MISO is requesting feedback on ERIS DFAX Reduction Proposal (PAC-2022-3).
Please provide feedback by October 26, 2022.
Q: Should the DFAX change be linked to the inclusion of approved LRTP projects in the DPP study process?
A: No
Q: If so, should the DFAX change be limited to the West/East (ATC & ITC)/Central DPP regions and only implemented in the South until the approval of LRTP Tranche 3?
A: N/A
Q: As an alternative to lowering DFAX when LRTP projects are included in the DPP process, should the DFAX reduction to 10% occur across the footprint but only for voltages below 345KV?
A: No
SoftBank Energy (SB Energy) appreciates the opportunity to provide feedback on the ERIS DFAX cutoff change proposal (from 20% to 10%) currently being discussed at the Interconnection Process Working Group (IPWG). SB Energy believes that MISO has not shown sufficient justification that requires a change to ERIS DFAX cutoff in the DPP Studies. Moreover, the market is designed to redispatch the generators to solve the overloads for system intact and N-1 contingencies and “ERIS” product and the stringency of its criteria was designed considering that there will be some curtailments in real-time, hence the rationale for changing the ERIS DFAX cutoff criteria must not be just linked to the market congestion. Interconnection Customer is not getting any additional assurance that the generator will still not be curtailed in the future even if the ERIS criteria is reduced because market congestion is caused due to several other factors as well. More consideration should be given in utilizing more market redispatch techniques instead. Revisions to ERIS DFAX cutoff will have a significant impact on generation interconnection process that will immensely increase the Network Upgrades and will potentially hinder the renewable energy growth in the MISO footprint. Therefore, SB Energy requests MISO to re-evaluate the need for ERIS DFAX cutoff change in the DPP Studies.
If MISO is still considering the ERIS DFAX cutoff change, a more thorough analysis shall be conducted for the entire MISO footprint and show the co-relation of DFAX criteria change in DPP study and the real-time congestions, this analysis should not be limited to a particular MISO region such as West region when showing the real-time congestions. Upon completion of this analysis and meticulous stakeholder review process, if the right approach is indeed to make a change to the ERIS DFAX cutoff, then this change shall be applied only to the upcoming DPP cycle because the Interconnection Customers put in a lot of effort and money (technical analysis, site control requirements etc.) before submission of each Interconnection Application in the DPP 2022 Cycle using the current ERIS DFAX cutoff. The implementation of such a significant change in the DPP 2022 Cycle with a short stakeholder review process is unfair. Consideration shall also be given to implement the ERIS DFAX change only after LRTP projects are approved in all of MISO regions. Furthermore, MISO shall make a tariff filing for further vetting and transparency to ensure that these significant criteria changes do not happen very often by simply changing the BPM languages. MISO mentioned in the response that it is not typical to include DFAX thresholds in the Tariff. However, this is not accurate because Section 3.8 – Identification of Contingent Facilities of the MISO Tariff includes DFAX and MW thresholds.
A general observation is that several stakeholders have provided a lot of valuable feedback as part of the prior stakeholder presentations and majority of the feedback is not supportive of making this ERIS DFAX change at this time; however, MISO has not provided detailed responses to all the feedback. Generalizing/paraphrasing several comments during stakeholder review would miss some important stakeholder feedback. If there is not sufficient time to discuss all the feedback during the stakeholder meeting, a detailed written response to each feedback (showing support/opposition/neutral stance) is greatly appreciated.
While SB Energy does not support the ERIS DFAX cutoff change, if one were to be implemented, SB Energy’s position on the below specific questions is also included:
Pine Gate Renewables (Pine Gate) appreciates the opportunity to comment on MISO’s ERIS DFAX Reduction Proposal. Pine Gate does not support this proposal, disagrees that there is sufficient support for this proposal, and is concerned this proposal will lead to unintended consequences for both generators and transmission owners and is, hence, unnecessary. In response to this request for feedback, Pine Gate reiterates its opposition and reasons therefor as submitted in its previous feedback and, in response to the specific questions posted, submits the following responses.
This proposal has been linked to the LRTP project investments since it was originally submitted as an issue charge in March 2022 and presented to stakeholders by Xcel Energy in June 2022. Such statements appeared to conflict the proposed schedule for review of the issue, which seemed to contemplate that the issue would continue to be under consideration and review well past the close of the 2022 DPP request submission window.[1] Stakeholders have questioned and objected to this linkage and timing. However, statements made by MISO and Xcel Energy during the stakeholder process have made plain that LRTP Tranche 1 will not be included in the 2022 DPP cycle without this DFAX change also being implemented as this change is needed to “balance” the LRTP investments.
The genesis and temporal dissonance of the linkage of the LRTP projects to the need for this DFAX change and its implementation timing are important and must be documented in the record. When initially presented for approval by the MISO Board of Directors, LRTP Tranche 1 was presented as a “least regrets” portfolio necessary for reliability with a myriad of benefits. Importantly, it was not presented as being conditioned on or having to be balanced by other, unrelated generator interconnection process changes. However, as early as March 2022, Xcel Energy was presenting MISO with this proposal as necessary “when the LRTP projects are added.”[2] Soon thereafter, MISO staff was echoing a similar need for balance.[3] The presentation of the LRTP Tranche 1 portfolio as a “least regrets” portfolio in July 2022 stands in stark contrast to both Xcel Energy’s and – now – MISO’s contentions that it must be balanced by this change in the current generator interconnection process.[4]
Simply put, the DFAX change/LRTP correlation and linkage was proposed without any stakeholder input prior to the approval of LRTP Tranche 1. Nonetheless, the implementation of this unnecessary change would be slightly less inequitable if it moved forward with the inclusion of the LRTP projects. Any other approach could lead to study results that identify redundant upgrades or upgrades that moot the need for LRTP projects during the generator interconnection DPP process. Such study results would perpetuate a patchwork transmission build out - negating the entire objective of LRTP, which is to build a comprehensive portfolio of necessary reliability upgrades.
Pine Gate questions whether a difference in the DFAX threshold across the MISO footprint or the linkage of that difference to the inclusion of LRTP is non-discriminatory. However, assuming that MISO has evaluated this proposal for its impacts on preference and discrimination and determined it to be non-discriminatory and non-preferential, Pine Gate observes that this unnecessary proposal would be less inequitable if it is implemented with LRTP and that there is no LRTP portfolio in MISO South.
Pine Gate is concerned about the number and size of “backbone” projects assigned to generators under MISO’s process generally. Further, that there are doubts about whether this proposal should or could be applied across all facilities and – even the entire footprint – underscores that it is a poor solution for the issue raised and a poor fit for the MISO system overall. This is before consideration has even been given to whether the introduction of additional carve-outs and complexity would create more confusion.
Current planning processes are already inconsistent in their modeling and assumptions. They also fail to fully consider the recovery mechanisms that could result in double charging of upgrades to generators. Instead of attempting to find disconnected methods of addressing real-time congestion, MISO should:
[2] Only 1 PAC meeting after the LRTP Tranche 1 portfolio was recommended to System Planning Committee of the Board for recommendation to the Board of Directors for approval, MISO published an issue charge submitted by Xcel Energy on March 18, 2022 that stated “Reduce the ERIS distribution factor used in the MISO DPP studies from 20% to 10% in conjunction with the DPP Cycle where the LRTP projects are added.” See also Xcel presentation to the Planning Advisory Committee on 6.22.2022 at: PowerPoint Presentation (misoenergy.org) and the presentations to the IPWG on 7.20.2022 at Interconnection Process Working Group (IPWG) and Planning Subcommittee (PSC) Joint Meeting (misoenergy.org), all of which occurred prior to the presentation of LRTP Tranche 1 to the MISO Board of Directors for approval on July 25, 2022 without reference to conditions to be applied to the inclusion of LRTP Tranche 1 in the generator interconnection process despite the issue receiving presentation and discussion at 2 subcommittees prior to that date (See PowerPoint Presentation (misoenergy.org).
[3] Id.
Clean Grid Alliance Comments on ERIS DFAX
Oct 26, 2022
Clean Grid Alliance appreciates the opportunity to provide feedback on MISO’s proposal to lower the ERIS DFAX in Generator interconnection.
MISO has requested feedback on the following questions:
To begin with, Clean Grid Alliance notes that this is a MISO Transmission Owner proposal and to date, the majority of MISO stakeholder feedback has been in opposition to it, giving a strong indication that MISO should not progress forward with lowering the DFAX at this time. The proposal continues to be unjustified, and the concerns expressed by non-transmission owning stakeholders in MISO, including Clean Grid Alliance’s concerns, remain unaddressed. There is no strong correlation that existing real-time congestion can be solved by lowering the DFAX threshold in Generator interconnection studies. As an example, a Generator may be assigned Network Upgrades to fix pre-existing issues but may chose not to move forward. In this case, MISO has done nothing to solve existing issues on the Grid, particularly given that the MISO Independent Market Monitor has identified other causes as being responsible for real time congestion.[1] MISO has not looked at the role the thousands of MW of battery storage in its queue could play in addressing existing congestion on the system. Furthermore, there are significant unintended consequences to this proposal beyond creating new barriers to interconnection. We have concerns that the history of benefit to cost ratio dependent transmission being cancelled in the last few years due to 345kV Generator interconnection upgrades assigned at just the 20% DFAX level would increase if the DFAX is lowered. Additionally, GI Upgrades that address a significant amount of economic congestion should be evaluated to determine if they meet the MEP criteria, yet MISO has not yet developed a process for such evaluation.
During discussion of the introductory proposal at the joint meeting of the IPWG/PSC, Randy Oye explained that lowering the DFAX to capture more Generator interconnection upgrades would help balance the investment that transmission owning members of MISO are putting into LRTP projects. However, the reality is that LRTP (and previously the MVP portfolio) are a means to balance a long-standing imbalance in transmission expansion where Generators are regularly burdened (beyond their fair share) to carry major backbone transmission upgrades that have widespread benefits. Currently Generators receive little to no benefit from these upgrades. Generators that build transmission upgrades are just as subject to curtailment (per the market) on those assets as entities that did not pay to build the upgrades. Building more upgrades does not mean that Generators funding these upgrades will get a congestion “free-ride” on the Transmission System.[2] In general, by lowering the DFAX criteria it is not clear that the right constraints are being fixed as the nature of the DPP studies is different than real time operations. MISO and/or Xcel must provide more substantial analysis and justification for such a major, and permanent change. The threshold of 10% also appears relatively arbitrary and further analysis should compare DFAX levels of 15%, 17.5%, etc.
The excessive burden on Generators for transmission expansion that currently exists is due to multiple factors, including the differences between LBA (Local Balancing Area) dispatch in MTEP transmission reliability studies and fuel-based dispatch in DPP reliability studies/modeling. In LBA dispatch, only enough generation within an LBA to meet load needs is dispatched. This results typically in MTEP models indicating lower usage of transmission lines than was studied in the DPP where all new generation coming online was dispatched at 100% on top of the previous LBA dispatch, and then area constraints opened up to allow power flows outside of the balancing area, leading to backbone 345kV transmission expansion upgrades being assigned to Generators.
Under “shoulder study” processes as they exist today, Generators take on a primary role for transmission expansion in MISO and hence why many backbone upgrades have historically shown up in interconnection studies[3]. Shoulder constraints are not required to be mitigated in MTEP reliability studies, which leads to upgrades at the current 20% DFAX threshold cancelling Market Efficiency Projects (MEPs) that (similar to LRTP projects) depend on a minimum benefit-to-cost ratio. Generator interconnection upgrades provide measurable benefits that lower the production cost[4]. Instead of lowering the DFAX on Generators, Shoulder constraints should be evaluated in in MTEP reliability studies for mitigation, and DPP projects should be evaluated as MEP projects.
Furthermore, Generators have long been given different (higher) standards in various local planning criteria such as all generation in an area being dispatched at 100% and constraints assigned to Generators based on that criterion, while, LBA dispatch in transmission reliability planning has not been subject to this same standard that is imposed on Generators. Further compounding the problem of Generators being assigned major backbone transmission within MISO, is the MISO “futures” historically[5] used in MTEP transmission expansion reliability planning which have drastically underestimated the amount of renewables on the MISO system. Such underestimation results in building out much less backbone transmission by Transmission Owners than was actually needed, and hence further shifting backbone upgrades to Generators.
With this background/context in mind, Clean Grid Alliance offers these responses to MISO’s questions:
As an initial point, CGA notes that MISO and Xcel Energy have linked this proposal to the LRTP Tranche 1 projects, and further that such linkage was not at the request of stakeholders. Next, CGA notes that while we oppose lowering the DFAX because it is not justified at this time, we firmly believe that to implement any new standards (such as lowering the DFAX) for application to Generator interconnection, the entire MISO transmission system must first be brought up to that same standard before changing it for Generators, else an excessive burden will unfairly be put on new Generators. While LRTP may help to some extent in bringing the MISO system up to that same standard prior to a lower DFAX standard applied to generators, it alone will not be sufficient, so other steps will also need to be taken to ensure that the cost allocation to Generators is equitable, before any DFAX change for ERIS generators is implemented. Lowering the ERIS DFAX threshold is an effectively “permanent”/ongoing change while the Also to note, LRTP transition date proposed is a one-time project portfolio approval and will not address similar situations in the future prior to the approval of other LRTP tranches.
The DFAX change should not be implemented in either the North or the South, as Generators have already been paying more than their fair share of backbone transmission upgrades at the 20% DFAX level. As noted previously, to impose any new standard on Generators, the entire MISO transmission system needs to be brought up to that standard first. While LRTP alone is not sufficient to do that, doing nothing at all is even more insufficient. If this proposed change is implemented, however, it must not begin to apply in MISO South until Tranche 3 lines are approved and included in the DPP base models and other steps taken to bring the system up to that same standard.
Upgrades at 345kV and higher level should generally not be assigned to Generators but anticipated/planned through adequate MTEP transmission expansion planning efforts. This principle should apply regardless of the DFAX proposal. Lowering the DFAX threshold on Generators at the 345kV level will increase the already occurring assignment of backbone upgrades to Generators which will result in lower B/C ratios of LRTP, MEP, MVP projects, leading to more project cancellations and creating significantly higher inefficiencies in the planning process than already exist today. In MISO’s analysis of the occurrence of 345kV and higher upgrades that would be assigned to Generators with a 10% DFAX, only a Phase 3 study was looked at –not a Phase 1 study which is more indicative of how often 345kV upgrades result from the DPP studies. It’s likely that the projects which had progressed to Phase 3 in MISO’s analysis, would have dropped in an earlier phase, if a 10% DFAX had been implemented. This flaw in the analysis provided by MISO only further serves to underscore how this proposal has not been appropriately justified in the stakeholder process and that there is insufficient analysis and insufficient support to implement it. While we do not at this time support a lower DFAX threshold for any voltage levels, if one were to be implemented, it definitely should not apply to transmission solutions 345kV and higher and it should clearly not be applied to any DPP projects prior to MISO Transmission Owners bringing the entire MISO grid up to that same standard.
[1] See Clean Grid Alliance’s earlier comments to the IPWG on lowering the DFAX in regard the MISO Independent Monitor’s assessment of the causes of congestion.
[2] Generators, are rarely, if ever, able to acquire or use FTRs that are supposed to be commensurate to the cost they pay for new transmission. Additionally, Generators are assigned a high “cost-adder” to Network Updates as a result of TO self-funding that brings their costs up significantly.
[3] The burden for transmission expansion in the shoulder cases is primarily on generators in years when no MVP or LRTP approvals occur. In MVP and LRTP years a balance exists, which is now proposed to be disrupted by lowering the DFAX threshold.
[4] MISO’s Tariff requires that DPP projects be evaluated as MEP projects because they do provide benefits, but to date, that has not been occurring due to multiple factors including a lack of timing alignment between the two processes, and lack of policy around how it might occur
[5] MISO has an opportunity to address this problem as it looks toward adopting more realistic “futures” in the future.
Sincerely,
Rhonda R. Peters, Ph.D.
Technical Consultant to Clean Grid Alliance
Should the DFAX change be linked to the inclusion of approved LRTP projects in the DPP study process? Yes or No.
If so, should the DFAX change be limited to the West/East (ATC & ITC)/Central DPP regions and only implemented in the South until the approval of LRTP Tranche 3? Yes or No.
As an alternative to lowering DFAX when LRTP projects are included in the DPP process, should the DFAX reduction to 10% occur across the footprint but only for voltages below 345KV? Yes or No.
AES Clean Energy appreciates the opportunity to offer additional comments on the ERIS DFAX Reduction Proposal. AES Clean Energy reiterates its previously submitted comments, and requests that MISO re-evaluate the schedule for this initiative and provide additional time for stakeholders to consider the broader impacts lowering the ERIS DFAX level would have and to determine if this is the best solution to address the congestion issues originally raised by Xcel. MISO should not bring a finalized recommendation to the PAC in November and should extend the schedule to at least Q2 2023 to provide stakeholders the necessary time to evaluate and engage on this issue. AES Clean Energy also reiterates its prior comments that this issue should not be a simple BPM change but should be filed as a tariff change at FERC since it would have a material impact on the “rates” i.e., network upgrade costs paid by generators for ERIS service. 
To the extent that MISO moves forward with this proposal, AES Clean Energy agrees the modifications to the DFAX should be linked and phased in with the approval of LRTP projects in each region. Additionally, AES Clean Energy argues that if MISO moves forward with lower the ERIS DFAX it should do so gradually and reduce the DFAX to 15% when tranche 1 goes into effect and then to 10% when tranche 2 goes into effect and remain at 20% for regions that do not have approved LRTP projects. AES Clean Energy believes that enacting a tiered ERIS DFAX reduction will give stakeholders, whose comments have been almost unanimously critical of this proposal, more time to adapt to the changes this will introduce to the DPP process. It may also help address the concern that lowering the DFAX levels will lead to the cancelation of LRTP project due to interconnection customer funded upgrades lowering the benefits ratio of the project.
If so, should the DFAX change be limited to the West/East (ATC & ITC)/Central DPP regions and only implemented in the South until the approval of LRTP Tranche 3?  Yes or No.
While AES Clean Energy believes more stakeholder discussion and analysis should be conducted before moving forward with the ERIS DFAX reduction, to the extent that MISO moves forward with this proposal MISO should only implement a DFAX Reduction in MISO South upon the approval of Tranche 3. This reduction should also be phased in with the ERIS DFAX reduced to 15% when tranche 3 is approved and included in the DPP base cases, and 10% when Tranche 4 is approved and included in the DPP base cases. AES Clean Energy does not view this as discriminatory treatment of generators in different service territories, especially given the recent FERC ruling on postage stamp cost allocation, but rather a more equitable treatment of resources that have more or less access to a robust backbone transmission system and would lead to more equitable network upgrade identification and cost allocation to resources across regions.
As an alternative to lowering DFAX when LRTP projects are included in the DPP process, should the DFAX reduction to 10% occur across the footprint but only for voltages below 345KV? Yes or No.
While AES Clean Energy believes more stakeholder discussion and analysis should be conducted before moving forward with an ERIS DFAX reduction, it is more supportive of a proposal that would restrict the DFAX reduction to the more localized high voltage system (below 345 KV). However, this proposal should also be tied to the integration of LRTP project as discussed above. The generator interconnection process is not the process to identify, fund, and build “backbone” transmission upgrades and maintaining a 20% DFAX threshold on higher voltage lines would help ensure that generators are not responsible for upgrading the EHV system. Rather the MTEP and LRTP processes should be the venue to trigger these types of investments and can better ensure that all the beneficiaries of the project are identified and allocated costs.
Invenergy appreciates the opportunity to provide feedback and respectfully submits the following comments to the ERIS DFAX Reduction Proposal.
Invenergy shares stakeholder concerns about congestion and encourages model assumption improvement through a transparent and collaborative environment. Though Invenergy notes that MISO has provided some additional analysis on the ERIS DFAX threshold, Invenergy still finds that the problem statement is too broad, and analysis provided to date is insufficient and does not support the proposal. Until the benefits and expected impacts of this decision have been clearly defined, Invenergy cannot support the proposal to decrease the ERIS DFAX from 20% to 10%.
The only analysis provided by MISO is the number of facilities that would be identified at different DFAX thresholds. While this analysis provided a sense of scale for the impact, the fact that more facilities will be impacted at a lower DFAX is not a novel insight. There must be further analysis of whether a lower DFAX would effectively address the problem at hand.
However, stakeholders cannot engage in meaningful discussion of a solution for which the problem has not been clearly defined. The initial concern brought forward by Xcel Energy was real-time congestion, then MISO alluded to reliability issues and LRTP timing, but Invenergy does not understand the concrete problem that lowering the ERIS DFAX threshold is trying to solve.
Further, MISO has not defined any framework or criteria by which the solution is being evaluated. MISO has supported this proposal by stating that certain thresholds do or do not have a “meaningful impact” or refer to a “significant barrier,” using terms which have not been defined or elaborated upon.It is unclear why 10% strikes a “reasonable balance” while 12% or 8% does not.Without clear standards and common terminology,stakeholders cannot objectively compare the proposed solutions.
Invenergy urges MISO to provide a concrete problem statement, a set of criteria, and analysis which demonstrates causation and not just correlation, all of which are necessary for a robust stakeholder process. Invenergy once again encourages MISO to draw inspiration from SPP’s “HITT T1 ERIS Study Scope” approach to define the appropriate study scope and objective:
“Part I Congestion Study Objective: Determine the impact on market congestion that might be realized by reducing the distribution factor threshold for ERIS requests in the GI study process.
Part II Comparison Study Objective: Determine whether upgrades that have been identified and approved for construction in the Integrated Transmission Planning Assessment (ITP) process would have been identified and assigned to GI customers in the GI study process if the ERIS threshold were lower.”
Even if this change is implemented through the BPM, the proposed change would have a substantial impact on all stakeholders and should not be made hastily.Lowering the DFAX threshold would be particularly impactful for interconnection customers’ commitments, financial requirements, and development strategies. Further, this change risks building out transmission through the interconnection process, which is a topic of heavy discussion at FERC. It is imperative that the rationale and expected impacts of the change be well-defined and sufficiently investigated.
Invenergy thanks MISO for their consideration. Invenergy urges MISO to provide additional analysis on the expected impacts of outcomes of the change on the defined problem and allow for further stakeholder discussions to (1) define the problem statement and (2) adequately compare and evaluate solutions.
Savion, LLC (“Savion”), a Shell Group portfolio company operating on a stand-alone basis, is an industry-leading utility-scale solar and energy storage project development company. Savion would like to thank MISO for the opportunity to provide feedback.
Savion provided a more complete statement on August 8 explaining our position on DFAX. At this time, we wish to reiterate our previous comments. Further we support the comments from Clean Grid Alliance.
Thank you for the opportunity to comment on this important topic.
IPWG,
EDF Renewables thanks MISO for this opportunity to share our beliefs and opinion,
Temujin
Transmission Owner feedback on ERIS DFAX Reduction Proposal (PAC-2022-3)
October 26, 2022
The MISO Transmission Owners’ Sector[1] provides the following feedback on the three questions below related to the ERIS DFAX Reduction Proposal (PAC-2022-3) discussed at the October 10, 2022 meeting of the Interconnection Process Working Group, consistent with the feedback the Owners have previously submitted on this topic.
Owners’ Response: Yes, the DFAX change should be linked to the inclusion of approved LRTP projects in the models used for DPP studies. This approach suggested in the Issue Submission, which the Owners have consistently supported as necessary to maintain the transmission capacity enabled by LRTP projects.
Owners’ Response: Yes, as noted above, the DFAX change should occur when approved LRTP projects have been included in the specific models used for DPP studies; therefore, until LRTP Tranche 3 projects have been approved, the DFAX applied to Generator Interconnection studies should not be lowered in the South subregion. Implementation of this change as suggested here would result in consistent application across MISO’s footprint by tying the change to the inclusion of LRTP projects in DPP Study models.
Owners’ Response: No, this change would be counterproductive to the goals stated in the proposal in that it would not appropriately account for the capacity of interconnecting generation on the LRTP projects approved in Tranche 1.
The Issue Submission referenced above is available on MISO’s website at: ERIS Distribution Factor Reduction (misoenergy.org)
Should the DFAX change be linked to the inclusion of approved LRTP projects in the DPP study process?
MRES supports changing ERIS DFAX cutoff to 10% concurrent with inclusion of the LRTP Tranche 1 projects in the GI process. The LRTP projects will help to eliminate existing constraints and, therefore, it would be a proper time to implement the ERIS DFAX change to avoid new congestion problems in the future and avoid shifting costs for issues caused by previous interconnections to new interconnections.
If so, should the DFAX change be limited to the West/East (ATC & ITC)/Central DPP regions and only implemented in the South until the approval of LRTP Tranche 3?
For consistency MRES would support the change being made across the entire MISO footprint.
As an alternative to lowering DFAX when LRTP projects are included in the DPP process, should the DFAX reduction to 10% occur across the footprint but only for voltages below 345KV? Yes or No.
MRES would support this proposal with the assumption that once LRTP projects are included in the DPP process the 10% DFAX would apply to all applicable voltages.
Once again, Apex Clean Energy (Apex) appreciates the opportunity to provide additional comments on the ERIS Dfax Reduction Proposal (the “Dfax Proposal”) currently being discussed at the Interconnection Process Working Group (IPWG).
Our original comments of August 8th and September 9th remain valid concerns.
At this time, MISO is requesting the following feedback on the ERIS DFAX Reduction Proposal (PAC-2022-3).
Should the DFAX change be linked to the inclusion of approved LRTP projects in the DPP study process? Yes or No.
If so, should the DFAX change be limited to the West/East (ATC & ITC)/Central DPP regions and only implemented in the South until the approval of LRTP Tranche 3? Yes or No.
As an alternative to lowering DFAX when LRTP projects are included in the DPP process, should the DFAX reduction to 10% occur across the footprint but only for voltages below 345KV? Yes or No.
MISO has asked that feedback be provided by October 26, 2022.
Again, Apex cannot and does not support the current Dfax Proposal. Further, Apex does not believe the requested feedback is adequately provided by “Yes” or “No” responses. While yes/no questions may be appropriate is some circumstances, they are not appropriate when seeking feedback on an issue that will have a major impact on the cost allocation of building appropriate transmission projects. MISO should avoid such questions when requesting feedback on the Dfax Proposal.
Apex still believes that there has been inadequate information and incomplete or missing analysis to correlate the Dfax percentages to actual market congestion in the overall MISO footprint or in any given zone. No comprehensive data has shown the cause of any real-time congestion to be ERIS Dfax driven, especially not with respect to individual zones in the MISO footprint.
In fact, it seems the data presented by MISO at the IPWG meeting on October 10, 2022 (Item 07) contained errors on either slide 7 or slide 8 (the number of new constraints for DPP-2017 South <345 kV is higher at a 15% Dfax than at a 10% Dfax, the opposite of what one would expect).
We again ask for MISO to provide stakeholders with the following additional information:
Notwithstanding the above, with respect to:
Because Apex is opposed to lowering the Dfax, it believes that linking Dfax to the LRTP projects is a just a means of avoiding an overall cost allocation stakeholder discussion. MISO should facilitate a holistic cost allocation discussion among stakeholders.
The Dfax change should not be implemented in either the North or the South. It will unfairly burden generators with resolving congestion issues.
Apex is opposed to lowering the Dfax, and in any event, believes upgrades at 345 kV and above should be planned as required backbone projects through the regional transmission expansion planning process.
Finally, Apex supports the comments of the Clean Grid Alliance that have been submitted pursuant to MISO’s feedback requests.
For the 10/10 IPWG, MISO and XCEL posted spreadsheets of data with little to no explanation of what methods and criteria were used, what the data shows, or how the data leads to the conclusions in the presentation. Stakeholders have not been given the chance to fully understand and digest the posted materials. We request a technical workshop to allow stakeholders to step through and comprehend the analyses performed and how the results support the DFAX proposal.
Regarding the specific questions asked:
Southern Renewable Energy Association (SREA) Comments
Re: IPWG: ERIS DFax Reduction Proposal (PAC-2022-3) (20221010)
Summary
SREA appreciates the opportunity to comment on MISO’s ERIS DFax Reduction Proposal, as well as the solicitation of feedback following the October 10, 2022 IPWG meeting presentation on the proposal. SREA appreciates the concern of MISO and Xcel Energy for real-time congestion, but disagrees that this proposal is necessary at this time. As it has been pointed out by many stakeholders, MISO’s IMM is monitoring real time congestion, and has identified drivers for this congestion, and has provided recommendations to mitigate it [1] in the 2021 State of the Market Report. However, the IMM has not suggested that ‘as available’ service from ERIS interconnections are contributing to real time congestion in that report.
In response to the questions MISO posted for solicited feedback, which are in response to concerns raised by stakeholders, SREA submits the following:
Should the DFax change be linked to the inclusion of approved LRTP projects in the DPP study process?
SREA’s contention is that this change is not needed at this time; however, this change has been proposed by MISO and Xcel energy as needed to balance the inclusion of LRTP projects in the upcoming DPP cycle [2]. This proposal has been linked to the inclusion of LRTP Tranche 1 in the DPP cycle since the initial proposal for a DFax change [3] and, despite stakeholder feedback questioning the linkage, statements made during the stakeholder process have made plain that LRTP Tranche 1 will not be included in the 2022 DPP cycle without this DFax change. For this reason, SREA observes that “Yes,” the implementation of this unnecessary change would be less inequitable if it moved forward with the inclusion of the LRTP projects. Further, to exclude approved LRTP projects from the DPP process is to ignore congestion relief benefits provided by LRTP projects. Excluding LRTP projects could lead to study results that identify redundant upgrades or upgrades that moot the need for LRTP projects during the ERIS interconnection DPP process - negating the entire objective of LRTP, which is to build a comprehensive portfolio of necessary reliability upgrades. The risk is that excluding approved LRTP projects from the DPP process could continue a piecemeal approach to regional reliability planning, reducing the value of the LRTP process.
If so, should the DFax change be limited to the West/East (ATC & ITC)/Central DPP regions and only implemented in the South until the approval of LRTP Tranche 3?
SREA questions whether a reduction in the DFax threshold across the MISO footprint, or the linkage of that reduction to the inclusion of LRTP is non-discriminatory. However, assuming that MISO has evaluated this proposal for its impacts on preference and discrimination and determined it to be non-discriminatory and non-preferential, SREA answers “Yes, with a qualification.”Again, the implementation of this unnecessary proposal would be less inequitable if it is implemented with LRTP. However, there is no LRTP portfolio planned in MISO South.
To accommodate for the lack of regionally significant transmission development in MISO South compared to MISO West, Central and East, it’s critical that, if the DFax reduction proposal is implemented, that it does not apply to the MISO South subregion until LRTP upgrades have been identified and approved for the subregion. A recent LBNL study on interconnection in MISO shows that ‘Texas ($416/kW) and Louisiana ($306/kW) have the greatest interconnection costs among projects that are still actively being assessed’ [4]. To place even higher costs on interconnection customers for upgrades triggered by the DFax reduction, when interconnection costs have been climbing since 2017, and are far beyond what MISO considers to be a reasonable threshold [5] would not be prudent. If the DFax change is determined to be non-discriminatory and non-preferential, it should only be implemented in MISO South when LRTP Tranche 3 lines are approved.
Furthermore, this approach of bifurcation in the interconnection study process would be consistent with the current proposal for the Joint Targeted Interconnection Queue study (JTIQ), where the affected systems study approach remains in place in MISO South until a JTIQ portfolio is planned for the MISO South subregion and its corresponding southern affected system zone in SPP.
To be clear, SREA anticipates the Tranche 3 projects to be fairly robust and would, in part, resolve the ongoing reliability problems, economic congestion, and rising interconnection costs in MISO South. If the Tranche 3 projects identified and approved are too anemic to significantly resolve broad problems throughout the MISO South region (for example, if Tranche 3 is only one or two lines), then, a reasonable minimum threshold for LRTP projects would not be met, and SREA would not support implementing the DFax change in MISO South even after approval of the Tranche 3 projects. The justification for changing the DFax as explained by Xcel has been the implementation of large scale changes associated with quantity and quality of LRTP lines, not just the approval process alone, but the amount of change itself. If Tranche 3 results in virtually little change in MISO South, then Xcel’s justification for implementing the DFax changes in MISO North would still not exist in MISO South.
As an alternative to lowering DFax when LRTP projects are included in the DPP process, should the DFax reduction to 10% occur across the footprint but only for voltages below 345KV?
SREA is not clear on this question. Is MISO asking whether any 345KV upgrades identified when lowering the DFax to 10%, but are not present at 20% should be excluded from upgrades an ERIS customer is responsible for, or is MISO asking whether a 20% DFax threshold for 345 kv and above should be retained?
If the question is the latter, the answer is not a simple ‘Yes’ or ’No’. SREA has an overall concern that the ERIS DFax reduction proposal has the potential to usurp more far reaching congestion and reliability planning and socialize the cost of those needed efforts to generators. This does not seem sustainable, and would seem to be leading towards a piecemeal approach to regional reliability planning.
Submitted on behalf of the Southern Renewable Energy Association,
Andy Kowalczyk
[1] Clean Grid Alliance, ENGIE NA, Pine Gate Renewables, AEMA Requested Feedback Comments on MISO’s ERIS DFax Reduction Proposal (PAC-2022-3) 9/19/2022
[2] See MISO presentation at Dispatch of Storage in MTEP and DPP Studies (misoenergy.org) and Xcel Energy presentation at Microsoft PowerPoint - 20220720 PSC_IPWG - ERIS Distribution Factor Change Proposal - XEL Rev2.pptx (misoenergy.org)
[3] Id.
[4] LBNL, ‘Interconnection Cost Analysis in the Midcontinent Independent System Operator (MISO) Territory’, Joachim Seel, Joe Rand, Will Gorman, Dev Millstein, and Ryan Wiser (Lawrence Berkeley National Laboratory); Will Cotton, Nicholas DiSanti, and Kevin Porter (Exeter Associates), at 10. October 2022 (https://eta-publications.lbl.gov/sites/default/files/berkeley_lab_2022.10.06-_miso_interconnection_costs.pdf)
[5] MISO Presentation for System Planning Committee of the Board of Directors, ‘Long Term Resource Adequacy’, slide 8, September 2022 (https://cdn.misoenergy.org/20220913%20System%20Planning%20Committee%20of%20the%20BOD%20Item%2004%20Long%20Term%20Resource%20Adequacy626335.pdf)
FEEDBACK ON BEHALF OD THE LOUISIANA COMMISSION STAFF:
Should the DFAX change be linked to the inclusion of approved LRTP projects in the DPP study process? Yes or No:
Yes. It is reasonable to assume LRTP projects will eliminate some of the potential Network Upgrades associated with this change in DFAX.
If so, should the DFAX change be limited to the West/East (ATC & ITC)/Central DPP regions and only implemented in the South until the approval of LRTP Tranche 3? Yes or No:
As an alternative to lowering DFAX when LRTP projects are included in the DPP process, should the DFAX reduction to 10% occur across the footprint but only for voltages below 345KV? Yes or No:
The Energy Resource Interconnection Service (ERIS) Distribution Factor (DFAX) reduction is much more than a BPM level adjustment. It is a significant policy change that has long lasting impact.We strongly encourage MISO to have more robust stakeholder discussions about the issue in the policy forums than rushing into implement it in the MISO generation interconnection process.
We especially concerned about reducing DFAX in MISO in the MISO South given there are no LRTP projects that will also be implemented in DPP models. Reducing DFAX in MISO South from 20% to 10% without LRTP in the models will render MISO south generation interconnection projects unfairly carry additional multiple millions or billions of dollar network upgrades that is commensurate with the benefits they will receive. At a minimum, MISO needs to consider having a transition plan in MISO South, such as applying the DFAX reduction until LRTP Tranche 3 projects are approved by MISO board and are put into the MISO-S DPP cycle models. This would ensure the cost allocation change due to this DFAX reduction, a significant policy change, would be more fairly distributed among beneficiaries.
In addition to MISO South transition plan, we also support the DFAX reduction be limited to lower voltage infrastructures (<200 KV), when the LRTP projects are in the models. This way, generation interconnection process will not develop piece-meal transmission solutions that would replace or undermine the more valuable and cost-effective integrated planning solutions.
As stated in our previously submitted comments, while we are sympathetic with the market congestion issues Xcel raised, we believes this historical congestion issue needs to be addressed with a more holistic planning process rather than through adjusting Distribution Factor (DFAX) for Energy Resource Interconnection Service (ERIS) process. The reasons are as follows:
We are looking forward to working with MISO, Xcel, and stakeholders to find the right solution for the issues raised.