July 23, 2018

Dr. Dariush Shirmohammadi thinks technology should be allowed to pave the way for renewable generation interconnection and integration.

I was recently asked by Pennwell to speak at a Transmission Hub Forum webinar to present a renewable energy industry perspective on transmission policy. (Coming July 26th – Register for the webinar here.) You see, one of my jobs at GridBright, in addition to assisting renewable resources interconnect to and operate in various balancing areas, is serving as Technical Director to the California Wind Energy Association (CalWEA). I advise CalWEA on the technical ramifications of state and federal renewable energy policies on California’s wind energy industry. So, at the Forum, I intend to share my thoughts about further steps that the CAISO might take in playing a leadership role in cost-effectively advancing renewable energy.

I have been involved in the grid-interconnection of well over 10 GW of wind, solar, geothermal and storage resources ranging from a fraction of a megawatt (MW) to 1500 MW in North America (including the CFE grid in Mexico) over the past decade and a half both as the Director of Regional Transmission at the California ISO (CAISO) and later in my consulting role.

As a backdrop to my remarks, I looked at the CAISO generation interconnection queue as of June 6, 2018. At that date, CAISO had still not added well over 200 new generation interconnection requests that will be processed in its Cluster 11 interconnection studies. The CAISO’s queue also does not include thousands of megawatts of interconnection requests that are processed directly by CAISO’s various Participating Transmission Owners (PTOs) such as Pacific Gas and Electric Company (PG&E) and Southern California Edison Company (SCE).

I found the numbers to be impressive and disappointing at the same time. Impressive because nearly 280 GW of generation has requested interconnection to the CAISO-controlled grid since CAISO started compiling its interconnection data. Disappointing because nearly 80% of this capacity (around 220 GW) ultimately withdrew from the queue and only 7% (or about 20 GW) has actually been developed with the remaining 40 MW still being processed.

Now, it is well known, at least in the wind industry, that CAISO has the most progressive resource interconnection protocols of all other RTOs or transmission owners in North America. In fact, in its FERC filings, the American Wind Energy Association (AWEA) used CAISO generation interconnection protocols as an example to be followed by other ISOs and transmission owners in the nation. CAISO has also been progressive in the areas of integrating DERs and storage resources. So, why such a large withdrawal rate for projects requesting interconnection to the CAISO-controlled grid?

Before CAISO reformed its generation interconnection protocols in 2007, a commonly stated reason for the high interconnection failure rate was that most of the projects were speculative since anyone could get into the queue and remain there “using one’s credit card,” as former CAISO CEO Yakout Mansour argued at the time. But the high failure rate persisted after the protocols were reformed and getting into and remaining in the queue using one’s credit card was made nearly impossible, at least without a credit card limit of several million dollars.

One prominent reason for such a high withdrawal rate has been the lack of commercial viability for the withdrawing projects. In other words, some of these projects could not find someone to buy their output at the right price. That is a legitimate reason for a project to withdraw from the interconnection queue. The other reason for such withdrawals has been that the projects requested interconnection to parts of CAISO-controlled grid that had very little transmission capacity to accommodate a new generating plant. Also, on occasion, the withdrawn generation project had requested interconnection in areas of the state where permitting (e.g., environmental) factors precluded the development of the generation plant or its needed transmission upgrades. In these cases, likewise, I see legitimate reasons for the aspiring generation projects to get out of the queue.

However, there is one very common reason that numerous generation projects have failed where I place direct blame on the CAISO, and particularly on its PTOs. You see, these entities study an interconnection request under very extreme operating conditions – i.e., conditions that might occur for a few hours every few decades where the system is experiencing a “super peak” load condition (a load level that happens for a few hours once every 10 years) and at the same time there are multiple major contingencies on the grid.

To make matters worse, when these interconnection studies, expectedly, show NERC reliability criteria violations (e.g., line overloads) under such onerous study conditions, the PTOs do not consider or allow the use of inexpensive solutions such as Dynamic Line Rating (DLR) devices or variable reactance devices (known as FACTS devices) for addressing the identified NERC reliability criteria violations. Rather, they claim that these technologies are unproven. Now, we all know that the electric utility industry is very conservative, and generally for good reasons, but these technologies have been around for decades and have proven themselves under all kinds of test- and real-life conditions wherever implemented. And, in the case of variable reactance devices, costs have come down dramatically from the original FACTS devices thanks to innovations by companies such as Smart Wires.

I know of numerous generation projects that had to withdraw from the interconnection queue because they overloaded a line by a few percent under the very onerous study conditions noted above and, as a result, were burdened with the multi-million-dollar cost of completely replacing the line where a simple variable reactance device or DLR device would have done the job. Unfortunately, adding such costs made the generation project, which was otherwise perfectly viable, commercially unviable, thus forcing it to withdraw from the queue and depriving electricity customers of a potentially competitive resource. What a pity!!

While I find the California utilities very conservative practices mainly responsible for this, the responsibility is shared, to varying degrees, with the entire North American electric utility industry and, indeed, the world. Hence, the needed fix should ideally come at a much higher level. But it would be fitting – as California leads the way in advancing reliance on renewable sources of electricity – for the CAISO and its PTOs to lead the nation in adopting proven technologies when performing interconnection studies. In addition to promoting competition, this practice would promote much greater use of the existing grid, bringing further financial as well as environmental benefits.

Dr. Dariush Shirmohammadi, GridBright EVP, Interconnection and Integration Practice