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Michigan State University - Institute of Public Utilities
Grid School, Richmond, VA; 10 March 2010
Transmission Planning:Federal, Regional, and State
Jurisdiction/Coordination/Siting
Rajnish Barua, Ph.D.Executive Director
Organization of PJM States, Inc. (OPSI)Email: [email protected]; Tel: 1-302-757-2441
DISCLAIMER: Opinions expressed in this presentation and related discussions belong to the presenter and do not represent any views of his employer or the organizers of this event; employment affiliation is listed for information purpose only. To the extent possible, all public sources of material have been identified.
Epilogue as Prologue My house is in the line of the proposed power line, so I will lose
it, along with many other people, we are upset.
This is an inadequate solution. Is it a good idea to consolidate so much power in lines that run for hundreds of miles through rural areas?
I protest. I am very concerned about the effects that a power line of this nature and all that must be done to maintain it will have on our surroundings.
This power line is proposed to run right through the center of TOTALLY residential neighborhoods! Make a visit here and see for yourself.
Source: Excerpts from DOE’s NIETC Comment Sessions
10-March-10 2IPU's Grid School: Rajnish Barua, Ph.D.
Overview
• North American electricity grid– Reliability Councils– RTOs and ISOs
• Where are we now and why?
• Transmission planning– Jurisdiction, Coordination, Siting– Current issues
10-March-10 3IPU's Grid School: Rajnish Barua, Ph.D.
One picture/slide = 1,000 words?
May need more than a thousand words to explain this one!
10-March-10 4IPU's Grid School: Rajnish Barua, Ph.D.
North American ElectricReliability Corporation (NERC)
• Ensure the reliability of the bulk power system• Develop and enforce reliability standards• Assess reliability annually via 10-year and
seasonal forecasts• Monitor the bulk power system• Educate, train, and certify industry personnel• Self-regulatory, subject to oversight by the
FERC and Canadian authoritiesSource: www.nerc.com
10-March-10 5IPU's Grid School: Rajnish Barua, Ph.D.
Selected NERC Terminology• Bulk power system = generation assets and
transmission lines and components• Balancing Area = Multiple assets together• Balancing authority = matches generation with demand• Transmission operator = monitors the flows over the
transmission system and voltages at substations• Different balancing areas are connected to each other
by “tie lines” • Regional Entity = delegated enforcement authority
through an agreement approved by FERC
Source: www.nerc.com
10-March-10 6IPU's Grid School: Rajnish Barua, Ph.D.
NERC’s Regional Entities (RE)• RE members are investor-owned utilities; federal power
agencies; rural electric cooperatives; state, municipal and provincial utilities; independent power producers; power marketers; and end-use customers
• Eight REs are:– Florida Reliability Coordinating Council (FRCC)– Midwest Reliability Organization (MRO)– Northeast Power Coordinating Council (NPCC)– Reliability First Corporation (RFC)– SERC Reliability Corporation (SERC)– Southwest Power Pool RE (SPP)– Texas Regional Entity (TRE)– Western Electricity Coordinating Council (WECC)
Source: www.nerc.com
10-March-10 7IPU's Grid School: Rajnish Barua, Ph.D.
North American Electric Reliability Corporation (NERC)
Source: NERC
Eastern InterconnectionWestern Interconnection
ERCOT
Canada
USA
Mexico
10-March-10 8IPU's Grid School: Rajnish Barua, Ph.D.
RTO/ISO Structure• Regional Transmission Organizations (RTOs)
• Independent System Operators (ISOs)
• Single state: NY, CA, TX
• Multi-jurisdiction: New England, PJM, SPP, MISO
• RTOs/ISOs do not own assets
• Operate by an approved agreement among transmission owners (TOs) in that area
10-March-10 9IPU's Grid School: Rajnish Barua, Ph.D.
RTOs / ISOs
Source: FERC
10-March-10 10IPU's Grid School: Rajnish Barua, Ph.D.
Restructuring and Retail Choice
Source: EIA
10-March-10 11IPU's Grid School: Rajnish Barua, Ph.D.
Comparison of Average Electricity Prices
10-March-10 12IPU's Grid School: Rajnish Barua, Ph.D.
(Somewhat) famous quotes
• Restructuring and competition will lead to less work!
• Restructuring of the electricity industry is not about the flow of power . . .
rather, it is about the flow of money![Refresher - electrons follow the laws of physics and not
of legal contracts!]
10-March-10 13IPU's Grid School: Rajnish Barua, Ph.D.
What do we have?• Federal – transmission; State – distribution• Generation – depends on state• New challenges for the regulatory community• Involvement in RTO/ISO issues• Regulatory practices gradually include monitoring of
non-jurisdictional entities• How does one ensure safe and reliable electric
service with no jurisdiction over wholesale generation?
• Provider of Last Resort (POLR), Default Service Provider
• Reliability standards; customer service
10-March-10 14IPU's Grid School: Rajnish Barua, Ph.D.
PJM Service Territory
Illinois
Michigan
Indiana
Ohio
Kentucky
Pennsylvania
New Jersey
Maryland
Delaware
Washington, DC
Virginia
North Carolina
Tennessee West Virginia10-March-10 15IPU's Grid School: Rajnish Barua, Ph.D.
Profile of Jurisdictions in PJM area• 13 states and DC• Several have traditional rate regulation and the
others have retail choice• Several have coal as a major resource (cheaper
power, economic driver)• Several have clean air mandates (also happen to
have the load centers)• Some have RPS (varied targets, dates,
requirements, definitions)• Wind availability on both sides• Some are predominantly in another RTO
10-March-10 16IPU's Grid School: Rajnish Barua, Ph.D.
Transmission Planning
• Transmission planning is regional• Transmission construction is utility’s
responsibility• Transmission financing is utility’s responsibility• Transmission siting is affected by state and
local jurisdictions
10-March-10 17IPU's Grid School: Rajnish Barua, Ph.D.
Choice of Resource• Build new generation, or build more lines, or both• Retrofit/upgrade existing generators• Specific requirements of resources
– Wind is usually far from customers– Nuclear needs water (and what about waste?)
• Demand response by customers – does it make a significant difference (how much and
for how long)• Energy efficiency measures
– mandatory, voluntary (how much and for how long)
10-March-10 18IPU's Grid School: Rajnish Barua, Ph.D.
Availability vs. Needs• Wind resources in the Midwest and Atlantic
(off-shore)• Load centers in the Mid-Atlantic• Electricity based on price primarily• Fuel resources based on other reasons• Renewable standards are state-by-state• If demand is greater than supply, then,
– build generator near customers– build transmission to customers
10-March-10 19IPU's Grid School: Rajnish Barua, Ph.D.
Issues to Keep in Mind• Coal is economic lifeline in some states• All electricity is clean and compete on price• Wind-generated electricity prices vary• LNG does not do much for energy
independence• Commercial and industrial customers behave
and respond differently to prices• Residential customers do not react to prices
until they receive last month’s bill10-March-10 20IPU's Grid School: Rajnish Barua, Ph.D.
A Different Jurisdictional Issue
Conflict between a state’s economic regulator and environmental agency
Stringent environmental controls could lead to shutting down generating plants . . .. . . which could lead to less electricity supply
and higher prices . . .. . . which could lead to lower economic
development . . .. . . but utility commissions do not regulate
wholesale generation . . .. . . so what is important: environment or jobs?
10-March-10 21IPU's Grid School: Rajnish Barua, Ph.D.
So the dilemma:
• Who will pay for transmission lines –– Societal benefit– Cost “causer”
• What resources for generation – renewables, fossil, nuclear?
• Who decides - federal or state?
10-March-10 22IPU's Grid School: Rajnish Barua, Ph.D.
• Lengthy application process• Document intensive process• Approvals required from other agencies-federal, state and
local• Additional timing pressures resulting from federal backstop
authority• Public notification can be an issue especially where eminent
domain authority is sought• Political involvement including county and municipal
governments and local legislators• Land availability
Source: Jim Melia, Esq., PAPUC
Major Challenges to Siting
10-March-10 23IPU's Grid School: Rajnish Barua, Ph.D.
• Is need predicated on state-specific or regional concerns?
• Route selection: Is the final route the least intrusive?
• Land-use concerns: proximity to populated areas• Environmental impacts• Health and safety issues • Aesthetic considerations
Source: Jim Melia, Esq., PAPUC
Dominant Themes in Siting
10-March-10 24IPU's Grid School: Rajnish Barua, Ph.D.
ARRA of 2009$4.5 billion for DOE’s Office of Electricity Delivery and Energy
Reliability $100 million is for worker training $10 million is for smart grid $80 million is for facilitating the development of regional
transmission plans Remaining funds -
for electricity delivery and energy reliability activities to modernize the electric grid
to include demand responsive equipment, enhance security and reliability of the energy infrastructure, energy storage research, development, demonstration and deployment
facilitate recovery from disruptions to the energy supply
10-March-10 25IPU's Grid School: Rajnish Barua, Ph.D.
ARRA of 2009
• $80 million is for facilitating the development of regional transmission plans
• Conduct a resource assessment and analysis of future demand and transmission requirements
• Formation of interconnection-based transmission plan for the Eastern and Western Interconnections and ERCOT
• May include modeling, support to regions and States for development of coordinated State electricity policies, programs, laws, and regulations
10-March-10 26IPU's Grid School: Rajnish Barua, Ph.D.
EIPC and EISPC• Part A: Eastern Interconnection Planning
Collaborative – over 40 planning authorities (RTOs/ISOs, TOs in non-RTO areas)
• Part B: Eastern Interconnection States’ Planning Council – 41 states and jurisdictions in the Eastern interconnection; a self-governing entity with its own staff
• At least 1/3 members on EIPC’s Steering Committee will be from EISPC
10-March-10 27IPU's Grid School: Rajnish Barua, Ph.D.
EIPC’s Objectives• Establish processes for aggregating the modeling and
regional transmission expansion• plans of the entire Eastern Interconnection• Perform interregional analyses to identify potential
conflicts and opportunities between regions.• Serve as a reference case for modeling various
alternative grid expansions based on the scenarios developed by stakeholders
• Perform scenario analysis as guided by broad stakeholder input and the consensus recommendations of the Steering Committee to aid policy makers and other stakeholders in assessing interregional options and policy decisions
10-March-10 28IPU's Grid School: Rajnish Barua, Ph.D.
MOU among Federal Agencies• Signed October 23, 2009 by:
U.S. Departments of Agriculture, Commerce, Defense, Energy; EPA, CEQ, ACHP, USDOI, and FERC
• To expedite the siting and construction of qualified electric transmission infrastructure
• Improves coordination among project applicants, federal agencies, and states and tribes involved in the siting and permitting process.
• Improve uniformity, consistency, and transparency by setting forth the roles and responsibilities of these entities when project applicants wish to construct electric transmission infrastructure
10-March-10 29IPU's Grid School: Rajnish Barua, Ph.D.
U.S. COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 07-1651
Argued September 24, 2008; decided February 18, 2009
PIEDMONT ENVIRONMENTAL COUNCIL, Petitioner,NYPSC and MNPUC, Intervenors,
v.FERC, Respondent,
SOUTHERN CALIFORNIA EDISON COMPANY; ALLEGHENY POWER; TRANS-ALLEGHENY INTERSTATE LINE COMPANY; EDISON ELECTRIC INSTITUTE; AMERICAN PUBLIC POWER ASSOCIATION; NATIONAL RURAL ELECTRIC COOPERATIVE ASSOCIATION; AMERICAN WIND ENERGY ASSOCIATION; SAN DIEGO GAS & ELECTRIC COMPANY; PPL ELECTRIC UTILITIES CORPORATION, Intervenors.
10-March-10 30IPU's Grid School: Rajnish Barua, Ph.D.
U.S. COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 07-1651
• On Petition for Review of an Order of the Federal Energy Regulatory Commission (RM06-12-001)
• Argued: September 24, 2008• Decided: February 18, 2009• Before MICHAEL and TRAXLER, Circuit Judges, and Richard
L. VOORHEES, United States District Judge for the Western District of North Carolina, sitting by designation.
• Reversed in part, affirmed in part, vacated in part, dismissed in part without prejudice, and remanded by published opinion.
• Judge Michael wrote the opinion, in which Judge Voorhees joined. Judge Traxler wrote a separate opinion concurring in part and dissenting in part.
10-March-10 31IPU's Grid School: Rajnish Barua, Ph.D.
U.S. COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 07-1651
• Decision reverses “FERC’s expansive interpretation of the language in FPA § 216(b)(1)(C)(i) that grants FERC permitting jurisdiction when a state commission has "withheld approval [of a permit application] for more than 1 year." The phrase does not include, as FERC held, the denial of an application.“
• U.S. Supreme Court -Sep. 17, 2009: Petition for a writ of certiorari filed;Jan. 19, 2010: Petition denied.
10-March-10 32IPU's Grid School: Rajnish Barua, Ph.D.