FERC Okays California ISO's First Step
in Clearing Backlog of Power Plant Requests to Hook Up
Jul 15, 2008 - Business Wire
In an important step toward streamlining
the process of interconnecting renewable resources to
the power grid, the Federal Energy Regulatory Commission
(FERC) issued an order yesterday granting the California
Independent System Operator Corporation (California ISO)
the ability to launch the first part of a two-step process
to clear a logjam that has hindered renewable projects
attempting to connect to the California grid.
"The good news is that renewable power
projects are clamoring to supply electricity to California
consumers," said California ISO President and CEO Yakout
Mansour. "The better news is we can take the first step
toward freeing bottlenecks that have prevented these exciting
projects from coming online."
This is the second lift FERC has given the
California ISO as it works swiftly to help green power
developers get their projects on the grid. Late last year,
FERC approved the ISO proposal for a new hybrid-financing
tool that is reducing cost barriers facing renewable developers
and paving the way for transmission "trunk lines" to reach
remote and renewable-rich areas.
In yesterday's FERC order, the ISO was given
the okay to waive certain rules and timelines for handling
requests from new power plants hoping to hook up to the
transmission system. As a result, the ISO can begin immediately
to reduce a backlog of projects in its overloaded generation
interconnection queue. One of the primary benefits is
to help accelerate development of green power needed to
meet California's Renewables Portfolio Standard and greenhouse
gas (GHG) reduction goals.
"FERC is giving California the power to
help 'green the grid' by addressing the backlog of generation
interconnection requests that have stymied our ability
to manage the timetables for ensuring the reliable connection
of renewable power to the transmission grid," said Mansour.
"We are impressed with FERC's response to this urgent
situation in California. All along, the Commission has
demonstrated in words and actions its commitment to adjust
existing policies and introduce new ones to facilitate
the implementation of environmental goals."
As part of this transition, the ISO will
now be allowed to create three study groups:
-- A grandfathered serial study group that
would give expedited treatment to projects already in
-- A transition cluster, comprising non-grandfathered
projects submitted on or before June 2, 2008 -- An initial
cluster for projects submitted on or after June 3, 2008
In response to the state's renewable and
greenhouse gas goals intended to reduce dependence on
fossil fuels, a torrent of renewable power projects has
poured into the ISO interconnection queue. Today, 361
interconnection requests totaling more than 105,000 megawatts
(MWs) are pending in the interconnection study process.
Of these, more than 68,000 MWs are from renewable resources.
These far exceed the highest demand on record and also
exceed the ability of the current interconnection procedures
to efficiently process the requests. FERC's actions will
be instrumental in breaking this logjam and will ensure
the interconnection process does not impede the California
Public Utilities Commission siting process.
The second step in the process to address
these issues will be gaining FERC approval for a full-scale
Generator Interconnection Process Reform (GIPR) proposal.
The California ISO worked closely with stakeholders to
develop the proposal which was approved by the ISO Board
of Governors only last week. The ISO plans to file the
long-term solution with FERC by the end of the month.
If approved, the GIPR will resolve the source of the procedural
flaws in the current interconnection process by increasing
the financial commitment necessary for project developers
to enter and progress through the interconnection process,
studying projects with related system impacts in groups,
and providing for pro-rata allocation of transmission
upgrades across grouped projects. With these and other
changes, the California ISO will have greater confidence
that the projects being studied are commercially viable
and will be able to study projects more efficiently. At
the same time, project developers will have greater certainty
about the timing of interconnection studies and their
share of interconnection costs.
The California ISO is a not-for-profit public
benefit corporation charged with managing the flow of
electricity along California's open-market wholesale power
grid. The mission of the California ISO is to safeguard
the reliable delivery of electricity, and ensure equal
access to 25,000 circuit miles of "electron highway."
As the impartial operator of the wholesale power grid
in the state, the California ISO conducts a small portion
of the bulk power markets. These markets are used to allocate
space on the transmission lines, maintain operating reserves
and match supply with demand in real time.