this beforehand.”
McIntire pointed out that the grid operator’s leadership has delivered two executive updates to stakeholders since the line went down. Neither mentioned the line’s outage.
As a rule, MISO doesn’t reveal specific generation or transmission outages on its system.
Andy Kowalczyk, with activist group 350 New Orleans, said he was also concerned that staff didn’t communicate the significant outage, especially considering that a winter storm passed through the area a few weeks later.
Dannis said MISO only recently became aware of the outage’s extension into summer. He said the RTO will replace the firm capacity with “non-firm, as available” transmission capacity after it exhausts its four-month grace period, according to a usage agreement of the line with SPP, AECI and other joint parties. The agreement provides that the grid operator can pay an additional $667/MW-month “for every decreased megawatt of contract path capacity.”
Assuming the line is back in service by July, MISO would need to pay about $1.3 million to secure 1,000 MW of non-firm transfer capability. It will divide the cost among market participants using its current market-based allocation design that assigns costs based on excess congestion across its regional directional transfer constraint.
Kevin Vannoy, director of market design, said though MISO’s usual 1,000-MW contract path becomes non-firm because the physical line is out of service, it can still flow up to its usual 2,500-3,000 MW non-firm transfers under its agreement with SPP and the joint parties.
“We think there’s enough physical transfer capability on the system to continue operating as we normally have,” he told stakeholders.
However, Vannoy said it’s possible that conditions might force MISO to order transmission loading relief to reduce transfers. The RTO’s use of non-firm transfers can be curtailed down to zero to prevent load shedding or during system emergencies.
Minnesota Public Utilities Commission staffer Hwikwon Ham asked whether MISO has considered a hypothetical heat wave striking it and SPP at the same time, forcing transfers to be curtailed.
Staff said they’re increasing coordination with members but haven’t devised any special mitigation plans.
Stakeholders questioned why MISO didn’t make updates to either its spring reliability outlook or the delivery estimates in its capacity auction because of a major transmission line’s loss.
Dannis said MISO has been operating for three months now with “minimal” operational impacts. He said he expects little difficulty during the shoulder maintenance season.
MISO Director of Settlements Laura Rauch said the impacts should be strictly financial.
“We can still operate as we normally do. This is about dollars, not anything that would preclude us from operating,” she said.
Stakeholders asked why it’s taking six months to complete line repairs.
Dannis said he was aware of some supply chain issues for equipment needed to fix the line but said he couldn’t offer anything further.
The D.C. Circuit Court of Appeals on Friday handed more fuel to FERC’s Democratic majority for its new policies on natural gas infrastructure, ruling that the commission has to take another shot at reviewing downstream greenhouse gas emissions from a Massachusetts compressor project.
The court granted a petition for review and remand from Food & Water Watch, which had challenged FERC’s approval of a project by Tennessee Gas Pipeline to upgrade a compressor station in Agawam, Mass.
“The commission’s environmental assessment failed to account for the reasonably foreseeable indirect effects of the project — specifically, the greenhouse gas emissions attributable to burning the gas to be carried in the pipeline,” Judge Sri Srinivasan wrote in the court’s opinion.
The environmental group had argued that FERC’s decision failed to comply with the National Environmental Protection Act in four ways, and the court agreed with one of those arguments: that FERC failed to adequately consider the effects of the emissions associated with the consumption of the gas that the project would carry.
The commission had asked for data from Tennessee Gas, and the pipeline company provided them, but FERC found the information was “too generalized” to estimate downstream emissions at all, an argument which the court rejected.
The court relied heavily on its 2017 decision in Sierra Club v. FERC, better known as “Sabal Trail,” a similar case in which the Sierra Club challenged FERC’s approval of three pipelines in the Southeastern U.S.
“Our decision in Sabal Trail points the way to concluding that the available information was sufficiently specific to render downstream emissions reasonably foreseeable,” Srinivasan wrote.
The court ordered FERC to “perform a supplemental environmental assessment in which it must either quantify and consider the project’s downstream carbon emissions or explain in more detail why it cannot do so.”
Well Timed for Glick
The ruling will fit neatly into the argument that FERC Chairman Richard Glick has been making around his decision to revamp the commission’s pipeline approval process to more closely consider emissions, which has been challenged by Republicans and even some Democrats in Congress.
In a Senate hearing just days before the latest ruling, Glick pointed specifically to the D.C. Circuit’s past opinions to defend his move to update FERC’s policy statement governing natural gas infrastructure certificates. (See Glick: No Regrets over Gas Policy Statements.)
“The D.C. Circuit has spoken on several occasions, and unless the court’s interpretation is reversed, we have no choice but to follow with unambiguous guidance,” Glick said.
The changes “will lead to project orders that are more legally durable,” he added.
Things Left Unsaid
The ruling notably did not take a position on the “significance” of downstream emissions, but only whether FERC has a duty to tally them.
“We see nothing that provides any view on whether FERC has the authority to require mitigation of those emissions as a general matter,” ClearView Energy Partners wrote in its analysis of the ruling. “Since FERC did not make a call on significance in this case, and the petitioner failed to properly raise it, this case provides no incremental insight into this issue.”
The court also didn’t shed any light on the assessment of upstream emissions or the use of the social cost of carbon, so those will have to be adjudicated in future cases. “Those fights still lie ahead,” ClearView wrote.
Reactions
“Today’s decision adds to a growing list of cases affirming that FERC is required to consider these climate impacts,” said Sarah Ladin, an attorney at the Institute for Policy Integrity at the New York University School of Law.
“More broadly, today’s decision affirms that the commission’s new policy statement is an appropriate action to ensure it properly considers greenhouse gas emissions in assessing pipeline applications,” Ladin wrote in a statement.
Gillian Giannetti, a senior attorney at the Natural Resources Defense Council, wrote that FERC’s work on the Agawam project was the “kind of shoddy review that FERC aims to correct in updating its policy statements.”
“It doesn’t benefit anyone for FERC to lose over and over and over on this issue,” she tweeted.
Washington’s legislature last week passed a bill to provide low-income residents access to solar energy through community-based projects.
The Senate approved an amended House Bill 1814 by a 29-20 margin on Thursday, followed passage by the House on a 57-41 vote.
The bill by Rep. Sharon Shewmake (D) will establish a new community solar incentive program through Washington State University’s Extension Energy Program to provide benefits for low-income residents, low-income service provider subscribers and tribal and public agency subscribers.
The program will provide grants to community solar project administrators, which can include utilities, nonprofits, tribal housing authorities and other local authorities.
A grant under the program would be limited to 100% of the installed costs of a project, in addition to associated start-up administrative costs, capped at $20,000 per project. Eligible projects must be between 12 and 199 kW in nameplate capacity and have at least two low-income subscribers or one low-income service provider.
The projects may also include energy storage.
The bill allocates $300,000 for the program in fiscal 2023, increasing the allocation to $25 million for each of the four subsequent budget biennia. At least $2 million of the money is to be directed to tribal programs.
Grant applicants would have two years to complete the project.
Republicans opposed the bill because it is expensive and does not help combat climate change, Sen. Lynda Wilson (R) said.
Sen. Reuven Carlyle (D) argued that the bill would make solar energy more viable for low-income people, who normally cannot afford to the energy source.
Outgoing Western Power Pool (WPP) President Frank Afranji envisions a deepening relationship between his organization and WECC as the WPP rolls out its Western Resource Adequacy Program (WRAP) over the next two years.
On the cusp of retiring from the WPP after leading the organization for four years, Afranji shared his views on the WRAP at a WECC Board of Directors meeting last Wednesday.
“This is probably the last presentation I make before I retire at the end of this month … and I’m sure many people out there are looking forward to seeing me gone,” he joked.
The WRAP came about because of a confluence of factors in the Western Interconnection, Afranji told the board. Two of those factors — the decommissioning of coal-fired generators and increased adoption of variable energy resources — largely stemmed from state clean energy policies. The third — reduced surplus hydroelectric capacity in the Northwest — was the product of that region’s load growth.
“As time passed on and loads increased, it became very evident that we’re going be heading into capacity adequacy problems,” Afranji said.
In April 2020, the WPP (then called the Northwest Power Pool) announced its intention to develop a resource adequacy program to help address looming capacity shortfalls in the West. (See Western Resource Adequacy Program in the Works.)
Two months after the WPP announced the RA effort, WECC laid out plans to redefine its own organizational mission by becoming the primary forum for discussing and tackling resource adequacy challenges in the West. (See WECC Seeks to ‘Invent’ Future with RA Forum.)
The overlapping pursuits could have spelled competition over which entity would become the authority on RA issues in the West.
Afranji anticipates a more collaborative outcome.
“In my mind, as WECC works on their own capacity assessment of the West, there is such a point of interaction on this that we have to work hand-in-glove on this, no different than we’re working with the [California] ISO,” Afranji said.
Afranji lauded WECC for being at the forefront of the Western capacity issue through its work on the Western Assessment of Resource Adequacy (a regional companion to NERC’s RA assessments), which he thinks the regional entity should continue to produce. (See WECC Warns West Heading for Resource Adequacy Shortfalls by 2025.)
“If anything, as we get the [WRAP] up and running, I think we should intensify the work, and my instructions to the staff have been always, ‘As soon as we get something that we could really say is working, we need to work closely with the WECC,’” he said.
Afranji also noted that WPP COO Greg Carrington has been asked to join WECC’s Joint Guidance Committee. “So there are many points of interconnection.”
On Track
Addressing the progress of the WRAP, Afranji said the “train is on the track, and it’s moving.”
“I have to say we ended up with an amazing group of folks working on this probe project from across the West.”
Afranji explained that the WRAP will be divided into two pieces. The first is the forward showing program, designed to demonstrate the resource adequacy and availability from participants seven months in advance of a program season.
The second piece, Afranji said, is the operational program, which will determine the WRAP’s capacity requirements.
“What are we going to need, going forward, to create these efficiencies and to have a much better planning reserve margins?” he said.
The operational component will also help WPP to determine the capacity contributions of various resources, including hydro, run-of-river hydro, pumped storage, wind and solar.
Once that part of the program is in place, participants will submit their resource portfolios to the WPP to assess deficiencies, which will need to be “cured” ahead of the operational season.
WPP teams are currently working to calculate the WRAP’s specific “qualifying capacity contributions.”
“Historically, people would just throw out a number for their own wind or their own solar or their own run-of-the-river,” Afranji said. “Our teams zeroed in on different zones, different areas, different technologies, to figure out what truly is the qualifying capacity contribution of a certain element in a certain area, so that when we do the assessment, it’s not really just a socialized number that may not really contribute much to reliability.”
Fixing a Misnomer
Richard Campbell, vice chair of the WECC board, pointed out that when the WRAP begins its binding forward showing program in 2023, major electricity consuming and producing regions will still sit outside its footprint, resulting in “suboptimization” of the RA process.
“How do you plan to sort of deal with these other large areas and entities that are outside of your purview?” Campbell asked.
Afranji said the WPP has already been meeting with CAISO regarding seams issues to ensure that their respective operations “are not going to clash or not really be in sync.”
“And certainly we’re working with SPP, because we hired SPP to be the [program operator], meaning we’re using their infrastructure to go ahead and implement the program on a contractual basis,” he said.
Afranji also explained the reason behind the Portland, Ore.-based WPP’s recent name change.
“Since 1942 we’ve been known as the Northwest Power Pool, but it started becoming very clear that this is a misnomer, because our footprint extends way beyond that … and with that the various executives of the participants urged us to really look at a name that is more descriptive of our footprint.”
The WPP currently has 44 members, 26 of which will initially participate in the WRAP.
Parliamentary delay tactics by legislative Republicans last week killed a Washington bill to add climate change considerations to city and county land use planning.
House Bill 1099, sponsored by Rep. Davina Duerr (D), would have made the change by revising Washington’s Growth Management Act (GMA), which regulates long-range land use planning for Washington’s city and county governments. It requires counties and cities to review and, if needed, revise their comprehensive plans and development regulations every eight years.
GOP tactics in the Washington Senate and House led to the bill’s death in the last evening of the legislature’s 2022 short session, which could not go beyond midnight Thursday. The session ended at about 11:30 p.m.
Duerr’s bill would have added “environmental resiliency” as a goal of the GMA and required the concept to be considered in land use and shoreline planning for the 10 largest of Washington’s 39 counties and in cities of 6,000 people or larger. The 10 largest counties cover Puget Sound, Spokane, the Yakima River Valley and the Washington-side suburbs of Portland, Ore. A 2021 legislative memo said 246 county and city governments would be affected, including 110 jurisdictions outside the 10 most populous counties.
The bill called for city and county comprehensive plans, development regulations and regional plans to “address jurisdictional needs for resilience to changing conditions and protect and enhance environmental, economic, and human health and safety,” according to the bill’s report.
It would have also required the state Department of Commerce to set guidelines by 2025 on how covered areas can reduce greenhouse gas emissions and vehicle miles traveled. Because 45% of Washington’s greenhouse gas emissions come from motor vehicles, traffic issues would become a priority in those guidelines.
Going into Wednesday, the House and Senate held different versions of the bill and had to go into compromise talks. While the differences were quickly hammered out, the majority Democrats in both chambers added language to allow cities to add real estate tax breaks based on being within a quarter mile of a transit station. The idea is to encourage higher housing density around transit stations to cut down on car traffic.
The real estate tax breaks were not in either version of HB 1099 prior to Wednesday.
At Thursday’s floor vote, Senate Republicans challenged the extra language as being illegally beyond the scope of the bill. Lt. Gov. Denny Heck’s staff researched the challenge for hours before Heck decided the addition was technically legal. As the Senate’s presiding officer, Heck’s duties include ruling on such matters.
“I don’t feel good about this one. This was a very, very difficult issue … This was not a clear case,” Heck said.
The Senate then passed the bill 28-21 along party lines.
Talking the Bill to Death
As Thursday evening unfolded, House Democrats faced a big debate on large operations and transportation budget packages. House Republicans told House Speaker Laurie Jinkins (D) that all 41 GOP members planned to speak in the debate on House Bill 1099. Jinkins said that that would stretch the floor debate, preventing one of two budget packages — both opposed by the Republicans — from passing before the midnight deadline.
“It was possible for the Republicans to kill the bill just by talking. … We got a clear message that it would be talked to death,” Jinkins said.
At Wednesday’s conference committee meeting, Rep. Mary Dye (R) argued the bill in its present form could have unintended consequences, but she did not elaborate further on what they could be. “We don’t have answers to the impacts of this sweeping policy. … I think it is premature to make a policy of this scope,” Dye said.
Duerr countered Wednesday, saying the issue “needs a sweeping solution.”
On Thursday, Republicans argued that adding climate change to the Growth Management Act will increase housing costs at a time when Washington is facing a housing shortage
Senate Minority Leader John Braun (R) said Democrats “decided climate change is the most important thing. … But the citizens of Washington are in the middle of a housing crisis. … This does harm to the people of Washington by driving up the costs of regulation.”
Democrats painted housing and climate change as parallel problems, not as an “either-or” situation.
“It’s important that we act now on climate change. It’s important that we act now on housing,” said Sen. Liz Lovelett (D). The legislature has passed several housing-related bills this session.
In 2021, the House passed the bill and the Senate Ways and Means Committee recommended approval, but it stalled in the Senate’s Transportation Committee. The proposal would require comprehensive plans, development regulations and regional plans to support state greenhouse gas emissions targets and improve resilience against climate impacts and natural hazards.
In 2021, the Senate Transportation Committee was chaired by then-Sen. Steve Hobbs (D), a moderate who sometimes crossed party lines. Gov Jay Inslee later appointed Hobbs as secretary of state to replace Kim Wyman, who joined the Biden administration as an election security expert. Liberal Sen. Mark Liias (D) replaced Hobbs as transportation committee chairman, and the bill sailed through that committee this year.
The annual resource adequacy survey conducted by MISO and the Organization of MISO States will become more frequent as the RTO moves to seasonal capacity auctions.
“One thing you couldn’t help but notice is MISO is moving to a seasonal construct,” MISO adviser Stuart Hansen joked during a Resource Adequacy Subcommittee (RASC) meeting Wednesday. “The question has been, will the OMS-MISO survey follow suit? … The short answer is ‘yes.’”
Hansen said staff has begun conversations with OMS staff and regulators and is “hashing out details internally.” He said the organizations will update stakeholders at future RASC meetings and have a new process in place by the third quarter. The changes will affect 2023-24 planning year readiness.
Hansen said the RTO is strengthening its data import capabilities so market participants aren’t overwhelmed with requests for four times the amount of usual information. He said staff envisions market participants responding to the survey once per year for all seasons.
However, MISO’s plans for seasonal capacity auctions are in doubt following FERC deficiency letters on the grid operator’s minimum capacity obligation proposal and its bid for a four-season capacity market using a resource’s past availability for accreditation. (See related story, Deficiency Notices for MISO’s Seasonal Capacity Auctions Bid.)
MISO plans to post what could be its final annual auction results on April 14. The grid operator has 177 GW of installed capacity, 136 GW in members’ confirmed unforced capacity, a 122-GW coincident peak forecast and a 135-GW planning reserve margin requirement.
Eric Thoms, the RTO’s senior manager of resource adequacy operations, said that confirmed unforced capacity values could still rise as members verify capacity amounts with MISO.
Stakeholders are pushing staff to reinstate a brief stakeholder teleconference to discuss auction results. MISO has historically hosted a call to review auction results the day after releasing them, but it has decided to replace this year’s discussion with a presentation during the April 20 RASC meeting.
Stakeholders said the day-after call is useful, particularly when zones clear at unusually high prices or capacity export limits bind.
“A typical, run-of-the-mill auction probably doesn’t need a workshop, but interesting results require one,” WEC Energy Group’s Chris Plante said.
MISO staff said they would reassess the need to schedule a call.
Maintaining bulk electric system reliability is similar to maintaining personal health, Tim Ponseti, SERC vice president of operations, said at the regional entity’s Spring Reliability and Security webinar Tuesday.
That begins with preventative measures, such as outreach and education about risks. SERC has “had 13 straight board meetings where we’ve highlighted the various issues, common failure modes, best practices and things to look out for regarding facility ratings,” Ponseti said.
Inaccurate transmission line ratings can cause a system operator to lose real-time situational awareness, or to operate equipment beyond its capabilities, damaging it or causing lines to sag beyond design, which could result in unplanned and potentially widespread outages.
Eighty-six percent of FAC-008 violations in SERC’s footprint are related to discrepancies between documented facility ratings and actual field conditions, said Dulce Plaza, SERC legal counsel, who offered a sneak peek at a report the RE will release later this month.
“If you give operators a rating, they’re going to operate to it, right or wrong, so it’s important they have good numbers and data to operate from,” Ponseti said in giving his own presentation. Planners use facility ratings to design capital projects and future improvements to the grid, so accurate facility ratings have a far-reaching impact. “Whether it’s every one, two, three or four years, we’ve touched base and given health checkups essentially covering almost 90% of our transmission models and generation megawatts in our footprint.”
Operations and planning audits often run into missing or altered equipment, or jointly owned equipment, said Heath Martin, SERC senior O&P auditor, who closed the session with a presentation on “things to think about.”
SERC
Equipment might need special consideration when applying the facility ratings methodology, generally older equipment that has older construction practices and clearance thresholds, perhaps older equipment in general that may not meet current standards, Martin said.
He showed a picture of a painted white line marking the edge of a country road that curved around a fallen branch.
“‘It’s not my job to remove that limb, so I’m just going to paint around it and keep going’; that is not the correct attitude when it comes to jointly owned facilities,” Martin said.
