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NERC Chair: Integrating Renewable Resources a ‘Priority'

By William Opalka, Energy Central - March 3, 2009

Discussions have percolated for several years about the need to integrate renewable resources but with jump-starting the transmission build-out on everybody's mind, the talk has become more urgent.   So the Federal Energy Regulatory Commission held a technical conference on Monday with stakeholders from transmission regulators, trade associations, utilities, energy companies and others.

“The need to reliably integrate renewable resources is no longer a question, it is a priority,” said Rick Sergel, president and CEO of the North American Electric Reliability Corporation (NERC).  According to data in NERC's 2008 Long Term Reliability Assessment, 145,000 MW of wind generation is proposed to be added to the grid over the next 10 years – though all of it will not be built.  “We absolutely need transmission – we estimate tens of thousands of miles of new transmission is needed to unlock location-constrained, remote energy resources and maintain reliability,” he added. 

Sergel also said the transmission system needs demand-side options, like energy efficiency and demand response, have a critical role to play in managing overall energy use. “Still, even with energy efficiency, a full portfolio of resources will be needed to support the development of variable generation. We will still need baseload options to keep the lights on. Today – baseload options are primarily nuclear and coal. We simply can't turn our backs on these needed resources,” he said. 

Participants outlined a series of significant challenges that have to be addressed, many that concern multiple jurisdictions with sometimes contradictory policies and priorities. “Though larger problems are looming, 29 state commissions are already facing the challenge of how their utilities will comply with state-sponsored renewable portfolio requirements, and five others are dealing with renewable energy goals. But focusing solely on compliance with existing renewable standards may be too myopic,” said Lauren Azar, a Commissioner at the Public Service Commission of Wisconsin.

She also addressed the widely anticipated regulation of carbon dioxide at the federal level, possibly through cap-and-trade regulations that she described as “transformational.” Commissioners at the state level need to act soon before they are left too far behind in regulatory frameworks.    But the dual challenges of planning for renewables and possible carbon constraints mean that the most cost-effective solutions most will likely involve several state solutions and planning is more problematic without finalized goals and timelines on renewable and carbon emissions.

Gordon van Welie, the CEO of ISO (Independent System Operator) New England, said the combined New York and New England region has over 100 projects representing over 12,000 megawatts of new wind resources currently in the interconnection queues, not counting offshore wind potential or resources that may be available from eastern Canada. He said regional plans should serve as the basis of an interconnection-wide planning process that is coordinated by a federal entity. RTOs (Regional Transmission Organizations) remain as the primary planning authority for managing integration in their footprint. “If this is not done, it will be impossible to gauge the true cost impact of integrating renewables, since the injection of bulk quantities of energy at selected points in any transmission network will require expensive additional transmission investment in order to be able to deliver the power to customers,” he said.

Some states, like California , have more thoroughly developed integration planning processes, to accommodate aggressive renewable energy mandates. Pedro Pizarro, the executive vice president of Power Operations for Southern California Edison Company, who also represented the Edison Electric Institute, said California has 6,240 megawatts of wind, solar, geothermal, biomass and small hydroelectric resources currently in service and tens of thousands of additional megawatts are planned.

California has the Renewable Energy Transmission Initiative (RETI), which created a 20-year outlook of transmission planning for renewable resources in a statewide collaboration of federal, state, and local agencies, environmentalists, generation developers and transmission owners. RETI identified potential transmission to serve generation currently operating or in development in California 's Competitive Renewable Energy Zones and potential generation that may be developed.

The study, to be released shortly, considered the existing 20 percent renewable portfolio standard (RPS) in California along with the potential for 33 percent or even higher goals. “First, higher RPS levels can result in significant amounts of surplus energy that cannot be used on the grid or sold to others. Power must be offloaded when generation is greater than load and export capability,” Pizarro said. That could happen in the spring, when renewable generation from wind, hydropower and solar is plentiful but summer peak demand has not been reached.

Off-peak electric-vehicle charging may mitigate this problem. “However, these energy storage technologies are not yet mature enough to significantly contribute to most resource plans today. Additionally, the ‘Smart Grid' is still being developed and it may be several years before it is capable of fully integrating such technology,” he added.   Also, to maintain grid reliability, higher RPS levels will require higher Planning Reserve Margins to back up the system when these intermittent resources are incapable of producing sufficient energy.

American Wind Energy Association Policy Director Rob Gramlich said FERC policies need to continue to: support the RTOs; consolidate the balancing areas from the existing 125 areas into a more regional, rationalized system; further improve wind forecasting; and adopt more flexible transmission schedules.   A national standard and increased transmission investment are not, by themselves, enough. “This Commission must also use its authority to make significant changes to the way the grid is structured and operates,” Gramlich said. This includes support for the NERC report that “essentially says that variable generation must be planned for and it describes the changes that must be made in areas where significant variable generation development is likely.”

Sergel also announced that NERC's upcoming special report, “Accommodating High Levels of Variable Generation,” is due out in late March. “A one sentence summary is: ‘We've got work to do,'” he said. The special report features the work of NERC's Integration of Variable Generation Task Force, commissioned by its planning and operating committees in 2008.

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