California Makes Progress Towards Ensuring Electric Reliability for Summer 2022

On January 11, 2022, the California Energy Commission (CEC) issued an update to its Summer 2022 Stack Analysis.  Previously, on September 8, 2021, the CEC issued a revised Summer 2022 Stack Analysis that showed potential energy shortfalls ranging from 200 MW to 4,350 MW during the months of July through September 2022, in the evening hours.  The early evening hours have become one of the most challenging period for California reliability.  Abundant solar is available to meet daytime peak load, but as that solar rolls off the system in the evening, alternate resources are needed to meet the evening demand.

To update the Stack Analysis, the CEC updated information about new resources, including procurements ordered by the California Public Utilities Commission.  The CEC also updated demand forecasts.  A substantial increase in available resources, including 1,230 megawatts of energy storage, has improved the outlook for summer 2022.  Using a 22.5 percent procurement reserve margin to address impacts to demand from climate change and potential extreme weather events, the updated Stack Analysis finds that there continues to be a risk for energy shortfalls during September 2022, ranging from 200 to 2,400 MW.

Oregon Department of Energy Seeks Stakeholder Input on Floating Offshore Wind Development

The Oregon Department of Energy (ODOE) is kicking off the stakeholder engagement part of its Floating Offshore Wind Study on January 20 at 9 a.m. As directed by HB 3375, ODOE is preparing a report on the challenges and benefits of integrating up to 3 gigawatts (GW) of floating offshore energy into Oregon’s grid by 2030, and it will submit that report to the legislature in September. A summary from the first part of the study, a literature review, should be released soon. Following the kickoff meeting, ODOE anticipates two more virtual meetings, as well as an opportunity to submit comments. Continue Reading

California ISO Issues Straw Proposal in Interconnection Process Enhancements Stakeholder Proceeding

On December 6, 2021, the California ISO issued an issue paper and straw proposal (“Straw Proposal”) for its Interconnection Process Enhancements stakeholder proceeding. The California ISO initiated this stakeholder proceeding on September 30, 2021 with the issuance of a preliminary issue paper. The stakeholder process comes at a time when an unprecedented level of energy procurement in California has caused dramatic increases in the number of projects in the California ISO’s interconnection queue. The California ISO’s most recent cluster, cluster 14, saw a record number of 373 interconnection requests being submitted, representing 150,000 megawatts of generating capacity, compared to 155 requests submitted in 2020. Ultimately, the volume of interconnection requests forced the California ISO to seek authority from the Federal Energy Regulatory Commission to extend its interconnection process by approximately one year.

The Interconnection Process Enhancements initiative will have two phases. Phase 1 will focus on near-term enhancements for cluster 14 and before the summer of 2022. The proposals in Phase 1 are scheduled be submitted to the California ISO Board of Governors in May 2022. Phase 2 will focus on longer term modifications and broader reforms to align interconnection processes with procurement activities. Those proposals are scheduled to be submitted to the Board in November 2022. Continue Reading

Reactive Power Compensation for Renewable Generators – On the Chopping Block?

On November 18, 2021, FERC issued a Notice of Inquiry (NOI) seeking comments on reactive power capability compensation and market design.  (Link to NOI here). Reactive power is a critical component of the bulk electric system. Almost all bulk electric power is generated, transported, and consumed in AC networks. These AC systems consume both real and reactive power. Reactive power supports the voltages necessary for system reliability to allow the supply of real power from generation to load. All balancing authorities must procure enough sources of reactive power to safely manage the grid and generator interconnection agreements contain provisions requiring generators to operate within certain reactive power limits. Reactive power is an ancillary service and costs are recovered separately from the cost of standard transmission service. Continue Reading

Public Utilities Commission of Texas Adopts New Winter Weatherization Rules in Response to Winter Storm Uri

On October 21, 2021, the Public Utility Commission of Texas (PUCT) approved a rule that creates requirements for power companies to better prepare for winter weather. The rule stems from the Texas Legislature’s passage of Senate Bill 3 (S.B. 3) in response to the devastation caused to the energy grid by Winter Storm Uri.

S.B. 3, effective June 8, 2021, is a multi-pronged law that attempts to make the Texas energy system more resilient to the effects of extreme winter weather events. Key to S.B. 3 is a requirement that the PUCT implement winter weatherization requirements so that each of the entities providing electric generation service must implement measures to prepare its generation assets to provide adequate electric generation service during a weather emergency. The new rule, codified as 16 Texas Administrative Code §25.55,  requires electric generators and transmission service providers (TSPs) (collectively, generation entities) to implement the winter weather readiness recommendations identified in the 2012 Quanta Technology Report on Extreme Weather Preparedness Best Practices and the FERC/NERC 2011 Report on Outages and Curtailments During the Southwest Cold Weather Event on February 1-5, 2011. The rule also requires affected entities to fix any known, acute issues that arose from winter weather conditions during the 2020-2021 winter weather season. The deadline for implementation of many components of the new rule is December 1, 2021. Continue Reading

California Public Utilities Commission Takes Action to Prevent Outages During Summer 2022 and 2023

On October 29, 2021, the California Public Utilities Commission (CPUC) issued three proposed decisions intended to address potential electric capacity shortfalls in 2022 and 2023.  The proposed decisions, if approved, would implement a variety of demand-side and supply-side policies designed to ensure that in the event of extreme weather during the summer of 2022 and/or 2023, California has sufficient electric capacity to avoid outages.

Background

In August 2020, the California ISO experienced outages during the evenings of August 14 and 15, and only extraordinary efforts, including voluntary conservation efforts by California energy users, allowed the California ISO to avoid outages the following week.

After those outages, the CPUC and the California Energy Commission (CEC) have been working towards addressing potential capacity shortfalls during extreme weather events during the summer.  In November 2020, the CPUC opened a rulemaking (R.20-11-003) to ensure reliability in the event of extreme weather during the summer of 2021.  In February 2021, the CPUC adopted a decision directing procurement of additional capacity (D.21-02-028), and in March, adopted a decision directing additional demand-side and supply-side actions to increase supply and decrease load during extreme weather events (D.21-03-056).

California managed to avoid outages during the summer of 2021, although it was helped by relatively mild weather in August and September.  A stack analysis performed by the CEC this summer, however, showed the potential for capacity shortfalls of up to 4,350 megawatts (MW) for summer 2022.  In August, the CPUC implemented a second phase to R.21-11-003, to ensure reliability during the summers of 2022 and 2023. Continue Reading

Biden Administration Revokes Trump Administration MBTA Rule and Initiates Rulemaking for MBTA Incidental Take Permitting Program

Earlier this month, the Fish and Wildlife Service (“Service”) published a final rule revoking the Trump Administration’s rule on incidental take under the Migratory Bird Treaty Act (“MBTA”), as well as an advanced notice of proposed rulemaking (“ANPR”) aimed at codifying the Biden Administration’s interpretation of the MBTA’s incidental take provision and creating new incidental take regulations.

The MBTA prohibits the “take” of over 1,000 species of migratory birds, but the reach of the MBTA’s take prohibition, including whether it applies to “incidental” take from otherwise lawful activities, is unsettled and subject to a current split in the federal circuit courts. The Trump Administration rule, published on January 7, 2021, largely reflected the Fifth Circuit’s view that the MBTA only prohibits “intentional acts” that directly kill migratory birds. We anticipate that the Biden Administration rule will take the position endorsed by the Tenth Circuit and articulated in the Obama Administration’s M-Opinion that the MBTA prohibits non-purposeful take of migratory birds, nests, and eggs that occur incidental to lawful activities. Continue Reading

FERC Approves Changes to CAISO Interconnection Procedures; Next Queue Cluster Application Window Not Scheduled to Open Until 2023

On September 24, 2021, the Federal Energy Regulatory Commission issued an order (176 FERC ¶ 61,207) approving tariff revisions to amend the California ISO’s (CAISO) interconnection procedures for its current queue cluster (Cluster 14).  The CAISO had requested changes to its interconnection procedures due to the massive increase in the number of interconnection requests it received this year—373 interconnection requests representing 150,000 megawatts of generating capacity, as compared to the 155 requests in 2020.  Prior to 2021, the average number of interconnection requests that the CAISO received each year over the past 10 years was 113.  The volume of interconnection requests in 2020 caused the CAISO to issue a market notice to delay the publication of Phase I interconnection study results by one month, pursuant to its tariff authority to extend the timing for providing study results under Sections 6.6 and 8.5 of its Generator Interconnection and Deliverability Allocation Procedures (GIDAP, Tariff Appendix DD).

Rather than rely on these tariff provisions to extend the study timelines for Cluster 14, however, the CAISO sought approval to establish extensions for various interconnection deadlines early in the process, to provide generators with advance notice of the timing for Cluster 14.  Per the approved tariff revisions, Cluster 14 deadlines will be extended as follows: Continue Reading

California ISO Survives the Summer with No Blackouts; Battery Energy Storage Beginning to Play Larger Role

The California ISO held its final Summer 2021 Readiness Update call on September 24.  As reported on the call, the California ISO managed to get through summer 2021 without any load-shedding events, in contrast to last summer, when load-shedding events occurred on two days in August.  The California ISO; California energy regulatory agencies, including the California Public Utilities Commission (CPUC) and California Energy Commission (CEC); and the Governor’s office have spent considerable effort to avoid any outages for both this summer and summer 2022.  However, as California ISO Senior Vice President and Chief Operating Officer Mark Rothleder explained, California experienced less extreme weather this summer, which helped the state avoid outages.  Although July was challenging, due to a West-wide heatwave and transmission impacted by the Bootleg Fire, August and September were more mild.  In 2020, load peaked at 47,121 megawatts (MW) on August 18, at 15:57.  In 2021, load peaked at 43,982 MW on September 8, at 17:50.  By comparison, the California ISO’s highest peak was 50,270 MW in 2006. Continue Reading

FERC Grants Limited Waiver to the CAISO to Immediately Interconnect Gas Turbines

In the wake of Governor Newsom’s July 30, 2021 Emergency Proclamation intended to mitigate the strain on the California energy grid, the California Department of Water Resources (CDWR) and the California Energy Commission have been reaching out to generation owners that could accommodate the addition of 30 MW gas turbines generators, an effort now referred to as the State Power Augmentation Project.  So far, two sites have been found:  Greenleaf 1 in Yuba City and Roseville Energy Park.  Each site will accommodate two turbines.  The units were supposed to come online in mid-September.

The two turbines at Roseville Energy Park will be interconnected through the Balancing Authority of Northern California and will participate in the California ISO’s (CAISO) energy imbalance market.  The two turbines at Greenleaf 1 will interconnect to the CAISO.  Under current tariff provisions, the CAISO can interconnect 50 MWs of the 60 MW total.  The Greenleaf 1 site has cogeneration facilities that are currently mothballed but still retain existing interconnection capacity of 49.2 MWs.  Because both the cogeneration facilities and the new gas turbines are gas-fired, there will be no change to the electrical characteristics, and the CAISO can therefore interconnect the two turbines under the repowering provisions of the tariff, but only up to 49.2 MWs. Continue Reading

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