Transmission Owners feedback on GI Queue Reform

June 13, 2023

The Transmission Owners (Owners or TOs) recognize the need for Generator Interconnection queue reform and appreciate the efforts MISO is making to address concerns with the current process, introduced at the May 31, 2023 Planning Advisory Committee for further discussion.  In response, the Owners have the following comments.

As this effort moves forward through the stakeholder process, the Transmission Owners stress the need to develop a solution that will result in GI Queue sizes not unwieldy relative to  the MISO load and existing generating capacity in order for Definitive Planning Process (DPP) studies to provide realistic, manageable, and meaningful results.

From the Owners’ perspective,  it is important that the changes made to the GI Queue process reflects and rectifies the engineering challenges Transmission Owners are currently seeing in the GI Queue process due to the magnitude (MW) of the queue, as well as the efficient management of this process  The size (MW) of the queue relative to load does not permit realistic dispatch in the DPP studies, and does not allow MISO to comply with the its Business Practices Manual requirements regarding the dispatch of existing generation, which will result in unrealistic transmission system conditions as the generating fleet and energy markets evolve.

To determine a better approach to reform intended to limit queue sizes , the Owners think it would be useful to evaluate the data MISO referenced at the PAC to inform discussion on appropriate queue sizes. Specifically related to the project withdrawal data, it would be useful to have the data presented by: 

1. Cycle and region
2. Stage of study withdrawals occur
3. Network Upgrade costs at which projects have withdrawn (by study cycle and stage)
4. Reason for withdrawal.

In addition, it would be useful for MISO to provide data supporting the need to evaluate the reasonableness of MISO’s assumptions. In particular, MISO assumes (1) raising entry costs will lower entry sizes (MW); (2) the only way to ensure limits on the queue size studied is to limit the entry sizes (MW); and (3) whether MISO’s current Cluster Study tariff language would permit a change to the ways the clusters are created without tariff modifications. Otherwise, Tariff modifications may be needed.

Clean Grid Alliance Comments on Generator Interconnection Queue Improvements
June 13, 2023

Clean Grid Alliance appreciates the opportunity to comment on Generator Interconnection Queue Improvements. We recognize the challenge MISO faces in managing large queue study cycles.

We would like to express our appreciation for MISO’s willingness to allow discussion of this topic at the IPWG where the subject matter experts on interconnection regularly attend. The vast majority of subject matter experts do not attend the PAC meetings where MISO has proposed to expedite this process and policy discussion into two meetings before a filing at FERC. 

We believe it is more important to make data based decisions and allow for robust and transparent stakeholder input and discussion, rather to just arrive at a solution quickly, which may or may not prove to be effective and can have significant negative consequences. To this end, we encourage MISO to hold at least one, possibly two workshops on this topic, prior to any final policy changes that are brought before the PAC to consider/review. 

Large queue cycles and penalty-free withdrawals may be symptoms of an excessive number of speculative applications, at least in part, but may also be the result of robust competition by generators seeking to serve the same load.  Clean Grid Alliance suggests that, prior to taking any action, MISO and stakeholders collaboratively review queue data to determine what the major contributors to large queue size are, and what policy changes might be most effective, while also not creating barriers so significant that MISO’s ability to meet Resource Adequacy goals is impeded, or that puts smaller companies out of business. To properly frame the problem, we strongly encourage MISO to collect and present data on (1) the number/percent of projects dropping in Phases 1, 2, and 3 by region, (2) the $/MW network upgrade costs of those projects, (3) the number and overall MW of individual company interconnection requests within a queue cycle, and (4) the overall changes in cost estimates between phases 1 and 2 and phase 1 and construction.

As MISO considers changes to the Generator Interconnect process, it should take a holistic approach, bearing in mind that multiple changes/approaches may be required, and that changes in other areas (non-thermal accreditation, for example) are likely to have dramatic impacts on the queue. 

MISO has offered a number of suggestions to potentially limit future queue cycles for the purpose of more accurate results and quicker study processing time. These are outlined on slide 8 of the presentation available at:  

https://cdn.misoenergy.org/20230531%20PAC%20Item%2006%20MISO%20GI%20Queue%20Improvements629025.pdf 

In summary, MISO’s proposed actions include: 

-       Significantly reducing or eliminating penalty free withdrawal to ensure harm calculations occur (financial milestones are “kept” and not returned to IC)

-       Increasing financial milestone commitments/risk (“pay to play”) provisions

-       No longer accepting letters of credit for financial security at GIA execution

-       No longer accepting land leases –only demonstration of ownership

Clean Grid Alliance supports solutions that are reasonable, effective and strike the right balance between ensuring manageable queue cycle sizes while protecting open access and supporting robust competition that will maintain reliability at the lowest cost reasonably possible. We caution MISO to not take action that will have significant negative consequences, such as elimination of accepting leases for site control, significantly raising the penalty free withdrawal thresholds, not accepting letters of credit for security, or even worse, a combination of these.

Clean Grid Alliance also believes that any reforms to MISO’s queue should apply prospectively; that is, reforms should not affect resources in the DPP 2022 cycle and prior queue positions if at all possible, given that such projects have made investment decisions based on current requirements regarding queue entry. 

Clean Grid Alliance offers the feedback below on MISO’s proposed solutions, along with additional suggestions for MISO and its stakeholders to consider: 

Comments on MISO’s proposed solution: 

-Changing site control from leases to land ownership should not be considered at all. Requiring ownership as a demonstration of site control is significantly at odds with how generation projects are developed and could potentially pose an unduly discriminatory barrier against certain asset classes, such as wind. Additionally, it would have a significant negative impact on farmer landowners who supplement farming income with leases since much of the generation development is done on leased farmland. While farmers are willing to lease land for a specified period of time, they are generally unwilling to sell their land outright just to capture the benefits of energy production in the form of long-term lease payments through the life of the asset. It would be unproductive to require the acquisition of a “forever-lived” asset to support a generation facility that is, compared to land, relatively short-lived. 

Also if MISO were to eliminate “options” for lease or ownership, it could force projects to drop from the queue based on administrative issues beyond their control. A common reason projects aren't built is the inability to receive a permit. When received, those permits often have a 1 year expiration date. By requiring full land ownership before submitting an interconnection request, developers would be forced to permit a project before filing an interconnection request to ensure that it is environmentally viable – but that permitting will ultimately expire years before the project can be built. Alternately, if the land isn’t viable for environmental or permitting reasons and the developer proceeds, they pay potential MISO penalties on top of a wasted land investment. These added costs ultimately get passed down to end -use consumers.   

A land ownership requirement would also have a negative impact on states’ economies and even potentially on national security as food production is one critical element in maintaining our country’s overall security, and energy developers are not likely to take up farming operations. 

- No longer accepting letters of credit is problematic in that it would tie up significant amounts of capital for upwards of 10 years with minimal to no added benefit in posting cash multiple times throughout the DPP process. Companies can potentially obtain a letter of credit from one bank and bring it to another bank for cash, adding an unnecessary cost (and administrative step) to a project, ultimately resulting in cost increases to the end user, yet not restricting interconnections. CGA does not support this change. 

-Raising the milestone payments, and/or the thresholds for penalty free withdrawal, if  kept within reason, could be part of an overall solution. Raising them too high will not fully solve the problem, but will create additional problems. While there may be room for adjustments, within reason to consider in these areas, there are also other options to consider either as alternatives, or in combination with reasonable increases to M2 and withdrawal thresholds, (but no increases to M3 or M4 as they come later in the process and are already significantly high). Financial penalties should be removed in cases where withdrawals are forced on the interconnection customer because the transmission owner is unable or unwilling to accommodate a project at the designated point of interconnection substation, and the IC was not provided that information prior to study kick off when deposits become “at risk”.  

 It’s also important that MISO look at the data behind larger queue sizes and withdrawals. Generators routinely withdraw due to circumstances beyond their control when differences between System Impact Study cost estimates and those provided in the Facilities Study phase are substantial, and when study assumptions from earlier queue study groups in current study models change drastically between Phases 1 and 2, impacting study results and financial decisions.   

Ideas not presented by MISO that are worth exploring: 

- Staggering  the DPP cycles so Phase 2 of the earlier cycle finishes before Phase 1 of the following cycle starts, could go a long way in reducing the huge swings in Network Upgrade costs that have led to broad penalty free withdrawal across within some study groups. The threshold for withdrawal can be met, because large variations are present. This issue has been a problem since well before the record breaking 2022 DPP cycle that led to these discussions, and should be addressed regardless. It could solve a long standing problem, with little to no negative consequences, particularly if Phase 2 studies are not significantly and regularly delayed as has been the case at times in the past, due to Affected Systems Studies.  

- Considering automation as a way to provide  more timely and accurate construction estimates in Phase 1. This is another area where huge unexpected cost increases have led to penalty free withdrawal. Having TO’s assess substations in advance and create a database of several salient features (such as crowding, line crossings, land ownership/room for expansion,  and identifying the need for OPGW (i.e., fiber) early could also eliminate some late-stage withdrawals. Every TO should be able to identify at the scoping call if a circuit possesses OPGW, and if not, how many miles an IC would have to fund to tap the nearest available fiber.etc.) Having this information earlier in the process could significantly help projects withdraw sooner when they need to. Hiring a consultant directly by MISO to work with the transmission owner to assess each construction feasibility (and associated cost estimates) in a timely manner prior to study kick off in Phase 1 would go a long way and costs could potentially be covered within the recently proposed and implemented cost increases to the M1 financial milestone. 

-Increased diligence in reviewing site control. Currently, projects may be able to submit land 100’s of miles away from a point of interconnection, or that is too small for a project size, or that otherwise does not make sense. Some flexibility is clearly needed in final vs initial design for a variety of legitimate reasons (including when studies indicate the need for an unanticipated interconnection location change that is not known until nearing the conclusion of Phase 1), there may still be opportunities to reasonably reduce the flexibility from where we are today, while care would be needed to ensure that viable projects are not harmed. If MISO has not already, hiring an expert consultant who can review and assess the reasonableness of submitted site control may be helpful, in conjunction with any new policy requirements. If not already doing so, MISO could consider requiring a Professional Engineer (PE) stamp on any condensed footprint designs. 

MISO could explore changing the concept of site control to potentially be defined not only by a # of acres per MW, but requiring an actual site plan that shows contiguous control for a significant threshold % (but not 100%) of:

 1-    Collection system (medium voltage)

2-    GEN tie line (not at application)

3-    Point of interconnection (not at application)

4-    Turbine or solar panel (smaller % for turbine may be needed since final design may not even be contiguous)

-Adding different options for demonstrating that a project is not speculative such as: has a PPA, is part of an RFP, has design permits, etc.  Metrics such as a PPA or being part of a RFP cannot generally be provided prior to projects entering the queue and having studies to understand Network Upgrade requirements. In regard to permitting, local permits generally have a 1-year timeline to construct, so it would not make sense to permit a project without being in the queue and knowing the interconnection timeline. 

Other metrics may be more readily available such as:

1-    Including an internal feasibility analysis covering information like injection analysis, basis risk, environmental constraints, resource assessment, engineering, etc

2-    At later decision points providing additional requirements/milestones to show development progress such as environmental/biological surveys, geotech, etc.

-Ensuring that Affected System (AFS) coordination occurs such that delays in MISO studies and fluctuations in Network Upgrades are not caused by other regions. One of the key elements of a good queue AFS process is reliable information up front so projects can make informed decisions early on. Often when projects receive information that is considered unreliable, they remain in the queue until more accurate results can be provided. If early estimates were highly reliable, projects would trust those high estimates and withdraw earlier in process, including in the screening study phase, and even pre-application phase, even omitting submitting a request altogether. 

- Looking for improvements to the study processes that would allow MISO to handle larger queues.  In addition to exploring changes that would limit the size of the queue, MISO should consider changes to its study processes -- reviewing what is studied, when it is studied, and how it is studied.

 -Capping the MW value and/or limiting the number of GI requests by each company allowed in each cycle by region, relative to load or available capacity, could help keep queue sizes manageable. While this solution is not endorsed by all CGA members, some feel it could be a good option to bring queue sizes down in the proportions needed in the near future, to keep study cycles steadily moving forward. Care must be taken to ensure that speculative projects do not enter the queue, particularly if there are limited opportunities to submit queue requests due to a MW cap. Caps should be looked at regionally, rather than footprint-wide. Additionally if a MW cap is enacted now, it will likely need to be raised in the future, and some regions may have high renewable policy goals that would need to be factored in. Finally, limiting the queue may prevent identification of larger Network Upgrade solutions, which will need to be addressed. Consideration of this solution would require significant stakeholder discussion on the details, as well as measures to mitigate and/or eliminate unintended consequences. 

MISO should not penalize interconnection customers just because the queue is large and penalty free withdrawals occur at a high rate. Collecting and presenting data to make an informed decision is an important next step. MISO stakeholders have identified three significant contributors to penalty free withdrawal being triggered – highly inaccurate study assumptions in models from using Phase 1 and not Phase 2 models to start the successive study cycle, highly inaccurate cost estimates in earlier phases due to not having conducted site visits to upgrade locations, and, some companies may have submitted hundreds of requests and therefore able as a single entity to trigger penalty free withdrawal for an entire study group. Each of these 3 causes may require a different solution, so a single solution may not be effective. 

While there may be some room for increasing the M2 milestone and the thresholds for penalty free withdrawal, any changes should be thoughtful and conservative and used only in combination with other approaches such as more diligently checked site control requirements, staggering the queue cycles to use Phase 2 results for subsequent studies, hiring a consultant to physically inspect facilities to create more accurate construction estimates for Phase 1 results, etc. Suggestions by stakeholders, including those listed above should be fully explored and discussed in the stakeholder process, as alternatives to, MISO’s proposed direction of simply making the generator interconnection process more costly and with much higher financial risk that would broadly apply, including for circumstances that are beyond the interconnection customer’s control.

 
We appreciate MISO’s consideration of these comments and look forward to continuing the conversation. 

 
Sincerely, 

On behalf of Clean Grid Alliance Members,

Rhonda Peters, Ph.D.
Technical Consultant for Clean Grid Alliance

Invenergy thanks MISO for the opportunity to provide feedback on Generator Interconnection Queue improvements presented at the May 31 PAC.

Invenergy sympathizes with the extraordinary challenge of modeling a 170 GW study group and providing meaningful and actionable results. A functional and efficient queue is top-of-mind for a broad range of stakeholders, as the submitted feedback will no doubt demonstrate. In the two weeks since MISO announced the intent to pursue queue reform, broad coalitions of stakeholders have organized and engaged in conversations across many forums to explore potential solutions. While expeditious solutions are key, effective reform requires acknowledging that intense market demand for renewable energy is here to stay.

The volume of the DPP22 cycle is indisputably driven by historic policy decisions, financial incentives, and market demand for renewable energy in the face of the climate crisis. A typical suite of queue entry reforms will likely have a different impact than expected in this unprecedented market environment. While the need for volumetric reform is urgent, it is equally crucial that solutions are fully vetted for the market incentives they create.

Invenergy supports precise reforms that further refine the project pool in the queue and target specific bottlenecks to increase throughput of the GIP. Such reforms must start with specific problems defined by data.

To foster expeditious resolution of queue concerns, Invenergy strongly encourages MISO staff to provide stakeholders with data on:
• Quantity / percentage of projects that drop across phases; and
• Trends regarding cost and typical technology of network upgrades immediately prior to
positions dropping from the queue.

Invenergy thanks MISO staff for their consideration and looks forward to continued collaboration.

     SB Energy US (Soft Bank Group) appreciates the opportunity to comment on the Generator Interconnection Queue reform ideas that MISO is considering.

1. First of all, MISO should investigate the root cause of the “issue” at hand. Without knowing the root cause of the issue, proposing new queue reform will not help to solve the issue. MISO doing an investigation will help them to understand the root cause of the issue. Lessons learnt from the last several queue reforms in the last decade or so will be very helpful to share with the stakeholders.
2. MISO mentioned that the interconnection milestone/entry requirements are low. However, MISO has not shown any data to prove this. MISO should compare the interconnection requirements such as study deposits, entry milestone ($4000/MW), site control requirements (deposit vs. site control), penalties etc. for other RTOs/ISOs and present that in a table format for stakeholders to compare before coming to a conclusion. Our understanding is that MISO has one of the most stringent interconnection entry requirements in the US as of now.
3. In any circumstance, MISO should not apply any queue reforms for the projects that are already in the queue (DPP 2022 and before) because all interconnection customers made a huge amount of financial and other commitments based on current rules.
4. Has MISO investigated whether the queue proliferation in DPP 2022 was due to the IRA passing and not due to the less stringent interconnection entry requirement? If not, can this be investigated further?
5. Are customers withdrawing from the queue due to very high Network Upgrade costs coming out of the interconnection studies wherein, the Network Upgrades are major “deep” upgrades that provides regional benefits? If that is the case, should MISO consider handing off the “deep” Network Upgrades with regional benefits to Transmission Planning process and cost allocate them based on beneficiaries? Perhaps MISO can come up with some guidelines to filter the “deep” Network Upgrades with regional benefits.
6. Increasing milestone payments will not solve the issue. Developers with huge capital can still enter the queue easily even if the milestones are increased. Has MISO conducted any assessment on what percentage of each developer constitute the projects entering the queue? If majority are developers with huge capital, then increasing milestones will not help. When designing the queue reform, MISO should consider common playing field for all developers and no discrimination shall be given.
7. Purchase only option for land should not be considered at all. Please note that this is not at all an industry practice for solar developers. It would be very critical for MISO to look from developer’s angle on these critical items
8. Speculative projects are sometimes just due to lack of information for Interconnection Customers wherein, IC’s do not know the transmission capacity, potential cost of interconnection at a location, timeline to interconnect at a given location etc. MISO already has a POI check tool to help with the transmission capacity. However, MISO needs to consider better maintenance of this tool (update with latest and greatest DPP models) and also think about potential improvements mentioned above to help signal IC’s to pick the right and certain POI. If IC’s have more information of a given POI, then IC’s will limit the number of projects to the queue. MISO should also consider a process improvement where they can provide the information considering the potential projects entering the current cycle as well (maybe a feasibility type of stage or something else)
9. We do not believe that the timeline proposed for this queue reform is not sufficient for a robust solution. This should be discussed at length at IPWG and PAC before making any Tariff filings by considering stakeholder inputs. It would be great to look at prior queue reform efforts at MISO. Moving fast may not help always given the number of changes that are being proposed

We thank you MISO for the opportunity to comment and look forward to participating in the future discussions.

Thank you for the opportunity to comment,

EDF Renewables North America (EDFR NA or EDFR), agrees that the need to implement some reforms to the MISO Generator Interconnection Queue process should be contemplated. The DPP queue cycles have become unwieldly with marked increases in study cycle megawatt (MW) volumes.  Tariff changes should be contemplated to better manage the number of new requests in future queue cycles. An appropriately sized study cycle with well vetted projects will result in faster process times and quicker implementation of the resource evolution. 

Changes to the queue process should appropriately incentivize submission of fewer projects per study cycle, a smaller study cycle will result in study times better approaching the MISO intended timeline, then study results will have more value at decision points, this should result in earlier withdrawal of uneconomic or less economic projects, reducing the need for later phase restudies and later stage withdrawal.

With fasted study cycle timing, cycles can be unstacked and spread out to minimize adversely effecting other study cycles and needs for restudies.

EDFR believe that MISO should entertain delaying the window for 2023 project submissions until potential Tariff changes are made.

Simple M2 increases and revisions to penalty free withdrawal - while EDFR could support some adjustments, depending on specifics - EDFR believes that these changes are unlikely to reduce volume in the queue

Penalty free withdrawal provisions, to some extent, still need to exist to protect projects from significant cost increases

Many unexpected cost increases are often associated with prior DPP cycles not being advanced enough beyond earlier DPP cycles under study, properly staging (staggering) DPP studies will help, e.g., waiting to kick-off the next DPP cycle to when a prior cycle completes DP2 will reduce uncertainty in assumptions for following cycle studies

At the present time 2-3 cycles in most MISO regions are concurrently in Phase 1. Projects understandably have no faith in Phase 1 estimates and proceed regardless of costs as a necessary step to receive results once prior cycles have eliminated more projects after their next Decision Point.

Revising (not eliminating) penalty free withdrawal may have its place, and EDFR suggests that instead of looking at revising the % increase between phases, the $/MW floor that is currently between $10,000-50,000/MW be increased by a factor of 10. This will raise the bar significantly for projects that receive lower cost estimates in earlier study phases. Additionally, this change will not negatively impact those projects that initially receive higher costs in their initial study results, where the current % increases should function appropriately.

It is logical that studying MW amounts reaching, or exceeding load are not functional. To address this head-on and simply, MISO should contemplate a limit on study MW volume per cycle.

Using timestamps, limit the study MW to X% (e.g.,40 or 60%) of the peak load of five study regions, i.e., West, East (ATC), East (ITC (Michigan)), Central, South.

Noting existence of Taylor Swift time stamp issue and need to fairly address projects submitted over the limit, too late.

Flooding or spamming a cycle complicates study process, as such a parent company should pay more if they are going to submit more MWs in a study cycle, this will incentivize judiciousness in project submission

So, in conjunction with or as an independent change, EDFR believes it is reasonable to introduce an incentive for increased due diligence, make parent company Total M2 a function of total MWs that are submitted by a parent company in a study cycle, for example: 

EDFR Total M2 for a study cycle = $4,000 * MW * 1.001 ^MW

This approach to raising M2 will not stymie competition and will incentivize due diligence.

With a cycle limit on MWs there is still needs for an incentive to not have entities flood or spam the queue to stymie the queue cycle study functionality and competition. EDFR believe that this formulaic approach to the M2 calculation may be the only change needed, still noting value in entertaining changes to penalty free withdrawal criteria as stated above. Looking into adjustments to harm calculations has merit also.

Reforms should and EDFR believes a formulaic M2 will result in:

Fewer requests in a queue cycle, fewer higher risk project requests, leading to faster results.

This will result in study assumptions that more resemble actual future dispatch.

Possibly reducing withdrawals

Which will lead to fewer restudies and possible changes to network upgrades between studies.

This will increase upfront certainty for customers in study results.

Again, thank you for the opportunity to participate and comment,

EDFR NA

Savion, LLC (“Savion”), a Shell Group portfolio company, is an industry-leading utility-scale solar and energy storage project development company.  Savion would like to thank MISO for the opportunity to provide comments on the need to improve the rules governing entry and exit from the Generator Interconnection Queue

We acknowledge problems arising from the large number of interconnection requests. MISO correctly identifies the need to somehow reduce the number of requests in future cycles.  MISO has also correctly identified the benefits that would arise from a smaller queue.

However, the proposals introduced by MISO in the May 31 PAC meeting attempt to address the queue size not directly, but rather indirectly by radically increasing barriers to exit and entry.  Economist William J. Baumol held that the outcomes of a competitive market could be almost entirely achieved with a contestable market, defined as one with minimal barriers to exit and entry. Increasing barriers alone would tend to achieve sub-optimal outcomes.

MISO has already conceded that most of the additional costs will be borne by smaller developers, which logic would hold, are not the developers clogging the works with speculative efforts.  In short MISO will be hampering the exact projects they need to keep costs lower.

If we assume the speculative projects currently flooding the queue will require increased financial costs and risk relative to more sound projects. Reducing the number of speculative projects should be MISO’s aim as it will reduce system-wide financing cost.  By allowing a small number of developers to crowd out smaller developers, MISO increases its long-term risk by requiring this small number of firms take on increasingly larger share of the responsibility for future supply.

Savion would like to propose a method to address speculative projects that will not adversely affect the ability of the market to be contested by smaller developers and thereby lower overall costs.

This method is rather straight-forward, simply limit the amount of generation, whether by queue position or total megawatt, a single firm and its subsidiaries may have in the queue at any time. Market Participants faced with this constraint would be incented to shed those projects that are weaker, without MISO having to determine through its own resources.

Lastly, Savion has concern that this entire conversation may not yet be ripe.  Recent improvements MISO has made to the queue were supposed to make improvements to the speed and responsiveness required to improve queue outcomes.  By asking for these changes, MISO could be seen as having decided the past work to improve the process will not work.

Response of the Solar Energy Industries Association

The Solar Energy Industries Association (SEIA) appreciates MISO accepting stakeholder feedback on the potential solutions to improve the Generator Interconnection Queue rules for entry and exit. Stricter queue entry requirements, paired with greater transparency and proper withdrawal incentives can help ensure an efficient queue.

Balancing Stricter Entry Requirements and Transparency

In its May 31 presentation, MISO noted that increasing requirements to enter and exit the queue can be perceived as an impediment to generation development.This is certainly the case when queue entry requirements are set to impossible standards, such as commercial readiness requirements that are inconsistent with the project development cycle or site control requirements out of step with development realities. To that end, SEIA actually supports prudent reforms that would increase the requirements to enter the queue, such as higher study deposits and higher site control (but not exclusive ownership) requirements. Such requirements may help identify the more viable projects earlier in the process and discourage developers from submitting interconnection requests that are not as far along in the development process, which the current queue’s opacity and uncertainties encourage. But to make these increased queue entry requirements meaningful, and not overly burdensome, MISO must continue to improve access to pre-interconnection request information.

SEIA applauds MISO for being a leader in providing pre-interconnection request data to interconnection customers. While the Points of Interconnection Map provides valuable data on constraints across the region, the tool can be improved. SEIA recommends that MISO continue to work with stakeholders, and specifically interconnection customers, to determine what additional information may be helpful in making interconnection decisions. This information could include the historical costs of network upgrades and information about the size of other generators or current in-queue interconnection customers at the point of interconnection. Additionally, SEIA encourages MISO to provide up-to-date information in its Points of Interconnection Map and available models.

In addition, it is imperative that MISO, along with stakeholders, delve into the veracity and, if true, facts behind the claim that “over 80% of queue submittals don’t actually get built.” In our members’ experience, many projects are withdrawn from the queue due to their exposure to unexpectedly high network upgrade costs and other surprise requirements late in the design process.

Potential Solutions to Address MISO-Specific Problems

To reduce the number of exploratory interconnection requests in the MISO queue, SEIA supports reforms that would limit the number of applications submitted by a single parent company. SEIA recommends that MISO limit the number of applications a single parent company can submit to 15 applications for each zone. Increasing the deposit amounts or requiring more site control will not limit the ability for companies that have access to large amounts of capital to submit less developed interconnection requests, especially when they can manipulate the harm calculation to mitigate their losses from withdrawals.[1] To enforce such a limit, MISO should require each interconnection customer to include an attestation in its interconnection request to confirm that the parent company of the interconnection customer is complying with the limit on the number of interconnection requests for a given cluster. MISO could periodically audit interconnection customers to confirm this by reviewing U.S. Energy Information Administration Form 860, which collects generator-level specific information about existing and planned generators.[2] Along with this reform, SEIA requests that MISO increase the withdrawal penalties at Decision Point 1, which would increase the cost of manipulating the withdrawal process.

What SEIA does not support is any change to the site control requirement that would require ownership of a site, as opposed to a lease with exclusive control. For solar farms, many landowners lease their land to developers, as a way of securing long-term income while also allowing them to pass their property to their heirs.

Conclusions

While SEIA appreciates the need to quickly address interconnection reforms, we are concerned that MISO’s aggressive timeline may not be sufficient to vet all proposals and revise them as needed. We have seen first-hand the need for an in-depth stakeholder engagement during the PJM interconnection reform process. The process took place over the course of a full year, with many stakeholder meetings and negotiations, but the result was a widely supported reform that received FERC approval. SEIA requests that the MISO schedule additional working groups to address its interconnection reform.

As the grid and the energy mix evolves and faces new challenges, interconnection procedures must be adjusted to address these challenges. However, these reforms, though, should not create challenges of their own. MISO’s proposal represents a good starting point and SEIA welcomes the opportunity to continue working with MISO during this stakeholder process.

Apex Clean Energy submits the following comments on MISO’s proposal to improve the Generator Interconnection Queue rules for entry and exit.

1. Though Apex could support reasonable adjustments to milestones payments and penalty free withdrawal thresholds, it is unlikely that MISO’s proposal using only financial levers will substantially reduce the volume of projects that are submitted into the interconnection queue. Historically, in MISO and in other RTOs/BAs, each iterative increase in financial security and more stringent at-risk rules has done little to reduce queue volumes and a more holistic approach that considers non-financial and technical factors is needed if MISO truly wants to keep future queue sizes manageable and continue to produce accurate results with reasonable processing times.

2. MISO should continue to accept letters of credit for milestone securities and for security required at GIA execution. Further, the security provided at GIA execution is provided to the TO and not to MISO and a lot of TOs have previously expressed concern around accepting cash for this security given the high interest rates levied when returning this security to the Interconnection Customer. Finally, removing the option to provide an LC would tie-up large amounts of cash and serves no broader purpose other than unfairly harming and limiting the ability of smaller developers/IPPs (with limited access to capital) to enter and remain in the queue.

3. As part of the overall solution, Apex believes that some limit should be placed on the number and total size of projects entering the MISO queue.
1. This would directly address the problem that MISO is trying to solve.
2. This MW cap should be tied to some percentage of MISO’s seasonal peak load forecast in the study models, and by extension, based on MISO’s ability to perform realistic studies with models that will converge.
3. We believe that this approach will ensure that the amount of generation does not unrealistically exceed the seasonal MISO load demand, while still being a level playing field for all interconnection customers.
4. Finally, MISO should develop a new powerflow dispatch scenario for standalone storage projects that more accurately reflects their real-time behavior relative to dispatch of solar and wind. The existing simultaneous 100% dispatch of standalone storage with solar is not representative of how these technologies are expected to operate. With the large volume of standalone storage projects that are entering the queue (this exponential trend is expected to continue), storage dispatch cannot be ignored and is already starting to have a material impact on model convergence.

4. MISO should not require land ownership versus option to purchase/lease. In almost all cases, it is typically attractive to landowners to lease their property (instead of an outright sale) by supplementing farming incomes with incomes from the long-term solar/wind leases. Additionally, most landowners would prefer to continue maintaining ownership of their property in the event of decommissioning of the generating facility.

Mississippi Public Service Commission (MPSC) Feedback Regarding

Generator Interconnection Queue Improvements - (PAC 20230531)

MISO Requested Feedback Statement:

In the May 31, 2023, meeting of the Planning Advisory Committee (PAC), MISO introduced an issue to improve the Generator Interconnection Queue rules for entry and exit.  Feedback is requested on what combination of rules MISO should include in its initial reform package that will be presented to the PAC on July 19.  The combination of rules should include, but are not limited to, those listed in May 31 PAC presentation. 

Comments are requested by June 13.

Feedback:

The MPSC generally supports the need for improvement to the Generator Interconnection (GI) Queue to increase efficiency, reduce overall costs of projects that will be built, reduce the number of speculative requests, and reduce the number of withdrawals.

The MPSC has two concerns with MISO’s potential issue solution of making changes to site control requirements, including requiring land ownership and eliminating leasing as an option (see slide 8 of its presentation).

First, the siting of generation is solely within the jurisdiction of the states.  The MPSC is concerned with MISO’s lack of communication or attempted communication with state regulators before making such a proposal to GI Queue site control requirements. 

Second, eliminating the leasing option would adversely affect land-owners by depriving them of income from future lease agreements. Requiring landowners to sell their land for what may be a limited use could actually deter investment in generation.  

The MPSC urges MISO not to bypass the stakeholder process by fast tracking its package of GI Queue reforms.  MISO should consult with regulators and stakeholders to develop reasonable reforms. 

Clearway appreciates the opportunity to provide feedback in response to MISO’s initial proposal to reform its interconnection rules.

Clearway understands that the volume of interconnection requests in DPP 2022 has overwhelmed MISO’s ability to provide timely and meaningful study results. However, Clearway remains about the expedited process proposed by MISO, which departs from precedent in MISO wherein consequential reforms have traditionally benefitted from a more structured and transparent stakeholder process lasting at least a year. Absent a more comprehensive stakeholder process to develop and debate proposed reforms, stakeholders will be deprived of the opportunity to fully consider the impacts of possible rule changes, which in turn will lead to suboptimal outcomes. Clearway would instead support delaying the DPP 2023 cycle until MISO can establish a more formal stakeholder dialogue.

Turning to the substance of MISO’s proposal, the ideas presented to stakeholders at the May 31^st Planning Advisory Committee (PAC) appear to be premised on winnowing the number of projects in the queue as the solution to overwhelming queue volume. Clearway believes this focus is problematic as it artificially restricts competition, while leaving unaddressed the root causes of bloated queues: namely, that developers have insufficient information at the time of submitting interconnection requests as to the possible range of interconnection costs, which is compounded by unreasonable study assumptions (such as the recent change to the DFAX threshold for ERIS resources), delays in receiving study results, and interdependencies between DPP cycles. While Clearway agrees that the volume of projects in the queue is unsustainable, we view this volume as a symptom of the problem, not the problem itself. Durable queue reform instead requires tackling these root causes through a more comprehensive review.

Clearway notes that Clean Grid Alliance (CGA), of which Clearway is a member, will be filing separate comments, which includes feedback on specific reforms proposed by MISO. At this time, Clearway does not take a position on CGA’s responses to the substantive features of MISO’s proposed reforms. However, for any reforms that MISO ultimately chooses to propose to stakeholders at the July 19^th PAC, Clearway believes those reforms should apply prospectively (i.e., they should not impact resources in the DPP 2022 cycle or with earlier queue positions). Developers with existing queue positions have made investment decisions based on the interconnection rules in place at time of submitting the interconnection request, and therefore it would not be appropriate to amend those rules after-the-fact.

Clearway looks forward to continued engagement with MISO and stakeholders on possible reforms to ensure that future DPP cycles are manageable and can yield timely, meaningful study results.

PAC (20230531) Generator Interconnection Queue Improvements - Environmental Sector Comments

The Environmental Sector appreciates this opportunity to comment on the topic of Generator Interconnection Queue Improvements introduced at the 5/31 PAC meeting. We too are concerned about the challenges faced by MISO related to the recent influx of generator interconnection requests, increasing the length and complexity of interconnection studies. Broadly, we are supportive of any change that ensures timely and affordable interconnection of resources for applications that enter the MISO queue with the intent to develop projects. We understand concerns raised around speculative applications, which complicate interconnection clusters when these applications are withdrawn. However, it should be acknowledged that the interconnection study process is a critical avenue for generation developers to assess their interconnection costs, without which those costs cannot be known as they depend both on the network topology and the other projects in the queue cycle. Projects that are otherwise ready and able to move forward can enter the queue only to find out that costs are too high and their project is no longer financially viable, forcing them to withdraw. 

We appreciate the menu of options offered by MISO for possible interconnection improvements presented at the PAC, and we understand that there is not a concrete proposal on the table to comment on at this time. However, we believe that transparent, public stakeholder feedback is valuable at this stage to help guide the reforms that MISO proposes at the upcoming July 19th PAC meeting. We are concerned about the process MISO suggested for the development of reforms where MISO plans to only reach out to individual stakeholders for feedback in a non-public setting before the July 19th PAC meeting. It’s important for the sake of transparency that MISO maintain a record of who MISO reaches out to, and a record of the substance of the discussions that occur when those discussions would likely shape large reforms like those suggested at the 5/31 PAC meeting. We support inclusion of a robust discussion of potential solutions to these interconnection challenges at the June 20th IPWG, and we encourage the PAC leadership to consider an additional half-day workshop on this topic prior to the July 19th PAC meeting.

Regarding the substance of interconnection queue reforms, we would like to provide the following suggestions for MISO and stakeholders:

• Interconnection queue reforms should be implemented before a delayed 2023 interconnection cycle deadline this year. 

• Changes to withdrawal penalties and milestone payments should not be applied retroactively for projects currently in the queue and should only apply to interconnection requests made after tariff changes are approved. To apply these tariff changes to existing interconnection requests would be unfair to interconnection requests made prior to any discussion of reform. 

• We strongly recommend that land ownership in fee simple not be a requirement for interconnection requests and that leasing arrangements continue to be allowed. Leasing arrangements are much more common with landowners than outright land sales, and a requirement for ownership may lead to an overcorrection in the lowering of interconnection requests.  Land leases also provide a welcome and important revenue stream for landowners and farmers, which benefits local economies, and in some cases allows farmers to remain on their land. By working with local landowners in a way that permits those landowners to maintain ownership of their land, the existence of land leases will also help build ties between the energy sector and local communities.

• If milestone payments are raised, there should be a thoughtful approach to what the necessary threshold is to reduce speculative interconnection requests while preserving the competitive development of generation resources in MISO’s footprint, particularly allowing smaller developers to compete. 

• There should be a means for prospective interconnection customers to have more information about potential points of interconnection before entering the queue. Currently the only way to have certainty about costs is to enter the interconnection queue, which increases the number of requests, and with it, the likelihood of ‘speculative requests’. Perhaps MISO can make upgrades to the POI tool that would include results based on projects that had entered in that same queue cycle. While such an upgrade may cost MISO scarce human resources, we believe that it may be the best way in which MISO can balance the need for interconnection reform with the need for developers to accurately estimate costs, and thus the benefit will far outweigh the costs.

Taking these matters into consideration, we hope that MISO provides a meaningful opportunity for stakeholder input in a transparent manner, which will help to ensure that the final proposal for interconnection queue reforms takes into account all stakeholder interests (including that of informal stakeholders such as communities and landowners) and is not one-sided. 

Vistra Corp. (“Vistra”) appreciates the opportunity to submit feedback on MISO’s “Generator Interconnection Queue Improvements” presentation which was shared during the May 31^st PAC meeting. While Vistra understands MISO’s need to improve the queue process to “enable faster and more certain study results,” it would be helpful if MISO’s initial package of reforms, which will be presented on July 19^th, included specific information, or a timeline, on how much faster MISO believes the interconnection queue process would be under the proposed improvements. It may be difficult for stakeholders to determine whether to support the generator interconnection improvements, absent a clear understanding of how much time the package of reforms, or discreet elements of the reforms, will reduce the study timeline process. For example-- there may be certain proposed increases to interconnection payments or fees which initially seem costly, but are worth supporting with the knowledge that their implementation will reduce the queue study timeline by a specific amount of time.

National Grid Renewables (NG Renewables) appreciates that MISO staff is dedicating focus and committee time to the issues facing the interconnection queue. Interconnection queue cycles are currently so large that the burden of their study is a large logistical roadblock and has created significant delays in the study process. These delays affect all stakeholders involved in MISO.

As MISO begins to assess how they might improve the queue process, the problem statement must be clearly and accurately defined. There are many levers that MISO can utilize to change the IC process, and understanding the root of the problem is absolutely necessary in choosing an appropriate and effective solution. NG Renewables proposes a problem statement as follows, but is open to and appreciates stakeholder discussion.

Problem statement: Currently, each interconnection queue study cycle contains too many MWs, which does not allow staff to run high quality, prompt, and consistent studies. Queue study sizes should be limited to enable more feasible, prompt, and reliable studies.

Based on this problem statement, NG Renewables offers the following options for discussion:

1. Administratively limit the size of each queue cycle study (30 GW could be a reasonable cap). This would need to be in tandem with more frequent cycles, as noted below.
2. Conduct more frequent IC queue cycles/studies each year. Conducting multiple, smaller studies will enable a comparable number of MWs to be assessed each year while making each individual study more logistically feasible to run.
3. MISO should adhere to reasonable sequencing of queue cycles and phases.
   1. For example, DPP2019 phase 1 studies should not commence prior to the completion of DPP2018 Phase 1 study and decision point, reflecting all withdrawals and nameplate capacity changes. This is required to ensure that 2019 study cycle Phase 1 results reflect the most accurate representation of the prior study cycle.

NG Renewables would also like to comment on the suggestions that MISO brought to the June Planning Advisory Committee (PAC). The bulk of MISOs current proposal focuses on raising various milestone payments and reducing penalty free withdrawal opportunities. While this may seem like an intuitive way to “weed out” projects and reduce queue sizes, NG Renewables objects to this approach on two counts. First, raising milestone payments will do very little to reduce queue sizes. Historically, this approach is shown to be ineffective. Project developers will largely internalize these costs, and the increases will simply raise the cost of assets across the board. This not only will be ineffective, but eventually could adversely affect ratepayers. Second, this approach is rooted in the assumption that many projects are not “real”, or are highly speculative. It is too difficult for MISO to effectively judge this, and a more strict granularity will likely end up imposing a relatively arbitrary rather than realistic limit on projects. The contemporary state of the queue is that most projects are “real” by the standards that the IC study seeks to assess. Most projects that MISO might consider “speculative” are not in fact speculative in terms of unavailable funds, land, or similar. NG Renewables experience is that these projects are secure in all these respects, except for transmission availability, which can only be determined through the MISO IC queue. The market demand does exist for competitive projects that can make it through the queue, but making it through the queue is one of the largest, if not the largest, barrier to success. MISO has not fully remedied the footprint need for transmission, but that is not within scope of this PAC issue. Therefore, the focus of this process should be limited to running more feasible, reliable, and prompt studies of eligible projects rather than attempting to create additional metrics on assessing the feasibility of individual projects per se.

Finally, NG Renewables notes that MISO has proposed an aggressive timeline for this reform, and has also proposed to extend the 2023 cycle deadline until these reforms are passed. NG renewables appreciates the commitment to implement these changes as soon as possible. However, tying this reform to this queue cycle extension may rush these reforms in a way that does not leave time for adequate assessment and review of both the problem statement and possible solutions. NG Renewables urges MISO to prioritize a proper problem statement and range of solutions, rather than limited solutions for the sake of an aggressive timeline.

We recognize MISO’s struggles with large queue cycles and high withdrawals. However, for a long-term, robust solution, we believe more time and discussion is needed to better understand the data and drivers behind the withdrawals. Instead of immediately pulling levers in an attempt to fix the issue, we should consider how each piece of the solution will affect the generators, developers, and interconnection queue as a whole. Consideration should also be given to maintaining an effective queue process and avoiding gridlock and slowdowns in a transitional process. The overall solution should be effective where withdrawals are high; we therefore request that MISO share additional information about where and why (if available) the withdrawals are occurring:

• Which study phase?
• Which cycle and region?
• Any additional information on why the generators are withdrawing?

Finally, we urge MISO to develop rules that are resource agnostic – hinderances to any one fuel type should be avoided.

While MPSC Staff is generally supportive of efforts to further reform the interconnection queue, MISO should also keep in mind the information asymmetries that exist today. Staff offers the following comments:

• Speculative projects are sometimes just that due to lack of data that interconnecting generators can only obtain by going through the GIQ
• Efforts by the MPSC, ITC/METC, Consumers, and DTE have helped improve data visibility for interconnecting customers
• In 2021, the MPSC requested ITC to conduct a hosting capacity study to help map where new sources of electricity generation could locate most affordably
• The study outlines locations where new generation sources could be built and interconnected with high voltage transmission lines without the need for costly system upgrades
• The MPSC also directed other regulated electric utilities to file similar maps, focused on the distribution system, in each companies’ distribution plans as part of MI Power Grid in Case No. U-20147
• Other data visibility improvements from U-20147:
• DTE Hosting Capacity Map
• Consumers Hosting Capacity Map
• METC Hosting Capacity Map
• While MPSC Staff is supportive of this queue reform, we caution that a balance must be drawn between adding disincentives to improve queue timeliness and the lack of data visibility today.
• MPSC Staff would also like MISO to keep in mind the lack of data visibility, as well as point to hosting capacity maps as one way to get developers the information they need as a way reduce speculative requests

The TDU Sector appreciates MISO’s recommendation that Generation Interconnection (GI) process improvements are needed to better manage the large number of interconnection requests within recent queue cycles. We agree with that concern and would like to consider not just queue entry and exit rules, but other potential improvements that would discourage requests that ultimately exit the process prior to executing a GIA.

From a process standpoint, the sector encourages MISO to develop a queue reform proposal in an open and transparent stakeholder process. While MISO’s request for feedback includes “rules” MISO should consider in its initial reform package that will be presented to the PAC on July 19, the TDU Sector believes that discussion of potential improvements should occur at the IPWG. We are not opposed to the issue remaining at the PAC. However, the IPWG has the charter, agenda flexibility and the right stakeholder mix to allow both MISO and stakeholders to present potential improvements (along with anticipated positive and negative benefits). Rather than just presenting its proposal to the PAC in July, MISO should develop a proposal based on the discussions at the IPWG, and more importantly, the ideas submitted by stakeholders.

Regarding the list of potential solutions that MISO presented at the May 31 PAC, MISO and stakeholders need to understand why there are requests in the queue that ultimately exit despite the existing hurdles. For example, are developers are submitting multiple interconnection requests (with different POIs, generation technologies, and MW service levels) for the same land that is under options to buy/lease? Are developers exiting upon notification of very high Network Upgrade costs and if so, is there a way to group requests based on sensitivity to cost?  Once we understand why requests are still entering and exiting the queue despite existing hurdles, we can better design requirements to process those requests.

DTE appreciates the opportunity to provide feedback on the Generator Interconnection Queue Improvements that MISO is considering.  We acknowledge the significance of improving the cycle time within the interconnection queue and commend MISO for recognizing the need for tariff changes.  Although we recognize the need for queue reform to improve queue efficiency, we are concerned with how MISO has defined the problem and the approach that MISO is taking to address the issue. 

The proposals narrowly focus on reducing the queue size opposed to adding capacity to the existing process which may not address the issue in its entirety and lead to sub-optimal results.  There are likely multiple variables contributing to the size of the queue that warrant in depth discussions on the appropriate solutions.  Given the incentive that developers have to initiate renewable projects through public policy goals and the Inflation Reduction Act, the notion of reducing the queue size is contradictory to the industry trends that we expect going forward. 

Efforts should be made to understand the key drivers behind the queue size so that we are addressing the root cause of the problem rather than its symptom otherwise we could see very little impact.  For example, the prior changes made to the site control requirements during the 2019 DPP Cycle did very little to reduce queue size as evidenced by how the queue has grown each year setting records within MISO.  Additionally, the current proposal to require developers to purchase land ignores the widespread practice throughout the industry (specifically solar developers) of leasing property and how such an agreement has been advantageous to both the developer and landowner who in many cases are farmers in rural areas that have traditionally been more receptive to such projects.  It is important that MISO understand the broad implications of their proposed changes.  

We understand that the changes that MISO is proposing are just steps to address part of the issue, however we feel there is an opportunity for MISO and stakeholders to work together in developing a more comprehensive solution that attacks the issue at its core.  We strongly urge MISO to ensure that reforms are managed through the appropriate stakeholder process so that the full gravity of the problem is understood, and the right solutions are deployed.