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June 5, 2024

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State Briefs

ALABAMA 

EPA Formally Denies Plan for Coal Ash Waste

EPA last week formally denied the state’s plan to allow Alabama Power and other utilities to continue storing coal ash in unlined pits. 

The state’s Department of Environmental Management said it was disappointed in the decision and would appeal. The state’s coal ash program “meets all the legal, environmental and other requirements for approval. The program and the permits issued under the program are leading the way in protecting the public and the environment,” the department said. 

EPA first announced a proposed denial of the plan last August, saying it did little to protect humans and the environment. The decision marked EPA’s first-ever denial of such a state plan.  

More: Inside Climate News 

FLORIDA 

New Gainesville Regional Utilities Authority Members Sworn in

Five members of the Gainesville Regional Utilities Authority board were sworn into office last week, officially marking the return of the authority following a brief hiatus after all four former members resigned because of a lawsuit that challenged the eligibility of the Gov. Ron DeSantis appointees to hold their positions. 

Ed Bielarski, the former general manager of GRU, was sworn in, along with Craig Carter, Eric Lawson, David Haslam and Robert “Chip” Skinner. 

Bielarski was elected chair, while Haslam was named vice chair. Carter and Lawson are two of the former members who had resigned. 

More: Gainesville Sun 

ILLINOIS 

ICC Rejects Peoples Gas Request for More Pipeline Funding

The Commerce Commission last week rejected most of a request from Peoples Gas to tack $7.9 million onto a rate hike for emergency work tied to the utility’s pipeline replacement program. 

The commission voted to add just $1.6 million “out of an abundance of caution” to the $303 million hike approved for Peoples last fall. 

Earlier this year, the utility asked for a rehearing to allow additional spending on the pipeline project, which was halted pending an investigation by the commission, as estimated costs have ballooned from $2 billion to $11 billion since 2007. 

More: Chicago Sun-Times 

Lawmakers Move to Pause, Regulate CO2 Pipeline Development

Gov. JB Pritzker last week said he plans to sign a bill that will ban new carbon dioxide pipeline projects until the federal government sets new safety rules. 

The moratorium would expire on July 1, 2026, if the U.S. Pipeline and Hazardous Materials Safety Administration doesn’t finalize safety rules by then. The bill also requires monitoring of injection wells for at least 30 years after they close, a process that must be approved by the state and federal government. 

More: IPM News 

MAINE 

PUC Rejects Settlement with Electricity Maine over Complaints

The Public Utilities Commission last week rejected a proposed settlement with competitive electricity provider Electricity Maine, ruling that the agreement calling for customer refunds and the opportunity to switch to different rate plans falls short of what’s needed to punish the company given its hundreds of consumer complaints. 

The PUC voted 2-1 against the agreement and asked a hearing examiner to set a “timely schedule” to resolve the dispute. The decision will prolong a case that has been pending since February 2023. 

The settlement would have given refunds to about 18,000 customers, ranging from less than $10 to nearly $4,000 based on how much electricity they used. However, Chair Philip Bartlett II said it was not in the public interest. 

More: Portland Press Herald 

MICHIGAN 

Consumers Energy Seeks Rate Increase for Wildfire Mitigation

Consumers Energy last week filed for a rate increase with the Public Service Commission for $325 million to address wildfire mitigation. 

The utility said the money would be spent on burying power lines and infrastructure upgrades, along with prioritized tree trimming and equipment upgrades in areas where there is increased wildfire risk. 

The request would add about $10 to the average residential bill. 

More: Detroit Free Press 

Consumers Fined over Faulty Meters, Delays in Services

Consumers Energy has agreed to pay $1 million after the Public Service Commission investigated complaints of malfunctioning electrical meters, violations of rules on estimated billing, and significant delays in providing new electric and gas service. 

According to a statement from the PSC, the metering issue was tied to Consumers’ transition from 3G cellular meters to 4G. The commission also said the utility violated its standard requiring 90% of new service installations to be completed within 15 days. 

More: Michigan Advance 

Wind, Solar Farm Law Won’t Make November Ballot

A proposed ballot initiative to repeal the state’s new renewable energy permitting law will not appear before voters in November. 

Officials with Citizens for Local Choice had until 5 p.m. on May 29 to turn in the 356,958 signatures needed to place the measure on this fall’s ballot. The group did not meet that deadline. 

The initiative emerged soon after Gov. Gretchen Whitmer last fall signed a suite of bills that aim to transition the state to 100% clean energy by 2040. As part of the package, the law changed the way large-scale wind, solar and battery storage arrays are approved and puts permitting authority in the state’s hands. Opponents argued it deprived communities of the right to make their own land-use decisions. 

More: Bridge Michigan 

MINNESOTA 

Judge Rules Xcel’s Negligence in Coal Plant Accident Merits Refunds

Administrative Law Judge Ann O’Reilly last month concluded that Xcel Energy’s negligence contributed to a catastrophic equipment failure in 2011 at the company’s Sherco 3 power plant in Becker and merits a refund of certain costs to customers. 

The Public Utilities Commission must now decide whether to accept the judge’s ruling and issue the refund. The size of the proposed refund was not disclosed, but it would be less than $34 million, split among Xcel’s 1.3 million state customers. 

The November 2011 accident at the coal-fired Sherco 3 ripped giant turbine blades off their mountings, hurled shards of metal across the plant and triggered a fire. No one was hurt, but the plant was closed for repairs for 22 months. While it was, Xcel had to find replacement power on the wholesale market or from other plants. The PUC allowed Xcel to bill customers for the extra costs of replacement power. 

More: Star Tribune 

NEW JERSEY

Galloway Passes Resolution Against OSW Development

The Galloway Township Council last week passed a resolution opposing offshore wind projects. 

“The Township of Galloway further opposes any wind turbine projects along New Jersey’s coast, regardless of height of the structures and distance from New Jersey’s pristine shorelines, until proper studies are performed,” the resolution states.  

The council urged the Atlantic County executive and Board of Commissioners to pursue all appropriate action, including legal action, to prevent the approval and construction of wind turbine projects. 

More: The Press of Atlantic City 

Orsted to Pay $125M for Pulling out of OSW Projects

Gov. Phil Murphy last week announced that Orsted will pay the state $125 million for pulling out of two offshore wind projects. 

The settlement is less than half of the $300 million Orsted originally guaranteed if it failed to build the first wind farms off the state’s coast. In October 2023, the company announced it had scrapped its Ocean Wind 1 and 2 projects because of inflation, rising interest rates and supply chain bottlenecks. 

The administration said it plans to use the money to further support offshore wind projects by investing in manufacturing facilities and other clean energy programs. 

More: The Philadelphia Inquirer 

OHIO 

Householder Pleads not Guilty to New Charges

Imprisoned former House Speaker Larry Householder last week pleaded not guilty to 10 additional felony counts brought against him by the state. 

Charges brought by Attorney General Dave Yost against Householder include one count of theft in office, two counts of aggravated theft, one count of telecommunications fraud, one count of money laundering and five counts of tampering with records. 

The indictment alleges Householder misused campaign funds to pay for his criminal defense in his federal case — for which he was found guilty of racketeering and sentenced to 20 years in prison — and failed to disclose fiduciary relationships, creditors and gifts on required ethics filings, including House Bill 6, the law that was at the center of a massive bribery scheme by FirstEnergy. 

More: The Associated Press 

Youngstown Explosion Caused by Cut Gas Line, NTSB Says

A crew working in the basement area of a building in Youngstown intentionally cut a gas line not knowing it was pressurized before a deadly explosion last week, the National Transportation Safety Board said. 

The agency said a preliminary investigation shows workers were in the basement of the 13-story Realty Tower, which contains apartments on the upper level, to clear out piping and other outdated infrastructure and debris in anticipation of a city project to fill in the area and replace the sidewalks. Workers smelled no gas before they started cutting the pipe. 

The explosion blew out much of the ground floor, killing a Chase Bank branch employee and injuring several others. Youngstown Mayor Jamael Tito Brown said in a news release that the city had contracted with a construction company called GreenHeart to perform private utility relocation in the basement of the tower. He said “there is no evidence” that cutting the gas line the NTSB mentioned was necessary to complete that work. 

More: The Associated Press 

OREGON 

PUC: State Can’t Limit PacifiCorp’s 2020 Wildfire Payouts

The Public Utility Commission last week ruled that PacifiCorp can’t limit how much it will have to pay for wildfire damage. 

The PUC rejected the request by Pacific Power’s parent company to limit how much it will have to pay by excluding noneconomic damages from its penalties, even in cases of gross negligence or willful misconduct. Both the PUC and PacifiCorp officials suggested it might require action from the legislature to limit the utility’s costs. 

More: Oregon Public Broadcasting 

VERMONT 

Scott Vetoes Lawmakers’ Priority Energy Bill

Gov. Phil Scott last week vetoed a bill that would require state utilities to buy more renewable energy at a faster pace, with most utilities purchasing all their energy from renewable sources by 2030. 

Scott cited cost as his main concern, saying the bill would “will raise Vermonters’ utility rates, likely by hundreds of millions of dollars.” While members of the Public Service Department projected the bill would cost ratepayers $1 billion, the state’s Joint Fiscal Office later said the bill’s price tag would be less than half the department’s estimate. 

The bill would accelerate the state’s renewable transition, requiring most utilities to source 100% of their electricity from renewable sources by 2030 and all utilities to make the switch by 2035. 

More: VT Digger 

VIRGINIA 

Federal Judge Rejects Request to Halt Virginia Beach OSW Farm

U.S. District Court Judge Loren AliKhan last week denied a request from a coalition of conservative interest groups that sought to halt construction of Dominion Energy’s Coastal Virginia Offshore Wind project in Virginia Beach. 

The groups sued the Biden administration earlier this year, arguing federal agencies ignored threats to endangered whales when approving the project. The suit will still move forward this fall, but the decision denied plaintiffs’ request for a preliminary injunction to stop construction while the lawsuit is decided. 

AliKhan said there wasn’t enough proof that plaintiffs would suffer irreparable harm from construction on the project moving forward. 

More: WHRO 

Hearne Named Director of Electric Utility Reg Commission

Carrie Hearne last week was hired as the executive director of the Commission on Electric Utility Regulation. 

Hearne will take the role after five years at Virginia Energy, where she was the director of affordability and competitiveness. 

The commission reviews requests to change the state’s energy laws and regulations. 

More: Virginia Mercury 

WASHINGTON 

Inslee Rejects Recommendation to Halve Wind Farm

Gov. Jay Inslee last week rejected a recommendation to cut a proposal for what would be the state’s largest wind farm in half. 

Plans for the $1.7 billion Horse Heaven wind farm originally included up to 222 wind turbines across 24 miles of the Tri-Cities area, plus three solar arrays covering up to 8.5 square miles. But last month, the Energy Facility Site Evaluation Council recommended slashing the proposal in half because nests of the endangered ferruginous hawk were found in the area. Inslee rejected the council’s recommendation and told the group to reconsider in hopes of expanding the project closer to its full potential. 

The council has deliberated over the Horse Heaven wind farm for more than three years. Now it has three months to consider the governor’s notes and revise its original recommendation. 

More: The Associated Press 

WISCONSIN 

Alliant Plans to Convert Sheboygan Coal Plant to Natural Gas

Alliant Energy last week announced it plans to convert its coal-burning power plant in Sheboygan County into a natural gas plant in 2028. 

The utility did not provide cost projections for the plant’s transition but said it will help retain the workforce at the Edgewater Generating Station as it continues to burn coal until 2028 instead of 2025. It is the second time Alliant has pushed back Edgewater’s retirement, which was initially planned for 2022. 

The transition still needs to be approved by the Public Service Commission. 

More: Wisconsin Public Radio 

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Federal Briefs

Manchin Leaves Democratic Party, Files as Independent

Sen. Joe Manchin last week officially left the Democratic Party and registered as an independent. 

“Since becoming a United States senator in 2010, I have seen both the Democratic and Republican parties leave West Virginia and our country behind for partisan extremism while jeopardizing our democracy,” Manchin said in a statement. “Today, our national politics are broken and neither party is willing to compromise to find common ground.” 

Manchin, who chairs the Senate Energy and Natural Resources Committee, is not seeking re-election. West Virginia Gov. Jim Justice (R) is seeking the seat in November and is expected to win. Senate Majority Leader Chuck Schumer had urged Manchin to leave the party but run for re-election. Justice’s decision to enter the Senate race was seen as a key factor in Manchin’s decision not to seek re-election. 

More: Axios; The New York Times 

Republican AGs Ask SCOTUS to Block Climate Change Lawsuits

Republican attorneys general in 19 states have asked the Supreme Court to block several Democratic-led states from pursuing climate change lawsuits against the oil and gas industry in their own state courts. 

The request comes as dozens of states and local governments have filed lawsuits alleging that fossil fuel companies deceived the public about the risks of their products contributing to climate change. The lawsuits claim billions of dollars of damage from severe storms, wildfires and rising sea levels.  

The GOP attorneys contend only the federal government can regulate interstate gas emissions, and states have no power to apply their own laws to a global atmosphere that reaches beyond their borders. 

More: The Associated Press 

Increasing Use of Renewables in US Yields Billions in Benefits

A new study published in Cell Reports Sustainability finds emission reductions provided $249 billion in climate and health benefits in the U.S. 

By increasing its use of renewable energy between 2019 and 2022, the U.S. has not only slashed its carbon emissions but also improved air quality, yielding hundreds of billions of dollars of benefits, the report found. During that period, by reducing fossil fuel power plants, the nation’s use of wind and solar power cut its carbon dioxide emissions by 900 million metric tons. 

“These findings can help us target future wind and solar development to provide the greatest climate and health benefits,” said Jeremiah Johnson, a climate and energy professor at North Carolina State University whose work was cited in the study. 

More: The Guardian 

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Company Briefs

PGE joins Grid United, ALLETE in 3,000-MW East-west Tx Line

Portland General Electric last week signed a nonbinding memorandum of understanding with Grid United and ALLETE in the development of the North Plains Connector, an approximately 415-mile HVDC transmission line. 

The $3.2 billion project would be the nation’s first HVDC transmission connection among three regional U.S. electric energy markets, including MISO and SPP. 

The parties will now work to finalize definitive agreements regarding PGE’s participation, which is expected to involve a 20% ownership share of the project. 

More: Portland General Electric 

Hydrostor Chooses Denver for HQ

Canadian energy storage company Hydrostor is opening its U.S. headquarters in Denver, the company announced last week. 

Chief Development Officer Tom Duckett said the company plans to hire 20 more people this year, boosting the Denver staff to about 30. The company employs roughly 100 people worldwide. 

Hydrostor chose Denver as its U.S. base in part because of its industrial activity, Duckett said. 

More: The Denver Post 

Recurrent Energy Closes BlackRock Investment

Canadian Solar-owned Recurrent Energy last week announced the initial closing and funding of an investment in its platform by BlackRock through a fund managed by its Climate Infrastructure business. 

Once the transaction is fully complete, BlackRock’s $500 million investment will represent 20% of the outstanding fully diluted shares of Recurrent on an as-converted basis. Canadian Solar will continue to own the remaining majority shares of Recurrent. 

Recurrent expects to have 4 GW of solar and 2 GWh of storage in operation in the U.S. and Europe by 2026. 

More: Renews 

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Pathways Backers Advance WEIM/EDAM Governance Proposal

Backers of the West-Wide Governance Pathways Initiative will move quickly on a proposal to alter the governance of CAISO’s Western Energy Imbalance Market (WEIM) and Extended Day-Ahead Market (EDAM) after voting to approve the plan May 31. 

The initiative’s Launch Committee unanimously endorsed step 1 of the “stepwise” proposal the group issued in April. The proposal calls for CAISO to revise the WEIM charter to elevate the oversight position of the market’s Governing Body over WEIM/EDAM matters to “primary” authority, rather than the “joint” authority it currently shares with the ISO’s Board of Governors. (See Western RTO Group Floats Independence Plan for EDAM, WEIM.) 

“We’re thrilled to be able to move forward with step 1 and start to engage with … CAISO in a different way,” committee Co-Chair Kathleen Staks, executive director of Western Freedom, said after the vote. 

The Launch Committee now will submit step 1 of the proposal to CAISO Board Chair Jan Schori and WEIM Governing Body Chair Andrew Campbell to kick off a stakeholder process at the ISO this month. 

Pathways backers anticipate CAISO will hold an initial public stakeholder call — with the Launch Committee presenting — in mid-June. That would be followed by a three-week comment period, a committee response period and a public meeting for a joint decision by the board and Governing Body in late July or early August. 

“Let me start by really thanking the Launch Committee for taking up the concept that the regulators had put forward last summer, fleshing it out and producing such an astonishing work product,” Oregon Public Utility Commissioner Letha Tawney said. 

Tawney was among the group of Western state energy officials who launched the Pathways Initiative last July to increase the potential for creating a single day-ahead electricity market for the region that expressly includes California and leans on the technical capabilities of CAISO. 

Arizona Corporation Commissioner Kevin Thompson, another initial supporter, commended the Launch Committee’s progress despite conflicts that arose at a previous private meeting of the committee in Phoenix. 

“There was some tension there in the room a little bit here and there,” Thompson said, “but to see where the stakeholders have moved the conversation to get us toward independent governance, and giving prior primary authority to the EIM as the governing board, is a step in the right direction that gets us away from the joint authority and starts moving us really closer towards independent governance.” 

The Pathways Initiative’s final proposal included a handful of changes from the original version, including expanding the responsibility of the Governing Body to respect both state and “local” policies in its decisions and highlighting the existing right of the body to institute a governance review process with the ISO board in the event of a mass withdrawal of EDAM entities from the market. 

The proposal also clarified the workings of the dual filing — or “jump ball” — process that would occur in the event the CAISO board disagrees with a tariff filing approved by the Governing Body and decides to submit a parallel filing with FERC.

Next Steps and Phases

The Launch Committee also voted to continue developing step 2 of the proposal, which will seek to transfer governance of the WEIM — and its associated future EDAM — to an independent “regional organization” (RO) that the Pathways group expects to establish next year. 

Step 2 poses greater challenges than the first step because it requires convincing the California legislature to pass a bill authorizing CAISO to transfer its authority over a large part of its market to the RO. While the Launch Committee itself will not be participating in those efforts, many of its members will be in their capacities as individual organizations with interests in the change. 

Launch Committee member Spencer Gray, executive director of the Northwest & Intermountain Power Producers Coalition, said step 2 also must address the “core tension” between the two options being considered for the structure of the RO, which relates to “the degree of institutional independence of the regional organization and the financial liability and responsibility that comes along with institutional independence.” 

Gray pointed to the series of “work streams” the Launch Committee has identified for its Phase II work plan, which focuses largely on issues embedded in step 2. The committee has appointed two leads to deal with each stream, which include:  

    • exploring the stakeholder process for the RO, including examining sector-based approaches and how to frame policies; 
    • dealing with CAISO-related issues; 
    • analyzing the existing CAISO tariff, which could entail identifying the functions of a balancing authority under a new market arrangement; 
    • addressing public interest issues, including considering the evolution of the WEIM’s Body of State Regulators; and 
    • addressing RO formation and governance, which would range from incorporation to board nomination to securing funding sources. 

Committee member Lisa Tormoen Hickey, a senior regulatory attorney with Interwest Energy Alliance, told meeting participants the Pathways Initiative will need to secure about $450,000 in funding for its Phase II activities through the end of the year. Those activities will include additional legal review for RO options, proposing an RO stakeholder process, making a final step 2 recommendation, and gathering and publishing stakeholder feedback on the recommendation. 

She said the committee estimates an additional $636,000 will be needed to complete Phase III activities, which will include establishing an RO “formation” committee, developing tariff amendments and bylaws, retaining a placement firm for selecting a board and management team, and monitoring California legislative and CAISO actions. 

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SERC Reports Sufficient Resources in Summer Assessment

The SERC Reliability region is positioned to meet peak demand under normal conditions this summer, although extreme heat and a busy hurricane season could cause concerns for grid operators, the organization said in its 2024 Summer Reliability Assessment released May 30.

SERC produces its summer assessment each year as a complement to NERC’s annual SRA, which the ERO released last month. (See NERC Summer Assessment Sees Some Risk in Extreme Heat Waves.) The report focuses on four key areas relevant to SERC and its subregions — demand, capacity resource adequacy, reserve margins and transmission adequacy — but “does not predict events or weather conditions” during the summer months.

In addition, SERC’s report “focuses on normal summer conditions,” or conditions with a 50% likelihood of coming to pass, while NERC’s assessment also considers an extreme “90/10” scenario (indicating a situation the ERO expects has only a 10% chance of happening). SERC’s assessment does include its summer transmission reliability study, which examines both 50/50 and 90/10 load projections.

In its assessment, the regional entity observed that its “footprint is susceptible to extreme heat, droughts, floods, tornadoes and hurricanes during the summer months.” The region has experienced an average of six heat waves per year over the past decade, compared to two per year in the 1960s. According to the National Oceanic and Atmospheric Administration’s weather forecast for June through August, the 16 states covered by SERC have a 43 to 50% chance of experiencing above-normal temperatures this summer.

NOAA also has predicted an above-normal 2024 Atlantic hurricane season, with 17 to 25 total named storms with winds of at least 39 mph, including up to 13 hurricanes (with winds of at least 74 mph). By comparison, 20 named storms occurred in the 2023 hurricane season, including seven hurricanes. In an average hurricane season, 14 named storms develop, and seven of these become hurricanes. SERC’s report noted the “risk of physical damage and disruption” to power facilities from hurricanes and other extreme weather events.

Along with these risks, the report also highlighted above-normal precipitation predicted across much of SERC’s footprint this summer. The RE warned that heavy rainfall can result in rapid vegetation growth, potentially interfering with transmission lines.

Despite these challenges, SERC emphasized that all its subregions have reported sufficient reserves to meet demand under normal circumstances.

Across the region, total internal peak demand — defined as the projected sum of metered generator outputs and metered line flows into the system, minus metered line flows out of the system — is projected at 262 GW. Total net internal demand — the total internal demand less controllable and dispatchable demand response — is predicted to be 252 GW. By contrast, last year’s actual system peak was 262 GW, against a forecast of 249 GW.

To meet this demand, SERC’s regionwide anticipated resources, including power transfers, stand at 328 GW, with all seven subregions also reporting sufficient internal resources to meet their expected loads. The smallest margin between resources and demand is found in MISO-Central — comprising parts of Illinois, Iowa, Kentucky and Missouri — where 20 GW of resources are available to meet 17 GW of net internal demand.

The region’s generation mix is varied, but SERC expects natural gas to account for just under 50% of generation capacity this summer with 161.4 GW. Coal is next with 64.2 GW at 19.9% of capacity, followed by nuclear energy — including the recently completed third and fourth units at Plant Vogtle in Georgia — at 42.7 GW and 13.2%. (See Southern Credits Strong Southeast Economy for Earnings Growth.)

The RE said fuel availability for gas and coal plants within the region constitutes a potential reliability risk for utilities in the region. SERC also noted severe weather poses a moderate risk of transmission impacts, though it also said its transmission reliability study projected only “localized thermal overloads and no voltage constraints in the SERC region” for both the 50/50 and 90/10 forecasts.

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Monitor Alleges EE Resources Ineligible to Participate in PJM Capacity Market

The Independent Market Monitor filed a complaint May 31 asking FERC to reject all energy efficiency (EE) offers into PJM’s capacity market, alleging that none of them meet the Base Residual Auction (BRA) participation requirements (EL24-113). 

The complaint argues that EE programs that seek to help consumers buy more efficient appliances by entering into agreements with distributors and retailers — known as mid- and upstream programs — are not obtaining consumer-level data or entering into contracts with individual end users. It took aim at the measurement and verification reports of a dozen EE providers, stating they had not included information to demonstrate that installations of more efficient products occurred in a manner that would allow PJM and the Monitor to conduct audits. 

“The reports fail to provide adequate evidence to demonstrate that the included EE measures meet the requirements to be approved and to receive payment. It is unjust and unreasonable to require PJM customers to pay a total of $128 million in the BRA alone for EE MW that have not been demonstrated to meet the requirements to be paid,” the Monitor wrote. 

The complaint asks the commission to either bar the EE providers from receiving capacity market revenues in the 2024/25 delivery year or order PJM and the Monitor to open an investigation to determine eligibility. 

Following the filing, PJM emailed EE market participants that it plans to delay signing off on all post-installation measurement and verification (PIMV) reports supporting EE offers until after the complaint is resolved, which also holds up capacity market payments to EE resources. 

“Delay of PJM action on the PIMV reports provides FERC the opportunity to consider the merits of the IMM complaint,” the email said. “As a result, no payments, deficiency charges and nonperformance charges associated with energy efficiency resources for the 24/25 delivery year will be invoiced to energy efficiency providers until FERC has ruled on the merits of the IMM complaint and PJM approves or rejects the PIMV reports. All replacement transactions associated with energy efficiency providers will be terminated and may be reentered depending on the outcome of this matter at FERC.” 

PJM spokesperson Jeff Shields said the delay affects all EE offers, including components not related to midstream and upstream programs. 

A representative of one of the entities named in the Monitor’s complaint, who spoke on the condition of anonymity, said it’s alarming that PJM opted to withhold capacity market revenues with less than a day’s notice before the start of the delivery year because of a complaint still pending before the commission. 

“From our vantage point, it is hard to see this as anything other than the IMM unilaterally suspending energy efficiency and, for reasons kind of unknown, PJM going along with that and supporting that,” they said. 

They said it fits squarely in the Monitor’s role to scrutinize a particular market participant; however, the complaint appears to target an entire class of resources and enact a policy change through a FERC complaint. They noted that there’s an ongoing stakeholder process focused on the rules around EE measurement and verification that the complaint seeks to sidestep. (See “Stakeholders Regroup on Energy Efficiency Rules After MRC Rejection of Proposals,” PJM MIC Briefs: May 1, 2024.) 

“It’s entirely reasonable and within the IMM’s discretion to take as close a look as he wants at any capacity resources … but to approach it in this fashion, especially in the midst of an ongoing stakeholder dialogue on how to make the rules better — it seems entirely inappropriate,” they said. 

Monitor Joseph Bowring told RTO Insider the complaint addresses a longstanding issue with EE participation in PJM’s capacity market and is meant to ensure consumers are not overpaying for EE under the current rules. He said the complaint is unrelated to stakeholder discussions looking at how the capacity contribution of EE resources is measured and verified. On the approach PJM and stakeholders should take in that forum, Bowring said he believes the tariff does not support the resource class being a part of the capacity market.  

“EE does not belong in the capacity construct at all,” he said. 

Many of the Monitor’s arguments in the complaint echoed those made by PJM as it drafted a proposal to tighten the measurement and verification requirements for EE. During the May 1 Market Implementation Committee meeting, PJM’s Pete Langbein argued it has not been demonstrated that capacity market revenues flowing to EE participants is incentivizing consumers to buy more efficient devices they otherwise would not have. 

“They shouldn’t be able to claim things that are naturally going to occur. … If I’m making a decision to purchase a high-efficiency air conditioner, an EE provider shouldn’t be able to claim that unless they can prove” they incentivized the purchasing of that unit over a less efficient product,” Langbein said in May. 

Stakeholders representing EE providers pushed back, stating that the resource class efficiently provides a guaranteed reduction in consumption over PJM’s load forecast. 

The complaint argues that the party seeking to enter energy savings into the capacity market either must directly control the load reduction or hold a contract with the consumer granting rights to the capacity associated with the energy savings. Without contracts between EE providers and the consumers buying efficient devices, the Monitor also raised the possibility that multiple EE market participants could attempt to include the same load reduction in their capacity offers. 

“There is no evidence that Indicated Energy Efficiency Sellers through midstream and upstream programs provided legally required consideration to any end users for the rights to their projects or products. The Indicated Energy Efficiency Sellers therefore are not the owners of the requisite contractual rights required by the PJM tariff to be eligible to receive revenues from the PJM capacity market,” the Monitor said. 

The Monitor also argued that EE programs that contract with retailers and distributors may not lead to lower costs for consumers buying more efficient devices and that no change in consumer behavior has been demonstrated. 

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$1B Committed so far to Floating Offshore Wind Shot

The U.S. Department of Energy has issued an update on federal efforts to speed up development and deployment of floating wind turbines. 

The DOE progress and priorities report lays out more than 50 milestones reached since the Floating Offshore Wind Shot was launched in September 2022. 

The initiative is part of the Biden administration’s Energy Earthshot program. The departments of Commerce, Energy, Interior and Transportation are collaborating in the hopes of reducing the cost of floating turbines by 70% and installing 15 GW of total floating wind capacity by 2035. 

Floating wind turbine technology is more expensive and complex than the widely used fixed-bottom turbine designs. Also, the first large-scale floating wind projects are in planning stages in other countries. There is no operational history at scale in U.S. waters, nor is there the specialized infrastructure to build it.  

Most of the 50-plus milestones listed in the report are research and/or funding initiatives intended to change this.  

With large swaths of U.S. coastal waters too deep to affix turbine foundations to the seabed, the Floating Offshore Wind Shot is designed to allow fuller use of this emissions-free power source. DOE reports that more than $950 million has been devoted to the initiative in the past 20 months. 

Near-term priorities summarized in the report include: 

    • cost reduction — by researching resource assessment, design, modeling, manufacturing, operations and maintenance; 
    • supply chain development — by identifying gaps and solutions to inform decision-making, and mobilizing investment through federal programs and lease bidding credits; 
    • expanding just and sustainable development — by increasing the involvement of tribal leaders, fishers and communities while increasing workforce development; 
    • transmission development — with in-depth offshore wind transmission studies, improved planning tools and advancing critical components; and 
    • developing co-generation opportunities — with analyses of hydrogen generation and energy storage options, and effective designs and demonstrations. 

Featured accomplishments include: 

    • DOE announced $38 million for six projects to develop floating offshore wind designs through the Aerodynamic Turbines Higher and Afloat with Nautical Technologies and Integrated Servo-control (ATLANTIS) Program. 
    • DOE launched the $6.9 million Floating Offshore Wind ReadINess (FLOWIN) prize to develop the domestic supply chain. 
    • DOE provided more than $18 million to support research and development of HVDC voltage source converter systems and standards, controls and curricula. 
    • DOT awarded $427 million to establish the first West Coast offshore wind terminal, through the Humboldt Bay Offshore Wind Project. 
    • DOE funded research to model and analyze the levelized cost of hydrogen for de-centralized offshore-wind-to-hydrogen systems. 
    • DOI held the first floating offshore wind lease auction off the coast of California in 2022 and designated wind energy area lease auctions off the Maine and Oregon coasts in 2024. 
    • DOI and DOC expanded the Sea Grant Offshore Wind Liaison Program to the West Coast to ensure continued engagement with the communities there. 
    • DOE completed a study on the impacts of developing a floating offshore port network on the West Coast that will inform future collaboration efforts. 
    • DOE convened local stakeholders to discuss key transmission needs on the West Coast. 
    • DOE-funded projects along the Pacific Coast began collecting data to support monitoring the presence of birds, bats and marine mammals in areas where wind turbines may be sited, and to develop autonomous monitoring for marine organisms and the seabed. 

DOE concluded its report by saying much more is needed if floating wind goals are to be met and said continued collaboration by stakeholders is important. It said regular summits are planned, along with periodic updates as needed to the summary report. 

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ISO-NE Expects to Have Sufficient Resources for the Summer

ISO-NE expects to have adequate resources to meet its projected 24,553-MW peak load this summer, the RTO announced as part of its summer outlook, released June 3.  

The ultimate outcome will be highly dependent on weather, ISO-NE said, estimating there is a 10% chance the peak load exceeds 26,383 MW. The RTO anticipates having about 30,000 MW of capacity available.  

“While the ISO expects the region to have adequate supplies of electricity this summer, abnormal conditions could force system operators to take action to maintain system reliability,” ISO-NE wrote in a press release. “Climate change has caused weather to become more volatile and less predictable, increasing the potential for system operators to resort to these actions.” 

Weather is the region’s “largest driver of energy use,” ISO-NE noted, adding that hot and humid conditions coupled with unexpected generator outages would be especially difficult to manage. 

ISO-NE’s demand forecasts are based on weather data from the prior 30 years, but they do not consider climate forecasts or more granular climate trends.  

Data from the National Oceanic and Atmospheric Administration indicate average and maximum summer temperatures have been trending up in the Northeast over the past 30 years. Average temperatures for summer months have increased by about 0.4 degrees per decade since 1993, while maximum temperatures have increased by about 0.3 degrees per decade. 

Average summer temperatures in the Northeast, 1993-2023 | NOAA

“Just a 1-degree change in temperature can impact the load and demand in New England significantly — by half a gigawatt or more,” Mike Fontaine, supervisor of operations forecasting for ISO-NE, said in a video released in May. 

ISO-NE has indicated it plans to incorporate climate modeling into demand projections starting in 2025. (See ISO-NE Decreases Its 10-year Peak Load Forecast.) 

The RTO also highlighted the role behind-the-meter (BTM) solar has played in reducing peak demand, noting that it is responsible for approximately a 1,000-MW reduction in the summer peak. The roughly 7,000 MW of BTM solar capacity in the region has pushed the timing of the peak from midafternoon to early evening, ISO-NE added.  

The forecast also includes just over 2,000 MW of energy efficiency, ISO-NE said, while dispatchable active demand response is counted as a supply-side capacity resource.  

This summer will be the first following the retirement of the Mystic Generating Station, which was once New England’s largest fossil power plant. ISO-NE said it is “not projecting any capacity issues during the summer based on this retirement.”

The 24,553-MW peak projection would be an increase over the 2023 peak load of 24,043 MW, which occurred Sept. 7.  

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FERC Approves SPP’s Cost-allocation Revisions

FERC on May 31 accepted SPP tariff revisions that will allow certain transmission facilities’ costs to be entirely allocated on a regional postage-stamp and cost-by-cost basis, effective June 1, 2024 (ER24-1583). 

The commission found SPP’s capacity, flow and benefit analyses of the Sunflower Electric Power transmission facilities at the center of the proceeding provided benefits to the region as a whole. It said the grid operator demonstrated that its proposal will allocate the facilities’ costs in a manner “at least roughly commensurate with estimated benefits, consistent with the cost-causation principle.”  

SPP’s analysis demonstrated that Sunflower’s “wind-rich” transmission zone had generation capacity that greatly exceeded its load. Flow analyses demonstrate that more than 70% of the power flows over the utility’s byway facilities are from generation unaffiliated with the zone’s load. 

“We find that SPP’s capacity and flow analyses demonstrate that electricity generated from resources inside the Sunflower zone is being used by load outside of the Sunflower zone and that the Sunflower byway facilities are being used to deliver this electricity,” FERC said.  

“The entire SPP region benefits economically,” from Sunflower’s facilities, the commission said. “We find that the proposed 100% regional, postage-stamp cost allocation will allocate the remaining costs of the transmission facilities in a manner that is at least roughly commensurate with benefits received and, therefore, is just and reasonable.” 

SPP allocates one-third of the cost of byway projects — on lines rated at 100 to 300 kV — to the RTO’s full footprint, with customers in the transmission pricing zone where the project is built being allocated the rest. “Highway” projects — those larger than 300 kV — are allocated RTO-wide. 

FERC rejected protests that the proposed allocation for the byway facilities’ remaining costs is inappropriate because those facilities were built to address zonal reliability issues or forecast load growth that never was realized, rather than regional needs. It said other arguments were that SPP’s analysis was “insufficiently granular” to determine whether the entire region would receive benefits at least roughly commensurate with costs. 

“We emphasize that cost-allocation precedent does not require such ‘exacting precision’ in the commission’s cost-allocation decisions,” FERC said. “We find that a granular zone-by-zone benefits analysis is not necessary to find that SPP’s proposal to allocate the remaining costs of the Sunflower byway facilities on a 100% regional, postage-stamp basis is just and reasonable.” 

The commission rejected SPP’s initial 2021 proposal to establish a process allowing entities to petition the RTO’s Board of Directors for exceptions from the highway-byway cost-allocation methodology. FERC accepted a revised proposal in 2022 in a 3-2 decision, only to reverse course in 2023 after several rehearing requests. (See FERC Reverse Course on SPP Byway Cost Plan.) 

Sunflower has advocated for relief from the highway/byway process since 2017. Transmission owners largely have opposed the proposal as it wound its way through the stakeholder process, saying it would shift byway cost responsibility from wind-rich areas to others. 

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Extreme Weather Workshop Hit by Extreme Weather

DALLAS — Attendees at a recent NERC and EPRI workshop on a draft standard addressing extreme weather’s effects on transmission planning now have a more personal understanding of those impacts. 

Violent thunderstorms ravaged North Texas on May 28, the day before the workshop began, knocking out power to about 1 million Texans and leaving destruction in its wake. Several speakers and attendees were unable to fly into the Dallas area’s two airports after numerous flights were canceled. Those who did arrive found restaurants and entertainment options closed, thanks to the outages. 

It didn’t get any better as the workshop adjourned May 30: Another line of storms rolled through the DFW Metroplex, forcing the cancellation or delay of flights out of the airports.  

“It’s very ominous to begin a workshop focused on extreme weather with extreme weather,” Eknath Vittal, a senior principal technical leader in EPRI’s transmission operations and planning department and the workshop’s moderator, said May 29 in opening the workshop. 

Pattel guided the diverse group of climate experts from national labs, research and development organizations, and other entities through a discussion of extreme weather and its implications for FERC Order 896 and NERC’s upcoming TPL-008 draft standard regarding extreme weather’s effect on transmission planning.  

The commission’s 2023 order directed NERC to update TPL-001-5.1 (transmission system planning performance requirements) or draft a new standard by December 2024 that addresses a lack of long-term planning requirement for extreme weather events. (See FERC Approves More Extreme Weather Rules.) 

FERC’s requirements included: 

    • developing benchmark planning cases based on major prior extreme weather events and/or meteorological projections. 
    • planning for extreme weather events using steady state and transient stability analyses expanded to cover a range of extreme weather scenarios, including the expected resource mix’s availability during extreme conditions. 
    • using corrective action plans that mitigate any instances where performance requirements are not met. 

The NERC drafting team’s initial work product “failed miserably,” as PJM team member Michael Herman said, on its first ballot. The team is reviewing the comments it received before determining next steps, he said. 

“We’ve been reading the comments that everyone has submitted about this,” Herman told his audience. “We’re taking that information and we’re working internally to process that information, and to determine what changes we need to make to the standard in order to address the concerns that all of you brought up.” 

Herman says the drafting team will work to improve the standard’s language to better consider wide-area — entire reliability coordinator areas and critical flow and status information from adjacent RC areas — impacts and setting study area boundaries based on the benchmark events’ planning coordinator or planning coordinator requirements.  

“In general, we see a lot of need here to bring online nuances to these studies, not just with respect to the defining the benchmark events, but actually the assumptions that go into the analysis itself,” he said. 

A second draft is expected to be released for a second ballot in July. The drafting team will consider the need to define wide-area studies, bounding coordination requirements within a single interconnection and whether additional details are needed to specify addressing impacts on/from adjacent systems. 

Vittal said the TPL-008 process won’t take as long as the original standard, which took five years to approve.  

“Well, there’s the FERC directive behind it, so that kind of dictates the timeline in a way that might not apply to other standard-development processes,” he said. “That’s driving things at a little more pace.” 

“This conference raises a lot of questions about how much data and how much analysis should be put into [the standard] because there’s a lot of assumptions and a lot of uncertainties that still require a lot of engineering and regulatory judgment,” said SPP’s Charles Yeung, executive director of interregional affairs.  

He said the standard still will need a lot of work but that the workshop laid out a set of questions that will be tackled in the development process.  

“I think it’s very valuable to do that upfront, rather than having to go through this iteration of postings and Q&A,” Yeung said. “This is definitely helpful because this is clearly something that’s not done in the planning horizon. So how do you translate all that analysis into a planning horizon? That’s going to be the challenge because the conditions and risks are very different going out far in the future than they are a week in the future.” 

SPP’s Jonathan Hayes asks a question during a workshop on an extreme weather standard as NERC’s Eknath Pattel listens. | © RTO Insider LLC

Creating the benchmark planning cases will require exchanging information on who develops the case, the weather variables that will affect inputs and assumptions, and how planning coordinators will coordinate case development with other PCs.  

The standard drafting team envisions coordination among adjacent affected PCs to include sharing all applicable modeling and contingency data and understanding the benchmark event being studied by adjacent impacted PCs.  

“Every time I talk to anyone in industry about what we’re trying to do … they’re so impressed because we’re trying to take on something that has not been done before,” said Soo Jin Kim, NERC’s vice president of engineering and standards. “When NERC first came into existence … it was in whether or not we had enough capacity on the system. That’s no longer the case anymore. Now with our changing resources, with almost all of the generation projects coming into the interconnection queues being renewable resources, we have to run our system very differently.” 

Kim said other planning projects are on the horizon once TPL-008 is completed. She acknowledged the industry is “a little tired” of all the standards projects in play and asked for patience as NERC works to address severe weather effects. 

“We do think it’s important that we continue to grow, and we continue to make sure that the momentum moves forward,” she said. “We’re now at a point where we have to keep up. I think it’s very important that we get ahead of the issue, and then we’re not playing catch-up for the next two years.”