PAC: MTEP Guiding Principles (20210113)

TO Sector Feedback on MTEP Guiding Principles

February 1, 2021

The Transmission Owners (Owners or TOs) appreciate the opportunity to once again provide feedback on the MTEP Guiding Principles. For the last several review cycles, the Owners have requested that the first two Principles be reordered to represent reliability as the first important principle in the MTEP process:

 1. Make the benefits of an economically efficient electricity market available to customers by identifying transmission projects which provide access to electricity at the lowest total electric system cost.

2. Develop a transmission plan that meets all applicable NERC and Transmission Owner planning criteria and safeguards local and regional reliability through identification of transmission projects to meet those needs.

MISO’s initial response to this recommendation was that the Principles are not listed in order of priority, all were equal, but since then, MISO affirmed that the Order is significant, and that the current ordering of these Guiding Principles is appropriate. However, the Owners continue to believe that the order of the Principles should reflect their priority in the planning process, and that the current order of the Guiding Principles does not.   

MISO has indicated in various presentations of the Guiding Principles that the Fundamental Goal of these Principles is, “The development of a comprehensive expansion plan that meets reliability needs, policy needs, and economic needs.”[1]  These Guiding Principles are memorialized in BPM-020, Section 2.1, which describes MISO Transmission Planning Objectives, and states that, “MISO regional transmission planning process has as its goal the development of a comprehensive expansion plan that meets both reliability and economic expansion needs.”

The Owners feel that re-ordering the Guiding principles to be reflective of the Fundamental Goal of the principles is important because:

• While the failure to complete an economic project has consequences under MISO’s tariff, failing to complete a reliability project carries financial and other consequences from both NERC and FERC.
• The suggested edits would conform MISO’s Guiding Principles to what Transmission Planners actually do, which no one suggests should be changed to prioritize economic planning over and reliability planning, and the principles should reflect the order of these priorities.
• From a consumer standpoint, 24/7 transmission service is a higher-level expectation than the economic efficiency of the transmission system.
• Reliability is also recognized as a key factor of MISO’s Value Proposition, where the biggest driver of the value-added by MISO is the avoided capacity cost for reserve margin targets, which are established for reliability, though they may have an economic upside.

An alternative to the Owners' prior suggestion would be to re-order the Guiding Principles to more closely reflect MISO’s “Fundamental Goal,” and place the current first Guiding Principle immediately before the last Principle.

The Owners thank MISO and the MISO Board of Directors for further consideration of this feedback.

Environmental Sector Feedback on MTEP Guiding Principles 

The Environmental Sector appreciates this opportunity to review and provide input into MISO’s MTEP guiding principles. We agree with other stakeholders, including the Organization of MISO States (OMS), that this review is timely and that amendments to the guiding principles are warranted given the multiple shifts underway across the MISO system that will have significant impacts on the energy sector in coming years.

Updating the MTEP guiding principles is also a logical and necessary outgrowth of the MISO Forward initiative to address the “three Ds” of De-marginalization, Decentralization, and Digitalization. The Environmental Sector offers a fourth “D” of Decarbonization as another critical driver of change to which MISO must be responsive.

The Environmental Sector also believes it is past time for MISO to recognize the full breadth of its role in efforts to eliminate the climate, public health, and environmental impacts of energy production and delivery. We are aware that MISO is not a regulator. Nor does it have decision-making authority over the changing resource mix. But that does not absolve MISO of its responsibility to its members and the states and communities within its territory to plan for and facilitate - within the bounds of its authority - the transition to a clean, equitable energy future that MISO consumers increasingly demand.

We suggest the following edits to ensure MISO’s MTEP planning process continues to be a foundation on which MISO fulfills its obligation and remains relevant to its members and consumers more generally (note: suggested new language is in bold and underlined):

Fundamental Goal: The development of a comprehensive expansion plan that meets reliability needs, policy needs, and economic needs, and is responsive to member resource plans and environmental commitments, state and local policy, and the technological and consumer-based drivers of change across the MISO system.

• Make the benefits of an economically efficient electricity market available to customers by identifying transmission projects, including non-transmission alternatives, that which provide access to electricity at the lowest total electric system cost.

• Develop a transmission plan that meets all applicable NERC and non-discriminatory Transmission Owner planning criteria and safeguards local and regional reliability through identification of transmission projects to meet those needs.

• Support utility resource plans and environmental commitments, evolving consumer demands, local, state and federal energy policy requirements, and beneficial technological advancements by planning for access to a changing resource mix.

• Facilitate and inform efforts to reduce the public health, climate, environmental, and equity impacts of MISO’s evolving resource mix and investment decisions.

• Provide an appropriate cost allocation mechanism that ensures that costs of transmission projects are allocated in a manner roughly commensurate with the projected benefits of those projects and that supports the approval of transmission expansion needed to accommodate MISO’s changing resource portfolio.

• Analyze robust, forward-looking system scenarios and make the results available to local, state, and federal decision makers and other stakeholders to provide context to inform regarding choices.

• Coordinate planning processes with neighbors and work to eliminate barriers to optimize reliable and efficient operations across boundaries and within the MISO territory.

• Ensure that all MTEP planning processes are as open and transparent as possible and facilitate robust stakeholder involvement by all sectors and individual stakeholders.

The Environmental Sector also supports the proposed amendments offered by OMS to the System Planning Committee and the MISO Board of Directors. We believe our proposed amendments above are complementary to the recommendations of OMS, and together present a much stronger and forward-looking set of principles to guide MISO’s MTEP process.

Thank you for the opportunity to provide feedback and for your consideration of our proposed amendments.

The Muni/ Co-op/TDU Sector supports and appreciates the MISO planning process.  However, as the energy industry, technology and customer preferences continue to evolve, the sector finds MISO’s transmission planning is not.  The sector is concerned MISO’s planning lacks an appropriate focus on finding the right solutions to potential system needs.  Going forward, consideration both of all potential alternatives (e.g., non-traditional transmission and non-transmission solutions) and of cost impacts to customers must play a more significant role in the transmission planning process.  As we embark on the Long-Range Transmission Planning process, it is critical that our efforts encompass all possible means to accommodate the coming changes.

Further, MISO’s planning must be balanced.  While we do not know what the future holds, it appears that MISO’s focus is only on futures with extreme demands on the transmission system.  The sector recognizes this type of future is possible; however, so is the potential for technological advances and other unexpected changes to mitigate demands on the transmission system.  Both scenarios must be studied by MISO to arrive at the best solutions for customers and currently they are not.

The TDU Sector believes the following edits to MISO’s MTEP Guiding Principles are required to reflect the appropriate framework for future MISO planning.  Our proposed revisions to the principles are indicated below.

Fundamental Goal

The development of a comprehensive expansion plan that meets reliability needs, policy needs, and economic needs

• Make the benefits of an economically efficient electricity market available to customers by identifying transmission projects, non-transmission alternatives or other solutions that optimize the utilization of the system and which provide access to electricity at the lowest total electric system cost
• Develop a transmission plan that meets all applicable NERC and Transmission Owner planning criteria and safeguards local and regional reliability through identification of transmission projects or non-transmission alternatives to meet those needs
• Support state and federal energy policy requirements by planning for access to a changing resource mix using a robust and balanced set of future scenarios
• Provide an appropriate cost allocation mechanism that ensures that costs of transmission projects are allocated in a manner roughly commensurate with the projected benefits of those projects
• Analyze a spectrum of potential system scenarios and make the results available to state and federal energy policy makers and other stakeholders to provide context to inform regarding choices
• Coordinate planning processes with neighbors and work to eliminate barriers to reliable and efficient operations

The CTD sector supports MISO's Transmission Planning Guiding Principles as currently written and offer no recommendations for changes.  We appreciate the opportunity to provide feedback.