ACP-California
Submitted 09/18/2024, 03:56 pm
Submitted on behalf of
ACP-California
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
ACP-California appreciates CAISO’s recognition of the challenges caused by the long development timelines for transmission that the industry is currently facing and, in particular, how those interact with the proposed revisions to the TPD allocation process. While we appreciate CAISO’s interest in bringing forward creative solutions, as CAISO heard from many stakeholders during the working group meetings, it is not viable/beneficial to bring projects online earlier as energy-only. Instead, other solutions are necessary to better align generation development timelines, commercial activity, and the timelines from completion of deliverability network upgrades. In the next iteration for the proposal, CAISO should include example timelines to illustrate how these elements can align in a workable manner.
As CAISO develops an updated proposal, ACP-California encourages CAISO to consider whether it is appropriate to increase the number of opportunities that projects would receive to secure a deliverability allocation from three (as proposed in the July 2024 proposal) to four. Of course, the final decision about whether this is appropriate needs to be considered in the context of the CAISO’s proposal as a whole and how the various elements interact with one another. But we encourage CAISO to consider providing four opportunities for a TPD allocation as part of the solution set.
We also encourage CAISO to consider whether additional deliverability groups should be added to recognize commercial structures that are not as firm as a PPA. For instance, options contracts to enter into a PPA at a later date, conditional PPAs, etc. could be added as new types of deliverability allocation groups. If CAISO explicitly created a deliverability allocation group for these less firm types of contracts, it may drive the market towards creative solutions that provide better alignment with the various timelines, including the long transmission development timelines generators and offtakers are facing.
Ultimately, ACP-California appreciates CAISO’s recognition of the problem statement and looks forward to reviewing the next version of the proposal and continuing to contribute ideas to improve the deliverability allocation process in light of the current transmission and generation development environment. Once the process has been developed and the timelines/requirements are better understood, CAISO should evaluate if any of these modifications should apply to earlier clusters to address the disconnect between commercial timelines and transmission development horizons.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
Again, ACP-California appreciates CAISO’s recognition of the challenges created by long development horizons for network upgrades. Specific to reliability network upgrades, we encourage CAISO to continue evaluation of an approach that might allow some of these projects to proceed for approval through the Transmission Planning Process (TPP). Developing a mechanism that allows “least regrets” reliability network upgrades to be approved and constructed in a more timely fashion will benefit the state’s reliability and clean energy goals and is worth continued exploration.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
ACP-California understands that CAISO is already reserving deliverability for certain Long Lead-Time resources. We continue to support this effort and agree that CAISO has existing authority to reserve capacity in this way. We also request additional transparency on what types of resources qualify for reserved deliverability (perhaps according to an LRA),and the MW quantity that is being reserved. To the extent any of this “reserved” deliverability has been allocated, CAISO should disclose the MW of deliverability that has already been allocated and where on the system. ACP-California is not asking for any sensitive project information to be disclosed but does believe aggregated information on the capacity being reserved, types of resources it is being reserved for and what (if any) deliverability has already been allocated to these resource types would be helpful for all stakeholders and interconnection customers to understand. We encourage CAISO to provide this type of transparency as soon as possible.
ACP-California supports CAISO’s development of deliverability processes tailored to the specific needs of Long-Lead Time resources that meet the defined resource technology and policy goals of local regulatory authorities. These process solutions are distinct from the deliverability reforms needed for long transmission development timelines affecting all resource types in the CAISO system, and discussed in Question 2, above. Deliverability process accommodations for Long Lead-Time resources should enable Long-Lead Time projects to proceed through the interconnection and deliverability processes in alignment with their development and procurement timelines, and without being converted to Energy Only prematurely. As such, ACP-California agrees with many stakeholders at the workshops that there is a need to separately consider what processes, or special provisions may be required for Long Lead-Time resources to compete for, receive, and retain a deliverability allocation. And we note there is a need to also consider the alignment of timelines for Generator Interconnection Agreement tendering, execution, and associated financial requirements given the unique technological challenges and contracting processes for Long Lead-Teim resources.
However, we urge CAISO to consider this issue, and the unique needs of Long Lead-Time resources after there is a better understanding of the “standard” deliverability allocation rules that will go forward as part of this stakeholder initiative. In other words, the consideration of TPD allocation rules for Long Lead-Time resources should be sequenced after the CAISO puts forward a proposal for addressing the standard deliverability allocation procedures and challenges with long development timelines for transmission upgrades.
Once the “standard” deliverability allocation process is well defined, CAISO should work with stakeholders to develop a framework for the modifications needed to accommodate LLT resources and, moreover, for how the CAISO will resolve competition among eligible resources for the same reserved deliverability. At this time, the CAISO may also consider how and when to apply new processes for LLT deliverability awards and retention within the larger interconnection framework.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
Without the benefit of a comprehensive proposal to comment on, it is difficult to understand how all of the proposed reforms might function together. Despite that, ACP-California continues to believe that Group D should be retained, at least for a period of time, given the long transmission development timelines the industry is faced with. While ACP-California would prefer to see Group D retained and the available TPD for this group not serve as a reduction to the TPD capacity for future clusters, we understand the challenges and complications that would bring (as highlighted in the working group discussion on ACP-California’s “Conditional Deliverability” proposal). For the proposal at hand, we encourage CAISO to retain Group D and to continue to work towards future enhancements, including potentially adding new allocation groups for commercial arrangements that are significant, but less firm, than a PPA. These could include options contracts or agreements to enter into a PPA at a later date and could serve as a potential replacement for Group D in the future.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
ACP-California appreciates the opportunity to have presented on the “Conditional Deliverability” concept. We also understand the complications and study modifications that may be required to implement a proposal of this nature and, moreover, understand CAISO’s reluctance to further complicate the deliverability allocation study process and procedures. We are pleased to hear that, in response to stakeholder discussions, CAISO is considering retention of Group D. While we continue to believe that a Group D allocation which does not result in a reduction to the deliverability available for future clusters would be a preferable approach, we are willing to concede that the challenges of implementation may not be worth pursuing at this time. Thus, we look forward to considering other alternatives, like the overall retention of Group D, in the next proposal.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
ACP-California appreciates EDF Renewables’ presentation. It highlights many of the ongoing challenges and outlines that there are other commercial structures, which are not as firm as a fixed-price PPA, which may be able to be leveraged in the deliverability allocation process. As stated above, ACP-California supports CAISO exploring whether additional deliverability groups should be added for commercial structures that are not as firm as a PPA (e.g., options contracts, conditional PPAs).
7.
Please provide any additional feedback:
ACP-California looks forward to CAISO’s next iteration of the proposal for Track 3 of IPE and to considering how all of the proposed reforms will work together. As stated in these comments, we urge CAISO to focus on developing the standard rules for deliverability allocations and, subsequently, to consider the provisions required for Long Lead-Time resource deliverability allocation and retention.
AES
Submitted 09/18/2024, 11:06 am
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
The CAISO should not adopt its suggestion to allow a PPA to operate as an Energy-Only (EO) prior to becoming FCDS for projects behind long lead-time Deliverability Network Upgrades (DNUs). While attendees suggested that this path could work for solar and wind, AES agreed with stakeholders on the call that this proposal will not make storage viable. Storage’s cost recovery is highly dependent on its ability to provide resource adequacy (RA). Unless the CPUC’s resource adequacy rules are revised to allow “interim” RA for storage resources during the EO years, storage resources would not be viable under this framework. Otherwise, AES recommends the CAISO to consider longer-term “interim” deliverability.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
AES asserts that there are significant development risks associated with contracting with projects with CODs far in the future. As noted by SCE and CalCCA on the August 28, 2024 workshop, projects are unable to commit to a binding PPA price for projects with far out CODs. Equipment costs could become variable in the future as technology changes. In addition, other development risks could exist, such as permitting. This proposal could only work if projects can enter into a price range PPA agreement with LSEs to account for the future pricing uncertainty and exist clause structures that minimize PPA termination fees if a project needs to withdraw. To address the issue of long lead time RNUs, AES encourages the CAISO to explore a funding mechanism similar to the CAISO’s Location Constrained Resource Interconnection Facility (LCRIF) process to allow for cost sharing.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
AES seeks clarity on how CAISO intends to reserve TPD capacity for long lead time (LLT) resources and whether reserving the capacity for LLT would result in less TPD available for short lead time resources. AES agrees with stakeholders on the September 4, 2024 workshop that increased transparency is critical.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
AES supports removing TPD Allocation Group D. AES resonates with CAISO’s reasoning that continuing Group D would reduce the capacity of projects in the future cluster studies. As CAISO contemplates increasing the attempts for TPD allocation from three to four, AES believes that there will be sufficient time for FCDS projects to see a PPA or be shortlisted. Projects in Group D are likely not as commercially ready compared to projects in Groups A-C and may slow down the study process with low probability of being awarded TPD. If the scoring criteria values commercial interest for queue entry, AES thinks that the TPD allocation process should be mirrored. Retaining Group D may divert from the intention of the purpose of linking procurement with the interconnection process. While AES appreciates ACP-CA’s proposal to retain Group D conditionally to eliminate the need to reduce capacity in future clusters, AES notes that this may create a potential for overprescription of conditional deliverability than what is actually available.
Retaining Group D will also decrease the ability for future clusters to be awarded TPD. Given that there is no TPD reservation system for projects entering the study process under the 150% queue cap, projects will have to rely on the chances to receive TPD allocation (i.e. 2/3 probability given that the queue cap is 150%). Adding Group D projects will decrease the probability given that more projects are competing for deliverability; this may ultimately undermine the purpose of the IPE to align the planning processes with interconnection.
In the case that Group D is eliminated, AES seeks clarification on the treatment of previous projects that were allocated TPD under Group D. Will previously allocated projects in Group D have grandfathered rules to follow?
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
AES continues to support the removal of Group D, as noted above.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
7.
Please provide any additional feedback:
Revised TPD Schedule
AES generally supports the proposed revised TPD allocation process and schedule. However, AES recommends the CAISO to consider extending the 2nd Interconnection Financial Security (IFS) posting deposit deadline for parked projects from the 2024 TPD allocation cycle. Under the current tariff, parked projects have a 12-month extension for their 2nd IFS postings. An extension would allow projects to attempt the TPD allocation process prior to making the 2nd IFS posting. With the delay of the 2025 TPD allocation cycle to conclude in March 2026, the CAISO to allow additional extension for parked project’s deposit to match the 2025 TPD allocation study delay.
Ensuring TPD Capacity is Available for Competition from Queue Entry to TPD Allocation
AES urges the CAISO to continue to consider a mechanism to reserve TPD capacity for clusters based on the 150% TPD MW they were admitted based on during the study process. At a minimum, CAISO should ensure that 100% of the 150% TPD capacity is available for the cluster to compete for. AES understands the CAISO’s concern that a reservation process can “tie up” capacity because older projects that are further in development would not have access to deliverability that is reserved for newer clusters. However, given that commercial interest arrangements are made for projects at the beginning of the study process, there should be a mechanism for projects to be sure that the TPD capacity will still be available for competition at the time of TPD allocation studies.
California Community Choice Association
Submitted 09/18/2024, 02:08 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
The California Community Choice Association (CalCCA) appreciates the opportunity to comment on the Track 3A working group meetings. The working group is seeking resolution on three categories of issues:
- Transmission Plan Deliverability (TPD) allocation issues for projects with long lead-time (LLT) or delayed Deliverability Network Upgrades (DNUs) approved in the ISO Transmission Planning Process (TPP).
- TPD allocation issues for projects with long lead-time or delayed Reliability Network Upgrades (RNUs) where the RNU only moves forward if funded by the projects needing the RNU.
- TPD allocation issues for long lead-time resources that meet the defined resource policy goals of local regulatory authorities for specific technologies and project locations.[1]
For the first issue, the California Independent System Operator (CAISO) put forth a potential solution that would increase the number of projects that would be able to come online in the near term as energy-only (EO) but must wait some period of years before being given full capacity deliverability status (FCDS). The CAISO asks, “Could a [power purchase agreement (PPA)] that allows a project to operate as [EO] for some period of time before becoming FCDS be a viable option?”[2]
The answer to this question is heavily dependent on the project’s ability to count for load-serving entity (LSE) compliance obligations (RA, Integrated Resource Plan (IRP), Renewable Portfolio Standard (RPS)) while the resource is EO. RA and IRP compliance programs currently require resources to have FCDS to count for compliance, with limited exceptions like the requirement to show excess capacity to charge co-located storage. For the CAISO’s proposed solution to be viable, the CAISO and the California Public Utilities Commission (CPUC) would both need to recognize these projects for RA and IRP compliance while they are EO. LLT DNUs take years to complete and if projects would not count for LSEs’ compliance obligations during this time, it would not be viable for them to finance these projects.[3]
If the CAISO and CPUC count projects that start as EO, which then receive FCDS after DNU completion, towards compliance obligations during the time they are EO, the CAISO’s proposed solution could be a viable and effective solution to the issue of LLT or delayed DNUs delaying interconnection of capacity seeking FCDS. It is unreasonable for LSEs procuring EO projects with expected future deliverability, at CAISO’s invitation, to bear the risk that these resources will be unable to satisfy CPUC requirements. The CAISO should therefore pursue this solution in collaboration with the CPUC.
[1] 2023 Interconnection Process Enhancements: Track 3A Working Group Meeting (Aug. 28, 2024) (CAISO Presentation) at 10: https://stakeholdercenter.caiso.com/InitiativeDocuments/2023-IPE-Track-3A-8-28-24-Working-Group.pdf.
[2] CAISO Presentation at 12.
[3] It is possible that an EO resource could be viable to meet an LSE’s RPS requirements. However, under the current needs for countable capacity to meet IRP and RA, LSEs will have a strong preference for FCDS to meet those requirements.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
The CAISO states that “contracting with projects with earliest achievable commercial operation dates further into the future (beyond 5-7 years) could allow projects with LLT [reliability network upgrades] to obtain an allocation of TPD within the 3 (or 4) opportunities they have to seek an allocation of TPD.”[1] It asks if there are significant issues that make contracting for projects further into the future inappropriate. Contracting for projects further into the future can be problematic because it puts risks on LSEs and/or developers who do not yet know the estimated development costs or upgrade costs of the projects, the timing of those upgrades, or the likelihood that the projects will receive deliverability allocations. Solutions that depend on contracting further into the future need to be carefully considered and understood by LSEs and developers who will need to protect themselves against the risks of contracting before all the development and interconnection costs and timelines are known.
[1] CAISO Presentation at 13.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
The CAISO asks parties if special/unique TPD allocation criteria should be developed for LLT resources that meet the defined resource policy goals of local regulatory authorities so that they are not at risk of being converted to EO before procurement begins for these resources.[1] Unique TPD allocation criteria will be necessary for LLT resources such as offshore wind (OSW), out-of-state wind, and geothermal. These resources currently have longer project development cycles than other renewables and may not be compatible with a new process that converts projects to EO after some time.
The CAISO’s presentation seems to contemplate this question within the context of the central procurement entity (CPE) as the only entity procuring these LLT resources. The CAISO must take a more expansive view of LLT resources to avoid discriminating against LSEs that are also pursuing LLT resources. CCAs, for example, have already procured geothermal,[2] long-duration energy storage,[3] and out-of-state wind[4] resources and are interested in a pathway to eventually procuring OSW themselves.[5] The CPUC adopted D.24-08-064 “with the explicit intent not to interfere with LSE procurement”[6] and the CAISO should support this intent by adopting uniform TPD allocation criteria for LLT resources regardless of the procuring entity. For example, if the CAISO reserves TPD for offshore wind, it should allow that reserved TPD to be allocated to OSW procured by CPEs or LSEs. The CAISO should adopt a similar scope as it did in Track 2 of this initiative, where both CPE resources and resource types designated by the CPUC in their TPP portfolio are counted as LLT for the purposes of allocating TPD.
While the CAISO has stated its intent to review out-of-state wind in this process,[7] the CAISO should clarify on how it will integrate TPD reservations for any unknown out-of-state resources when compared to resources interconnecting to the CAISO controlled grid. This is particularly important to LSEs attempting to meet their IRP requirements who have an allocation of points and would like to have an out-of-state resource considered to meet their needs. Further, such a process must also examine how the CAISO would allocate Maximum Import Capability if an LSE places points on an out-of-state resource and/or if there is a separate process for allocating deliverability to LLT resources.
[1] Id. at 14.
[2] Summary of Compliance with Integrated Resource Planning (IRP) Order D.19-11-016 and Mid Term Reliability (MTR) D.21-06-035 Procurement (Aug. 2023) at 42-43: https://www.cpuc.ca.gov/-/media/cpucwebsite/divisions/energy-division/documents/integrated-resource-plan-and-long-term-procurement-plan-irpltpp/publicirpcompliancereport080123.pdf.
[3] Id.
[4] Howland, Ethan, Pattern Energy Secures $11b in Financing, Starts Full Construction on Sunzia Wind, Transmission Projects (Jan. 3, 2024): https://www.utilitydive.com/news/pattern-energy-sunziatransmission-wind/703508/.
[5] California Community Power and CADEMO Execute Offshore Wind MOU: https://cal-cca.org/california-community-power-and-cademo-execute-offshore-wind-mou/.
[6] D.24-08-064, Decision Determining Need for Centralized Procurement of Long Lead-Time Resources, R.20-05-003 (Aug. 29, 2024) at 51: https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M539/K202/539202613.PDF.
[7] 2023 Interconnection Process Enhancements, Track 3-A Revised Straw Proposal and Track 3-B Straw Proposal (July 8, 2024) at 23: https://stakeholdercenter.caiso.com/InitiativeDocuments/Track-3A-Revised-Straw-Proposal-Track-3B-Straw-Proposal-Interconnection-Process-Enhancements-2023-Jul-05-2024.pdf.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
CalCCA has no comments at this time.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
ACP-CA states that “the long development timelines for transmission make the proposed elimination of group D particularly concerning,” and proposes instead to provide a pathway to deliverability prior to a project receiving a shortlist position or PPA through a new “Conditional Deliverability” group.[1] The CAISO would allocate more “conditional deliverability” than the “standard” TPD available, then allow projects with conditional deliverability to compete for standard deliverability. Conditional deliverability would remain available for future clusters.
CalCCA appreciates ACP-CA’s thoughtfulness in developing a solution to the problem of LLT upgrades holding up deliverability allocations. ACP-CA’s proposal, however, raises several questions that must be addressed before determining whether this solution is viable. These questions stem largely from the fact that ACP-CA’s proposal would allocate more conditional deliverability than standard deliverability. For example, if conditional deliverability remains available for future clusters, at what points in the process would a project with conditional deliverability know whether it will be converted to standard deliverability? How would projects with conditional deliverability and a PPA compete with projects in later clusters when both are seeking standard deliverability? What is the benefit of providing conditional deliverability, when the retention of deliverability to Group D projects is already conditional upon the project receiving a PPA? These questions should be further explored to determine if ACP-CA’s proposal provides enough certainty to an LSE that an LSE signing a contract with a Group D project with conditional deliverability will receive standard deliverability.
[1] Revised Group D Treatment, ACP-California Proposal from Prior Comments with Hypothetical Examples (Sept. 4, 2024): https://stakeholdercenter.caiso.com/InitiativeDocuments/Presentation-ACP-CA-Group-D-Conditional-Deliverability-Presentation-Sep-04-2024.pdf.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
CalCCA has no comments at this time.
7.
Please provide any additional feedback:
CalCCA has no additional feedback at this time.
California Public Utilities Commission - Energy Division
Submitted 09/18/2024, 06:06 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
Note: As many stakeholders know, CPUC staff participates in the CAISO-led Transmission Development Forum, as well as the Tracking Energy Development (TED) Task Force which coordinates activities and information from several state agencies and the CAISO. The CPUC also manages the Transmission Project Review Process which reviews IOUs’ capital transmission projects, allowing the CPUC and stakeholders to receive robust data from Transmission Owners and provides transparency on the IOUs’ current and forecast transmission projects.
All these ongoing initiatives provide useful information to generator developers, load-serving entities (LSEs) and interested stakeholders about the status of specific transmission upgrades.
Long lead-time projects face a “chicken and egg” challenge. Which comes first: getting a signed PPA prior to a deliverability allocation or ensuring that a project with a PPA will get deliverability? How to align commercial decisions with the allocation of deliverability for a project?
CPUC staff would like to enable ways, potentially in the integrated resource planning process (IRP), to provide better certainty for long lead-time resources that are dependent for their deliverability allocation upon completion of TPP-approved transmission projects. CPUC staff encourages reasonable and fair incentives for PPAs to be signed before a project receives a deliverability allocation. We also hope to contribute to any CAISO efforts to increase the level of certainty that projects with PPAs will likely get a timely deliverability allocation.
While we favor diminishing incentives for projects to jump into the queue mostly to save a spot to seek deliverability, we recognize that developers and LSEs can better judge the usefulness of adding a fourth opportunity to seek an allocation. We note, however, that maintaining Group D (with or without restrictions on material modifications or changing COD) could significantly impact the ability of long lead-time resources to gain deliverability because the amount of capacity available in future Clusters would likely be reduced.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
CPUC staff encourages consideration of a “least regrets” approach for identifying substations or other transmission infrastructure in certain zones that is likely to be needed for future interconnection of preferred resources. We anticipate that criteria and analysis would be developed, including potentially additional analysis in the CPUC led TPP portfolio development and busbar mapping work, to identify such transmission facilities through the TPP, rather than waiting for interconnection studies to identify such needed facilities. A key factor that should be considered in this approach is the level of risk that these facilities may be stranded if resources are not developed in those areas.
CPUC staff supports exploring with CAISO and stakeholders to develop this proactive approach, which would accelerate development of some transmission facilities that will likely be needed for interconnection of certain long lead-time projects and, we hope, incentivize contractual arrangements with such long lead-time projects. We are eager to coordinate with CAISO to determine which projects might be incorporated within TPP, recognizing that such action will change the cost responsibility for such upgrades.
Developing a process for “least regrets” inclusion in the TPP would entail specifically identifying areas where renewable development and transmission development are likely under a broad range of scenarios. We anticipate this unique kind of policy support would reduce uncertainty whether and when Reliability Network Upgrades would be built, thereby providing more certainty for long lead-time resources.
We also anticipate that further development by CPUC staff, and eventual implementation of, the Reliable and Clean Power Procurement Program (RCPPP) will generally help LSEs and developers to enter contracts with longer lead times. RCPPP is intended to improve upon the current order-by-order procurement approach in IRP by establishing and maintaining ongoing requirements for LSEs to contract with resources for reliability and greenhouse gas reduction.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
CPUC staff strongly supports reserving transmission capacity to ensure deliverability for specific resources that are identified in the TPP portfolios.
CPUC staff first noted back in the January 2022 comments to the CAISO’s 2021 IPE Issue Paper and Straw Proposal that “A mechanism for withholding transmission capacity for the achievement of policy goals can help ensure resource diversity. This is especially the case if this mechanism prioritizes large, long lead-time, or locationally constrained resource types.” Further, this would be consistent with the CPUC’s joint request with the California Energy Commission that CAISO preserve sufficient transmission capacity for specific out of state resources in its 2022-2023 TPP to ensure deliverability of policy-driven long lead-time renewable resources.
We anticipate coordinating with CAISO to develop a process to identify what resources could be eligible for transmission capacity reservation, and under what circumstances we might consider stopping the reservation.
CPUC staff anticipates that resource types being centrally procured by a state agency – such as offshore wind -- would be likely eligible for capacity reservation, but that other resources may also be considered.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
CPUC staff is concerned that maintaining Group D (with or without restrictions on material modifications or changing COD) could significantly impact the ability of long lead-time resources to gain deliverability because the amount of capacity available in future clusters would likely be reduced. Additionally, maintaining Group D could encourage more exploratory projects to continue entering the queue earlier than necessary and sit longer in the queue, limiting access to further developed projects seeking to enter at later dates.
CPUC staff continues to support one of the key goals of the IPE process, which is to transition to a queue with a manageable number of projects so that interconnection studies can provide meaningful results.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
CPUC staff has no comment at this time.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
CPUC staff has no comment at this time.
7.
Please provide any additional feedback:
CPUC staff would express concerns if implementation of broad auction use would likely lead to increases in the cost of resource development and those costs would then be passed on to the ratepayers.
We recognize that a limited auction process may occur under the CAISO’s recent IPE proposal that is currently under FERC review, but such a process would be used only in limited “tiebreaker” situations where certain projects had the same commercial interest scores and the same distribution factors.
A proposal for a broader, more frequently used auction process to determine which projects are allocated deliverability would likely be opposed by CPUC staff, if it led to increases in costs to ratepayers without corresponding benefits.
California Wind Energy Association
Submitted 09/18/2024, 04:54 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
No comment at this time.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
No comment at this time.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
- Resources that should qualify for TPD capacity reservation.
During the Sept. 4 workshop, CAISO stated that it is currently reserving TPD capacity for out-of-state wind (OOSW) and offshore wind (OSW) for the amounts in the CPUC’s baseline portfolio. At the Sept. 17 Interconnection Fair, CAISO stated that it is reserving capacity only for offshore wind. Either way, CalWEA strongly objects to reserving capacity for such a limited subset of resources, for which no rationale was provided.
CalWEA agrees with CAISO’s Track 3A Revised Straw Proposal[1] wherein CAISO stated that TPD capacity will be reserved “for long lead-time projects that align with TPP[-]approved new transmission to meet specific CPUC portfolio requirements for specific resource types, such as offshore wind, out-of-state wind and geothermal.” CAISO stated that “Sections 8.9.1(b) and (c) allow the ISO to reserve TPD capacity for resources outside the ISO and resources internal to the ISO that are designated as resource technologies and in locations that are needed to meet state policy goals.”[2] CalWEA recommends that CAISO define this policy more specifically to state that CAISO will reserve TPD capacity for all location-constrained resources as identified by the CPUC in its most recent Preferred System Plan (PSP) as well as the resources identified in the CPUC’s final decision on Central Procurement.
While CAISO also indicated that it would look to the CPUC’s decision on Central Procurement to “determine if it provides any relevant guidance on further TPD allocation modifications for long lead-time resources,”[3] that CPUC decision was focused solely on what resources require central procurement and did not address what resources require TPD capacity reservation. Therefore, CAISO should look to the CPUC’s most recent resource portfolio to determine which “resource technologies and in locations that are needed to meet state policy goals.”[4]
All location-constrained resources – projects that must locate in very limited, site-specific locations where commercial-grade resources are present – should qualify for TPD capacity reservation because the CPUC’s portfolio will not be realized without this treatment. These resources – namely, geothermal, all types of wind energy (offshore, in-state and out-of-state), and long-duration energy storage – also happen to constitute the diverse generation-resource supply in the CPUC’s PSP. CalWEA also agrees with CalCCA that resources that “may not be compatible with the updated interconnection process” should qualify. Indeed, CAISO has stated that its now-adopted interconnection reforms “incentivize projects to come into the queue when there is a realistic ability to secure a PPA or be shortlisted. However, projects such as offshore wind projects may need to enter the interconnection process prior to any realistic opportunity for procurement of their resource.”[5] While the example used was offshore wind, the rationale applies to any diverse, location-constrained resources entering the interconnection process prior to any realistic opportunity for procurement of their resource (e.g., 8-10 years from commercial operations for transmission or other reasons). Rather than using the term “long-lead-time” (LLT) resources in these comments, therefore, CalWEA will refer to the resources for which TPD capacity should be reserved as “qualifying” resources.
As we’ve seen, for example, with Imperial Valley geothermal, the Southern California capacity approved in the 2022-23 TPP cycle could have served these resources had the TPD capacity reservation policy been in place at that time. As it was not, all that capacity was allocated to solar and battery resources. So, the geothermal in the PSP in Imperial Valley and elsewhere must now be planned for – and reserved – in the current (2024-25) and subsequent TPP cycles. Similarly, if the CPUC’s portfolio is to be realized, the “in-state” wind energy (including Baja-area wind), out-of-state wind, offshore wind, and LDES resources included in the PSP must be planned for in the current and subsequent TPP cycles, and their TPD capacity reserved in the immediately following TPD allocation process.
- How and when capacity should be reserved.
In the current (2024-25) TPP cycle (with the plan to be approved in May 2025), CAISO must include in the study a combination of queued and generic (or “phantom”) resources at planned substations that fulfill the CPUC’s resource plan and assign them deliverability in developing the plan. If the queued capacity in QCs 13, 14 and 15, for each qualifying capacity type is insufficient to meet the CPUC’s planning target for that type, the CAISO should add sufficient generic capacity in the TPD allocation process to achieve that goal. That capacity should be reserved for the QC16 TPD allocation process in 2028, and for resources in later queue clusters as necessary.
The reserved TPD capacity should become available at POIs designated for the designated qualifying resource according to the busbar map (e.g., offshore wind at Humboldt, onshore wind in Northeast California, geothermal in Imperial Valley, etc.). Collector substations should be planned accordingly until a sufficient amount of projects in these areas materialize, adjusting substation locations as needed.
CAISO should accept projects of all types into the interconnection study process at these POIs until total capacity (in-queue) of qualifying resources reaches 150% of portfolio goals since not all projects will succeed. Planning for and reserving of TPD capacity for qualifying resources should be done throughout the interconnection study process, from intake of the application to TPD allocation. During the cluster study/restudy, these qualifying resources should be studied, along with any non-qualifying projects. In the TPD allocation process, if the amount of qualifying queued resources is not sufficient to reach the CPUC portfolio goals, additional “phantom” resources should be added to make up for the difference and the total sum of qualifying resources should be allocated TPD on a priority basis before allocating TPD to non-qualifying projects seeking TPD based under the TPD allocation rules.
For out-of-state resources, there are two different mechanisms – projects that require MIC and projects in the CAISO queue. CAISO should explain how it is going to reserve the proper amount of TPD in each step of the study process and ensure that TPD capacity is not double counted.
- Rules regarding converting capacity to different technologies.
It is CalWEA’s understanding that a total of 5.6 GW of OSW capacity was reserved in the latest TPD allocation at Humboldt (1.6 GW – generic OSW capacity) and Central Coast (4 GW – all queued projects). However, under current CAISO rules, queued OSW resources can convert from OSW to another technology if they cannot secure PPAs or other procurement assurances within a few years. The new technology is likely to be battery storage, but certainly not other types of location-constrained resources, which do not exist in the Humboldt or Central Coast locations.
To ensure that sufficient capacity is reserved to achieve the CPUC’s portfolio, if any Central Coast OSW resources convert from qualifying to non-qualifying technologies, CAISO should plan for additional generic OSW capacity in the following TPP cycle to make up for the converted capacity.
In the future, beginning with QC15, qualifying resources that benefit from capacity reservation should not be allowed to convert to non-qualifying resource types, except for some fraction of their net injection to storage to provide reasonable flexibility.
- Addressing near-term reliability needs
To ensure that the capacity reservation policy for qualifying resources does not interfere with capacity that is needed for the mid-term period, interconnection customers should be able to request, during the TPD allocation process, release of capacity that would otherwise be reserved for qualifying resources. Capacity should be released to such customers if they prove to CAISO that they can come online within the MTR timeline (by 2028). New capacity should be planned in the next TPP cycle to make up for what is allocated to MTR resources.
[1] CAISO Track 3-A Revised Straw Proposal (July 8, 2024) at p. 12.
[2] Id. at p. 23.
[3] Ibid.
[4] Ibid.
[5] Ibid.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
No comment at this time.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
No comment at this time.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
No comment at this time.
7.
Please provide any additional feedback:
No comment at this time.
CESA
Submitted 09/18/2024, 12:30 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
The California Energy Storage Alliance (CESA) appreciates the opportunity to provide comments on the 2023 Interconnection Process Enhancements Track 2 working group meetings.
CESA appreciates the additional discussion at the two working groups on how to grapple with long lead-time deliverability network upgrades. CESA supports CAISO’s proposal to allow for an additional TPD attempt through the introduction of the three annual TPD allocation opportunities. As stated in previous comments, CESA is concerned that while directionally positive the three-attempt limit could result in the window expiring before developers and load serving entities are able to enter into power purchase agreements if the earliest commercial operating dates for the projects are beyond the CPUC’s procurement requirements.
Currently the three-year window is by cluster. The CAISO could consider allowing projects more flexibility to enter the TPD allocation window in the year of its choice as long as it can still meet the unavoidable time-in-queue requirements. The CAISO could consider allowing projects to enter the TPD allocation window based upon the completion date of the long lead time upgrades impacting the project’s forecasted commercial operation date. The CAISO should still prioritize earlier queued projects in the TPD allocation. For example, projects with commercial operation dates in 2034, the three-year TPD allocation window would be 2029, 2030, and 2031. After 2031, the project would be converted to energy only.
CESA looks forward to other proposals on how to bridge this gap between procurement requirements and completion of transmission upgrades.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
See above.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
In prior comments, CESA requested CAISO to provide greater transparency on the process to determine the quantity of TPD held back for long lead-time resources from the TPD allocation process and other processes. CESA recommends that the CAISO leverage the Constraint Mapping with TPD Allocated spreadsheet to add Reserved TPD for each area deliverability constraint. CAISO should consider reposting the August 30 constraint mapping spreadsheet with this data given the surprise expressed by many stakeholders that the long lead-time resource TPD was already withheld from cluster 15 interconnection request intake process.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
No comment.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
CESA appreciated ACP-CA’s proposal. CESA agrees that 2024 TPD Cycle allocations to Group D will significantly reduce the TPD availability to be used in determining the quantity of new interconnection requests to be studied if the proposed changes pending at FERC are approved. During the workshop, CAISO stated that it is becoming convinced that Group D should be maintained. If Group D is maintained, all or a portion of the TPD allocated in this group during 2024 should be included as available TPD in the interconnection request process.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
CESA believes this proposal highlights that coordination between the CAISO and CPUC is needed to implement changes to issue procurement directives beyond 2028. The proposed changes seem to be more under the CPUC purview than CAISO. CAISO should focus efforts in this initiative to changes or clarifications that are fully within the CAISO’s purview.
7.
Please provide any additional feedback:
CESA requests the CAISO provide a status update on proposed changes in the Generation Deliverability Methodology Review initiative. CAISO proposed to provide deliverability while a resource is waiting for the related n-2 deliverability upgrades to be completed if the contingency is not considered always credible in the operations horizon and does not risk cascading outages. Did the 2024 TPD allocation deliverability study include the change above?
Also, the CAISO should consider additional increases in interim deliverability as well as introducing multi-year interim deliverability as discussed in early tracks of this initiative. Expanding the use of interim deliverability will allow projects, such as storage, which are reliant on resource adequacy payments to enter into power purchase agreements and come on-line earlier.
EDF Renewables
Submitted 09/18/2024, 05:20 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
EDF Renewables (EDF-R) appreciates the opportunity to provide comments on CAISO’s IPE Track 3A 8/28 and 9/4 working group meetings and thanks the CAISO for prioritizing these discussions prior to posting the Second Revised Straw Proposal expected in late October 2024. Additionally, for CAISO improving the alignment between the 2025 & 2026 TPD studies to accommodate Cluster 15 interconnection studies which allows the needed time for better TPD policy development in a post-Order 2023 and IPE Track 2 regulatory landscape.
Need for accommodation when DNU in-service dates are 7 years out or further
As for the challenges of LLT DNUs as it relates to projects in queue, EDF-R strongly believes that CAISO should create a procedure with unique considerations for projects affected by LLT DNUs. It is not reasonable for CAISO to request projects show an executed PPA for TPD allocation or for Commercial Viability Criteria (CVC) in circumstances where estimated FCDS dates are more than 7 years after IR submission date. Historically, LSEs have not signed contracts for those long-term timelines. If this was a common practice, much of this conversation would be moot.
EDF-R discussed this item in detail in its July 29th comments. In brief, projects with these LLT DNUs should be allowed to delay requirements for showing an executed PPA until closer to possible FCDS achievement (or a secure long-term IDS allocation.) Without this policy, CAISO asks developers to risk catastrophic financial losses because CAISO’s GIA financial security posting requirements in GIDAP and RIS, which becomes immediately at-risk.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
EDF-R commends CAISO for extending the timeline for this initiative to accommodate thorough discussion of this item. EDF-R requests CAISO assign additional time and resources to further discussion and research on the possibility of funding RNUs via a subscription mechanism, or funding least-regrets RNUs via the TPP. EDF-R appreciates the willingness of CAISO’s transmission department to devote staff time to identifying how useful such a proposal could be.
EDF-R also notes that CAISO must find a way for projects with these LLT RNUs to reduce some of the financial risk currently inherent to CAISO’s process, and suggests that CAISO should have a third posting approach for these projects that allows for RNU construction to begin without requiring developers to risk catastrophic financial losses because CAISO’s GIA and third posting procedures require immediate execution and posting of 100% financial security. Executed E&P agreements could allow for these actions while protecting ICs from the most extreme financial risks. For these LLT RNU and DNU circumstances, CAISO’s process should reflect risks to developer financial security that are reasonable and prudent. Creating circumstances where projects can only possibly succeed if developers are willing to take absurd risks does not filter for viable projects nor does it serve California ratepayers.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
No comments at this time.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
EDF-R encourages CAISO to retain Group D with future enhancements, potentially adding a new allocation group for projects affected by LLT DNUs.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
EDF-R requests more time be allocated to discussion to ACP-CA’s conditional TPD proposal. EDF-R understands the proposal to be, simplified in the figure below:
In their presentation, ACP-CA indicated a priority order for allocation conditional deliverability, EDF-R suggests projects seeking Conditional TPD for the first time get priority in the allocation, projects seeking Conditional TPD for a second time get second priority, and projects seeking Conditional TPD for the third time get third priority in the allocation. This priority order would allow the “cream to rise to the top” -- giving new projects the same chance to market themselves in their first TPD allocation year that the previous years projects had.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
EDF-R thanks CAISO for the opportunity to present at the working group, and hopes the information provided spurs discission.
EDF-R looks forward to hearing from the CAISO and stakeholders if there are feasible alternative contract options that could occur before PPA execution, that would provide more certainty for continued project development, given LSEs are not executing PPAs for projects more than 5 years from COD/FCDS dates.
EDF-R encourages CAISO to consider Conditional PPAs conditioned on certain regulatory approvals, technological benchmarks, and or project developments, being met within a specific timeframe. Another consideration is allowing for a more CAISO-centric metrics conditioned on meeting development milestones, such as GIA milestones. The Conditional TPD allocation and retention could be structured with specific milestones that the Project must meet over the development period based on the FCDS date. This second option would allow for more CAISO oversight.
7.
Please provide any additional feedback:
EDF-R urges CAISO to move forward to implementation exercises as it pertains to improving IDS allocations, and potentially allowing IDS lock in times for more than 1 year. This item has come up several times in various venues, and CAISO has indicated willingness to do so. As with any item, we will have a better collective understanding of how viable the proposal is by exploring a real-world example. As a next step perhaps, CAISO could look at a study area in PG&E and a study area in SCE and outline how much TPD is currently available. Not available for allocation in the study process, but available for IDS use for projects coming online. Now seems an opportune time given CAISO recently published NQC data. EDF-R posits that this longer-term IDS assignment will never be a routine task, that unique factors will need to be taken into consideration based on study area, and in some areas a long-term IDS assignment may not be possible – but this information would be very valuable for marketing efforts.
Emeren
Submitted 09/18/2024, 04:28 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
7.
Please provide any additional feedback:
Our comments relate to the proposed revised 2025 & 2026 schedule for TPD allocation processes.
In respect to the push-out of the 2024/25 TPD affidavit/allocation cycle, we request an earlier opportunity to seek TPD allocation for projects that have secured PPAs with RA obligations or RA agreements with LSEs after the 2023/24 cycle commenced. This would be consistent with the CAISO goal to prioritize "shovel ready" projects. The delay of the 2024/25 cycle by a year will jeopardize the ability of these near-term projects to fulfill 2026/27 RA commitments within their LSE agreements.
In respect to the cancellation or skipping of the 2026 TPD cycle, Wholesale Distribution Access Tariff (WDAT) projects have PTO study processes and interconnection agreement timelines that proceed at a different pace than the CAISO interconnection processes. It is highly likely that WDAT projects that requested to be studied for full capacity deliverability in conjunction with Cluster 15 will have their PTO Facilities Studies or Phase II Interconnection Studies completed (and in many cases interconnection agreement executed) prior to the completion of the Cluster 15 Restudy & Reassessment. WDAT projects with completed Facilities Studies or Phase II Studies and CAISO Deliverability restudy results should be afforded the opportunity to seek TPD allocation in 2026. They should not have to wait until the 2027 cycle after the CAISO Cluster 15 Facilities Study process is completed.
Fervo Energy Company
Submitted 09/18/2024, 01:18 pm
Submitted on behalf of
Fervo Energy Company
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
Fervo Energy (Fervo) appreciates CAISO’s recognition of the unique challenges faced by Long Lead-Time resources like Enhanced Geothermal Systems (EGS), which play a critical role in California’s clean energy transition. With an over 80% capacity factor, EGS can significantly enhance grid reliability amidst the growing presence of intermittent resources. Securing early TPD assurances is vital to attract offtake agreements and financing for these capital-intensive projects.
We encourage CAISO to explore additional deliverability categories that account for commercial readiness indicators beyond PPAs, such as site control or purchase orders for key generation equipment. These steps could better align deliverability timelines with the extended development periods faced by Long Lead-Time projects.
Fervo also recommends that policy-driven resources with established readiness signals be prioritized in the Transmission Planning Process (TPP) and considered in the Maximum Import Capability (MIC) process. Coordination between the CAISO TPP and IPE teams, as well as with CPUC, will be crucial to ensuring timely network upgrades for these essential resources, especially those appropriated through the Central Procurement Entity (CPE). Given this special policy appropriation to Long Lead-Time resources issued by the California Public Utilities Commission (CPUC), we encourage the CAISO to consider additional deliverability groups that recognize commercial readiness signals other than a PPA.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
N/A
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
Fervo thanks CAISO for its continued commitment to reserving deliverability for Long Lead-Time resources, which has been essential for meeting California’s reliability goals. Given the ALJ’s recent decision not to mandate specific procurements unless contractually appealing to the Department of Water Resources (DWR), we request continued transparency regarding how CAISO will determine network upgrades for Central Procurement Entity procurements.
We also support the development of resource-specific deliverability processes that allow Long Lead-Time resources to apply for interconnection and deliverability allocations without prematurely being converted to Energy Only. Specifically, FERVO supports a special TPD allocation category for Long Lead-Time resources to ensure that they are not crowded out by resources with shorter development timelines. This is crucial for maintaining competition while recognizing the unique challenges these resources face and without convoluting their value to fit into a process that does not adequately recognize their system benefits. The state of California has recognized the need for reliable clean firm power, many of which have long lead-times as such, our transmission allocation process must adequately match policy driven resource need with transmission delivery.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
N/A
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
N/A
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
Fervo appreciates EDF’s examination of the deliverability challenges faced by Long Lead-Time resources. We agree that readiness parameters should reflect the commercial realities of extended development timelines. We support EDF’s proposal to incorporate alternative readiness indicators, such as development milestones, financial guarantees, or strategic partnerships, in addition to traditional markers like site control.
Deliverability assurance, as highlighted by EDF, is key to de-risking projects and securing funding from less risk-tolerant lenders. This approach will expedite project development and foster innovation, as demonstrated by Fervo’s ongoing work across the West. Fervo thanks EDF for their analysis and suggestions which address concerns about deliverability for Long Lead-Time resources and present a suite of potential solutions.
7.
Please provide any additional feedback:
Fervo thanks the CAISO for its continued efforts to improve the transmission deliverability processes to align with policy driven appropriations. We look forward to future iterations while urging the CAISO to present viable solutions that will unlock Long Lead-Time resource deliverability to match the unprecedented demand as seen in California.
Golden State Clean Energy
Submitted 09/19/2024, 12:29 am
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
Golden State Clean Energy (“GSCE”) opposes the continuation of Group D, especially if a deliverability allocation via Group D reduces the available deliverability for the next queue cluster’s intake process. Under CAISO’s pending track 2 queue reforms, a project could receive deliverability via Group D without demonstrating additional commercial readiness since it entered the queue, and that deliverability allocation would prohibit new capacity from seeking interconnection in the next queue cluster window. Projects that receive an allocation of deliverability via Group D are not necessarily more viable than new projects that wish to apply for interconnection. Group D is at odds with IPE track 2 queue intake reforms and does not create the right incentives by rewarding projects that are not necessarily taking key commercial steps.
Without any further demonstratable readiness, it is overly limiting to future projects for Group D to enable any given queue cluster to swallow up all available deliverability, only for some of the deliverability to potentially be relinquished the next year if retention criteria is not met. If CAISO retains Group D, GSCE supports it being a conditional allocation. GSCE supports a modified and simplified version of ACP-CA's proposal where a Group D allocation does not count against the available deliverability for interconnection request intake until a project has met its retention criteria (either through a PPA, shortlisting, or active commercial negotiations).
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
7.
Please provide any additional feedback:
Hydrostor Inc.
Submitted 09/18/2024, 04:48 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
Hydrostor agrees with parties that indicated during the stakeholder workshop that the pathway envisioned by the CAISO – i.e., that projects operate for several years as Energy Only (EO) before becoming Full Capacity Deliverability Status (FCDS) while waiting for long lead-time (LLT) deliverability network upgrades to be completed – would not work well for energy storage resources. For energy storage resources, and in particular, long-duration energy storage resources (LDES), their key value derives from the ability to provide Resource Adequacy (RA) benefits to load-serving entities (LSEs).
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
Contracting for LLT resources, including many LDES technologies, is already challenging given the preference of many LSEs for projects with earlier in-service dates. Further compounding the Commercial Operating Date (COD) issues with extended in-service dates for reliability network upgrades only serves to exacerbate these timeline issues.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
Hydrostor notes that in the CPUC’s August 22, 2024 Decision 24-08-064 (“Decision Determining Need For Centralized Procurement Of Long Lead-Time Resources”), the CPUC appropriately included LDES technologies as long-lead time resources (specifically, LDES that can discharge for 12 or more hours that does not employ lithium-ion batteries). To ensure consistency, the CAISO’s definition of LLT resources should be broadly consistent with the CPUC’s definition and include LDES.
Hydrostor agrees with parties that have indicated that unique Transmission Plan Deliverability (TPD) allocation criteria should apply to LLT resources that meet certain technology and policy goals. However, Hydrostor is concerned that the focus on treatment of LLT resources in the interconnection queue thus far has been narrowly focused on off-shore wind (OSW). We further understand that some deliverability was held back for OSW, but it remains unclear what deliverability, if any, has been held back for LDES resources that have been identified as required by the CPUC in their Preferred System Portfolio.
Importantly, unique TPD allocation and interconnection processes for LLT resources, including LDES, is required to facilitate the timely development of these much-needed resources. In the CPUC's Decision 24-02-047, the Preferred System Portfolio includes 3.8 GW of LDES in 2035 (modeled as 8-hour energy storage, pumped hydro and other LDES), increasing to 10 GW in 2040. These required amounts are even greater in the High Gas Retirement Sensitivity case. CAISO facilitation of the development of these resources through the interconnection process is entirely consistent with the December 2022 Memorandum of Understanding (MOU) between the CPUC, California Energy Commission (CEC) and CAISO regarding transmission and resource planning and implementation. As the CAISO has noted, the MOU is intended to tighten the linkages between resource and transmission planning, interconnections, and procurement so California is better equipped to meet its reliability needs and clean-energy policy objectives required by Senate Bill 100.
Hydrostor is further concerned about interconnection study processes and timelines that further delay in-service dates for LDES resources. For example, some of the interconnection study areas that have the potential for beneficial LDES development (e.g., North of Lugo, East of Pisgah) appear to have had deliverability allocated already with little or no deliverability available in Cluster 15. This puts LDES developers in the difficult decision of either trying to proceed in Cluster 15 in some form (e.g., merchant transmission, Energy Only) or waiting until Cluster 16 (which would not begin until late 2026). Waiting until Cluster 16 would further delay LDES development, pushing CODs even further out and making the CAISO grid increasingly dependent on a small subset of resources (i.e., short-duration battery storage and solar projects). Hydrostor therefore urges the CAISO to consider how it may be able to allow LLT resources, including LDES, to be studied in Cluster 15. This clarity is needed urgently given Cluster 15 deadlines and the need by LLT developers to make decisions in the near term including the posting of sizable deposits.
Hydrostor understands that the CAISO plans on convening a separate effort to consider LLT resources and their treatment. While we intend to participate in this stakeholder effort, we also wish to underscore the urgency given current Cluster 15 study timelines.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
No comments at this time.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
No comments at this time.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
No comments at this time.
7.
Please provide any additional feedback:
No further comments at this time.
LSA
Submitted 09/18/2024, 08:47 pm
Submitted on behalf of
Large Scale Solar Association
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
LSA appreciates the CAISO's effort here. Unfortunately, the CAISO’s premise that PPAs could be developed allowing for years of Energy Only service before FCDS is awarded was not supported by LSEs or other stakeholders during the workshops. The older Standard Offer contracts implemented a form of this concept, projecting high oil and gas prices in the future and including a levelized pricing mechanism that allowed some payment on that basis earlier in the contract term, to provide sufficient revenue for earlier development of more efficient and renewable resources to replace them.
However, the regulatory regime has moved away from that approach. Based on statements from SCE and others, LSEs are not willing to pay for NQC that they are not receiving, years in advance, and they will clearly not move in that direction without regulatory support or mandates. The CAISO mentioned at the working-group meetings that it is “talking to the CPUC” about these matters, and this could be included as a topic in those discussions.
This problem is a particular issue for energy storage, a badly needed resource to manage growing intermittent-generation penetration and fossil-fuel retirements. The common RA-only PPAs for storage resources generally pay exclusively for NQC (adjusted for counting-rule changes over time) and nothing else. NQC is generally the payment basis even for most so-called “tolling” arrangements, which provide for broader services, with deductions where the project fails to meet certain other performance metrics.
In other words, these facilities appear to have little value to off-takers other than their RA/FCDS value, and off-takers will not pay for them without that attribute under current procurement directives.
As SCE stated, the new CPUC Slice-of-Day (SoD) RA framework makes deliverability more important even for variable resources. Though they may not provide much NQC on their own, depending on the technology, they must have deliverability in order to count toward filling storage resources not located at the same Point of Interconnection (POI).
Aside from the contract changes discussed above, the best solution to this problem is determining a way to provide RA status sooner to these projects. LSA continues to believe that the CAISO should develop a way to implement a longer-term Interim Deliverability Status (IDS) model, even if only a limited amount of capacity could be made available on that basis. That is better than zero.
(The elimination of N-2 upgrades (in the absence of cascading outages) in the Deliverability Assessment Methodology was posited as a way to provide FCDS sooner. However, that implementation has been completely opaque. It would be helpful if the CAISO could provide information on how often this revision enabled FCDS to be awarded sooner, and how much capacity received FCDS sooner as a result.)
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
LSA is confused about the CAISO’s question here. Whenever workshop participants suggested a solution here – e.g., a framework similar to the Location-Constrained Resource Interconnection Facility (LCRIF) provision in the tariff, which allows for temporary ratepayer funding of “trunkline” gen-tie lines where alternative forms of commercial interest can be demonstrated – the CAISO responded that RNUs needed to accommodate the TPP resource portfolio were approved in the TPP, so these other RNUs were not really needed. The CAISO itself has hypothesized that these upgrades will not really be needed once the “overheated” queue is reduced to more realistic levels.
Well, if needed upgrades are already approved in the TPP, and these upgrades may not actually be needed, what was the point of this question?
The LCRIF framework may work especially well for RNUs. Gen-tie costs are typically borne by new generation projects, but RNU costs are usually borne by ratepayers anyway, so this approach would not require additional ratepayer funding, just the same funding a bit earlier. In addition, busbar mapping in the resource portfolios is not a perfect exercise, and to the extent that new resources develop in slightly different locations indicated by commercial interest, presumably that would allow similar upgrades to be eliminated elsewhere.
The fact is (as stated by EDF-Renewables (EDF-R) in its presentation), it is extremely difficult for projects to acquire PPAs more than 5 years before COD, and projects without them appear to be reluctant to fund long-term RNUs. If the CAISO is not willing to entertain an LCRIF-type approach, or in addition to that approach, the best way to address this issue is by accelerating the CODs themselves, through a combination of:
- The Contract & Queue Management proposals to clear old and non-viable projects from the queue. These proposals were broadly supported by stakeholders exactly to free up capacity that can be used by more viable projects and remove unneeded upgrades, but the CAISO has yet to file them at FERC.
- The “headroom” approach in Track 3B, to allow some projects to reach COD before the RNUs are triggered.
- Other approaches to speed up RNU construction and/or implement operating procedures or other alternatives that would make them less necessary.
However, the CAISO is missing an important aspect of this issue. Projects in this situation might be willing to fund the RNUs needed – most recently, the short circuit duty (SCD) upgrades needed for Cluster 14, for example even without PPAs, if that was all they were asked to do because the amount of money allocated to each project for those upgrades is usually very little.
The real problem is the other, shorter-lead-time but more expensive upgrades, combined with the recent insistent by PTOs in GIA negotiations that project make their third Interconnection Financial Security (IFS) postings very shortly after GIA execution, instead of phasing the third posting to reflect the timing of the actual work.
LSA is aware of many Cluster 14 projects where SCD upgrades requiring upwards of 98 months, but with very low cost allocations per project, are delaying CODs for 8 years or more. Often, the other upgrades require 60 months or less and account for the huge majority of costs.
These projects are being required to post security for the entire cost of all upgrades up front, for years before any work will be done for most of the upgrades needed. Financing is expensive, and this adds considerable cost to these projects. In addition, making the third posting so early increases risk, because many factors can de-rail a project so far in advance of COD and the entire posting would be forfeited if that happens.
Phased third postings are highly appropriate and should be required in these situations, i.e., posting for the long-lead-time RNUs initially and the rest of the upgrades closer when work will actually be done. Second-posting amounts, combined with monthly invoice payments, should be sufficient to protect the PTOs in the years before any serious work will be done for the non-SCD upgrades.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
LSA appreciates the time the CAISO took in the workshops to explain its recent actions related to long-lead-time (LLT) resources. The CAISO explained that:
- It held back 1,600MW of TPD in the Humboldt and Morro Bay areas in the 2023-2024 TPD Allocation process through creation of a “generic” off-shore wind (OSW) resource in that process; and
- Since the recent Cluster 15 (C15) POI mapping information was keyed off the 2023-2024 TPD Allocation process, the available TPD figures shown in that package also reflected the OSW capacity holdback.
However, this discussion raised several serious concerns.
First, LSA has asked many times about the reforms proposed in the earlier TPP Enhancements Initiative, which was never completed. One such reform was the proposed LLT capacity holdback. The CAISO response has been that it had not yet found it necessary to implement that change. Thus, LSA was surprised to find that the CAISO had, in fact, already implemented this important reform. Even if the tariff gives the CAISO the authority to do this, there should have been some stakeholder discussion about how and if it should be done, consistent with the CAISO’s inclusion of this issue in that earlier policy initiative.
Second, the 2023-2024 TPD Allocation process included transmission upgrades approved through the 2022-2023 Transmission Plan. To LSA’s knowledge, OSW in that TPP cycle was included only in the Sensitivity Portfolio, not the Base Portfolio. In other words, the upgrades approved in that planning cycle (or earlier cycles) did not include any upgrades for OSW – those came only later, in the 2023-2024 Transmission Plan.
Thus, it appears that the CAISO subtracted deliverability for OSW capacity before any capacity was approved for OSW capacity. This is the equivalent of adding generation projects to interconnection studies but not any upgrades that would be constructed for them.
If the CAISO held back deliverability for OSW generation without assuming upgrades for it, that seems to be a serious error that could have resulted in severe underestimation of available TPD in northern PG&E zones, and the CAISO should correct it by revising the C15 package now. LSA looks forward to prompt clarification or correction by the CAISO on this point.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
LSA’s members do not have a uniform position on whether Group D should be retained. Below, LSA provides the members’ arguments in favor (at least for Cluster 14) and opposing Group D retention, along with feedback on some of the details if Group D is retained.
Arguments in favor of Group D retention for Cluster 14
At a minimum, Group D should be retained for Cluster 14 projects coming out of parking for the 2025 cycle, and for projects that received TPD Allocations under Group D in 2024 but were unable to retain them. It should be available to:
- C14 projects that parked without submitting a Group D TPD Allocation request, because the Group D restrictions were so onerous. They should have another opportunity once some or all the restrictions are removed.
- C14 projects coming out of parking. TPD was severely limited in the last allocation cycle, and the inclusion of upgrades approved in the 2023-2024 and 2024-2025 Transmission Plans should give them a better chance to receive an allocation.
- C14 projects that received TPD Allocations in 2024 but were unable to retain them. Many of these have CODs or FCDS dates years into the future, and so shortlist positions or executed PPAs have been extremely difficult to obtain. The CAISO should allow them to try again for new allocations, including taking advantage of any mitigation measures for these problems that might result from the recent Track 3 workshops.
In addition, the CAISO should give consideration to the LSEs who said they support Group D retention, because they want to use their limited resources to negotiate PPAs with projects they know already have TPD Allocations. Likewise, developers want to use their limited resources negotiating with LSEs knowing that they already have TPD Allocations; this is especially important, because PPA execution normally requires developers to post development security that would be forfeited if their projects do not then receive TPD Allocations, a very risky position.
Arguments opposing Group D Retention
Retaining Group D would significantly reduce the capacity for future clusters. In addition, Group D requires no demonstration of commercial viability. The CAISO has proposed new rules in Track 2 prioritizing projects with commercial support (from LSEs or other off-takers) in the Intake process, and it makes sense for the TPD Allocation process to similarly require some indication of commercial interest. Retaining Group D would be inconsistent with efforts to link procurement with the interconnection process.
Additional input if the CAISO retains Group D
Because no viability demonstration is required to obtain a Group D allocation, LSA does not object to retention of the current conditions prohibiting project suspension, or COD extensions without a PTO Delay or an executed PPA with a later COD.
However, LSA believes that parking (or, under the new Order 2023, going for 3-4 tries at a TPD Allocation) should warrant a COD extension (regardless of whether it is characterized as a “PTO Delay”), and that projects that request but do not obtain a Group D allocation should not be subject to Group D restrictions.
LSA also asks the CAISO to remove any restrictions on projects requesting Group D allocations before, regardless of whether they received such allocations, to the extent that it is removing them for projects requesting Group D allocations in the future. This is a matter of basic fairness that would also relieve the considerable administrative burden that these restrictions seem to be placing on the CAISO and PTOs.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
LSA notes ACP-CA’s statements that this complex proposal was offered in lieu of Group D retention, and it wasn’t clear whether even ACP-CA supported it if Group D is retained. LSA does not believe that this concept is needed if Group D is retained.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
LSA is not sure that it understands the entire EDF-R proposal, but there is merit to the idea that projects should be able to offer alternatives to PPA execution or shortlist positions to warrant receipt or retention of a TPD Allocation, especially in light of the problems described in the CAISO questions above (delayed CODs or FCDS status impeding PPA acquisition).
In particular, the CAISO has stated its intent to include many more project milestones in Generator Interconnection Agreements (GIAs), perhaps related to permit applications and construction commencement. If projects follow these milestones, funding upgrades needed for their projects on time and in full, then it seems likely that they reach Commercial Operation.
While some (perhaps many) developers may not be willing to proceed with project development without an executed PPA, that should be a commercial decision for developers to make, to give them flexibility to take the best path for their projects.
7.
Please provide any additional feedback:
LSA has additional comments concerning other topics raised at the working-group meetings, namely: (1) updating of the C15 data package; (2) ability of projects to proceed with GIAs while they are trying for TPD Allocations; (3) near-term announcement of TPD Allocation cycle change; and (4) possible near-term implementation of the Track 3B item for RNU “headroom.”
C15 package explanations and updates: LSA appreciates the CAISO’s hard work to update the C15 data package, but our members and others have many questions about different aspects package. The CAISO posted the information without written explanations, and we would like the opportunity to ask questions to better understand it. LSA thus requests that the CAISO convene a workshop to better explain the data, assumptions, and calculations, and to allow stakeholders to ask questions where some of that may be unclear.
In addition, we believe that the CAISO should consider a quick update of the C15 data package. In response to a question from LSA during the workshops during a discussion about delaying the 2025 TPD Allocation affidavit due date to September 2025, the CAISO said this would (among other benefits) allow for incorporation into that process any upgrades approved in the 2024-2025 Transmission Plan, which would be issued in May 2025. That seemed like a significant plus for the new schedule.
If the CAISO can include the 2024-2025 Transmission Plan upgrades in the 2025 TPD Allocation process by September, would it possible to update the C15 package already issued to include the upgrades from 2023-2024 Transmission Plan issued this past May? This would at least rationalize the treatment of OSW resources (see above), since upgrades targeted at those resources were approved for the first time in this latest transmission plan.
Ability to move forward with GIAs while trying for TPD Allocations: One workshop participant asked whether projects could move ahead with GIAs while parked (current framework) or waiting to try again (new framework), in order to start work on long-lead-time upgrades. LSA believes that this, combined with the ability to reasonably phase third postings (see above), could provide another way for projects to fund SCD-type RNUs while waiting to move ahead with the project overall. The CAISO should certainly encourage project that want to move forward to do so.
Near-term CAISO announcement of TPD Allocation process dates: LSA continues to urge the CAISO to officially announce soon – via a Market Notice or other means – the affidavit due dates and other milestones for the next TPD Allocation process. Projects with TPD retention compliance obligations (Groups B and D) need more certainty about the time they have to meet those obligations, and other Energy Only projects trying for their “last chance” TPD Allocations before COD also need to know their shortlist/PPA deadlines.
Possible near-term implementation of Track 3B RNU “headroom” proposal: Similarly, projects need to know their CODs in order to obtain the shortlist positions and PPAs required for TPD retention and acquisition. Thus, LSA asks that the CAISO accelerate this Track 3 item and implement it as soon as possible, to maximize the time Group B/D and other Energy Only projects have for their retention compliance activities.
New Leaf Energy
Submitted 09/18/2024, 02:53 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
New Leaf Energy, Inc. (“NLE”) appreciates the CAISO’s continued leadership in the Interconnection Process Enhancements (“IPE”) initiative. Below NLE provides comments on specific Track 3-A issues.
One viable solution to the long lead-time deliverability network upgrade issue is the development of a longer-term framework for Interim Deliverability Status (“IDS”). The first iteration of the IPE Track 2 Straw Proposal stated the CAISO’s intent to “continue to work with stakeholders in both the IPE initiative and the Deliverability Assessment Methodology initiative to construct a methodology where a multi-year Interim Deliverability allocation process could bridge the gap between the in-service date of [a Local Delivery Network Upgrade] and the project’s requested [commercial online date (“COD”)].”[1] NLE supported the CAISO’s continued focus on this issue because it would help provide contractable assurance of Interim Deliverability. However, the CAISO declined to move forward with the proposal. The IPE Track 2 Draft Final Proposal justified this decision by stating “there is not expected to be a significant amount of longer-term interim deliverability available.”[2]
NLE respectfully urges the CAISO to implement a longer-term IDS framework even though there may not be a significant amount of interim deliverability available. Providing even a small amount of interim deliverability would help LSEs meet their procurement obligations.
Additionally, NLE requests information regarding implementation of the 2024 Deliverability Assessment Methodology Revisions, which provide a pathway to receiving deliverability at an earlier date—during the period where the only pending mitigation is for a non-cascading n-2 outage.[3] It would be useful for the CAISO to provide information on: (1) the number of times this revision enabled earlier deliverability awards, (2) how much deliverable capacity was provided at an earlier date, and (3) how much earlier deliverability was provided due to the revision.
[1] CAISO, 2023 IPE Track 2 Straw Proposal at 41 (Sept. 21, 2023), available at: http://www.caiso.com/InitiativeDocuments/Straw-Proposal-Interconnecton-Process-Enhancements-2023-Sep212023.pdf.
[2] CAISO, 2023 IPE Track 2 Draft Final Proposal at 71 (Feb. 8, 2024), available at: http://www.caiso.com/InitiativeDocuments/DraftFinalProposal-InterconnectionProcessEnhancements2023.pdf.
[3] CAISO, Deliverability Assessment Methodology Revisions Final Proposal at 15-23 (Jan. 4, 2024), available at: https://stakeholdercenter.caiso.com/InitiativeDocuments/Final-Proposal-Generation-Deliverability-Methodology-Review-Jan-04-2024.pdf.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
NLE does not have any comments on this item.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
NLE does not have any comments on this item.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
NLE supports retention of Transmission Plan Deliverability (“TPD”) allocation group D, including for Cluster 14 projects that exit parking prior to the 2025 TPD allocation cycle. The planned delay of the 2025 TPD cycle will allow currently queued projects to potentially benefit from upgrades approved in the 2024-2025 Transmission Plan, which would increase the supply of projects that are eligible for Resource Adequacy and that could come online earlier than Cluster 15 projects. Retaining group D would also provide increased certainty to LSEs during their procurement processes. If group D is eliminated, LSEs would need to contract with resources before knowing whether they will receive a deliverability allocation.
NLE additionally supports removing the group D restrictions (i.e., prohibitions on suspension requests under Generator Interconnection Agreements (“GIAs”), delays to providing notice to proceed, and COD delays) for all projects. Eliminating these restrictions would provide needed flexibility to group D projects to address unexpected delays and to ensure that the projects have a viable pathway to commercial operation. Additionally, Cluster 14 projects that exit parking prior to the 2025 TPD allocation cycle should have the opportunity to extend deadlines for Phase 2 postings and GIA negotiations—if the new Federal Energy Regulatory Commission Order 2023 deadlines do not apply to these projects.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
NLE does not have any comments on this item.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
NLE does not have any comments on this item.
7.
Please provide any additional feedback:
NLE respectfully urges the CAISO to issue a formal announcement regarding the 2025 and future TPD allocation cycles as soon as feasible. Developers and LSEs especially need to know when the 2025 TPD allocation cycle will commence in order to make development and procurement decisions in the coming months.
Northern California Power Agency
Submitted 09/18/2024, 03:55 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
CAISO stated DNU issue in 9/4 call: “Increasing numbers of projects would be able to come online in the near term as Energy Only (EO), but have to wait some period of years before being given Full Capacity Delivery Status (FCDS). Could a PPA that allows a project to operate as Energy Only for some period of time before becoming FCDS be a viable option?”
NCPA feedback: Yes, a PPA that allows a project to operate as Energy Only for some period of time before becoming FCDS could be a viable option. An LRA could have certain non-RPS resources providing resource adequacy capacity to its portfolio in the mid-term and could roll in temporary Energy Only projects that would convert to deliverable capacity around the same time that existing resources are being retired or RA contracts for non-RPS resources are ending.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
CAISO stated RNU issue in 9/4 call: “Contracting with projects with earliest achievable CODs further into the future (beyond 5-7 years) could allow projects with LLT RNUs to obtain an allocation of TPD within the 3 (or 4) opportunities they have to seek an allocation of TPD. Are there significant issues that make contracting for projects further into the future inappropriate?
NCPA feedback: NCPA sees no other alternative than to enter into long-term obligations, whether in the form of a PPA or otherwise, for LLT projects such as offshore or out of state wind. LLT projects such as offshore wind require massive R&D to address unprecedented depths and distances into the ocean, while out of state wind projects will require billions of dollars of investment in transmission lines across state boundaries. While these types of contracts will be necessary to access these types of projects, there is no doubt that the challenges involved in bringing such projects to fruition involve substantial risks and substantial costs. NCPA is concerned that CAISO reserving scarce TPD for LLT resources that may not materialize as anticipated or in the time frames desired may block near term projects that could immediately supply needed capacity to the grid more immediately. To the extent such reservations are appropriate, there should be a fair and transparent process for making those decisions. Please see below for further discussion on these concerns.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
NCPA is concerned that CAISO has already been quietly reserving large amounts of TPD for long lead time (LLT) resources for specific technologies designated in the resource plans of the CPUC, without a transparent and non-discriminatory process. While there may be good intentions behind this practice related to facilitating state policy objectives, until POU resource needs are fully included in the TPP, the practice is in fact discriminatory towards other LRAs and their LSEs. These reservations set aside TPD otherwise available for current projects. The lack of TPD meanwhile threatens to prevent POUs from meeting their objectives of meeting demand with clean power that is also affordable and reliable.
There appears to be a misunderstanding that all LRA portfolios are included in the CPUC portfolio submitted to the CAISO TPP. This is incorrect and has not historically been the case. NCPA has seen instances where the CEC forecasts for POU members were significantly inaccurate, and the CPUC has incorporated incorrect assumptions in its planning related to projected retirement dates for POU resources, without reference to whether they were correct. NCPA is working with CAISO to resolve TPP participation and hopes to ensure that TPD will be available for projects where NCPA needs then in the future.[1] LLT resources, by definition, may not be available for many years. NCPA also requests that CAISO be transparent when reserving TPD for LLT resources. At a minimum, project developers and LSEs should know how much TPD is being reserved at which locations and for which types of resources. NCPA would also support more transparency on the methodology CAISO is using to decide how much TPD to reserve in which locations. NCPA understands that CAISO has committed to doing so and looks forward to reviewing such information when it is made available.
Many generators have commented at FERC, that FERC should not allow LSEs to have any influence on what projects are evaluated in the interconnection process (cite to all the generators). By reserving capacity for LLTR projects, the state through the three agencies, CEC, CPUC and CAISO, is pre-reserving capacity for the agencies’ selected resources as set out in the CPUC resource plan. This highlights NCPA’s concerns with full representation of POU needs in the TPP. How will CAISO ensure that the needs of all LRAs are considered in a non-discriminatory manner as part of these criteria? Please describe how CAISO squares the reservation of TPD for LLTR projects with FERC’s open access requirements.
[1] For example, NCPA is targeting a plant expansion at a certain line with multiple constraints. All but one constraint have available TPD. The constraint without TPD could potentially kill an opportunity to add near-term affordable and reliable power and capacity to the grid. The constraint in question has over 3000 MW of TPD, only 700 has been reserved to queue projects behind the constraint so the rest presumably has been reserved for LLT resources.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
No comment at this time.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
No comment at this time.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
No comment at this time.
7.
Please provide any additional feedback:
NCPA agrees with Six Cities’ request that the Group B scoring criteria be revised so that the points allocable to a project with a PPA and the points allocable to a project that is LSE-developed pursuant to local regulatory authority (“LRA”) directed procurement are equal.
Pacific Gas & Electric
Submitted 09/19/2024, 04:52 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
PG&E proposes that retention of group D (with retaining restrictions to remain in group D) could be an avenue for projects behind long lead-time DNUs to get TPD. If projects behind long lead-time DNUs cannot sign a PPA, then they can seek allocation via group D. However, PG&E does not understand the CAISO’s proposal to eliminate restrictions, further discussed below.
PG&E does not find the proposal that LSEs be permitted to enter into energy only contracts long before the projects get TPD to be viable, other than for a few niche cases. Much of the value in energy storage is in the RA, not in arbitrage. If LSEs pay only for the energy value, developers may not get steady income required for financing. If LSEs pay for more than the energy value without getting RA, the contracts will harm customers. Such contracts would require one of the parties to bear substantial risks on the timing of the long lead-time DNU. Under slice of day, stand-alone solar facilities need TPD to provide energy sufficiency. Additionally, solar and battery facilities have degradation. Running the facilities prior to receipt of the RA will decrease the RA that the facility ultimately is able to provide.
PG&E supports giving projects four TPD affidavit cycles to get deliverability, but is also open to other reasoanble proposals that balances the need to give projects an opportunity to secure a PPA or be shortlisted while ensuring projects do not further exacerbate the problem of queue congestion.
Another way to provide insight and ranking of projects with long lead-time DNUs would be to publish the TPD allocation date, flow impacts and DFAX of projects behind constraints to give insight into Interim Deliverability Capacity Status (IDCS). Those with lower impacts could have higher priority to IDCS and FCDS.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
PG&E and policy makers need to see data to understand how large an issue this is. The CAISO allocated 28,000 MW of TPD in 2024. To understand the magnitude of the RNU item, it would be helpful if the CAISO could aggregate the data and publish in a searchable excel format and by individual queue position, the expected timing of each RNU and DNU impacting the project in the queue position. If such data is published in such a format, PG&E is not aware. With this data, LSEs and the LRAs could evaluate if there is a reliability concern down the horizon or if the existing expected resources with TPD are sufficient.
One stakeholder suggestion was the socialization of the RNU costs. However, if there is no reliability concern based on the particular RNU, then it does not seem reasonable to change the paradigm to pay for RNUs.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
To echo other market participants, PG&E would like clarification on how the CAISO is reserving deliverability for this group and then how the reserved deliverability gets assigned to specific projects.
PG&E agrees that it is reasonable to reserve TPD for certain long-lead time resources that are policy priorities and are highly location-specific. The CAISO already has this authority in the tariff in Section 8.9.1 of the GIDAP. Certain upgrades resulting from TPPs will be driven by location specific long-lead time resources. If deliverability is not reserved for these resources, customers may have to pay for additional upgrades to enable deliverability for these resources or risk meeting policy objectives. PG&E recommends that the long-lead times resources for which deliverability is reserved be expanded to include more long lead-time resources provided they are location specific and identified in the busbar analysis from the CPUC or other LRAs.
Based on the CPUC’s latest decisions, relevant categories include offshore wind, geothermal, and multi-day or twelve hour plus long duration storage, including new or expanded pumped storage facilities. Solar and lithium-Ion batteries would not qualify. Reservation for these would only be needed for locationally dependent resources. To be eligible to receive the deliverability, PG&E proposes that the projects must meet certain development milestones. PG&E also recommends that this policy be revisited after Cluster 16 to evaluate implementation.
PG&E does not believe that long-lead time resources should be conflated with solar and lithium-ion batteries behind long lead DNUs or RNUs.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
On consideration of the discussion in the stakeholder process, PG&E supports retention of group D in some format, but with keeping restrictions in place. The amount available to group D should not include what is needed for long-lead time resources as discussed above. If the remaining projects are generally storage, solar, or co-located, it is unclear to PG&E why TPD should be reserved for later cluster when the earlier cluster is presumably more advanced. Some considerations for geographic or resource mix diversity may be necessary if the availability of TPD does not otherwise account for those IRP needs.
PG&E supports maintaining restrictions and does not understand the need to remove restrictions as proposed by CAISO. The group D projects should be moving forward with their GIAs, delaying NTP, or delaying COD. One possible change is allowing one year of exemption from the need to be on a shortlist - or establishment of some other factors - to retain TPD. Generally keeping restrictions means that projects will get TPD to market the project but will need to make progress and take actions to market it.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
PG&E understands that ACP-CA's proposal was in lieu of group D. Maintaining group D with restrictions seems to eliminate the need for the proposal. One concern PG&E has with the ACP-CA proposal is that conditional deliverability that does not decrease the future cluster amount will increase the number of projects that get studied. This would result in more projects being studied that cannot receive TPD, retaining “bloat” in the queue by creating a work around to the 150% limit the CAISO has proposed in IPE Track 2.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
PG&E appreciates EDF Renewable’s creativity but does not find the contractual solutions to be viable. Rather, group D might be an easier path for these projects to have a path to TPD.
PG&E is supportive of exploring other commercial milestones (such as the posting proposed by SCE) because many development milestones would also be premature 10 years before COD.
7.
Please provide any additional feedback:
PG&E suggests the CAISO consider whether Energy Only projects that came into the queue as seeking FCDS be treated differently than Energy Only projects that came into the queue as Energy Only? While likely only applicable in limited circumstances, if a project came into the queue as FCDS and became Energy Only, it seems reasonable that it should be allowed to seek TPD under group A if the project gets a PPA.
Pattern Energy
Submitted 09/18/2024, 05:41 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
See (7)
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
N/A
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
See (7)
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
See (7)
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
See (7)
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
See (7)
7.
Please provide any additional feedback:
Pattern Energy supports addressing the interconnection queue bottleneck at the beginning of the process, rather than the end, as this will increase efficiency of studies. reduce network upgrade costs, and reduce required development capital exposure, thereby decreasing "capital-based" interconnection competition and support the most ready projects.
The Interconnection Process Enhancements initiative generally seeks to remove projects from the queue which have low viability. As noted by the CAISO, without Group D, it’s likely more zones will be TPD zones and within TPD zones, more POIs will have more capacity available under the 150% threshold. This is an invitation for projects with lower engineering completeness and lower LSE interest scores to enter the queue, making it less likely that high viability projects will eventually receive deliverability, a major project risk. To that end, Pattern Energy believes the most plausible path forward for the TPD allocation process is to retain Group D, making sure to remove any allocated Group D Deliverability from the queue intake process.
Pattern Energy would appreciate further discussion about the proposal to tie Commercial Viability Criteria for retaining TPD allocations for this Group D structure to GIA milestones, given that GIA timelines are compressed. Pattern Energy thinks this could be a remedy to issues (1) and (3).
Pattern Energy would also like to re-submit the following comment excerpts whichdid not receive responses to after the Track 3A revised straw proposal and 3B straw proposal:
It is known that generator expansions are generally the projects most likely to interconnect, as acknowledged by CAISO in allocating additional points to these projects in proposal #10. Thus, Pattern Energy opposes proposal #6.2 because it would relegate storage facilities added through Material Modification Assessments or Post-COD modifications to the Commercial Operation group, thereby penalizing exactly the projects this process is intended to move forward.
Pattern Energy reiterates that the proposal should reward projects which seek to interconnect with deliverability, and which are able to secure PPAs commensurately, whether those projects are modifications, queue positions, or take any other future path to interconnection.
In the same spirit, regarding proposal #10, Pattern Energy supports additional TPD scoring points for expansions of existing generation facilities but asks for clarification of the definition of expansions and of surplus capability.
- Is the addition of storage through a Post-COD modification an expansion? Pattern Energy believes these projects should be allocated expansion points.
- Is the addition of storage through a transfer of Surplus Interconnection Service an expansion? Pattern Energy believes these projects should be allocated expansion points.
Rev Renewables
Submitted 09/18/2024, 02:10 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
REV Renewables (REV) appreciates CAISO providing additional time and working group discussions on Track 3 issues. As CAISO knows, deliverability is a critical attribute for a project to be commercially viable and providing a transparent and predictable process for deliverability allocation is critical to a successful interconnection process. REV commends CAISO for trying to work with stakeholders on tackling the complicated issue of how to retain TPD while awaiting long-lead time upgrades.
REV proposes that CAISO continue allocation group D (as noted in #4), and projects that are awaiting long lead-time deliverability and reliability network upgrades be allowed to “reserve” their place in the queue. In this “reservation”, a project would be allowed to defer showing a short-list or PPA until 3-4 years before the network upgrade is complete. This will allow projects to retain their position in the queue and deliverability while waiting for required upgrades (for which they have no control). For example, if a project has a network upgrade date of 2031, then a shortlist would be required in TPD allocation cycle for 2028. REV also proposes that projects be required to show progress during the interim years, such as signing an LGIA and queue management milestones like obtaining permits.
REV notes that this proposal will better align with existing LSE procurement practices of entering into contracts 2-3 years before COD. REV cautions that any proposal that relies on LSEs and CPUC to change current procurement practices, without an accompanying proposal from the other entities, would put the CAISO proposal at risk. REV also notes that this is similar to the Clearway proposal from July 2023 and REV’s comments from August 2023.
REV emphasizes that any type of deliverability received, such as in the proposal above or the proposal contemplated in Track 3B for allocating available headroom while waiting for long lead-time network upgrades, should be provided on a multi-year basis. Projects need rule stability and reasonable assurance of deliverability terms from year to year in order to make the financial commitments necessary to continue development and progressing towards COD.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
See REV’s proposal in #1 which can apply to reliability network upgrades as well.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
REV continues to oppose reserving TPD for long lead-time resources, especially if there are other projects that could come online sooner and provide resource adequacy to the grid. If this proposal continues, REV requests more details around the process for TPD reservation, including timing and retention deadlines, and impact to available capacity for future clusters.
CAISO noted that some TPD has already been reserved for long lead-time resources; REV requests CAISO provide more transparency into where and how much TPD has been reserved for these resources and its process for doing so.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
REV supports continuing allocation group D as it operates now, and could support removing restrictions as long as a provision such as REV’s proposal in #1 is also adopted so that these projects have some level of assurance they can retain their deliverability while progressing towards COD. As noted in the workshop, group D provides important information to LSEs during the procurement processes that the project will meet resource adequacy requirements.
REV could consider eliminating group D starting with 2027 TPD Allocation year for Cluster 15 and beyond projects, depending on the final outcome of CAISO’s Track 2 reforms. This would be conditional on Cluster 14 being allowed to maintain group D status if awaiting long lead-time upgrades (as noted in #1). Additionally, if CAISO’s 150% transmission zone reform is finalized and CAISO can provide reasonable assurance that any project that gets studied has a high likelihood of receiving deliverability, that could alleviate the need for group D. REV requests CAISO provide data on how many projects were able to be studied or not in TPD zones for Cluster 15, and how many projects were able to receive a commercial interest score, these could be useful data points to consider before eliminating Group D and should be available before the final proposal.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
REV appreciates ACP-CA thinking outside the box for this proposal. However, REV is concerned that the Conditional Deliverability category would remain available for future clusters. As noted above, projects need reasonable assurance of deliverability in order to make the financial commitments necessary to continue towards COD. Given the significant size of recent clusters, REV is concerned that TPD could get fully used while waiting for long lead-time upgrades and the conditional deliverability would be useless. If this does move forward, the priority system proposed may be able to address this issue. However, it could also just give false hope to later cluster projects since in reality they are behind many other projects in priority.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
REV does not disagree with the information in EDF’s presentation, but this highlights the potential for procurement process reform, which CAISO does not have jurisdiction over. Renewable energy projects such as solar and wind may be able to take advantage of energy or REC contracts that allow them to come online earlier. However, storage projects will likely require resource adequacy contracts to be financially viable and are unlikely to come online as energy only in the interim.
7.
Please provide any additional feedback:
REV requests that in CAISO’s next iteration that it clarifies how the proposals will work for projects currently parked if the parking process is eliminated (or if it is maintained).
Southern California Edison
Submitted 09/18/2024, 04:55 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
SCE supports finding ways to bring energy onto the grid in a timely manner but does not have a proposal based in part that SCE does not yet see much benefit in accelerating the commercial online date for resources with long-lead time DNUs. In the narrow case if a need exists for Energy Only resources in the near-term and deliverable capacity is needed in the longer term; allowing projects to initially connect as Energy Only and then obtain deliverability after the DNUs are complete may be beneficial. However, SCE does have concerns regarding the viability of such a resource.
When SCE is in the market to satisfy a procurement mandate, it seeks a clearly defined product and needs to have certainty when that product will be delivered. As an example, if SCE is in market for RA, it will look to procure resources that can deliver RA at a date certain. Therefore, a resource that initially will be Energy Only for a long period of time will likely be viewed for compliance as an Energy Only resource. This will impact the project’s value and will also increase the risk profile of the project
While there are additional quantitative benefits for resources that are deliverable, that benefit is not without cost. Specifically, the RA benefit will be considered in conjunction with the costs of the DNUs. Since the product that the resource will initially be delivering will be based on an Energy Only deliverability status, resources with long lead-time DNUs are practically Energy Only resources with the DNU costs of a fully deliverable resource.
Furthermore, the risk of delay associated with the DNUs may lead LSEs and developers to contract for the only the energy attributes of the resource in the shorter term, or debate who is best suited to where the risk around the delivery of the RA product and how much does that risk cost. Therefore, there could be an unintended consequence of having deliverability tied up by a resource that was procured based on and Energy Only status.
As a result of the above mentioned, SCE does not have a proposal at this time, but may have a better idea on a creative solution when the new procurement framework for the Reliable Clean Power Procurement Program is established.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
SCE does not have a proposal on how to address resources impacted by long-lead time RNUs.
SCE may likely not seek these resources given the long-dated online dates as resources with a long-dated online date will likely not have firm pricing that their developers are willing commit to. There are also risks in how the RNU costs will be distributed if specific project/s do not fully obtain a fully executed GIA. Project failure would create financing risk for the other projects that are depending on the RNUs to be built.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
Since the CAISO claims they already have to the ability to earmark deliverability for specific policy driven resources/projects, the focus should be on how best to allocate and retain deliverability for long-lead time resources.
SCE believes that the allocation of deliverability for long-lead time resources should follow the same process as “generic” resources. However, since some long-lead time resources possess more development risk than the typical solar, wind, and battery energy storage systems, there needs to be further scrutiny on the retention of deliverability based the development status post PPA execution.
Following through on PPA commitments may likely present new challenges and it will be critical to monitor the status of the PPA while the resources are developed. Therefore, the CAISO should monitor whether a long-lead time resource is continuing to meet its PPA commitments while the resource is waiting the full execution of its GIA. If the GIA is not signed and the PPA is defaulted, that resource’s deliverability should be re-allocated.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
SCE opposes retaining Group D, while simultaneously removing the related restrictions. This scenario would likely lead to projects unjustifiably lingering in the queue by extending their commercial operation date, which would be in misalignment with the intent of the queue and contract management topics in IPE Track 2.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
SCE currently has no comment on ACP-CA’s proposal.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
SCE currently has no comment on EDF’s proposal.
7.
Please provide any additional feedback:
SCE appreciates the open dialog of the stakeholder process around long-lead time DNUs, RNUs and resources, but would like to reiterate that the elements within the initial track 3a scope also merit further discussion.
Terra-Gen, LLC
Submitted 09/18/2024, 04:39 pm
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
Terra-Gen, LLC (Terra-Gen) appreciates the opportunity to comment on the CAISO’s IPE Track 3A Working Group meetings.
It is commonly understood that the ability of energy storage projects to qualify for provision of Resource Adequacy (RA) to LSEs under a Power Purchase Agreement (PPA) is contingent upon those projects receiving deliverability from the CAISO. Terra-Gen highlights that the allocation of deliverability of many future energy storage projects will be contingent upon the completion of long-lead network upgrades whose timing will fail to meet the RA obligations of the LSE’s signing those PPAs. New solutions are necessary, such as longer-term interim deliverability, to bridge the gap until the network upgrades are completed.
Interim Deliverability Status (IDS): CAISO should develop and implement a longer-term interim or conditional deliverability policy that provides RA status sooner for projects, especially energy storage resources. The CAISO should develop a proposal to expand the use of interim deliverability, including multi-year durations.
Transmission Upgrades and Interim Solutions: CAISO urgently needs to develop a more formalized approach to consider near-term solutions, where appropriate, such as modeling changes or breaker configurations, to reduce the need for large, long-lead-time network upgrades that can enable earlier awards of interim deliverability.
Transmission Plan Deliverability (TPD) Allocation Window: CAISO should explore allowing projects to enter the TPD allocation window based on their forecasted Commercial Operation Date (COD) to address potential mismatches between procurement requirements and transmission upgrade timelines.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
Terra-Gen highlights the need for a more flexible and supportive approach to addressing the challenges faced by projects due to the timing of long lead-time RNUs and the need for accelerating their CODs.
Accelerating CODs: To address the challenges faced by projects, CAISO should prioritize the development and implementation of proposals to achieve the following:
- Clear the interconnection queue of old and non-viable projects;
- Allow projects to reach COD before RNUs are triggered; and
- Speed up RNU construction or implement alternative solutions.
Phased Interconnection Financial Security (IFS): CAISO should require phased IFS postings for projects with long-lead-time upgrades, especially those involving Short Circuit Duty (SCD) upgrades, to mitigate financial risks and accelerate CODs.
Update on Prior Deliverability Assessment Methodology (DAM) Changes: CAISO should provide a status update on the effectiveness of the last changes stemming to the Generation Deliverability Methodology Review initiative, including the impact of the revised contingency assessment on deliverability. CAISO should provide some form of transparency regarding the impact of recent changes to the DAM, particularly regarding N-2 upgrades, to assess their effectiveness in accelerating FCDS awards.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
Terra-Gen believes a more balanced and flexible approach to the reservation of deliverability for LLT resources is needed – one that also provides the ability to secure deliverability for other resource types, including solar and energy storage. For instance, the North of Greater Bay Area planning area provides a good example of where the CAISO is proposing to reserve a vast majority of future planned deliverability for LLT Resources while failing to study and provide for deliverability of many planned energy storage projects currently queued and under development in that area.
LTT Deliverability Reservations: CAISO should clarify its methodology for implementing LTT deliverability reservations, including how they were determined and the impact on available TPD. Additionally, as previously highlighted in written comments, the CAISO should consider the potential impacts of these reservations on the ability of other traditional resources to achieve deliverability.[1] CAISO should ensure that policy-driven planning and deliverability reservations for LLT resources accurately account for existing/planned and future upgrades needed to provide adequate deliverability for LLT and other resource types.
Transparency, Clarity and Consistency: CAISO should provide greater transparency and engage stakeholders more actively in discussions regarding LLT resource deliverability reservations, including the rationale, methodology, and potential impacts on other resources. Additionally, CAISO should provide clear and consistent information regarding the LLT resource reservation process, including specific regions, capacity, and implications for other processes. This would help stakeholders understand the potential impacts of LLT reservations on their projects and make informed decisions regarding development and interconnection.
Impact on Existing Projects: The CAISO should assess and mitigate the potential negative impacts of LLT reservations on existing projects, particularly those that have advanced significantly. This includes considering the potential for LLT reservations to limit the ability of other traditional resources to achieve deliverability by reducing available TPD.
Flexibility and Adaptability: The CAISO should consider incorporating mechanisms to allow for some flexibility in LLT reservations, such as releasing reserved capacity for interim use or including additional headroom in transmission studies. This would help balance the need for LLT resource development with the potential impacts on other resources.
In summary, Terra-Gen recommends that CAISO should:
- Conduct a thorough assessment of the potential impacts of LLT reservations on the ability of other traditional resources to achieve deliverability;
- Develop strategies to mitigate these impacts, such as prioritizing LLT reservations in areas with excess transmission capacity or considering alternative interconnection options;
- Provide clear communication and transparency regarding the potential impacts of LLT reservations on other traditional resources; and
- Consider incorporating mechanisms to allow for flexibility in LLT reservations, such as releasing reserved capacity for interim use or including additional headroom in transmission studies.
By addressing these concerns, CAISO will help to ensure a more balanced and equitable approach to LLT resource development while minimizing the negative impacts on other traditional resources.
[1] See Terra-Gen's July 29, 2024 Comments on IPE 2023 Track 3 straw proposal: https://stakeholdercenter.caiso.com/Comments/AllComments/30de9643-387f-494c-99af-93ccecf21294#org-9bc96e8c-ade7-40e0-8e82-11fd28dcff60
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
Terra-Gen supports the retention of Option D, at minimum, for Cluster 14 and earlier projects, to provide flexibility and opportunities for projects that may have parked or faced challenges in securing TPD. Additionally, the delayed 2025 TPD cycle could benefit currently queued projects by allowing them to leverage upgrades approved in the 2024-2025 TPP, increasing the supply of RA-eligible projects.
Specifically, Terra-Gen recommends that CAISO should:
- Carefully consider the potential benefits and drawbacks of retaining Option D, especially for Cluster 14 and earlier projects;
- Assess the potential impact of the delayed 2025 TPD cycle on the availability of TPD for projects and make necessary adjustments; and
- Review and update Group D restrictions to ensure they are fair and equitable, considering the potential challenges faced by projects that may need to park or attempt multiple TPD Allocations.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
7.
Please provide any additional feedback:
Vistra Corp.
Submitted 09/20/2024, 09:17 am
1.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time deliverability network upgrade issue:
As the region continues to struggle with this challenge, Vistra believes CAISO should focus on the development of a network service subscription model to address long lead-time deliverability network upgrade issues. Please see attached an updated slide deck with Vistra’s Network Service Subscription Model proposal with clarifications on what elements can be implemented on interim only within interconnection processes while the longer-term solution also impacting Transmission Planning Process (TPP) improvements can be implemented in a second phase.
Developers that know their projects will need long-lead time Network Upgrades (NU) should be allowed to subscribe to the Transmission Plan Deliverability (TPD) capacity resulting from those Area Delivery Network Upgrades (ADNU), but until the full solution at a minimum they should be allowed to:
- Delay competing for TPD until no later than 3 years prior to CAISO Interconnection Process Enhancements (IPE) 2023 Track 2’s queue management Commercial Viability Criteria (CVC) deadline.
- Be allowed to subscribe to the NU upgrades once they are approved and identified as Network Service Subscription candidates.
- For approved subscriptions, the TPD subscriptions would be used as a credit to the Transmission Access Charge (TAC) reducing TAC costs associated with the NU.
- Project associated with subscription is included in a new highest priority TPD group called “Network Service Subscriber Group”.
These proposed changes should apply to all project types. CAISO would still be able to reserve TPD capacity from these NU for long-lead time resources before identifying the amount of TPD capacity available for subscription.
2.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time reliability network upgrade issue:
Vistra supports the Network Service Subscription Model also being used to address Reliability NU. While the commensurate benefit of receiving TPD priority is likely not relevant, there are other benefits that may merit IC willingness to subscribe to a portion of a NU in a way that could help accelerate those RNU. For instance, if a Participating Transmission Owner (PTO) is “deprioritizing” a RNU or if there are issues with procuring long-lead elements needed for RNU, the Network Service Subscription Model approach could allow IC to indicate a high priority RNU for CAISO to include in the subscription candidate list to solicit interest to subscribe to fund the RNU. If there is substantial interest and willingness to fund the RNU could be used to help prioritize the RNU and to use the subscriptions to put towards the RNU costs at this stage to facilitate the PTO to use those funds to progress the RNU. This is not the exact scenario that Vistra has considered the subscription model for and consequently this requires additional discussion to further develop a solution that is workable for RNU.
3.
Please provide your organization’s questions or comments and potential solutions to the Track 3A long lead-time resource issue:
Vistra continues to believe the most viable solution to this chicken and egg problem is pursuing a Network Service Subscription Model where these Interconnection Customers would be able to request the ability to subscribe to a Network Upgrade being considered in a TPP cycle in exchange for receiving a commensurate share of the increased full capacity deliverability headroom due to the approved NU. As mentioned in response to #1, the interim solution could address this issue solely within the interconnection process until the full solution with TPP enhancements are feasible.
Under the interim approach, CAISO would be able to reserve a share of the TPD capacity for a project that indicates willingness to subscribe, allowing the CAISO to reserve a share of the deliverability for subscribing projects until the projects submit their TPD affidavit request. Once the TPD capacity is reserved, CAISO should allow the reservation to be retained until all three TPD allocation attempts are exhausted.
The last critical element is that CAISO should allow projects to delay the start of TPD allocation attempts to no later than three years prior to the CAISO IPE 2023 Track 2’s Commercial Viability Criteria deadline. Vistra conceptually proposes that CAISO add to its proposal the ability for projects to delay beginning the TPD allocation process until no later than three attempts prior to its Commercial Viability Criteria (CVC) deadline to show proof of one or more executed power purchase agreements among other requirements:
|
Cluster
|
CVC Deadline
|
Earliest First TPD Attempt
|
Proposal – Allow TPD Delay No Later than Deadline for First TPD Attempt
|
|
15
|
April 30, 2028[1]
|
March 2027
|
2025 TPD Cycle[2]
|
|
16
|
~ August 2033[3]
|
March 2028
|
2031 TPD Cycle
|
|
17
|
~ August 2034
|
March 2029
|
2032 TPD Cycle
|
Finally, Vistra recommends CAISO include a proposal for pre-application data transparency be provided prior to the queue process being available. CAISO should produce pre-application data that would distinguish between available capacity, interconnection feasibility, estimated upgrade costs and timelines to interconnect for each interconnection service level.[4] This information should be available to IC as well as PTO prior to the IR window. This information will allow developers of long-lead resources to better sequence the best IR window for submitting their project based on when TPD capacity will be available for it to subscribe to and/or compete for TPD.
[1] Given the proposed deadline in April 2028 where the 2028 TPD Allocation cycle is not expected based on proposed timelines to be finalized until June 2028, the 2028 TPD Allocation cycle would not be feasible for C15. If CAISO modifies the CVC deadline to
[2] If CAISO modifies the date for C15 CVC to Fall 2028 the Deadline for First TPD Attempt Proposed would be 2026 TPD Cycle.
[3] CAISO IPE Track 2 Final Proposal states on Page 89: “All projects in Cluster 15 and later will be required to meet CVC by 5 years from the publication of the interconnection facilities study, which is the last study in the Order No. 2023 study process.” Given RIS Section 8.5 and 8.7 pending at FERC, Vistra believes the IFS study publication is August of each year, so we tentatively use August annually for IFS publication for the proposal.
[4] For example, Clearway proposed pre-application data would improve interconnection processes in the testimony of Chris Barker Managing Director, Transmission & Grid Integration (Clearway Energy Group) at the FERC Interconnection Workshop, Sept. 10-11, 2024, Efficiencies Panel 1 in FERC Docket No. AD24-9-000. Available at: 2024, https://elibrary.ferc.gov/eLibrary/filedownload?fileid=62712A82-9890-CC0A-9FCB-9193BC300000.
4.
Please provide your organization’s questions or comments in response to the Track 3A: continuing allocation group D as it operates now, removing the restrictions and have the group D allocations reduce the available TPD capacity for the cluster studies:
Vistra appreciates the efforts that CAISO has made to clarify its policy intent for interconnection projects to have long-term contracts that meet its Power Purchase Agreement requirements before competing for TPD. Apart from our proposal to allow the highest priority for TPD to Network Service Subscription Group, Vistra recognizes that the remaining prioritization is based on whether the project has been contracted, shortlisted, or has achieved commercial operations. Vistra strongly supports eliminating “all other projects” group – Group D.
It is our belief that TPD capacity will be scarce. It is also our belief that we are moving towards a framework where IC will be able to subscribe to fund NU to effectuate its deliverability (e.g., ADNU) or advance its ability to interconnect (e.g., RNU) that will contribute to TPD capacity being reserved for Network Service Subscribers. Further, we also understand the CAISO is moving towards reserving TPD capacity for long-lead time resources that are designated as resource technologies and in locations that are needed to meet state policy goals under existing Appendix DD Tariff Section 8.9.1. In combination, future TPD capacity increases are likely to have meaningful portion reserved for state policy goals or for Network Service Subscribers. Next, Vistra believes the remaining TPD capacity after reservations will likely be fully allocated to PPA Group, Shortlist Group, and Commercial Online Ops Group. In practice, going forward we do not think a Group D will be useful or meaningful.
If CAISO incorporates elements of our proposal that allow TPD attempts to be delayed to three attempts prior to CVC deadline and ideally allows for NU subscriptions in exchange for being included in a new Network Service Subscriber Group there will not be a need for Group D for viable projects whether mid-term or long-term resources. We strongly encourage CAISO to eliminate Group D and pursue the subscription route instead.
5.
Please provide your organization’s questions or comments in response to the ACP-CA “Group D Conditional Deliverability” presentation:
See Vistra’s response to #4. Vistra believes with a subscription model and the ability to delay TPD attempts to no later than three attempts prior to CVC deadline that the issues raised be ACP-CA are resolved. We do not think the intent of ACP-CA proposal will be met by retaining Group D.
6.
Please provide your organization’s questions or comments in response to the EDF Renewables “Development Alignment Proposal” presentation:
Vistra requests CAISO clarify its PPA eligibility requirements specified in Appendix DD Section 8.9.2 and any nuances it approaches in its scoring methods. Our understanding of the current PPA eligibility rules is below:
- Term must be ≥ 5 years in a single agreement or across combination of multiple agreements combined term length (Appendix DD, Section 8.9.2)
- Contracted attribute(s) must include Resource Adequacy attributes (Appendix DD, Section 8.9.2)
- Counterparty criterion must be met within 30 days after receiving TPD allocation or else pay $10,000/MW deposit in lieu capped at $500,000 that will be returned if it achieves COD or meets counterparty criterion or else if withdrawn then non-refundable.
- Counterparty requirement is that the project's buyer is:
- A Load Serving Entity (Appendix DD, Section 8.9.2a)
- Non-Load Serving Entity with a contract to serve a Load Serving Entity with the RA attribute for at least one year term (Appendix DD, Section 8.9.2b)
Our understanding is that CAISO’s PPA requirements do not include pricing or penalty terms. We would appreciate clarification on these requirements.
7.
Please provide any additional feedback:
In summary, Vistra requests the CAISO consider the following:
- Produce pre-application information prior to the queue process to include available capacity, interconnection feasibility, estimated upgrade costs and timelines.
- Allow projects to delay their three TPD attempts to no later than three TPD cycles prior to its Commercial Viability Criteria deadline.
- Clarify that CAISO policy intent is that its intent is to allocate TPD capacity to contracted or shortlisted projects and clarify the PPA eligibility requirements.
- Clarify which group or new group that the Exclusivity Agreements will be included in. In exchange for commercial interest point allocations for IPE 2023 Track 2 proposal pending at FERC, IC must enter exclusivity agreements that will prohibit it from marketing its project. These projects will not be able to compete for PPA and will be subject to that LSE determination of when it would like to or would not like to convert it to a PPA. Given that the IC will not be able to market the project, the CAISO should clarify in which group these Exclusivity Agreements will be allowed to count. Since these projects are technically “shortlisted” and on standby for being converted to PPA and unable to be marketed elsewhere, the Exclusivity Agreements should be in same group with shortlisted PPAs. While Vistra has urged FERC to reject the Commercial Interest Point proposal, in particular over the concerns regarding the use of Exclusivity Agreements, it is crucial that CAISO offer these clarifications. At a minimum, if FERC approves the pending IPE filing, CAISO must clarify how Exclusivity Agreements will be prioritized.
- Add Network Service Subscription process to the interconnection process at a point prior to TPD allocation process and give new Network Service Subscriber Group the highest TPD priority in exchange for its subscription offsetting Transmission Access Charge costs that would otherwise be paid by load.
- Eliminate Group D
