Comments on 20-Year Transmission Outlook & May 14 Stakeholder Call

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

ACP-California greatly appreciates CAISO’s efforts to develop the 20-year transmission outlook, which is consistent with the types of transmission evaluations for which ACP-California has been advocating. A more forward-looking transmission evaluation, which provides CAISO with more flexibility in study approach than the tariff defined Transmission Planning Process (TPP) is needed as the state enters a new phase of clean energy development, where additional transmission capacity will be needed to achieve the state’s long-term goals. The 20-year transmission outlook can provide important analysis and information to the CPUC’s Integrated Resource Planning (IRP) process and is a necessary first step to beginning to better align the generation and transmission planning processes. ACP-California supports the assessment’s broad scope, which will include evaluations of in-state and out-of-state transmission solutions, including inter-regional transmission projects and transmission capacity to incorporate offshore wind.

There are several areas where additional information would be helpful to stakeholders. ACP-California encourages CAISO to hold additional stakeholder calls and issue a draft study plan to enable stakeholders more time to review assumptions and approaches to the 20-year transmission outlook during the course of the study process. Some of the areas where additional information would be valuable are discussed below.

Stakeholders will benefit from additional information on the outputs of the 20-year transmission outlook. CAISO should review with stakeholders the type of information that will be provided on the transmission solutions that are evaluated. CAISO could provide a high-level summary of the anticipated outputs of this process as part of the upcoming workshop discussed in the presentation (which will be held in conjunction with the joint energy agencies in June). We understand the outputs of this process will include high-level cost estimates for transmission solutions that are evaluated.

• It may also be valuable to include information on whether additional generation resources (beyond those studied in the resource portfolios of the 20-year outlook) are expected to be able to be accommodated on the transmission solutions. This information will likely be helpful for the CPUC it its planning efforts. ACP-California encourages early communication with the CPUC to ensure that the outputs from the 20-year transmission outlook are as valuable as possible to the IRP process. This type of up-front communication and coordination with the CPUC and stakeholder will help ensure the results of the 20-year outlook are meaningful and supportive of other ongoing processes, such as the IRP.
• ACP-California also requests that CAISO provide additional details on how the outlook studies will be conducted. During the stakeholder call, CAISO indicated that the 20-year outlook will not focus on deliverability studies nor evaluation of transmission solutions to provide deliverability of resources but will instead focus on transmission solutions which are needed to simultaneously achieve reliability and GHG metrics. While ACP-California has raised concerns with deliverability assumptions for resources studied in the TPP, we agree with CAISO that focusing on deliverability requirements, in a study looking out 20-years, is not appropriate. It is, however, critical to ensure that the 20-year studies are focused on the right metrics. It would be helpful for CAISO to provide the reliability and GHG metrics and/or output that will be evaluated as part of the 20-year outlook for stakeholders to comment on. CAISO should build opportunities for stakeholder review of both inputs and outputs of the 20-year outlook and individual scenarios and sensitivities.
• As the CAISO considers new metrics and scenarios for the 20-year outlook, ACP-California suggests scenarios that ensure CAISO can maintain reliable and economic service while meeting the goals of SB 100 and supporting increased electrification.  To this end, CAISO should include one or several scenarios that are significantly more aggressive than current IRP study scenarios, with reliability consideration and consistent with the ARB’s greenhouse gas electricity sector greenhouse gas planning target range of 30-44 MMT CO2e, which will likely be reduced in the upcoming cycle of the Scoping Plan.[1]
• Additionally, the assumptions that are incorporated about the non-CAISO west will be important to the 20-year outlook. It may be helpful to hold a stakeholder workshop and work with regional stakeholders to help develop and refine these assumptions.
• CAISO should work with the joint energy agencies to ensure that the outcomes of this effort are actionable and provide efficient linkages back into regulatory processes to approve the right transmission elements in the near-term, recognizing the long time horizon associated with transmission development.

ACP-California reiterates our appreciation for the CAISO developing this proposal and encourages continued engagement with the CPUC, CEC, and other stakeholders on the items outlined in these comments to help ensure this analysis is as valuable as possible.

[1] https://ww2.arb.ca.gov/sites/default/files/2021-04/sb350-final-report-2020.pdf

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

ACP-California also appreciates CAISO discussing the Out-of-State (OOS) wind sensitivity which will be part of the 2021-22 TPP. As with the 20-year transmission outlook, it would be valuable for CAISO to provide additional information on the anticipated outputs of the OOS wind sensitivity and how the sensitivity results might be utilized/considered in the assessment of the base portfolio, which also includes OOS wind delivered on new transmission.

CAISO indicated that the analysis of out of state transmission alternatives will only include production cost simulation. ACP-California requests clarification on this and whether deliverability studies will be conducted or other metrics/analysis might be performed as part of the out-of-state wind sensitivity.

3. Additional comments on the May 14, 2021 stakeholder call discussion:

No comments at this time

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

On May 14, 2021, the CAISO held a stakeholder call to kick-off its 20-Year Transmission Outlook as an expansion of its existing Transmission Planning Process (TPP) and to review details of the Out of State (OOS) wind sensitivity study it will be performing under the CAISO 2021-22 TPP. The Bay Area Municipal Transmission group (BAMx)^[1] appreciates the opportunity to comment on these two topics.

BAMx Supports the CAISO’s Broad Objectives for the 20-Year Transmission Outlook Initiative

On slide #5 of its May 14^th presentation, the CAISO indicated that it is “Launching the 20-Year Transmission Outlook initiative to explore longer term grid requirements and options for meeting the State’s greenhouse gas reduction and renewable energy objectives reliably and cost-effectively.” The CAISO further explained it has opened this initiative in response to stakeholder feedback and noted that its focus will be on exploring longer term grid requirements and options to support meeting California’s objectives. However, it will not be focusing on specific project approvals, which will continue to be pursued through the existing near-term TPP. BAMx supports the CAISO’s objective of this study to engage in meaningful discussion without focusing on specific project approvals. BAMx also supports the CAISO’s plans to coordinate the 20-Year Transmission Outlook initiative with the other state agencies including the California Energy Commission (CEC) and California Public Utilities Commission (CPUC). As explained below, we recognize the critical role of the CPUC in helping Load Serving Entities (LSE) select the best options to meet the State’s goals as laid out by Senate Bill (SB) 100 (DeLeón, 2018)[2] (SB 100, hereafter).    

BAMx Recommends Utilizing the CPUC 2019 IRP Model Used for the Year 2045 As A Starting Scenario

The State’s climate goals are likely to require a transformation of the state’s electrical infrastructure including the In-State, Offshore, and OOS solar, wind, and storage resources, including the transmission facilities associated with the expanding supply infrastructure. Such large-scale planning needs to co-optimize economic, land use, transmission, and interconnection issues associated with the amount of renewables and storage needed to be online in the 20-year timeframe to achieve the state’s SB 100 goal of 100% clean electricity by 2045, as well as 80 percent below 1990 emissions by 2050. Therefore, BAMx concurs with the CAISO that a longer-term context for framing issues in the existing 10-Year Transmission Plan is necessary. One natural candidate for the starting point for study assumptions for the 20-year outlook is the year 2045 modeling of the 46MMT 2019 Reference System Plan (RSP) portfolio as shown in Table 1 below. BAMx understands that this portfolio is extrapolated from the 46 MMT by 2030 target using the same assumptions that were used for incorporating post-2030 years (into select modeling runs) to reflect achievement of the SB 100 2045 goals in the development of the 2019 RSP. There are two major advantages of using this portfolio as the starting set of study assumptions. First, this portfolio is readily available as part of the CPUC 2019 IRP. Second, it is consistent with the 46MMT portfolio (with resource build-out in 2031) that is used as the Base portfolio for the 2021-2022 TPP. This means that the resources to busbar mapping for the 20-year case would not only be consistent with the 2031 Base portfolio used in the 2021-2022 TPP, but also the efforts required for this mapping exercise would likely be manageable given the current timeline that envisions the CAISO sharing the draft results of the 20-year outlook with the shareholders by November 2021. BAMx hopes that the high-level technical analysis of the CPUC’s 2045 (or 2041 for a 20-year case) portfolio based upon 46MMT 2019 RSP will provide stakeholders with useful insights into transmission project needs and approvals beyond the 10-year planning horizon.

Table 1: Capacity Additions 46 MMT with 2019 IEPR Portfolio[3]

[1] BAMx consists of the City of Palo Alto Utilities and City of Santa Clara, Silicon Valley Power.

[2] See https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB100

[3] Source: Figure 1 in the “Descriptions of the Proposed Portfolios for the 2021-2022 TPP,” CPUC Energy Division, October 23, 2020, p.B-3.

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

Out of State (OOS) Wind Sensitivity Study Should Help Policy and Decision Makers Identify Realistic Assessment of Additional In-State Transmission Upgrades and Related Costs to Accommodate OOS Wind

RESOLVE,^[1]  a capacity expansion model, that is used to develop the resource portfolios by the CPUC, is a linear model that applies only an estimate of the cost on a $/kW basis of the necessary transmission to deliver the energy to the CAISO system. For example, in the Sensitivity 1 portfolio used in the 2021-2022 TPP, RESOLVE selected 1,500 MW of Full Capacity Deliverability Status (FCDS) New Mexico wind interconnected into the “SCADSNV-Riverside_Palm_Springs” transmission zone.[2] This selection assumed that the transmission costs to reach the CAISO system are approximately $121/kW-Yr.[3] The RESOLVE model does not capture in-state transmission buildout to access the OOS resources. In other words, RESOLVE might underestimate the overall transmission costs associated with procuring OOS wind. Presumably, the CAISO modeling of the Base and Sensitivity portfolios in the 2021-2022 TPP will capture these additional transmission upgrades to accommodate the OOS wind. These additional internal (gateway) upgrades need to be fed back into the CPUC IRP to accurately capture the overall transmission cost associated with the OOS wind. It is pertinent that all types of transmission costs associated with OOS wind are accurately captured to adequately evaluate the cost-effectiveness of the OOS wind resources relative to the competing In-State and other OOS renewable resources.

Need for a Framework that Ensures the Allocation of Costs of OOS Transmission Project(s) to LRAs/LSEs that Trigger the Need for Them

During the May 14^th meeting, the CAISO explained that it has determined that its economic assessment of the Base portfolio will not assess the transmission outside of the CAISO system and will assume the use of existing transmission to access OOS resources that would be procured. The Base portfolio will consider the injection of the OOS wind at either the Eldorado or Palo Verde (Pinal Central) areas and will also consider related potential internal CAISO system transmission constraints.[4] The CAISO has also indicated that it would assess as a special study a comparison of transmission alternatives for the OOS wind in the Sensitivity 1 portfolio provided by the CPUC.[5] We agree that the benefit of resources should be evaluated at the connection point to the CAISO grid.

On slide #18 of the May 14^th presentation, the OOS Wind Sensitivity study will “directly compare the CAISO ratepayers’ net payments of the selected study scenarios, and provide the comparison results to the CPUC’s IRP for future portfolio development.” Slide #16 indicates that an “(a)nalysis of the out (of) state transmission alternatives will only include production cost simulation.” We agree that the CAISO cannot necessarily determine the economics of OOS transmission. It should be determined by the OOS sellers to deliver its product to the CAISO grid. That will probably be based upon the Seller’s ability to access existing transmission or purchase transmission from developers of that transmission. To perform a systematic comparison of the transmission cost impact of the OOS transmission, the following transmission cost allocation principles must be applied. The fundamental principle for cost allocation is that it should be allocated in a way that is commensurate with benefits. In particular, the LSEs within the Local Regulatory Authorities (LRAs) approving resource procurement that are benefiting from the OOS resources should pay for that transmission delivering those resources to the CAISO border. BAMx believes that having the supplier build in its cost of delivering its product to the CAISO will also improve its ability to optimally deliver its product to the WECC-wide grid. This mechanism ensures that buyers of the remote generation output will have the transmission costs outside of the CAISO captured in the power purchase agreement (PPA) pricing. This will also help accomplish the first principle of FERC Order 1000, that is, costs are allocated in a way that is roughly commensurate with benefits. Broadly, LSEs voluntarily procuring resources using transmission should pay for the cost of delivery. One such example is the SunZia Transmission Project, accessing the New Mexico wind, which is not seeking CAISO Transmission Access Charge (TAC) cost recovery to deliver its product to the CAISO boundary point.[6] In other words, the costs of new transmission outside CAISO are captured in the PPA pricing with LSE off-takers who are procuring New Mexico wind energy and will not be borne by all the CAISO-wide TAC payers.

[1] Further information on RESOLVE is available here: https://www.cpuc.ca.gov/General.aspx?id=6442459770

[2] Source: Figure 3 in the “Descriptions of the Proposed Portfolios for the 2021-2022 TPP,” CPUC Energy Division, October 23, 2020, p.B-6.

[3] “Descriptions of the Proposed Portfolios for the 2021-2022 TPP,” CPUC Energy Division, October 23, 2020, p.B-4.

[4] CAISO May 14^th Presentation. Slide #16.

[5] Ibid.

[6] See Southwestern Power Group and Pattern Energy Group Joint Reply Comments on Administrative Law Judge’s Ruling on Portfolios for the 2021-2022 Transmission Planning Process, November 20, 2020, p.1. Southwestern Power Group (SWPG) is developing SunZia Transmission Project, a 520-mile independent transmission project to deliver New Mexico wind to Pinal Central (Palo Verde area) to serve Arizona and California markets.

3. Additional comments on the May 14, 2021 stakeholder call discussion:

BAMx appreciates the opportunity to comment.  BAMx would also like to acknowledge the significant effort of the CAISO staff in developing the 20-Year Transmission Outlook and OOS Wind Sensitivity Study, as well as the CAISO staff’s willingness to work with the stakeholders in the process of developing the Study Plan. We believe there are many structural issues involved in the recovery of transmission costs that should continue to be examined here or in another forum while the CAISO performs the proposed production cost analysis.  We look forward to participating in such discussions prior to the CAISO presenting its study findings at the November 2021 stakeholder meeting.

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

CPUC staff endorse the 20-Year Transmission Outlook study initiative. If structured optimally, this study can answer important questions. The 10-year outlook used in the Transmission Planning Process (TPP), although appropriate for the purpose of that process, has some limitations. To meet state reliability and greenhouse gas reduction goals, including SB100, it is evident that a large amount of new generation and storage resources are needed, and as a result, investments in the transmission system to deliver the electricity to load. When considering that the process for developing a new transmission line can take up to 10 years, the TPP’s 10-year outlook can result in transmission developed just in time for the need. A 20-year outlook can ensure that transmission and resource development decisions within the 10-year TPP outlook are made with the insight of resource and infrastructure needs in the following decade.

CPUC staff appreciates the CAISO holding a stakeholder call to begin a discussion on the scope of this study. We believe a lot of questions remain to be answered and we look forward to collaborating with the CAISO, the CEC, and stakeholders to answer these questions among others.

1. What specific questions do we all aim to answer? Will the end product be more qualitative or quantitative in nature? Will the study explore a range of futures? What use cases do we hope the results will serve?
2. What modeling and interagency resources will be utilized to conduct this study?
3. What inputs and assumptions will be used?
   1. Will a specific resource portfolio need to be mapped to the busbar level?
   2. What supply-side and demand-side assumptions will be considered?
      1. For example, if scenarios from the Joint Agency SB 100 study were to be used, would the core or study scenarios be used? How would other potential routes such as that explored the “CEC Draft Staff Report: California Building Decarbonization Assessment” be considered?
   3. Can a range of import levels be assessed, including a very high amount of imports that would be indicative of a larger CAISO footprint?
4. How can this study be designed to mitigate any potential circularity between the transmission limit and cost inputs used in the SB 100 scenarios and how the resulting resource portfolios will be used to study transmission need in this 20-year study?
   1. The transmission assumptions used in the SB 100 Joint Agency Report study certainly influenced the resource build out. That resource build out would shape the findings on 20-year transmission needs if it were to be used as a direct input into the 20-year outlook study. If the transmission inputs used in the SB 100 study are out-of-date, how may that influence the results of this 20-year outlook study?

CPUC Staff Straw Proposal:

CPUC staff recommend studying a range of cases representing aggressive resource build out futures. For example, if the CAISO had to prioritize one of the SB100 cases, CPUC staff would suggest prioritizing the SB 100 Study Scenario over the SB 100 Core Scenario. If that is not possible, we at least recommend studying bookend scenarios. It will be important to understand how transmission needs would vary under futures including, but not limited to, high electrification and fossil fleet retirement.

Purpose: The study should aim to answer the following questions:

1. What transmission upgrades/development will be required to meet SB 100 goals?
2. How should the 20-year transmission system outlook inform decision-making regarding what transmission and resource investments can best address identified near-term transmission needs while also staying in line with the investments that will be required in the long-term? This could include a cost-benefit analysis to determine whether it is more cost-effective to build a transmission line sooner rather than later.
   1. E.g., How do the 20-year outlook study results inform what urgent transmission projects are recommended for approval in future TPPs
3. Assess whether the current planning processes (IRP, TPP, GIDAP) can adequately serve as a bridge between fulfilling the needs identified in the 20-year outlook study and resource procurement and transmission development identified as part of the regular 10-year study process
   1. E.g., if upgrades require a development timeline of longer than 10 years, how could those upgrades be incorporated into existing processes versus needing new processes.

Use Cases:

• The end product should include quantitative information that can inform other planning processes.
  • For example, if within the TPP the CAISO needs to decide between a few policy-driven project alternatives to recommend one for approval to the Board of Governors, the 20-year study results could serve as an important source of information to determine which of the transmission projects better aligns with the trajectory to meet SB 100 goals.
• CPUC staff believe the 20-year transmission system outlook can inform the following use CPUC cases: Future IRP capacity expansion modeling; resource-to-busbar mapping; and decision-making, such as that required for procurement orders.

Final Product:

• The results of this study should be granular enough that they could serve the same purpose as TPP policy-driven sensitivity studies, which are information only, but do provide a detailed understanding of the transmission development that would be required to accommodate a specific resource portfolio.
• Ideally, the results of this study would provide a list of specific transmission projects that could be necessary to achieve SB 100. For example:
  • Transmission development required to accommodate offshore wind resources. CPUC staff anticipates that need for an increasing amount of offshore wind resources will be identified in modeling results in the decade beginning 2030.
  • Transmission development that would reduce constraints on the LA Basin local capacity area and constraints on power flow from southern to northern CA.
  • Transmission that would increase imports and access to out-of-state resources.
• The list of transmission projects could be ranked/prioritized in a variety of ways. CAISO would not need to take a stance on which prioritization is the best policy, but rather these could serve as a menu of approaches that could be used when assessing implications through various lenses in decision-making. These could include:
  • Least regrets: Identification of transmission improvements that can be considered least regrets based on the range of SB 100 scenarios (transmission that would be required under a variety of paths taken to achieve the SB 100 goals)
  • Most urgent: Based on the order of implementation - taking into consideration when transmission upgrades may be necessary based on resource build out, and expected duration of the transmission development
• It would be useful for the end product to include a roadmap that could easily be used over the coming years to assess whether we are roughly on track to meet SB 100. CPUC staff urge CAISO to consider whether the study could be conducted and the results presented in a manner that would allow for them to be updated over time.

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

CPUC staff supports the CAISO’s Out of State (OOS) Wind Sensitivity Study. Transmission upgrades required on the existing transmission system + transmission development outside of CAISO + development of OOS resources are the three elements that need to be assessed before the state can understand the best holistic option for bringing OOS resources to CA load. Per our comment during the stakeholder call, we support the use of Sensitivity 1 rather than the base case for the purpose of this study because we believe it will provide more comprehensive results.

However, the base case portfolio that was transmitted to CAISO by the CPUC does include 1062 MW of OOS resources on new transmission that would be injected into the CAISO grid. There are two potential injection points and depending on at which point the resources would be injected, the implications on the CAISO transmission system can be significantly different. These CAISO system implications will be studied as part of the regular TPP economic assessment. This separate OOS sensitivity study could provide very useful information on the second important component, transmission development outside of CAISO. It is only when options on both sides of the CAISO border are considered that a full picture becomes available. For this reason, the OOS sensitivity needs to be designed in such a manner that the results can be scaled down and conclusions can also be drawn on smaller amounts of OOS resources, such as those included in the base case.

Specific questions on the scope of the study

1. What assumptions will be made about connecting the resources to the interties points studied?
2. What criteria/methods will CAISO use to specifically compare the costs, benefits, long-term risks of the two somewhat disparate approaches for bringing the selected OOS wind resource to current CAISO interties: wheeling the energy through existing OOS transmission or merchant controlled facilities or using a CAISO controlled facilities under TAC?

3. Additional comments on the May 14, 2021 stakeholder call discussion:

•  The 20 Year Outlook could assume or address the specific transmission planning benefits of a larger ISO footprint – how a more diverse set of resources available for dispatch over a wider area could enhance the planning and efficient development of new transmission and identify optimal avenues for this expansion to occur.
• The 20 Year Outlook could include graphics that clearly highlight the scale of transmission buildout that is likely to be needed. NYISO maps this kind of information on approved projects here. 

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

INTRODUCTION

The Public Advocates Office at the California Public Utilities Commission (Cal Advocates) is the California’s independent consumer advocate with a mandate to obtain the lowest possible rates for utility services, consistent with reliable and safe service levels, and the state’s environmental goals.[1] 

During the California Independent System Operator (CAISO) presentation on May 14, 2021, the CAISO requested comments on its proposed 20-Year Transmission Outlook Initiative (Initiative) by May 28, 2021.  Cal Advocates provides the following comments and recommendations on the Initiative.

The CAISO proposes this Initiative to engage stakeholders in a meaningful discussion within a less structured framework than its “tariff-based 10-Year Transmission Planning Process (TPP) that focuses on transmission project needs and approvals over a 10-year planning horizon.”[2]  The primary objective of the Initiative is to explore longer term grid requirements and options for meeting the state’s greenhouse gas reduction and renewable energy objectives reliably and cost-effectively, including inter-regional transmission project opportunities.[3]  The CAISO intends to produce a draft 20-year transmission plan by January 31, 2022 that identifies transmission projects within a 20-year planning horizon that could inform the CPUC’s Integrated Resource Plan (IRP)  and CEC’s Integrated Energy Policy Report.

For reference, in February 2021, as part of the CPUC’s IRP proceeding, the CPUC submitted a base case resource portfolio for the CAISO to evaluate in its 2021-2022 TPP.  This base case includes 1,062 megawatts (MW) of wind from out-of-state,[4] and new interregional transmission lines are needed to access these out-of-state resources.  The CPUC also submitted alternative resource portfolios to the CAISO with larger quantities of in-state renewable resources including offshore wind and batteries, and new transmission lines and/or upgrades in California are likely needed to access these in-state resources. 

 COMMENTS AND RECOMMENDATIONS

Cal Advocates is generally supportive of a long-term transmission outlook.  Cal Advocates recommends the CAISO provide cost and economic benefit information to stakeholders on the identified transmission projects needed to meet the state’s clean energy goals.  With this information, stakeholders will better understand the potential costs and benefits of additional transmission investment to meet the state’s goals.

[1] Cal. Pub. Util. Code § 309.5.

[2] CAISO 20 Year Transmission Outlook Kick-Off Meeting (Presentation), May 24, 2021, slide 6.

[3]CAISO 20 Year Transmission Outlook Kick-Off Meeting (Presentation), May 24, 2021, slide 5.

[4] CPUC Decision (D.) 21-02-008, p. 3.

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

Recommendations

1. Provide a Comparative Cost Analysis for Out-of-State Transmission Projects to Determine Relative Cost-Effectiveness of Interregional Projects.

Cal Advocates recommends that the CAISO provide a comparative cost analysis of the transmission infrastructure needed to meet the state’s clean energy targets, focusing on in-state resources and with a combination of in-state and out-of-state resources.  The CAISO stated it will provide its 20-year assessment of identified interregional transmission projects at its November 2021 TPP Policy and Economic Projects stakeholder meeting.  As such, Cal Advocates recommends that the CAISO should also present the transmission costs related to meeting the state’s goals with in-state resources only at this meeting.  This information will allow stakeholders to evaluate the range of potential transmission projects to meet the state’s goals and will assist with determining the best option for California ratepayers.

2. Determine all the Economic Benefits and Beneficiaries from New Interregional Transmission Projects Consistent with Federal Energy Regulatory Commission Order No. 1000.

Per Federal Energy Regulatory Commission (FERC) Order No. 1000,

The costs of new interregional transmission facilities must be allocated to each transmission planning region in which that transmission facility is located in a manner that is at least roughly commensurate with the estimated benefits of the transmission facilities in each of the transmission planning regions.  In determining the beneficiaries of interregional transmission facilities, transmission planning regions may consider benefits including, but not limited to those associated with maintaining reliability and shared reserves, production cost savings and congestion relief, and meeting Public Policy Requirements.[1]

Consistent with FERC Order No. 1000 and the Interregional Cost Allocation Principal 1, Cal Advocates recommends that the CAISO identify the regional economic benefits generated from new interregional projects including energy, jobs, and tax benefits for cost allocation purposes.   The regional economic activity associated with large infrastructure projects such as new interregional transmission projects directly benefit local businesses and contribute to the economy of the regions the interregional project passes through,[2] and should be assessed for cost allocation purposes consistent with FERC Order No. 1000.

3. Identify the Economic Benefits from In-State Transmission Projects to Maximize Benefits to the State of California.

Any new transmission projects located in-state to the meet the state’s clean energy goals would create energy benefits in California, as well as economic benefits such as increased employment opportunities and tax base.  The CAISO should identify these benefits when assessing in-state transmission projects to determine the optimal transmission projects for California to pursue to meet its clean energy goals.

4.   Evaluate the Capacity of Proposed Transmission Projects Using Both Energy Only as well as Full Capacity Deliverability Status Resources to Maximize its Cost-Effectiveness.

Cal Advocates requests that the CAISO assess the cost and need for potential new transmission lines and upgrades based on the deliverability assessment for renewable resources portfolios with both full capacity deliverability status resources[3] and energy only (EO) status resources.  EO resources can be used to meet the state’s clean energy goals and are not as costly as full deliverability status resources,[4] for this reason Cal Advocates recommends the CAISO evaluate the proposed transmission project capacity needed to access EO resources both in-state and out-of-state to meet the state’s goals.  This evaluation will assist with determining the most cost-effective transmission projects for California ratepayers.[5]

[1] FERC, Order No. 1000, Transmission Planning and Cost Allocation by Transmission Owning and Operating Public Utilities, July 21, 2011, 2. Cost Allocation Principle 1-cost allocated in a way that is roughly commensurate with benefits, b. 622, Interregional Cost Allocation Principal 1. p. 448.

[2] It is common practice to include job and tax base increases as part of the overall project benefit analysis for large public projects such as bridges, airports, and port terminals.  For example, to estimate the economic activity generated by port capital projects, port authorities in the United States rely on an economic impact model commissioned by the Department of Maritime Administration referred to as MARAD Port Economic Impact kit. This kit estimates expected job and tax base increases with Port capital projects. 

[3]  There are three possible deliverability designations for resources when they interconnect to the grid: (1) Full Capacity Deliverability Status (FCDS); (2) Partial Capacity Deliverability Status; or (3) Energy Only (EO).  A FCDS designation means a generator can deliver its maximum capacity to the grid under peak load and stressed conditions. FCDS also qualifies a generating facility to offer its capacity to Load Serving Entities (LSE) to meet their Resource Adequacy (RA) requirement.  The cost responsibility for Area and Local Delivery network upgrades are initially born on generators selecting full deliverability status.  CAISO Tariff Appendix DD, September 9, 2020, 8.4 Cost Responsibility for Local Delivery Network Upgrades and 8.4.1 Cost Responsibility for Area Delivery Network Upgrades. These upgrade costs are then passed on to ratepayers after the upgrades are completed.

[4] Energy only resources are resources that are interconnected to the CAISO grid and can deliver energy only to the grid. Generators can select to provide energy only during peak conditions or just off-peak conditions.  For energy only deliverability status projects, local and area delivery network upgrades are not required, CAISO Tariff Appendix DD, 8.4. Cost Responsibility for Delivery Network Upgrades.

[5] Expedited Generator Interconnection and Deliverability Allocation Procedures (GIDAP) and Enhancements Draft Issue Paper and Straw Proposal, July 24, 2017, CASIO pp. 9-10 “it remains to be determined whether additional transmission capacity should be built to make the additional renewable capacity needed to make 50% deliverable, which impacts whether incremental renewable capacity should be procured as FCDS or Energy Only.”  

3. Additional comments on the May 14, 2021 stakeholder call discussion:

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

Comments of California Western Grid Development, LLC

On Presentation of CAISO 20 Year Transmission Outlook

Three Rivers Energy Development, LLC (TRED) is an Independent Transmission Developer that is developing the proposed Pacific Transmission Expansion Project (“PTE Project” or “PTEP”) on behalf of California Western Grid Development, LLC. (“California Western Grid”).[1]  The PTE Project is a 2,000 MW controllable HVDC subsea transmission cable that the California Independent System Operator (“CAISO”) has found will allow new and existing supply available to the Diablo Canyon 500 kV switchyard or new offshore wind to be delivered to the West LA Basin to reduce local capacity requirements, potentially allowing for the replacement of up to 1,993 MWs of thermal plant generating capacity.  The PTE Project is more fully described in Section 4.8.8 of the 2020-2021 CAISO Transmission Report issued March 24, 2021.  The PTE Project is also currently being restudied by the CAISO as part of 2021-2022 CAISO Transmission Planning Process (“TPP”).

We are pleased to submit these comments on behalf of California Western Grid with regard to the May 14, 2021 kick-off meeting for the CAISO 20-Year Transmission Outlook.

We applaud the CAISO for creating a process to plan for and address transmission needs that will be crucial for allowing the State of California to meet SB100 goals, support increased electrification and plan for reduced reliance on fossil fuels in the production of electricity.  Respectfully, however, based on the May 14 presentation, TRED is concerned that this process, and the CAISO objectives could be “too little, too late” without the changes recommended herein.

The State will be procuring tens of thousands of new renewable resources in coming years.  And by law, most existing gas plants will need to retire.  Yet, the high voltage transmission system in California has changed little in the last decade and as of the recently concluded CAISO 2020-2021 TPP almost no significant new transmission is contemplated.  As a result, the State is facing a transmission crisis which, unless acted upon immediately, will threaten grid reliability, perpetuate sub-optimal economic resource procurement decisions, and threaten system reliability. Further, the failure to act now to plan and approve new transmission will actually increase the usage of existing gas plants as demand grows which affects disadvantaged communities and minorities disproportionately.

The lack of transmission into LA and resulting requirement to rely on local capacity is particularly problematic now in light of the extraordinary State and Federal public policy actions being taken to advance an Offshore Wind (“OSW”) industry in California.  While OSW can be delivered to costal locations such as Diablo Canyon, it cannot reach LA because of the transmission constraints that define the LA Basin as a Location Constrained Resource Area (LCRA) and preclude LA from accessing or relying on clean energy, including OSW, that is located outside the LA Basin. 

This is unfortunate in light of the recent State and Federal policy efforts to develop OSW in California and for LA that desperately needs access to clean energy to reduce reliance on gas plants and the related adverse impacts on DAC’s.  CAISO approval of new transmission into LA as part of the current 2020-2021 TPP is now more essential than ever.

California badly needs a transmission roadmap identifying transmission additions that are “least regrets,” and robust under a variety of future scenarios.  With the 10-year lead time for new transmission, the CAISO and other agencies must act now to implement high voltage transmission additions while complying with SB 100—which, in part, requires prioritization in areas such as Los Angeles, which has poor air quality and is disproportionately affecting DACs. New transmission would relieve congestion into the Los Angeles Basin, allowing for non-emitting resources to displace emitting local thermal generation. 

California Western Grid urges the CAISO to:

• Create a “grid roadmap” as part of its 20-Year Transmission Outlook.  That roadmap should identify the new long-lead time, least regrets transmission that California will need to maintain reliable and economic service while enabling the goals of SB100.

• Explore “low”, “mid” and “deep” decarbonization (aggressive thermal retirement) scenarios to examine how much additional transmission development will be required under each scenario (instead of the 7.2 GW shown in slide 11 of the May 14^th Presentation). 

• Model additional transmission requirements required to support load growth associated with electrification of transportation and buildings,

• Ensure the 20-year transmission outlook is actionable.  If “least regrets” new transmission is identified in the 20-Year Transmission Outlook, , the CAISO should move to study and approve those new transmission elements as part of the 2021-2022 TPP. 

California Western Grid strongly supports a less administrative and more collaborative approach to identifying transmission additions needed over a 20-year time horizon.  This less prescriptive approach must be adopted also by State agencies to allow the CAISO and stakeholders to engage with a focus on long-term reliability requirements and ensuring compliance with State policy goals.   

The task of creating a state-wide 20-Year Transmission Outlook will likely require more than a single year.  Accordingly, the CAISO should place the highest priority on the development of a 20-Year Transmission Outlook for each area with a preference for transmission additions which would enable the greatest amount of additional renewable generation development; however, this approach should also consider regions with the worst air quality which is disproportionately impacting communities of color.  As suggested, regions such as the LA Basin would benefit from new transmission development to enable retirement of emitting resources. 

Each region will eventually need a “Plan of Service” that integrates new transmission, new local storage, zero carbon generation, and allows for the retirement of existing gas plants.   The goals must be to identify least cost transmission solutions that will strengthen the grid, enhance resource diversity and allow eventual retirement of fossil fuel thermal plants that are currently essential to local area reliability. 

LA desperately needs access to clean energy to reduce reliance on gas plants and the related adverse impacts on DAC’s.  CAISO approval of new transmission into LA as part of the current 2020-2021 TPP is now more essential than ever.

In summary, while California Western Grid is encouraged that the CAISO has taken the initiative to proactively plan for the grid of the future, we are concerned that additional steps are necessary at a minimum for California to support SB 100 goals.  The CAISO has a unique and critical role in ensuring the grid is robust to support SB 100 goals reliably and cost effectively.  We look forward to participating in the development of the CAISO’s 20-Year Transmission Outlook.

Marty Walicki

Managing Partner

Three Rivers Energy Development, LLC                            May 28, 2021

[1] As the CAISO is aware,  the PTE Project was recently transferred from Western Grid Development, LLC to California Western Grid Development, LLC.  TRED’s role as developer of the Project has not changed.

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

3. Additional comments on the May 14, 2021 stakeholder call discussion:

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

To be meaningful, the CAISO’s 20-Year Transmission Outlook must be informed by CPUC planning decisions. Absent specific, actionable long-term guidance regarding the generation resources to be accessed or replaced, the 20-Year outlook will be aimless.  But, with such guidance, the CAISO can begin to approve “least-regrets” transmission upgrades that serve immediate near-term needs while also supporting long-term objectives.  

The CAISO tariff is linked to CPUC directives, not to state reports such as the SB 100 Joint Agency Report.[1]  Thus, the CPUC must first make long-term planning decisions before the CAISO’s 20-year outlook will serve any real purpose.   The CPUC could direct the CAISO to use the SB 100 Joint Agency Report as the basis for the policy-driven upgrade process, which includes a baseline and “stress scenarios” that are compared to the baseline scenario.[2]   As examples: while the SB 100 report includes 10 GW of offshore wind, different development patterns could be studied (e.g., more or less at the Central Coast vs. the North Coast), and offshore wind resources could exceed 10 GW; different combinations of gas-plant retirements could be studied; and different patterns of solar development could be studied. 

The CPUC and CAISO should consider whether an update to the 2010 Memorandum of Understanding on the Transmission Planning Process (TPP) is needed to ensure that there is a clear understanding of the relationship between the CPUC’s adoption of long-term resource planning, the 20-year transmission outlook, and the annual TPP.   

[1] Section 24.4.6.6 of the CAISO tariff provides that, for Policy-Driven Transmission Solutions, “the CAISO shall evaluate transmission solutions needed to meet state, municipal, county or federal policy requirements or directives” (emphasis added).

[2] As CalWEA has advised in the past, the CAISO should plan transmission solutions for each alternate scenario that meets the identified objective and move forward with solutions that are common to all scenarios.  This type of “least-regrets” planning will ensure that planned upgrades will serve a variety of possible resource futures.

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

3. Additional comments on the May 14, 2021 stakeholder call discussion:

The CAISO should contemplate reforming its deliverability standards and transmission planning processes in response to the CPUC’s Resource Adequacy reforms.

As the CAISO is aware, the CPUC is considering major structural reforms to its Resource Adequacy (RA) program.[1] The reforms are in response to the changing nature of the grid and its resources, which in the future will revolve principally around non-dispatchable, carbon-free renewable and integration resources, namely, solar and wind energy generation resources and storage resources.  The RA reforms recognize the need to ensure that energy needs are met in all hours, rather than just one hour in each month, which is at odds with the CAISO’s current deliverability methodology that is designed around rare system operating conditions during the monthly system-peak hour.  The CAISO should consider to what extent, under CPUC RA reforms, reform of the CAISO’s deliverability standards is also needed, particularly for non-dispatchable resources and the conditions that are expected in the hours of these resources’ production.  Under the new RA framework being contemplated, wind and, especially, solar resources will largely serve to charge dispatchable storage resources when these renewables are not serving load directly, and act mainly as load modifiers.  These conditions will not be nearly as constrained as the rare system operating conditions that CAISO currently uses for its deliverability test.  The deliverability standard for dispatchable RA resources should also be modified to some extent, given greatly expanded hours of concern rather than a worst-case, peak-hour condition. 

Deliverability reforms also have important implications for transmission planning, which should be considered as part of the CAISO’s 20-year transmission outlook process as well as its annual TPP.  With deliverability reform, there could be multiple levels of deliverability and, in well-developed areas of the grid, it will be much easier for wind and solar resources to obtain the relevant level of deliverability, and thus to interconnect to the grid.  This will reduce the need for transmission upgrades that are focused on providing Transmission Planning Deliverability (“TPD”) `capacity and shift the focus of transmission planning toward (1) relieving congestion within major transmission-constrained areas to enable battery charging, delivery of clean resources, and gas-plant retirements, and (2) strengthening the grid to interconnect needed resources (such as North Coast offshore wind).

Given these important implications of RA reform, once the direction of those reforms take shape, the CAISO should initiate a forum specifically to plan for deliverability reforms and how those reforms will change the CAISO’s Transmission Planning Process.

[1] CPUC R. 19-11-009, Assigned Commissioner’s Scoping Memo and Ruling (January 22, 2020).

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

EDF-R appreciates the CAISO being proactive in assessing the long term transmission system needs to meet SB100 by performing a 20 year transmission study.  This study, if performed correctly, could provide insights into CAISO’s future transmission needs.

With regards to the planned study process, at a high level EDF-R suggests the CAISO should utilize an economic production cost model instead of power flow models.  An economic model would provide more meaningful assessment of the transmission system on an 8760 hour basis, including energy (GWH) requirements, charge/discharge patterns, emissions, imports/exports, transmission constraints, and prices. Power flow studies could be later used to supplement the economic models after a better understanding of viable scenarios and dispatch assumptions are determined on an annual basis.

• At the 20 Year Plan meeting the CAISO described this moment as a inflection point for storage, renewable integration, and reliability for the California system and EDF-R enthusiastically agrees on this point. MISO’s study results demonstrate that an integrated planning process that includes cost considerations and makes solve recommendations in each milestone is needed to solve issues related to all focus areas and to achieve desired penetration levels. https://cdn.misoenergy.org/20191115%20RIIA%20Workshop%20Item%203%20Lesson%20Learned400989.pdf slide 27. MISO’s approach ultimately identified that moving to a renewable centric grid will require transmission technologies equipped with dynamic support to move renewables from transmission constrained regions; existing infrastructure was inadequate for Energy Adequacy throughout the year; and Resource Adequacy needs were occurring at non typical hours of the day.
   
• NYISO is in the process of moving to a 20-year System & Resource Outlook which will provide energy deliverability as a metric reported for the resources on the system. This assessment will be done as an 8760-hour chronological assessment using production cost simulation tools versus snapshots assessments.  In its March 22, 2021 comments, NYISO highlights how “traditional system upgrade analysis only examines temporal snapshots of system conditions, and must be supplemented to properly assess temporal issues that should drive the extensive buildout expected in the next few decades”.

EDF-R would also like to comment that although the 20 year study is purely informative the CAISO should work with the CEC and CPUC to use the information from this study to ensure short sighted transmission decisions are not advanced from TPP or GIP studies if the 20 year plan calls for more robust expansion. While the uncertainty is higher long-term, it is not only practical but also important to look at both the medium term and longer term needs to inform transmission prioritization decisions. Ultimately, the cost of the transmission expansion is born by ratepayers and a piece-meal expansion could result in higher costs to them, in addition to market and transmission planning inefficiencies that could ensue from such decisions.

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

3. Additional comments on the May 14, 2021 stakeholder call discussion:

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

Golden State Clean Energy (GSCE) appreciates CAISO undertaking this effort. We are very supportive of CAISO creating a transmission planning process with a longer outlook than the current 10-year outlook of the TPP. California absolutely needs new transmission studies to complement the SB 100 report and facilitate its long-term carbon reduction goals. In addition, CAISO should use this novel outlook to push forward a vision for the grid of the future, thereby ensuring transmission planning is not just reacting to external planning processes and resource portfolios dominated by a limited set of current technologies. California should understand the ramifications of planning a system dominated by 4-hour batteries, the risk this may create for persistent reliance on natural gas generation, and what generation and transmission alternatives can be paired to provide a different path forward that better meets the state’s carbon reduction goals.

Our comment focuses on two main points: (1) ensuring this effort can be translated into more immediate action and that this effort is actionable; and (2) scoping the outlook to consider scenarios beyond the SB 100 report’s primary cases.

I.  Ensuring the outlook is actionable and able to produce meaningful results

GSCE appreciates the limits CAISO notes regarding the purpose of this 20-year outlook – that it is not called for by the tariff but is intended to provide higher-level technical studies to test the feasibility of alternatives, rather than the detailed level of comprehensive analysis that underpins the 10-year transmission plan.[1]

However, one goal of this exercise is to inform existing planning processes that do drive results such resource development, procurement, and new transmission. Thus, the 20-year outlook must produce meaningful results that not only inform existing planning processes but also facilitate action.

The IRP and the SB 100 report are two clear areas that can benefit from additional transmission studies. The outlook also needs to inform CAISO’s TPP and produce results that TPP can use.  CAISO should consider whether revisions to its tariff-based transmission planning process are needed to incorporate the results from the 20-year outlook process. We cannot ignore least-regrets in-state transmission that can be developed now and push California forward with the infrastructure needed to achieve climate goals.

Ensuring the 20-year outlook’s results are in a form that TPP can act on will help CAISO avoid its stated intent of not conducting an academic exercise. There has been talk of the 20-year outlook creating a window into the future so we can see how the TPP’s 10-year results compare. TPP needs to be able to incorporate information that can better inform the annual plan and projects approved for construction. For example, if TPP shows a major transmission line is needed, but the 20-year finds a need for a second line (or a larger line), CAISO should assess whether there are benefits to building that second line sooner or as an upsized version of the line identified by the transmission plan. It will make the 20-year outlook actionable and meaningful for TPP purposes if CAISO considers this interface with the 20-year outlook now and revises its tariff process to accommodate the input.

CAISO could consider a process whereby the 20-year outlook has the ability to promote transmission projects to be studied in the tariff-based TPP, providing those projects with a realistic path forward in the TPP. Thus, CAISO would have its 20-year outlook process that studies several projects to meet various longer-term policy needs, and the outlook can then promote some of these projects to the TPP for the more rigorous studies needed to support their construction.

If the 20-year outlook is to promote projects to be studied and considered for construction in the TPP, it seems the TPP needs an additional method for approving such projects beyond reliability, economic, or policy needs. These three existing avenues for construction and the TPP’s 10-year outlook may not capture the value created by longer-term planning. For instance, a 20-year outlook transmission project would likely appear premature in the economic assessment, as the financial benefits that can be realized in a 20-year timeframe may not sufficiently materialize in a 10-year timeframe to justify the project based on the current economic assessment’s standards.

Considering that new criteria appears needed to recognize the advantage of building sooner and not wait for TPP’s existing pathways to select the project, potential TPP criteria for promoted 20-year projects includes ensuring the following:

• the project does not create reliability issues if brought online in this earlier timeframe;
• the project does not create negative economic impacts in the immediacy;
• the project provides an acceptable amount of certainty it will not result in stranded costs; and
• the project provides some quantifiable benefits or improved efficiencies if constructed in the earlier timeframe (i.e., permitting and construction efficiencies, cost reductions from those efficiencies, directly driving a reduction in use or early retirement of natural gas resources).

A policy-driven criterion is likely not needed because a 20-year project should be inherently policy-justified. Considering the risk of stranded costs more accurately assesses uncertainties around competing paths forward for meeting our policy goals.

II.   Framing the outlook beyond the SB 100 Core and Study cases

GSCE supports CAISO’s plan for the SB 100 report’s Base and Study cases to be the starting point for the 20-year outlook. There is a natural fit here, as the SB 100 report needs to be informed by transmission studies. We also suggest that CAISO run an updated 20-year outlook following each future SB 100 report to ensure updated resource assumptions are tested and the grid is planned around emerging technologies.

We also support CAISO conducting additional studies to more fully examine the transmission implications of scenarios besides the SB 100 report Base and Study cases. It is important for CAISO to preserve and protect its independence as the transmission planner for its grid and its ability to critically examine the assumptions that are the inputs to the planning process and modify them using its independent judgment if needed. Through its tariff, CAISO has the ultimate responsibility over resource assumptions that are assessed for transmission solutions related to policy projects.[2]  Study cases should be altered or additional scenarios created to ensure California is prepared for realistic future scenarios and that both our transmission system and resource portfolios work to produce a reliable plan for the future. 

High storage penetration, high grid charging need scenario

GSCE believes CAISO should study a high storage penetration, high grid charging need case that helps illuminate deliverability needs for solar resources and helps plan for avoiding excessive curtailment. We are concerned about ever-rising solar curtailment and believe curtailment should be an important issue in the 20-year outlook, considering the amount of solar predicted to be online by then and considering solar’s role on the grid will evolve. Battery storage already appears in large amounts throughout the SB 100 report portfolios, but sensitivities involving green hydrogen should also be considered in this proposed study scenario as a means of storing midday solar. The SB 100 report’s primary cases and hydrogen sensitivities should be assessed under a scenario where they are reliant on a substantial amount of midday grid energy to properly test future grid conditions.

In the future, California expects to have a significant amount of storage on the grid with increased amounts of lithium-ion batteries, long-duration storage, and green hydrogen facilities. While current concerns about curtailment may be mitigated by co-locating batteries with solar, as the ITC falls off or if a stand-alone storage ITC materializes, a major incentive to co-locate may disappear. There are also advantages to stand-alone storage,^[3] and some newer storage technologies may not be as feasible to co-locate with sufficient on-site generation. Thus, it does not appear to be a safe assumption that storage will largely have access to on-site generation, or that storage will be the solution to mitigate excess curtailment for nearby solar. We need to be prepared for a scenario where a significant amount of storage or green hydrolysis is heavily reliant on energy from the grid.

This scenario is important for two reasons, one being policy-driven and the other being reliability-driven. Regarding California’s policy needs, storage is not a renewable resource or even inherently carbon-free, it merely stores energy produced by other resources. The storage we see in the SB 100 report needs clean energy resources backing it, likely to be mostly reliant on inexpensive, midday solar generation. Thus, if California is grid charging its storage fleet to a significant degree, storage will only further the pursuit of state policy goals and allow California to wean off thermal resources if the solar fleet is deliverable midday.^[4]  We must ensure our storage fleet is not reliant on or prolonging the use of natural gas resources.

The argument for this scenario being important to our reliability needs is similar to the policy-pursuit argument. Storage resources are turning out to be, and likely will remain, critical resources for California’s RA program as well as provide other products needed to keep our grid reliable. To the extent California is looking to storage to provide reliability services, it needs access to energy from generation sources as an extension of RA and reliability needs. This reliability assessment should also be stress-tested with more aggressive natural gas retirement assumptions to align policy with reliability.

Now that we can see why midday solar deliverability is important if storage or green hydrogen facilities rely on grid energy to a significant degree, we can consider what the 20-year outlook needs to do to study that scenario. This comes back to the concern about rising levels of curtailment. The scenario should examine and stress-test deliverability studies that are to occur in the 20-year outlook for a number of the study cases (i.e., Base, hydrogen sensitivities), and CAISO should consider a new deliverability assessment that could properly assess the deliverability of solar for the purposes of charging stand-alone storage and facilitating green hydrogen production.

This assessment of solar’s ability to support grid-charging should also evaluate the meaning of excessive curtailment. One approach could be a cost analysis that compares what degree our solar fleet needs to overbuild to create sufficient generation redundancies in a high variable energy resource grid versus transmission that can reduce curtailment and make more use of solar resources. Overall, CAISO needs to take a look at curtailment; what would be deemed excessive curtailment; and ensure that the enormous solar fleet that is coming can be utilized by retail users chasing time-of-use rates, storage resources that are enabling state policy and ensuring reliability, and a host of areas that are newly electrifying that may shift our peak usage in unpredictable ways.

Central Valley build-out scenario

GSCE also believes there should be a scenario where a larger portion of future resources, especially solar, are developed in the Central Valley. In-state resources will be increasingly important for California as baseload capacity throughout the West retires, congestion and flow issues increase, and regional competition becomes more apparent. Within California, the Central Valley has historically been left behind in broader developmental efforts. In this instance of an evolving energy sector, development in the Central Valley carries environmental justice principles by focusing investments and decarbonization in an area that has a long history of environmental injustice.

The Central Valley offers a win-win for large scale development of renewable generation along with the necessary in-state transmission expansion that is needed to meet California’s SB 100 goals that is “smart from the start”.  The valley has ample land that is already environmentally impaired, transmission corridors that can be expanded for increased access to in-state renewables, and the ability to displace fossil generation and reduce air pollution in many disadvantaged communities. There are also overlapping policy goals with the Sustainable Groundwater Management Act given the significant acreage of agricultural lands to be retired. And the increasing pressure to reduce development on public lands to protect fragile desert ecosystems also provides support for locating more solar resources in the Central Valley and planning transmission to deliver this solar.

Lastly, more transmission through the Central Valley could help California’s wheel-through issues by increasing north-south flows, which in turn could improve the economics of in-state transmission development. Increasing in-state transmission capacity could provide numerous benefits to southern California load and the desert Southwest. The wheel-through issues before CAISO in the 2021 summer reliability initiative are not going away, and entities seeking Northwest hydro will only increase as supply in the West becomes tighter and other states also increase their decarbonization efforts.

[1] Cal. ISO, 20 Year Transmission Outlook Kick-off Meeting – Agenda, at 12, May 14, 2021, available at: http://www.caiso.com/InitiativeDocuments/Presentation-20YearTransmissionOutlook-May14-2021.pdf.

[2] See Tariff §24.4.6.6 (“The CAISO will create a baseline scenario reflecting the assumptions about resource locations that are most likely to occur and one or more reasonable stress scenarios that will be compared to the baseline scenario. Any transmission solutions that are in the baseline scenario and at least a significant percentage of the stress scenarios may be Category 1 transmission solutions.”).

[3] See Will Gorman, et. al., Are coupled renewable-battery power plants more valuable than independently sited installations?, May 2021, available at: https://emp.lbl.gov/publications/are-coupled-renewable-battery-power.

[4] See Cal. ISO, 20 Year Transmission Outlook Kick-off Meeting – Agenda, at 10, May 14, 2021 (This initiative will consider “[b]roader ranges of resource transitions including potentially more aggressive gas-fired generation fleet retirement”).

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

No comment.

3. Additional comments on the May 14, 2021 stakeholder call discussion:

No additional comments.

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

GridLiance West (GLW) supports the CAISO’s proposal to conduct a 20-Year Outlook study.  The goal of the study, in addition to supporting more specific input for the SB100 and IRP studies, should be to identify least-regrets paths, including transmission upgrades, that can be selected in the short run that would serve the long-term needs.

GLW offers suggestions for study enhancements in two major areas: The base scenario to be used and the impact of the transmission assumptions of any scenario used.

Base Scenario for 20-Year Study

We encourage the CAISO to consider what base assumption set, or portfolio(s), it uses for its study.  The CAISO included a chart on slide 11 of its May 14, 2021 presentation (shown below) that suggests that it is considering the SB100 Core and Study scenarios.

While the SB100 Core and Study scenarios were well defined and rather appropriately chosen for the SB100 study, the scenarios this time are more than 15 months old (originally developed in early 2020), and they do not reflect the reliability needs recently articulated by the CPUC in its mid-term reliability procurement process, nor do they reflect the needs that the CAISO articulated in its response to the CPUC in that same process.  These scenarios pre-date the August 2020 heat wave events, the lessons learned about the resources needed for extended severe weather, and the increasingly near-term nature of the Diablo Canyon retirement.  Thus, studying the Core or Study scenarios would produce long-term transmission insights that are in part no longer responsive to the current resource needs of the grid. The CPUC, SB100 Study Group and the CAISO could develop an alternate scenario (likely needing to be re-assessed in RESOLVE). The CAISO could alternatively use, for its 20-year study, an SB100 case that is more aligned with responsive generating resources, namely, the SB100 case seeking high flexibility and high electrification (“CEC_B_SB100_HighElec_HighFlex_20210204”). 

Irrespective of which SB100 study is used, for any portfolio that has not yet been mapped to busbars, GLW recommends that CAISO apply the methodology and mapping choices applied in the IRP to the portfolio for the 20-year study.  Additionally, GLW recommends that the CAISO consider the resources who submitted requests in Cluster 14 as informing the mapping process.

In summary, the assumption set used by the CAISO in its 20-year assessment must both recognize the carbon goal trajectory and recognize the flexibility/reliability requirements of the generation fleet.  While the SB100 cases do reflect the carbon goal requirements (some cases more accelerated than others), the primary Core and Study cases do not include the generating flexibility needs that have been since identified by the CPUC and CAISO.  GLW specifically encourages the CAISO to ensure sufficient diversity exists in the fleet; both technological diversity to complement the vast levels of California solar generation, and geographic diversity to ensure deliverability and grid resilience, especially in light of the impending Diablo Canyon retirement. Among other such study assumptions, GLW requests the CAISO ensure the 20-year study include benefits of interconnecting diverse Nevada resources to the CAISO grid.[1]

Transmission Assumptions Underlying the Scenario

GLW also feels it is critical for the CAISO, along with the CPUC, SB100 Study Group, and other stakeholders, to consider the transmission assumptions underlying the study portfolio resources.   The CAISO has traditionally provided to the CPUC transmission system limitations for use in the RESOLVE model resource build out optimizations.  In some, but not all cases these limitation assumptions include costs for exceeding existing capabilities.  It is not clear the extent to which the CAISO has verified those costs as time progresses.  These pre-defined limitations will constrain the buildout in many cases to not exceed the existing transmission capabilities.  Given that, the CAISO’s powerflow study of these portfolios will not yield transmission upgrades.  A study with such constraints already driving the resource buildout therefore would be circular and would not provide useful current information about the transmission needs of the system. GLW urges the CAISO to revisit these assumption limits and associated exceedance costs – especially in light of the more recent emphasis on additional grid resources needed to ensure resource adequacy and sufficient reserve and ramping capability. GLW is open to the exploration of how best to ensure that this circularity – concluding that no upgrades are warranted – is avoided.  One possibility is re-establish the transmission limitation data. Another option would be to relax the transmission limitations to some degree (for example a 20% increase in capabilities) and see where resources would be sited in RESOLVE to meet the scenario goals. This could be akin to the work that was performed for Policy Sensitivity Case 2 – the case testing the Energy-Only limits – conducted as part of the CAISO’s 2020 – 2021 TPP. At this juncture, however, it is very important to also revisit the full deliverability limits in light of the short supply of reliability resources. If there is information that PTOs can provide in support of this study, GLW would be pleased to provide such information.  In that case, GLW requests that CAISO clarify what information would be beneficial.

GLW also believes the study would benefit from further CAISO and stakeholder discussion about the level of export capability (i.e., the export limit) assumed over the study duration.

[1] GLW submitted into the 2021-2022 TPP an Economic Study Request for the CAISO to study a transmission system upgrade to interconnect a geothermal-rich qualified resource area in Nevada to the CAISO grid. (http://www.caiso.com/InitiativeDocuments/GLWEconomicStudyRequest-2021-2022TransmissionPlanningProcess-Feb252021StakeholderCall.pdf), pp. 7-8. 

2. Provide your organization’s comments on the Out of State Wind Sensitivity Study, as described in slides 14-23:

GLW supports additional CAISO study of renewable resource injections to the CAISO grid. GLW looks forward to further information about the methods the CAISO will apply in study and how the resultant information will be used to choose the most beneficial in-CAISO and external transmission enhancements. 

The August 2020 heatwave events, and the impending Diablo Canyon retirement, point to the necessity for California to leverage a wide range of renewable sources.  The CPUC and the CAISO have recently clarified Resource Adequacy rules for imports. Given the reliability needs and policy goals of California, it will likely become critical to integrate significant renewable RA imports as well as significant renewable RA build out within the CAISO grid.  For these reasons, GLW is supportive of this sensitivity study.

The CAISO indicates that its base case TPP study will examine deliveries of wind at either Eldorado or Palo Verde (slide 16), and that its out of state sensitivity case will aid in choosing between New Mexico and Wyoming sources (slide 18).  GLW encourages the CAISO and other parties to recognize the need for deliveries from both locations and not just one or the other.  The more progressive SB100 cases resulted in up to 6,000 MWs of imported wind at Eldorado and 6,000 MWs of imported wind at Palo Verde.  Thus, the out of state wind case, or at a minimum, the 20-year transmission study, should explore the CAISO’s grid readiness to accept these levels of imported renewables.

3. Additional comments on the May 14, 2021 stakeholder call discussion:

From a process perspective, for both the 20-year study and the out of state wind study GLW asks that CAISO take stakeholders’ comments, develop and post more descriptive study plans, and invite additional stakeholder comments on those study plans.

1. Provide your organization’s comments on the 20-Year Transmission Outlook topic, as described in slides 4-13:

Horizon West Transmission (HWT) applauds the CAISO’s proposal to conduct a 20-Year Outlook study to anticipate and plan for transmission needs in support of SB100. The goal of the study, in addition to supporting more specific input for the SB100 and IRP studies, should be to identify least-regrets paths, including transmission upgrades, that can be selected in the short run and would serve the long-term needs. In order to meet the 100% clean energy goal by 2045 per SB 100, California requires a significant renewables buildout. CPUC’s 2019-20 Reference System Portfolio (RSP) default scenario forecasts ~130 GW of new in-state solar and storage buildout by 2045, more than 10x the current installed solar and storage capacity. It is important to note that exponential growth in new resources is needed especially post-2030, as renewable penetration in CAISO increases and it gets harder to reliably decarbonize the remaining fossil power generation. In addition, large-scale transmission development typically has a long lead time, often spanning 10-15 years. As such, a longer planning horizon envisioned by the CAISO is critical to reliably and cost-effectively identify and develop transmission to accommodate this huge surge in renewables. Considering the long lead time for large-scale transmission development, proactive need identification and planning of new transmission is crucial for ensuring that both the renewable generation and associated new transmission can be planned, permitted, and constructed in time to meet the state’s GHG goals.

HWT offers opportunities for study enhancements in two major areas: The base scenario to be used and the impact of the transmission assumptions of any scenario used.

Base Scenario for 20-Year Study

We encourage the CAISO to consider what base assumption set, or portfolio(s), it uses for its study.  The CAISO included a chart on slide 11 of its May 14, 2021 presentation (shown below) that suggests that it is considering the SB100 Core and Study scenarios.