Grid Operator Compels Renewables’ Connectivity Conformity

By Published On: May 21, 2010

While acknowledging that the move may be expensive and not entirely fair to solar and wind project developers, the California Independent System Operator board demanded that developers add operational capabilities to assure grid reliability, May 18. “The industry has to grow up,” said board chair Mason Willrich. In general, investor-owned utilities supported the move because they have traditional generation and transmission facilities that provide the capabilities. They also supported the demand because if renewable energy developers are not required to do the same, traditional power plants would have to compensate for intermittent producers. Renewables developers opposed the move, citing lack of available control systems to implement the new technical requirements, as well as cost issues. Developers claim they now have to offer not only renewable power to the grid, but technical reliability support on call by the grid operator. According to one developer, those control systems have yet to arise. It also adds costs to renewables projects at a time when developers are rushing to get started on their facilities before the end of the year to qualify for federal stimulus funds. The move is one of several CAISO is undertaking because it insists the changes are needed to reach the state goal of a 33 percent renewables portfolio standard. “If we don’t [begin] this requirement today, the lack of requirements would be an impediment to achieving RPS goals,” Keith Casey, CAISO vice president, market & infrastructure development, said. The details are highly technical, noted the grid operator staff. Mostly, they demand that renewables developers conform to the same grid reliability capabilities that are now met by fossil fuel generators and utility transmission. For instance, one requirement is for “reactive power.” According to Grant Rosenblum, CAISO manager for renewable integration, reactive power is like “foam on the beer.” Technically, he was unable to explain the service (see glossary box page ?) In another renewables-related move, the board voted to make renewables’ capacity ratings applicable to the state’s resource adequacy rules. CAISO approved applying a “standard capacity product” to wind, solar, and cogeneration projects. “It makes capacity more homogenous and fungible,” said Casey. Renewables representatives called the requirement “punishing.” Due to renewables’ intermittent delivery nature, a wind project, for instance, with a nameplate of 100 MW capacity is not able to deliver that much electricity all the time. The grid operator creates a “deliverability assessment” for the project based on complicated equations tweaked by regions and technologies. Thus, a 100 MW capacity plant may have “deliverability” of a fraction of that for purposes of resource adequacy. The standard capacity product appellation applies to technical calculations used for rating projects. Federal regulators still have to approve the tariff. CAISO gave renewables’ interconnection to the grid an opening by specifying technical requirements for large-scale generators. According to Casey, there are 83 renewables projects representing 20,000 MW of capacity in the grid operators’ interconnection queue. The Federal Energy Regulatory Commission has to approve the interconnection requirements. In another move to address the state’s 33 percent renewables goal, the grid operator is changing its transmission planning method. Before the new process was adopted May 18, CAISO staff evaluated its overall transmission plan project-by-project, according to Lorenzo Kristov, CAISO market and infrastructure policy principal. With the 33 percent requirement, he said, the grid operator needs to look at transmission on a statewide basis, not just within its own control area. “What are the facilities we need to get to 33 percent?” he asked. This year, the new process is set to evaluate “economic project proposals” submitted during the last two years. In other news, the board heard an update on new products in its wholesale electricity market. Although CAISO is moving ahead with its derivatives-style trading market--known as “convergence bidding”--the board is beginning to question the plan. The grid operator was directed to include this bidding option in its markets by the Federal Energy Regulatory Commission, according to a CAISO spokesperson. “There’s [been] no financial reform, while the wheels of Wall Street fell off. Yet we’re allowing convergence bidding,” Willrich said. For the last eight months, federal economic regulators, like the Commodities Futures Trading Commission and FERC, are positing centralizing and regulating such trades. Utility hedging through derivative trading could be exempt from the centralization. It remains a question of which agency, if any, would regulate trades through independent system operators.

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