Entergy Operating Companies[1] Feedback on proposed Generator Interconnection Queue Improvements

September 27, 2023

In the September 18, 2023, special meeting of the Planning Advisory Committee (PAC), MISO shared updates to the Generator Interconnection Queue Improvements proposal.  Stakeholders were invited to review the proposal as well as companion BPM and Tariff language and submit feedback.   The Entergy Operating Companies’ comments below focus on the increased cost to customers that will result from the proposal. 

Comments Regarding Automatic Withdrawal Penalties

The Entergy Operating Companies support an Interconnection Queue Process that provides clear and predictable information to Interconnection Customers so they can understand the expected costs of their projects and, as necessary, withdraw from the interconnection queue when appropriate in a manner that does not penalize their customers.  MISO’s queue reform proposal for Automatic Withdrawal Penalties increases the risk that Interconnection Customers that are load-serving entities (LSEs), including the Entergy Operating Companies, will automatically incur costs that will be borne by their customers when they decide to benefit those customers by withdrawing a project that is potentially uneconomic or infeasible due to DPP Study results.

MISO’s proposed Automatic Withdrawal Penalties create a perverse incentive for uneconomic or infeasible projects to remain in the interconnection queue to avoid being penalized for withdrawal.  When an Interconnection Customer concludes that it should not continue to develop its project, MISO’s policies and rules should provide a process for the Interconnection Customer to withdraw from the interconnection process with minimum friction or penalty.  Such withdrawal is likely to benefit the Interconnection Customers remaining in the queue by allowing the next phase of the DPP process to more accurately model the interconnection costs of those remaining projects and potentially reduce the upgrades associated with that DPP study cycle.  By automatically imposing costs on a withdrawing Interconnection Customer, MISO’s proposed Automatic Withdrawal Penalties will incent customers with projects they might otherwise withdraw to remain in the queue in hopes that study outcomes will change over the course of the study process.

The Entergy Operating Companies encourage MISO to consider instituting a Penalty Free Withdrawal window at each Decision Point to give Interconnection Customers with marginal projects the opportunity and incentive to withdraw without cost, potentially benefitting the other projects that remain in the queue.  Moreover, at the time of each Decision Point, MISO should transparently identify projects that withdraw from the queue so other Interconnection Customers have information they need to make their own decisions about whether to stay in or withdraw from the queue prior to the subsequent Decision Point.

If MISO adopts Automatic Withdrawal Penalties and will utilize the penalty revenues to contribute to transmission system upgrades, the cost allocation regime should clearly specify that  penalties collected from Interconnection Customers in a certain DPP Study Area are used to upgrade the transmission system in the same DPP Study Area. 

Comments Regarding Proposed Entry Milestone requirements

The Entergy Operating Companies support MISO’s proposal to reduce the Milestone M2 payment from $10,000/MW to $8,000/MW.  We note, however, that the amount is still twice the amount of the current Milestone M2 payment and higher than corresponding milestone payments in any other ISO/RTO.  MISO’s costly milestone payments create a burden on Interconnection Customers that seek to develop needed generation in MISO and disproportionately impact MISO members who are subject to MISO’s  Resource Adequacy requirements.  We encourage MISO to cap the M2 total payment at 500 MW to mitigate disproportionate impacts to MISO LSEs that must maintain sufficient generation resources to serve their load and meet MISO’s Resource Adequacy requirements, which include a Reserve Margin and Zonal Resource clearing requirements.

The Entergy Operating Companies also are concerned that the proposed Increases to Milestone M3 (from 10% to 20%) and Milestone M4 (from 20% to 30%), tied to high Network Upgrade costs due to amount of MW in the queue, will drive good projects out of the queue and impact associated credit support requirements tied to the M3.  Larger developers will not experience the same impact of this construct as smaller developers.  The effect will be to reduce competition among resources seeking to compete for utility load, and the increased carrying costs of the capital invested over the duration of the DPP study cycles will ultimately be included in the cost of energy to consumers.  

Ultimately, while the impact of the proposed increase to Milestone payments on MISO’s queue composition is uncertain, the impact on customers’ energy prices is relatively certain.   The increase in Interconnection Customers’ funds at risk likely will be rolled into the prices of self-build projects as well as BOT and PPA pricing that will ultimately be borne by consumers.  For example, a 200 MW solar plant will have a $1.6M M2 amount, while a 1000 MW CCGT, which LSEs depend on to serve their loads, will have a $8M M2 cost just for entering the queue.

The Entergy Operating Companies thank MISO for considering their comments.

Transmission Owners Feedback on Generator Interconnection Queue Reform

September 27, 2023

In a special meeting of the Planning Advisory Committee (PAC) on September 18, 2023, MISO shared additional updates to their Generator Interconnection Queue Improvements proposal and invited Stakeholder feedback.

The Transmission Owners[1] thank MISO for the continued opportunity to provide input in the development of an effective set of reforms that can be implemented swiftly to address increasing demand for interconnecting new generating resources at a reasonable cost, and we recognize the urgency of this task. 

The Owners have provided extensive feedback already, and we appreciate the adjustments to the initial Queue Reform MISO has made in response to Stakeholder feedback, as well as MISO’s commitment to working on the Process Improvements presented by MISO at the September 18^th PAC meeting. 

These comments focus on refinements to three elements of the reforms MISO has proposed, for MISO’s further consideration:

                 I.          POI Site Control Entry Requirements

                II.          The establishment of DPP Study Area Caps 

              III.          The proposed Study Cap Safety Valve 

Suggested Refinements

The suggested refinements below are targeted to result in a DPP Study Process that gets ready and needed generators projects in and through the Generator Interconnection Process (GIP).

I.             POI Site Control Entry Requirements

The TOs have concerns about MISO’s proposed POI-related Site Control entry requirements due to the inability to fully assess the viability of a POI without completion of the Interconnection Feasibility Studies and Short Circuit and Stability Studies. 

POI Entry Requirements should reflect both the need for ICs to perform and demonstrate necessary due diligence while also recognizing that some POI limitations are only able to be identified in studies that are performed as part of the DPP:

• For an existing POI, the IC is not likely to be able to get site control because is under Physical Control of the Owner, who will need to complete the relevant studies to determine the interconnection IC Interconnection Facilities, which would include the placement of the Switchyard and the facilities needed to interconnect from the switchyard to the substation.  Without these studies, along with the completion of short circuit and stability studies, the exact location and size specifications of the POI, which could be a substation or a switchyard, are subject to change.
• For a new POIs, it difficult to pinpoint the exact location until all of the necessary studies have been completed.

Due to limited information available to an IC at the time of Application, the Owners recommend that MISO adjust the POI-related entry requirements to require the Interconnection Customer (IC) to demonstrate its due diligence in planning the project by focusing on demonstration of a viable ROW to the proposed POI and identification of any limitations on the ability to procure Site Control of that ROW for the ICIF as physical Site Control requirements progress through the study phases, rather than focusing on demonstration of physical Site Control at the POI at Application.  

For the reasons described above, the Owners are concerned that MISO’s proposal to require 100% site control at GIA execution doesn’t allow for flexibility in siting the Interconnection Facilities, but 75% site control for a greenfield site would still allow the flexibility needed for routing and siting of facilities needed to interconnect the generator to the transmission system, though 100% of Site Control at GIA Execution or within 180 days of GIA Execution may be feasible for existing substation POI). 

II.           DPP Study Area Caps 

The Owners encourage MISO to provide stakeholders with additional detail regarding the factors and process that will be used to set the cap, and when the caps are set for each study. 

The Owners also request that the process include the opportunity for the Owners to review and provide input on the specific DPP Study Area caps when they are set or proposed.  For example:

• Owners would like the opportunity to review and comment on “reasonable dispatch.”
  • Once the cap is met, what will MISO dispatch it against? 
    • not turning down existing units below pMin
    • nuclear units need to be left on
    • using RT dispatch data for existing units
    • new and existing units in the same area of the same fuel type should not be dispatched against each other
    • Must Run units need to be on
    • COGEN facilities that serve their own load should be left on if the load is also turned on. 
• Owners would like the opportunity to review and comment on the caps, once they have been set.

III.          The proposed Study Cap Safety Valve

The Study Cap Safety Valve concept needs to be further defined and must be sufficiently tailored to avoid (1) inclusion of MW in the study that will create the modeling challenges that drove the need for a MW cap to be applied in DPP studies, and (2) creating capacity shortage issues for LSEs.  Some considerations in further developing this concept include:

• The need to maintain “reasonable dispatch” in study models.
• The obligation of LSEs to serve their load.
• Varying LSE resource selection and regulatory approval requirements.

The allowance for committed resources needs to be broad enough to allow LSEs (those entities who are obligated to serve retail load) the ability to get resources committed to serving that load through the DPP in time to meet those commitments considering that:

• public power agencies (and they plan to submit comments);
• every state doesn’t have an IRP. 

Rather than tying the exception to the cap to a signed PPA, it should be tied to a commitment to and indication by an LSE that that the Interconnection Request has been demonstrated by the LSE to be needed to meet their obligation to serve their load  and, as appropriate, approved or subject to be approved by the applicable regulatory authority.[2]

Ad-hoc Stakeholder Group Feedback on MISO’s Queue Reform Package presented at the September 18 PAC meeting.

September 27, 2023

The Ad-hoc Stakeholder Group (“Ad-hoc Group”) appreciates this opportunity to provide feedback on MISO’s updated queue reform proposal presented at the September 18, 2023 PAC meeting and reiterate key elements of the “Alternate Proposal” that should be incorporated into MISO’s Tariff filing.  The Alternate Proposal” is intended to improve upon MISO’s queue reform package by suggesting enhancements to some of the elements of MISO’s proposal, in addition to offering process improvements, some of which may be reasonably addressed after MISO files queue reform Tariff revisions to ensure the reforms are successful. 

The Ad-hoc Group asks that MISO incorporate the following items in its Tariff filing:

      I.         Proposed Site Control-related entry requirements

• Pin deadline for site control submission to application submission deadline rather than 90 days prior to DPP start. 
  • As queue sizes decrease and only ready projects enter the queue, projects will be submitted as they are ready rather than rushing the queue at the application deadline.  This will allow MISO to validate the completeness of applications and Site Control as projects are submitted. 
  • To be deemed “complete,” applications must include required Site Control which is the desired result of this recommended change; however, making the suggested Tariff change would be cleaner and more accurate.
• Require Site Control for the generator and demonstration of a viable pathway to the requested POI.   
  • At the application stage, the IC should not be required to demonstrate any physical Site Control to the POI until feasibility, short circuit, and stability studies have been completed, as the TO may recommend moving the POI due to issues identified in these studies.
  • This physical Site Control could be required to progress to DPP II if the short circuit and stability analyses are performed in Phase I as recommended.

     II.         Proposed Entry Milestone requirements

The Ad-hoc Group appreciates that MISO reduced the proposed M2 from $10,000/MW to $8,000/MW; however, it is still 2 x the current M2 and higher than corresponding milestone payments in any other ISO/RTO.  To address these concerns, we offer the following recommendation:

• Consider instituting a cap on M2 total payment (perhaps based on M2) at 500 MW to mitigate disproportionate impacts to MISO LSEs who must maintain sufficient generation resources to serve their load and meet MISO’s Resource Adequacy requirements, which include a Reserve Margin and Zonal Resource clearing requirements.

   III.         Proposed Queue Cap

The Ad-hoc Group supports the establishment of a cap on queue sizes and appreciates the inclusion of a safety valve to allow resources committed to serve Load Serving Entities’ (LSEs’) load to enter a queue cycle and potentially exceed the MW cap. 

• MISO should include a safety valve provision that allows resources committed to meet Resource Adequacy obligations to be included in a DPP Study Cycle that will allow the obligated entity to meet the need by date for Resource Adequacy commitments after the cap has been met.    As proposed, the safety valve design is not aligned with how resource planning is done in MISO or regulatory structures.  For example, not all LSEs are subject to state jurisdiction or have a formal IRP process, and while many LSEs are required to solicit resources through competitive RFP processes, this is not a requirement for all LSEs.  The safety valve must provide the appropriate flexibility to avoid being a barrier to MISO members meeting their Resource Adequacy obligations, but not so broad as to render the cap useless in ensuring reasonable dispatch in DPP Studies.   The Ad-hoc Group views the safety valve as critical to ensuring the final reform proposal does not threaten reliability and the ability of utilities with an obligation to serve to meet resource adequacy requirements.
• The Ad-hoc Group supports further discussion of how the safety-valve concept would be implemented and requests additional clarity on what MISO will require for a project to qualify for the safety valve provision.

   IV.         Automatic Withdrawal Penalties

The Ad Hoc Group requests that MISO eliminate Automatic Penalties (APs) for withdrawal when study results return information that could not have been identified prior to queue entry or was not identified earlier in the study process.

• The Ad-hoc Group appreciates that MISO eliminated the 10% AP for withdrawals that occur prior to DPP start and reduced the AP at DP1 and DP2.  However, because short circuit and stability analyses provide information about a POI that the IC could not have known through any other means or any amount of due diligence, the Ad-hoc Group recommends moving these analyses to Phase I and implementing the AP after DP1.  If MISO adopts this recommendation, applying an AP at DP1 would be more reasonable; however, if MISO does not make this change in the upcoming tariff filing, the Ad-hoc Group strongly encourages MISO to eliminate the application of an AP at DP1 and eliminate or further reduce the AP at DP2 if short circuit and stability violations requiring mitigation are identified that would otherwise meet the Penalty Free Withdrawal criteria.
• Similarly, as studies move through the DPP, the withdrawal of one project negatively impacts the economics of another project, particularly when Shared Network Upgrades (SNUs) are identified and one of the projects assigned to that upgrade withdraws, but the SNU is still needed and the other IC(s) sharing the responsibility for that upgrade are not aware that their cost assignment will increase as the remaining IC does not have visibility into the cost increase associated with the withdrawal.  While this has always been a risk in MISO’s three-phase DPP Study process, the introduction of escalating Automatic Penalties increases the financial risk to the other ICs sharing that SNU if they do not withdraw in the same cycle.  To address this increased risk, the Study process should include a mechanism for ICs who share in the allocation of a SNU to have visibility into the projects that are moving forward and those who are not, perhaps through a System Impact Study Report coordination call among those ICs in advance of the next Decision Point.  

Finally, in the proposed language for Attachment X GIP Section 7.8.1, “a single study group” should be replaced with “each DPP Study Area Group” to clarify that the funds withheld will be applied to that study group and not distributed more broadly.   

    V.         Process Enhancements

Finally, in its tariff filing transmittal letter, MISO should commit to evaluate and implement (as appropriate) the recommended process enhancements included as an Appendix to these comments through an open and transparent stakeholder process AND add this to the IPWG Management Plan beginning in Q1 of 2024.

For reference, the “Alternate Proposal” is compared/contrasted to MISO’s revised proposal in the table below:

Again, we thank you for the opportunity to provide these comments and recommendations, and we look forward to continued collaboration among MISO and stakeholders as we develop effective queue reform.  Please feel free to contact Ginger Hodge (Customized Energy Solutions - ghodge@ces-ltd.com or 317-910-5260) with any questions or to arrange a broader discussion with the Ad-hoc Group.  

The Ad-hoc Group includes American Municipal Power (AMP), Entergy, Michigan Public Power Agency (MPPA), Wolverine, Central Minnesota Power Agency & Services (CMPAS), Alliant Energy, and LS Power.

Appendix: Process Enhancements

The ad-hoc group offers the following process enhancements necessary to support, facilitate, and ensure the success of MISO’s proposal:

Pre-queue due diligence requirements supported by increased transparency

• The IC should be required to verify the preferred POI is a transmission facility included in either MISO’s Appendix H list of transmission facilities that have transferred functional control or MISO’s Appendix G list of transmission facilities that have not transferred function control but are subject to the Agency Agreement of the Transmission Owners Agreement.  If the POI transmission facility is not included in either MISO Appendix H or Appendix G, the IC must choose a different POI after the study has kicked off, which wastes resources.  The POI tool should be a definitive source of the POI facilities available for MISO interconnection.
• Formalize the IC POI “viability” inquiry process currently available to ICs under MISO’s tariff.
  • Create a standardized IC inquiry form that would also be used to verify the IC has done due diligence in selecting the POI, since the mandatory pre-queue calls were eliminated.
  • Require pre-queue communication between IC and TO.
  • Update POI tool in real-time
    • Update POI tool to include interconnection facility constraints or requirements.
    • Add high-level costs and limitations at a substation in the POI Tool from the Cost Estimation Guide.
    • Post to the POI Tool the past TO responses to IC inquiries regarding POI viability with any sensitive details posted to a platform that has protected access (e.g., fiber requirements and associated costs would be useful).
      • Require the IC to demonstrate it has performed appropriate analysis to validate the viability of the POI prior to queue entry to demonstrate feasibility or require additional deposit if IC does not include results with their application or if results demonstrate the requested POI has complications identified by the TO or prior studies.

Improvements at Queue entry

• Make the POI and MW of submitted projects visible prior to the application deadline to offer another data point to inform subsequently submitted IRs.  It might be appropriate to limit availability to other ICs only. 
  • Validate site control and application upon IR submittal so that a ‘J’ number can be assigned, and IR information can be added to the POI tool.  This validation should be concluded within a specified number of days after the IR is submitted. 
  • This transparency could be achieved through a portal or the POI tool, and information should be redacted so as not to put a developer at a disadvantage when seeking Right of Way (ROW) options or a buyer for their generation.
  • Identify and provide high level estimates of upgrades that are certain to be required based on the MW at the requested POI sooner in the process (i.e., mitigation requirements identified through pre-queue due diligence, in Scoping, or in a prior study or study  phase), which could support higher M3 and M4 Milestones and increased “at risk” portion of these payments tied to the harm caused to other ICs by late stage withdrawals. 
    • Require IC acknowledgement of scoping call & form comments through a formalized process (use of portal for receipt and acknowledgement of project review form completed by the TO, now in advance of or potentially instead of a Scoping Call).
    • Currently, developers may choose to remain in the queue longer since they are not required to acknowledge information prior to the scoping call that materially impacts their project.

Queue & study cycle Sequencing

• A new study cycle should not kick off until the prior cycle is at least ready to start Phase II.  This refers to the actual study (model) and does not refer to the application validation, etc., which should begin as soon as possible and ideally prior to study kick off.
  • The ad-hoc group recognizes this could have the unintended result of creating a backlog but believes the potential backlog is reduced through other aspects of the proposal. 
  • The benefits outweigh the potential drawbacks, and SPP has instituted a similar requirement that also applies to beginning Phase II of a subsequent study prior to the previous study completing Phase II. This helps avoid re-study.
  • This would have the benefit of increased confidence in study results due to less prior queued generation being included in study models without associated NUs and reduced risk of withdrawals of projects in prior queues, increasing certainty and visibility on the prior-queue NUs and issues, and more overall information to support IC’s financial commitments.
  • Failure to sequence appropriately exacerbates the physical demand problem seen in DPP21 and 22.

Other suggested improvements to information access, flow, and timing

• Post an FAQ detailing available information and where to find it. 
• Make pre-screening results easier to understand to allow ICs to make informed decisions.
• Allow more time between pre-screening results and the start of the cluster study to allow ICs more time to conduct due diligence on the screening results.
• Revise study methodologies as informed by the roadblock analysis.

SB Energy appreciates the opportunity to provide comments on the MISO queue reform proposal.

Please see below the comments that SB Energy can offer:

1. Automatic Withdrawal Penalty:

a)       MISO should utilize Automatic Withdrawal Penalty payments collected only towards System Impact Study costs and not towards Network Upgrade costs as proposed in the original slides “Penalty will be used to offset interconnection costs of projects that sign a GIA.”

b)      Let’s say if an IC moves forward in the DPP process based on a set of MISO results. However, if there were changes to the MISO results due to an error from Transmission Provider/Transmission Owner/Affected System, then Automatic Withdrawal Penalty should be waived for the IC. IC’s shall not be penalized due to these type of errors, and errors cannot be fully eliminated especially due to the huge size of the queue.

c)       If there are MISO and/or TO delays, a project may have issues to move forward because of real estate option expiration, local use permit expiration, etc. MISO should consider reducing the withdrawal penalties for IC’s if that type of delays happens to have a fair process among IC’s/MISO/TO.

2. Penalty Free Withdrawal:

a)       For Penalty Free Withdrawal provisions in Section 7.6.2.4, MISO shall not apply Automatic Penalty payments pursuant to Section 7.6.2.1.1 for cost increases due to Transmission Provider/Transmission Owner/Affected System errors. It is unfair to Interconnection Customers if MISO applies Automatic Penalty rules if the cost increase is due to an actual error in the study. This Tariff provision was originally included to protect IC’s from any study errors.  

b)      For Penalty Free Withdrawal provisions, DPP Phase 1 to DPP Phase 2 is currently at 25% (to 50%). MISO should not further increase the % increase and should just keep 25% between DPP Phase 1 to DPP Phase 2. Moreover, a lower % increase should be used between DPP Phase 1 to DPP Phase 2 than DPP Phase 2 to DPP Phase 3 to be consistent with the current Tariff if MISO is still planning to increase the %.

3. MW Cap:

a)       SB Energy does not agree with MISO’s revised proposal of removing MW Cap per developer completely even after major support for this proposed change from stakeholders – this MW Cap removal is clearly favoring larger developers. Given MISO is introducing a MW cap per queue per study region, MISO shall also apply a MW Cap per developer. The argument that MW Cap per developer maybe seen as undue discrimination by FERC (but not MW Cap per queue) is a faint argument. Moreover, this MW Cap per developer proposal has not been submitted to FERC to draw any conclusions. MISO also mentioned at the PAC meeting that MW Cap per developer will be considered in the future if the proposed queue reform still does not reduce the entry of speculative projects into the queue – in that case why would MISO not consider this change now. Also, CRA’s recommendation clearly states the reasoning behind adding a MW Cap per developer and its advantages for an efficient queue entry. MISO should revisit this proposal to ensure fairness and prevent disproportionate control by a few larger developers based on historical data. What is MISO’s plan in reducing speculative projects that will be submitted by larger developers if there is no MW Cap per developer?

b)      There have been several MISO GI Portal access issues for several developers recently (for e.g., IT issues). This has also happened closer to the application submission deadline due to larger traffic of portal usage. If there are similar GI portal IT access issues during application submission window in the future, this may impact some developers (with access issues) while trying to submit applications and they may not be part of the MW Cap per queue per study region (because it is all about timing). How is MISO planning to resolve this issue if there is a genuine GI portal access issue for select developers whereas other developers do not have this issue? MISO should consider email submissions (or alternate submission methods) if such GI portal access issues happen to select developers during the submission window deadline to be part of the MW Cap.

4. Milestones:

a)       Please note that PJM and SPP still uses similar calculation like current MISO’s approach for M3 & M4. MISO should consider keeping the same 10% and 20% for M3 and M4 respectively and only add “or $1,000/MW” requirement, thus not varying drastically from PJM and SPP.

5. General:

a)       MISO mentioned that the study results from prior DPP cycles including DPP 2022 and DPP 2021 are unrealistic given the size of the queue and the unrealistic dispatch of queue projects. MISO should consider plans to clear the prior DPP cycles as well as part of this queue reform effort given there is a possibility that speculative projects would continue to stay in the queue (due to stringent DPP 2023 milestones) in the early DPP phases and can create late-stage withdrawals causing further delays. MISO should consider applying POI site control requirements to projects in the previous cycles. This will eliminate several speculative projects. 

Thank you for the opportunity to provide feedback and MISO’s consideration of the comments.

RWE Clean Energy, LLC (RWECE) expresses gratitude for the chance to provide feedback on MISO's queue improvements proposal. We commend MISO's dedication to resolving queue delay concerns, and we value the adjustments shared during the recent PAC meeting.

We kindly urge MISO to prioritize a thorough and transparent stakeholder engagement process when implementing the majority-supported changes. In the absence of meticulous implementation, there is the potential for adverse effects on ICs and their ability to help regions achieve ambitious renewable energy targets.

MW Queue Cap:

RWE respectfully seeks clarification from MISO regarding the implementation of the queue cap, emphasizing the importance of avoiding last-minute rushes and addressing potential issues with the GI portal. We are concerned about ensuring equitable opportunities for all projects and developers, preventing the unintentional exclusion of worthy projects due to internet or portal issues.

 Additionally, the introduction of a queue cap may restrict the entry of commercially viable projects, while the waitlist system introduces uncertainty and delays for select projects. RWE believes that increasing financial penalties could effectively reduce the queue size. We encourage MISO to collaborate with stakeholders in developing a precise dispatch methodology rather than implementing a MW queue size cap.

 In the event of a cap, there is the possibility that ICs may choose not to wait and opt to submit more applications to secure a position, potentially hindering opportunities for other deserving projects.

POI Site Control:

Meeting the MISO proposed POI site control requirements is contingent on factors that often lie beyond the control of ICs. For ICs to provide what MISO has asked a confirmation and commitment from the TO on the POI is required in sufficient time to pursue the appropriate site, which could take several months. In addition, provisions should be made for penalty-free queue withdrawals if the POI is relocated by the TO or MISO.

Additionally, it's essential to acknowledge the ever-evolving landscape of state siting and permitting regulations. RWE respectfully urges MISO to engage in collaborative efforts with state regulators to assess whether the proposed interconnection facility site control requirements might potentially create delays in state-level decision-making processes. It is advisable that MISO formulates site control requirements that align with and accommodate the specific requirements of each state.

RWE expresses its opposition to the existing MISO POI site control requirement upon queue entry. Instead, we recommend a revised approach where no POI site control is mandated at queue entry. A phased approach is proposed: 50% site control by Phase 2, 70% by the execution of the GIA and 90% within 180 days post-GIA execution so long as the TO has committed to the POI location.

This adjustment allows customers adequate time for navigating any necessary regulatory procedures related to securing easements on public, or utility ROWs. Furthermore, it provides TOs with sufficient time to evaluate the POI and offer feedback, aligning with the progressive availability of information to ICs.

M2 Calculation:

RWE acknowledges and appreciates MISO's proposal discussed during the last PAC meeting to lower the M2 requirement to $8k per MW. While this reduction is a positive step, we believe that a tiered approach is necessary to fully address the volume of requests or MWs from any individual IC or parent company effectively.

RWECE recommends MISO consider a tiered M2 security structure as follows:

-     0 – 2.5GW       M2 = $6,000/MW

-     >2.5 – 5GW     M2 = $10,000/MW

-     >5GW              M2 = $15,000.MW

This tiered approach would likely incentivize developers to propose viable projects and discourage excessive submission of higher capacity projects into the queue. Queue MW cap is also not required with this proposal.

For later milestones, RWECE suggests that MISO consider a 15% value for Network Upgrades (NU) in calculating M3 security and maintain the proposed M4 security at 30% instead of the initially proposed 20% for M3. Furthermore, the stipulated minimum requirement of $1000/MW is advised to be reevaluated and potentially removed. Discriminating against projects on the basis of lower upgrade costs would be inappropriate.

Other Topics:

• RWE Clean Energy, LLC (RWECE) expresses its support for MISO's proposal to restrict the transfer of a project to another developer until Phase 2 completion.
• RWECE recommends that projects entering the queue should be mandated to perform a fundamental power flow analysis to demonstrate feasibility. This would ensure that ICs are aware of known complexities and can have level set expectations when submitting to the queue..
• RWECE suggests that MISO consider incorporating financial penalties, as outlined in Order 2023, on MISO or the TO for any queue or study delays. While recognizing the involvement of several stakeholders in the process, it's important to acknowledge that ICs assume the most significant risk under the current proposal. Implementing such penalties would incentivize timely performance and ensure that MISO and the TO have fewer concerns if the proposal functions as intended to eliminate or minimize delays.
• RWECE recommends that MISO consider expanding its staffing and consultant resources to effectively manage the growing influx of queue requests. Additionally, MISO and the TO could leverage increased study deposits to expedite study completion, thereby reducing uncertainty and cluster sizes while adhering to defined timelines. Despite the proposed changes, there is a possibility that cluster sizes may not be smaller than those observed in the 2019/2020 cycles and significant delays persist. Hence, the allocation of additional resources and the optimization of processes remain crucial requirements.

The NDPSC believes that MISO should not apply the annual queue cap to those projects wishing to interconnect as a Network Resource to serve load and should eliminate the proposed cap exemption to those with an executed PPA. The speculative projects in the queue that are likely to drop out are those that aren’t a Network Resource serving a load obligation, and so any cap should apply to them, and not to those serving load with Network Resources. If not, MISO runs the risk of trampling on states’ resource adequacy objectives and crowding out resources that states prefer.

Anchoring the cap to executed PPAs would do nothing to distinguish between LSEs or those projects wishing to serve load with speculative projects, which are delaying the benefits going back to load. Such a proposed cap does nothing to encourage projects to become Network Resources, and would create a host of uncertainty and ambiguity in deciding whether a PPA would be subject to such a cap.

MISO should exempt any LSE or a project serving load that seeks to interconnect as a Network Resource from the cap. MISO could enforce this by an attestation that the project is seeking to become a Network Resource and has a memorandum of understanding associated with a PPA.

MISO should also think of ways that the interconnection queue can be used to encourage the kind of resources it needs on the system to replace the attributes that will be needed as baseload generation retires. Therefore, MISO should think about whether resources that bring with them needed attributes, regardless of Network Resource status, should also be exempt from the cap.

1. Introduction

Clearway Energy Group LLC (Clearway) appreciates the continued opportunity to provide feedback in response to MISO’s proposed interconnection queue reforms, including the updated package of reforms presented at the September 18, 2023 meeting of the Planning Advisory Committee (PAC). 

MISO’s most recent package of reforms includes several improvements to what was initially proposed. However, Clearway remains concerned that MISO’s rushed approach to generator interconnection reform fails to address the main cause of the problems that exist today and will have unintended consequences that will actually undermine what MISO is seeking to achieve.

• The root cause of MISO’s queue problems is not the volume of projects entering the queue per se but rather (a) inadequate integration with transmission planning and (b) the limited throughput of current interconnection processes, which are not built for the scale of commercial interest today.
• Any MW cap that is implemented must serve as a stopgap until MISO can undertake broader queue reforms. MISO’s transmittal letter to FERC should commit that MISO will eliminate the cap once it implements broader queue reforms that keep pace with market demand and system needs.
• MISO should abandon its proposed safety valve, which is unduly discriminatory as a matter of law and unworkable as a matter of practice.

Below, we supplement our prior comments with several additional observations based on MISO’s September 18^th presentation to the PAC and subsequent conversations with stakeholders. In this feedback round, Clearway also (1) joins comments filed by Cypress Creek Renewables on behalf of the IPP Coalition and (2) supports the comments filed by Clean Grid Alliance (CGA). We thus incorporate those comments by reference.

2. Clearway supports MISO’s proposed reduction to the M2 milestone payment but urges MISO to refine its proposal to allow surety bonds as a form of security for milestone payments.

Clearway appreciates MISO’s modifications to its package of reforms to further adjust downward the proposed increase in M2 milestone payment that was initially $12,000/MW to $8,000/MW.  While this downward adjustment is welcome, it is still a significant increase from current M2 milestone amounts. As a result, MISO should provide flexibility for interconnection customers (ICs) to satisfy their milestone payment obligations by accepting surety bonds as a form of security. As noted in our September 12^th comments, such an approach would be consistent with other RTOs/ISOs, including CAISO, NYISO, and SPP that all accept surety bonds to securitize at least some cost allocations in the interconnection study process. The market for surety bonds has evolved significantly over the last few years such that these financial instruments are in many cases comparable to letters of credit in terms of both a demonstration of financial commitment by ICs and, from the perspective of the oblige (the party protected by the bond), responsive payment terms and liquidity backed by highly creditworthy institutions. If MISO is unwilling to accept surety bonds, MISO should provide an explanation why they are insufficient.

3. Clearway supports MISO’s proposed reduction in automatic withdrawal penalty amounts but continues to object to any automatic withdrawal penalty. The proposed escalating fixed penalty schedule is inconsistent with cost causation principles and based on a theory that ignores the realities of project development.

Clearway supports the direction of the proposed changes to the automatic withdrawal penalty schedule as compared to prior versions of the proposal. However, as expressed in prior comments, Clearway categorically opposes automatic withdrawal penalties. It is simply unjust and unreasonable to impose penalties without making any showing of harm. Such an approach violates long-standing cost causation principles as well as FERC’s recently issued Order No. 2023. FERC requires that transmission providers assess a withdrawal penalty, “only if the withdrawal has a material impact on the cost or timing of any interconnection requests with an equal or lower queue position,” and if the impact of the withdrawal is immaterial, FERC found that “the transmission provider must not assess a withdrawal penalty.”[1] To comply with long-standing FERC policy as well as Order No. 2023, projects should only face withdrawal penalties where MISO can demonstrate that the withdrawing project results in material harm to other interconnection customers.

This is particularly true for early-stage withdrawals where automatic withdrawal penalties would not have the desired impact and ignore the realities of project development. The escalating fixed penalty schedule is based on a theory from CRA that this will incentivize “careful consideration at every phase” and “timely decision-making.”  Careful consideration requires information. Cost information is unknown until proceeding through at least one study phase. Automatic withdrawal penalties after the first study phase cannot possibly incentivize timely decisions in advance, and will only raise consumer costs for projects that are successful. This is simply not justified.

Finally, the examples provided at the September 18^th meeting explain how these penalties will apply even to those projects that would otherwise qualify for penalty-free withdrawal, which undermines the purpose of penalty-free withdrawal. If MISO believes that outliers should have the ability to withdraw penalty-free, then those projects should not be subject to an automatic penalty. This undermines the very reason that MISO created such a category.

4. Clearway strongly supports MISO’s efforts toward process improvement and MISO staff’s comments at the September 18^th meeting that it seeks to increase study throughput. Clearway urges MISO to include those commitments in its transmittal letter to FERC.  

Clearway appreciates the generator interconnection-related process improvements that MISO highlighted as being underway during the September 18^th presentation (slide 4). Clearway also supports aspects of the process enhancements put forth in the ad hoc stakeholder group alternative proposal. Namely, the pre-queue transparency and process enhancements, the POI viability feedback to ICs through pre-queue coordination among MISO, transmission owners, and ICs, as well as additional clarity around MISO’s harm calculation (e.g., explicitly specifying models, methodology, threshold criteria, exemptions, and providing 1-2 examples in the BPM).

While these enhancements may prove useful, we urge MISO to explicitly include improvements to study methodologies. The state of the interconnection queue has not changed just in degree, but in kind. The types of projects and the amount of projects seeking to interconnect are not going to return to pre-2020 levels and imposing a MW cap to constrain the number of projects that can be studied will not turn the queue back into what it was.

Instead, MISO must change how it studies these projects and strive to be a leader in innovation to meet the challenges the dynamic interconnection queue requires. This includes exploring options for automation, reforming study methodologies, improving access to POI information for pre-queue diligence, as well as other process improvements. Without these changes, MISO will not have a sustainable approach to interconnection.

Clearway urges MISO to add queue process improvements to the IPWG management plan for Q1 2024 and to include commitments toward process improvement as efforts to increase study throughput in its transmittal letter to FERC.

The TDU Sector supports limiting queue size by MW to allow for more realistic studies and appreciates MISO’s intent to include a safety valve to allow resources committed to serve load of a Load Serving Entity (LSE) to enter a queue cycle and potentially exceed the MW cap. However, further discussion is needed to clarify the safety valve concept, process, and requirements to qualify for the safety valve provision.

 During the September 18 PAC meeting, MISO stated that only those resources that are needed to satisfy LSE load obligations and have been “approved” through a state Integrated Resource Plan (IRP) or other state-approved obligation to build would qualify for the safety valve.  The TDU Sector notes that some LSEs, such as municipals and cooperatives, may not be subject to state jurisdiction.  Moreover, not all states have a formal IRP or similar process to “approve” a resource plan prior to that plan entering the interconnection queue.  In many states, a state-approved obligation to build is granted only after a GIA is executed or the interconnection request is far enough through the queue to have some certainty in the amount and cost of requisite Network Upgrades.  The TDU Sector recommends that MISO include a safety valve provision that allows LSEs to provide an executive attestation and documentation of need for inclusion in the queue. 

 Finally, this safety valve option should be extended to a developer or other entity that is working with an LSE to meet a resource need.  Fundamentally, MISO needs to ensure its queue process is not a barrier to reliability or to the ability for LSEs with an obligation to serve to meet resource adequacy requirements. 

IPP Coalition comments in response to the MISO September 18 2023 updated interconnection queue reform proposal

The undersigned coalition of Independent Power Producers (the IPP Coalition) appreciates the opportunity to comment on the MISO queue reform process update presented at the September 18, 2023 MISO PAC meeting. We remain opposed to a MW cap for the reasons highlighted in our respective companies’ prior comments. If, however, MISO proceeds with a MW cap, below we reiterate select comments that our companies have previously raised regarding critical implementation details, but which have not received sufficient response in the stakeholder process. We are joining to emphasize their importance to the success of a final MISO filing at FERC.

1. To avoid unintended future capacity shortfalls as a result of the proposed MW cap, MISO should incorporate LRZ load forecasts, and differentiate between the resource operational behavior, technology dispatch, and ELCC. These and other key details regarding the MW cap calculation must be transparent and adequately captured in MISO’s tariff.

While the pace of interconnection is directly related to future system resource adequacy, MISO separates these processes, creating unnecessary uncertainty to future reliability assessments, and should be addressed in MISO’s ‘cap’ proposal. 

In the 2022 Regional Resource Assessment (RRA), MISO identifies a risk of existing and planned resources falling below load plus reserves starting in 2027 (p.4 Figure 2.), with Zone 5 seeing capacity shortfalls as early as 2023 (LRZ-level assumptions and results, slide 40). As highlighted in the 2023 OMS-MISO survey, the risk of shortfall is exacerbated if any planned resources are delayed beyond their currently scheduled in-service dates and other solutions are not promptly implemented (Long-term RA, System Planning Cmte of the Board of Directors, Sept. 2023). 

In PAC meetings, MISO verbally states there are enough projects in the queue as well as projects with signed GIAs to cover supply needs for the foreseeable future. However, MISO has not addressed whether this is true for each LRZ, and whether this extends beyond five years, the time period indicated in stakeholder process (whereas the RRA assessment looks further ahead to 2031 and 2041).

Artificially reducing capacity of regional interconnection requests (via a MW cap) without accounting for regional specific load growth, resource dispatch, and ELCC could result in a lower than needed MW cap that may exacerbate near term capacity shortfall risk and create longer-term impacts. The cap calculation methodology must account for not only interconnection volume that can be processed more quickly within a given timeframe, but also regional supply needs.

MISO has acknowledged that it intends to incorporate a ‘reasonable’ dispatch when setting the MW cap within business practice manual edits, but has not provided any additional information about its approach or committed to providing that information in a relevant timeline.

As a result, the IPP Coalition again requests that MISO detail the following in its final proposal presented at the October 11th PAC meeting or, at the very latest, in its final filing with FERC:

• Confirm it intends to incorporate LRZ probabilistic load projections into its calculation of the supply cap to avoid creating load-specific shortfalls in the near-term.

• Clarify how it intends to synchronize interconnection processes with RA planning broadly, including how it will incorporate the MW cap into longer term RA planning assumptions. 

• Clarify that it does not intend to use the nameplate capacity in setting an aggregate MW cap, and provide greater specificity in how it will factor operational behavior.

• Define the dispatch assumptions used to set the MW cap, including how it will incorporate Prior-Queued generation.

Additionally, the MW cap will significantly affect rates, terms, and conditions, and should be included, by rule of reason, in the MISO tariff (End Note 1).  MISO’s proposed tariff language governing the queue capping provides scant detail without any formula or even an explanation of the objective function (what balance MISO is trying to achieve) in establishing a MW cap.  The BPM provides little help, specifying vaguely that the cap will be based on “sound engineering judgment” and in a “non-discriminatory manner”. This wholly insufficient level of detail with too much discretion suggests a closed-door process that could easily be abused and would be impossible to monitor. Prior to filing with FERC, MISO must provide stakeholders with Tariff language specifying the cap methodology and provide opportunity for stakeholder feedback and dialogue. Examples alone are insufficient for meaningful stakeholder dialogue and do not rise to just and reasonable terms and conditions. In sum, the IPP Coalition urges MISO to instead establish a transparent process that provides stakeholders with details on the model and assumptions used to calculate the MW cap. Key details of the process must also be included in MISO’s tariff.

2. MISO’s proposal for a MW cap must be time-limited while MISO implements holistic interconnection reforms to increase queue throughput. 

MISO has consistently framed the proposed MW cap as a necessary “backstop” to ensure that MISO can continue processing interconnection requests. Yet MISO has not explained how the MW cap will ensure that MISO can meet its tariff-prescribed deadlines for completing DPP studies, let alone at a sufficient cadence to keep pace with commercial interest to develop resources in MISO. If implemented indefinitely and with no guarantee that MISO’s study processes can scale to this volume, a MW cap (even if modified as discussed above) will merely constrain competition, which will ultimately raise consumer costs without a perceptible accompanying benefit. 

While there is no precedent for MISO’s proposed permanent MW cap, there is precedent of FERC granting ISOs/RTOs flexibility to limit cluster study sizes to enable an efficient study process in a “transitional phase” while processing an interconnection queue backlog.  In Docket No. ER22-253-000, FERC accepted SPP’s proposed tariff revisions to modify its Generator Interconnection Procedures for the purpose of mitigating backlog in its generator interconnection study queue. Included in SPP's revisions was the ability to leave queue cluster windows open until “SPP has mitigated the GI Backlog or until such time as SPP determines that the cluster will be too large to effectively study.” Importantly, in the event that SPP determines a cluster will be too large to effectively study, FERC requires SPP to provide a 10-day notice to ICs prior to queue closing (with “reasoned basis for its decision to…close the window”), to promptly open additional study windows for ICs that may not be prepared to submit before a window closing, and to submit an informational filing to FERC “explaining what factors SPP considered in exercising its discretion to close the window.” 

MISO has repeatedly and incorrectly cited SPP’s above GI queue process as precedent for its current MW cap proposal. If MISO intends to pursue a MW cap or other revision to limit queue sizes, it should thus follow SPP and FERC’s precedent by limiting the implementation of such a cap to a “transitional phase” to address queue backlog, in addition to providing assurances and reporting as outlined above to ensure continued access and competition in the queue. 

As requested by numerous stakeholders, including members of the IPP Coalition, MISO must commit to a thorough evaluation of process updates that would increase DPP project throughput, including both the speed at which MISO can produce study results and the volume of projects that can be studied in a given year. These solutions should include, but not be limited to, improvements to study methodologies, automation of study processes, and increased staffing and resources. If MISO is willing to make such a commitment – both in its transmittal letter to FERC and by adding process and methodology improvements to the 2024 IPWG management plan – the IPP Coalition would support a short-term MW cap that would automatically sunset when these broader improvements take effect. Such a transitional bridge would permit MISO to continue processing interconnection requests under current DPP study practices while broader reforms are developed, and avoids the long-term harms of an indefinite MW cap.

3. MISO’s proposed “safety valve” should be abandoned entirely. 

Anti-competitive risk is particularly acute with MISO’s proposed “safety valve,” which the IPP Coalition categorically opposes as it raises legitimate concerns of undue discrimination and preference in accessing limited queue positions by creating a two-tiered system for interconnection in MISO. Instead of abandoning its safety valve approach as urged by members of the IPP Coalition and others, MISO’s September 18th modified proposal actually expands the eligibility for its safety valve proposal.

The September 18th PAC meeting “safety valve” discussion highlighted the many problems with this approach. Firstly, the PPA “safety valve” is counter to a typical development process given interconnection cost certainty is necessary to sign PPAs and finance contracted generators. As a means of mitigating the risk of delayed queue entry due to the MW cap, developers would be incentivized to pursue the “safety valve” and sign PPAs before costs are certain. The contingencies necessary to account for cost uncertainty in these PPAs would drive up the costs of these contracts, resulting in higher consumer costs.

As such, projects that have a PPA at queue entry are either: (1) the result of affiliate transactions—in which case MISO’s proposal would violate the Federal Power Act in that it unduly discriminates against generators without affiliated off-takers, or (2) written with so many contractual contingencies as to provide no meaningful demonstration of “due diligence.” This approach places MISO staff in the untenable position of being the arbiter of PPAs which is fraught with subjective determinations and likely to end in litigation. This approach is too easily manipulated and unworkable in practice. 

Furthermore, with respect to MISO’s proposal for “load serving entity obligations,” (a term that is not defined in MISO’s tariff and yet to be defined by MISO staff) to be eligible for the “safety valve,” this inclusion provides direct preference for load serving entities and their preferred projects to the detriment of competition that could benefit consumers. It also provides the same concerning incentives provided by the inclusion of PPAs, to include projects in IRPs without knowing costs. This will only result in increased costs on consumers. 

Additionally, MISO risks a full rejection of this interconnection reform proposal at FERC given their ruling on a similar provision in their recent interconnection reform NOPR. In Order 2023, FERC declined to adopt the NOPR proposal to allow projects with a signed PPA to be deemed “commercially ready” to enter the queue, in part due to concerns that this, “could incentivize power purchasers in some regions to execute purchase contracts with interconnection customers whose generating facilities will later be determined to be commercially non-viable” (FERC Order 2023, Paragraph 698). FERC also noted that this could be a detriment to reliability and cost (End Note 2).   MISO has provided no explanation for why it thinks it can implement this in a manner that will not have those same outcomes or why the record developed at FERC is incorrect.

Lastly, this entire endeavor only further undermines MISO’s stated objective of imposing an overall MW cap to enable MISO to solve its study models. If MISO’s contention is that an overall MW cap is needed to produce a “reasonable dispatch”, it remains unclear why allowing additional MWs to enter doesn’t undermine that stated objective. And if instead, MISO is now shifting to the safety valve projects supplanting projects that would otherwise be within the cap, that only compounds the discrimination concerns. The fact that MISO is unable to clarify for its stakeholders how the cap will be implemented and that the tariff is silent on the issue raises even greater concern.

4. In the likely event that GI requests exceed the identified cap by each LRZ in a given queue cycle, MISO should not allocate requests above the cap to future cycles, but instead require those proposals to resubmit in the next queue cycle.

MISO’s time-stamped approach of admitting projects to the MW capped queue and its proposal to allocate projects exceeding the cap to the next DPP cycle directly contradict MISO’s stated effort to weed speculative projects from the queue. If conservatively assuming a base case of 200 GW of submissions (as recent queue volumes would suggest) to the 2023 queue and a 73 GW cap (as initially proposed by MISO), DPP 2023, 2024, and 2025 would nearly fill in a single submission period. The risk of missing out on current and future queues will create a “gold rush,” where ICs are incentivized to submit more risky projects to the queue in order to “get in line.” This process puts a queue position at an even greater premium, further encouraging ICs to submit risky projects and creating a spiraling effect. Projects that do not fall under the cap should be eligible to replace withdrawn projects from that queue but should not be automatically assigned to the following queue. Rather, a fresh submission window and full queue should be opened for each study period to disincentivize speculation and to ensure viable projects with up-to-date information have access to the queue.

5. MISO should create a plan and notify stakeholders of how it intends to manage an unprecedented flood of interconnection requests with the opening of the 2023 cluster window.

MISO’s proposed package, along with the delayed timing of the 2023 cluster, will inherently make queue positions significantly scarcer and more valuable, and there is substantial precedent elsewhere for market participants to develop and deploy sophisticated automation tools to instantaneously reserve positions in programs with limited slots.  In the September PAC meeting, MISO acknowledged the in-rush of requests as a concern and said that it’s working with IT on the issue.  The IPP Coalition remains concerned and asks for MISO to provide actual measures that it will take to prevent companies from taking significant portions of the cluster simply because they had a faster computer program.  Measures could include website restrictions (e.g. time limits per IP address) and a plan to manage or avoid simultaneous requests (such as a delay with each request’s registration). The implementation plan can be worked on with stakeholders while awaiting a FERC determination.

IPP Coalition Signatories:

• Clearway Energy Group, LLC
• Cypress Creek Renewables, LLC
• Invenergy LLC
• New Leaf Energy
• NextEra Energy Resources
• Pine Gate Renewables

End Notes:

1.  FERC uses its “rule of reason” policy to identify “provisions that significantly affect rates, terms, and conditions” and must therefore be part of the tariff, rather than a business practice manual.  Midcontinent Indep. Sys. Operator, Inc., 158 FERC ¶ 61,003 at P 69 (2017) (citing Cal. Indep. Sys. Operator Corp., 119 FERC ¶ 61,076 at P 656 (2007); Order No. 890-A, 121 FERC ¶ 61,297 at ¶¶ 988, 990 (2007) (“. . . we reiterate that each ISO and RTO must include in its OATT all of the rules, standards and practices that significantly affect the transmission service provided by the ISO or RTO. . .”).
2. Improvements to Generator Interconnection Procedures and Agreements, Order No. 2023, 184 FERC ¶ 61,054 (2023) at P 694 – P 698.

MRES supports the TO sector feedback on proposed GIP changes. In addition, MRES/ Western Minnesota Municipal Power Agency wants to make it clear that as a public power entity (municipal power agency / joint action agency) we do not have the same Integrated Resources Plan (IRP) obligations with the states as other utilities may have. Such public power entities will have reliance on internal governance in the planning of new resources. In our instance, this will come from approvals by appropriate Board(s) consisting of member municipal utilities of the respective organizations. Under the proposed BPM-015 language in section 4.2.2.1, submission of documentation of self/ board - determination of a public power entity is therefore critical when the public power entity opts to pursue constructing its own generation resource(s).

Xcel Energy continues to support the proposed reforms as a necessary step to ameliorate the MISO Interconnection Queue issues.

In alignment with the full TO comments, we recommend changing the language regarding the cap from exceptions for PPAs to instead allow exceptions for projects deemed necessary by the applicable LSE to meet an imminent capacity shortage, approved by the applicable regulatory authority. 

Pine Gate supports the IPP Coalition comments that Cypress Creek has posted.

Louisiana Public Service Commission Feedback (Response to PAC: Generator Interconnection Queue Improvements Proposal)

Feedback

The Louisiana Commission provides this feedback to address any MISO proposed annual cap on generation interconnection.

• MISO must respect and defer to States when it comes to resource adequacy decisions.  MISO study processes must not interfere with State and Load Serving Entity (LSE) decisions as to the type, the location, and the timing of generation interconnection to serve electric customers within the State’s jurisdiction.

• This obligation applies to any MISO proposal to place an annual cap on studies on generation that may apply to interconnect. The Louisiana Commission agrees that a cap may be appropriate in some circumstances.    Generation projects that will be or are likely to be designated as a Network Resource, to serve load, whether by LSE ownership or bilateral contract with an LSE, should not be subject to such a cap so as to not interfere with retail regulatory plans.    The cap should be limited to the types of projects that are not designated by LSEs/Retail Regulators as future Network Resources.

• MISO proposes that an executed unconditional Power Purchase Agreement (PPA) is appropriate evidence as to whether a generation project will be used as a Network Resource. The Louisiana Commission recommends that  an LSE officer attestation in writing as to the LSE’s intention to use the generator as a Network Resource also be included as an acceptable alternative.  These attestations will provide a level of certainty sufficient to meet MISO needs.

• Finally, as MISO begins to address the need for generation functionality to support the interconnection of renewable generation and the retirement of thermal generation (attributes), MISO may want to provide an exception to the cap for non-Network Resources that would provide this much-needed functionality.

Mississippi Public Service Commission (MPSC) and Arkansas Public Service Commission (APSC) Response to PAC: Generator Interconnection Queue Improvements Proposal (PAC-2023-1) (20230918)

In the September 18, 2023, special meeting of the Planning Advisory Committee (PAC), MISO shared updates to the Generator Interconnection Queue Improvements proposal. Stakeholders were invited to review the proposal as well as companion BPM and Tariff language and submit feedback.
Feedback is due September 27.

Feedback

The MPSC and APSC feed-back is limited to a single issue - - MISO’s proposed annual cap (limitation) on generation interconnection.

MISO must respect and defer to States when it comes to resource adequacy decisions. That means, among other things, MISO must not interfere with State and Load Serving Entity (LSE) decisions as to the type, the location, and the timing of generation interconnection to serve electricity customers within the State’s jurisdiction.

This obligation applies particularly to MISO’s 9/18/23 proposal to place an annual cap on the amount of generation that may apply to interconnect. The MPSC and APSC agree that a cap may be appropriate so long as it is applied to the type of generation MISO hopes to constrain - - speculative projects that are likely to drop out of the queue. To date, the vast majority of speculative projects have been renewable. The cap should be applied to any and all generation that is speculative. The cap should be limited to the types of projects that are not designated by LSEs as future Network Resources. But generation projects that are, will be or are likely to be designated as a Network Resource, to serve load, whether by LSE ownership or bilateral contract (LSE Project), must not be subject to such a cap; that authority is reserved exclusively by law to the MPSC and APSC.

To be clear, since no cap should be applied to an LSE Project, there is no need for an exception, safety valve or other safe harbor applicable to LSE Projects. Providing an exception would appear to give MISO the discretion to decide when an LSE-designated project is speculative and subject to the cap, which is not within MISO’s authority.

The MPSC and APSC disagree that an executed unconditional Power Purchase Agreement (PPA) is required to evidence whether a generation project will be used as a Network Resource. MISO’s proposal to require an executed unconditional PPA before accepting an interconnection request reflects a fundamental misunderstanding of the process for negotiating PPAs. It should be enough that a developer has a memorandum of understanding (MOU) to negotiate a PPA with an LSE or an LSE officer attests in writing to the LSE’s intention to use the generator as a Network Resource. Although neither is an absolute guarantee, they are significantly less speculative than other types of generation interconnections.

Finally, as MISO begins to address the need for generation functionality (attributes) to support the interconnection of renewable generation and the retirement of thermal generation, MISO may want to provide an exception to the cap for non-Network Resources that would provide this much-needed functionality.

Re: Savion Comments on MISO Queue Reform

To MISO:

Savion, LLC (“Savion”), a Shell Group portfolio company, is an industry-leading utility-scale solar and energy storage project development company. Savion respectfully submit these comments on MISO’s Interconnection Queue Reform Proposal. Savion is an active participant in the MISO administered markets and stakeholder process and has been monitoring MISO’s efforts to make the interconnection queue process more efficient given the growing backlog of projects entering the queue.

Comments

Savion would like to thank MISO for their continued efforts to improve the queue process.  Based on MISO’s latest modifications to their proposal, Savion would like to offer up the following comments.

Need for Cap on MW’s by both region and Developer

Savion has already put forth detailed comments in previous submittals expressing proposed process and solutions to this issue.  We request that MISO please reconsider those as opposed to the current proposal issued by MISO.

Modifications to Penalty Free Withdrawal

Savion strongly opposes changes to the PFW provisions or any sort of automatic penalty (especially before Decision Point I) as proposed by MISO.  As previously stated, MISO should incentivize projects to leave the queue, as opposed to imposing financial penalties for doing so.

M2 @$8K/MW

Savion appreciates MISO’s latest modification to only increase the M2 value to $8k/MW, however we believe this is still too high.  As a compromise and as expressed in prior comments, we would propose $6k/MW instead .

Necessary Changes

In closing, Savion would like to echo our support of MISO’s efforts to reduce the size of the queue, increase study accuracy, and decrease study processing times.  While Savion does agree with some of MISO’s proposals, there are still serious concerns we have which we have expressed above and in prior comments.

AES Clean Energy (AES CE) appreciates the additional opportunity to comment on MISO’s Generator Interconnection Queue Improvement Proposals in advance of the final proposal. AES CE’s comments focus on feedback on the proposed tariff and BPM changes to align with these reforms. AES CE is also encouraged by the process and technological improvements that MISO outlined on Slide 4 and would appreciate more details on each item and potential timelines for implementation.

Changes in Milestone Payments

AES CE appreciates MISO’s responsiveness to stakeholder feedback on the M2 milestone payments and supports the lowering of M2 to $8,000/MW. As stated in our previous comments, $8,000/MW better aligns with the median network upgrade assignment in Phase 1 and is a more justifiable increase to this milestone payment.

AES CE, also supported by Clearway, remains disappointed that MISO did not adopt its proposal to allow interconnection customers to utilize surety bonds or guarantees to post milestone payments, and request that MISO reconsider this decision or provide additional justification supporting this decision, please see our initial comments for further details on why we think surety bonds could be utilized to post security.

Site Control Proposal

AES CE continues to oppose requiring site control up to the point of the POI too early in the interconnection process, but since MISO has not changed the latest proposal AES CE would urge MISO to continue to provide incentives and information to help ICs select viable POIs. The current process allows interconnection customers to test for the viability of a POI through the DPP1 cluster study. Moving this test ahead of the queue will require more pre-queue information to mitigate the additional risk worn by the interconnection customer in securing land and ROW. Additional pre-queue information can be provided through several improvements to existing processes. First the MISO POI tool should be enhanced to provide more pre-queue information including available transmission capacity including limiting contingencies and elements. The tool should include the latest queue information. Second, more information from TOs will be needed including substation configurations, design standards, and historical network upgrade costs. Third, the Generator Interconnection Ad Hoc Information Session Request Form could be automated and enhanced to ensure interconnection customers receive answers to their questions ahead of submitting a project application. TOs should be incentivized to engage with Interconnection Customers through this process. These pre-queue information requirements are supported in the Alternative Stakeholder Proposal. AES CE is encouraged by mention of Ad Hoc Request improvements but would like to see additional details on what this will mean in practice, and how MISO intends to get more TO involvement up front in the process to ensure that IC investment in site control for a specific POI will remain viable.

AES CE believes the tariff needs to be further expanded to contemplate what will happen with the $80,000/mile deposit in lieu. The redlines still do not specify when and if the deposit will be refunded or what MISO will do with any forfeited deposits. MISO should include this in the next round of revisions or provide specific existing tariff references that cover these issues if AES CE has overlooked language that addresses this.

Penalty Free Withdrawal Provisions

AES CE supports the further reduction of the automatic penalties for withdrawal during Decision Point 1 and 2. AES CE appreciates MISO removal of references to “estimate outliners”, and the clarity that the specific cost thresholds provide. AES CE would like to point out that Section 7.6.2.1.1b percentage does not match the 35% outlined on slide eight. In Section 7.6.2.4 several paragraphs still mention 25% cost increases eligible for withdrawal which contradicts language further below that section and does not seem to reflect changes proposed on slide eight.

Finally, AES CE noticed that in several places (such as Section 7.3.1.4 and in the BPM) MISO mentions that only 40% of M2 will be refundable. In MISO’s presentation and in verbal comments, MISO mentioned that they are not changing the M2 at risk, but rather of the 50-100% at risk, some portion would be automatically forfeited, and the rest would be determined by the harm calculation. AES CE reads the redlines as saying that now 60% of M2 is at risk following the start of DPP studies. AES CE opposes a further increase of the % of M2 at risk, and MISO should undo these tariff redlines and leave them at 50%. With the doubling of M2, interconnection customers are already incentivized to submit only ready projects and face an increased risk premium in deciding whether to enter or advance in the queue and further changes to the cash at risk structure is unnecessary and overkill.

Queue Cap Proposal

AES CE continues oppose an overall queue cap with a first come, first served method of subscribing projects under the cap. AES CE believes that MISO should not move forward with a queue cap proposal at this time and should move forward with changes to the other requirements and evaluate their effectiveness at limiting less ready projects from entering the queue. If volumes remain unsustainable following the 2023/2024 queue cycles, then MISO should consider if an overall queue cap or some other up front scoring criteria is needed to further manage the queue.

AES CE continues to believe that the current tariff language in Section 7.2.11 and BPM Section 4.2.2.2 gives MISO too much arbitrary power to raise or lower the cap without a transparent methodology, input from stakeholders, and without recourse if stakeholder believes the caps are being set too low. In addition, to posting the cap 90 days before the start of the queue window, the BPM should further contemplate a process for all stakeholders to weigh in on the proposed cap, or a dispute resolution process. As written, stakeholders’ only recourse would be a 206 filing at FERC, which likely would not be resolved before the closing of that queue window when the harm would have already been caused.

At the very least, MISO should publish in the final proposal to the PAC in October what the 2023 queue cap will be.

AES CE continues to believe that the current tariff and especially the BPM language that provides exceptions to the cap through submittal of a PPA, load serving entity obligations, requests to convert ERIS to NRIS or approved Replacement Generating Facility provides insufficient detail and would give MISO too much leeway to accept or reject documentation. While MISO said during the September 18^th call that things like PPA requirements and documentation of LSE obligations would be clarified in advance, the BPM language in section 4.2.2.1 needs to be further flushed out. For instance, MISO should specify what kinds of PPA terms will not be allowed in contracts to qualify- like minimum term lengths, exit clauses, etc.

ENVIRONMENTAL SECTOR COMMENTS ON MISO QUEUE REFORM

20230918 PAC item 2C

The Environmental Sector appreciates that MISO’s interconnection queue (“IQ”) reform is intended to solve real challenges in its IQ process. The following comments are intended to ensure that the reforms actually resolve those challenges.

First, the Environmental Sector requests that after two cycles under any FERC-approved IQ reforms, and after a maximum of two years, MISO evaluate whether the reforms overall have provided the intended relief.  Specifically, whether the reforms have significantly increased the number of generation projects making it through the IQ process and signing a generation interconnection agreement when compared to the historical performance of MISO’s IQ process. This should include a re-evaluation of the MW cap to determine if it has been effective without overly limiting the size of each queue cycle, and whether the criteria for setting the cap are appropriate.  See Slide 7 of the Charles River Associates Presentation retrieved at https://cdn.misoenergy.org/20230918%20PAC%20Item%2002b%20Charles%20Rivers%20MISO%20IC%20Reform%20Report630230.pdf

Second, MISO is now proposing a “safety valve” mechanism to allow generator interconnection (GI) applications to be submitted after the cap is met in the following four circumstances: 

1. Projects with a PPA,

2. Load serving entity obligations, 

3. Requests to convert ERIS to NRIS, or 

4. Approved replacement generating facility.

We understand these circumstances to be based on the need to ensure that sufficient new capacity resources are available to ensure resource adequacy.  To ensure projects submitted under the safety valve are limited and the process not abused, the Environmental Sector requests the following:

1. Affiliated Entities signing a PPA should not be able to use the Safety Valve:  Affiliated entities could enter into a PPA with the intent to circumvent the cap and undermine projects that were properly submitted under the cap. Specifically, entities could review the applications properly submitted under the cap and design competing project(s) undermining those properly submitted applications. To prevent this type of gaming, projects where the parties of the PPA are affiliated should not be able to avail themselves of the safety valve and must submit their applications under the cap. 

2. Specified Qualifications for LSEs Invoking the Safety Valve:  As to applications submitted to meet a load-serving entity’s obligations, the Environmental Sector requests that LSEs be required to submit proof of the following: 

• Identify which specific legal obligation; 
• Explain how the new generation is required to meet that legal obligation in the near term;
• An explanation of why the proposed generation is required quickly – i.e. an explanation as to why the LSE cannot wait a year for the next queue cycle; and 
• A commitment that the in-service date of the proposed generation will be within the next five years.   

3.  Applications under the safety valve will not be accepted after the DPP cycle closes.  To avoid complications in MISO’s DPP process, there must be a cut-off for applications submitted under the safety valve, which should be when the DPP cycle closes. 

Third, the Environmental Sector reasserts its prior comments that:

1. More information be provided to developers up front so developers can make meaningful decisions about whether to enter the IQ, including the facilitation of more robust pre-queue communication between developers and TOs.  This will lead to a greater proportion of projects being of high quality and thus more likely to proceed successfully through the DPP to a GIA;  and 

2. MISO consider returning to two queue cycles per year to ensure it has an interconnection process that reflects the pace and scale of the resource transition.  

Introduction

 The MISO G&T Cooperatives[1] (”G&Ts”) appreciate the opportunity to comment on MISO’s queue reform initiative. As a group of Generation and Transmission Cooperatives, we have the dual responsibility of ensuring an appropriate resource portfolio to serve our members’ load and to plan and maintain transmission facilities and contracts to deliver energy and capacity to our members at a reasonable cost.  This provides a unique perspective with respect to the interconnection process as we can potentially fill any of three distinct roles in the process:  Interconnection Customer, purchaser of the output from an Interconnection Customer’s generation, or the Transmission Owner. 

Significant comments were submitted on August 9, 2023 and September 12, 2023 addressing several aspects of MISO’s queue reform proposal. The focus of these comments is limited to two brief areas: 

• The question of what constitutes an appropriate offtake agreement such that MISO should include the project in a queue cluster if the maximum size of the cluster has been met
• Details on site control requirements

Comments

 Offtake Agreements

Conversation at the latest stakeholder meeting centered on what the Interconnection Customer can bring to MISO to show that it has a customer in an advanced enough stage of agreement that construction and operation of the plant is more likely than not, demonstrating readiness. 

One proposed solution is for the Interconnection Customer to identify their offtake customer during the application process, which then prompts the offtake customer (i.e., Load Serving Entity) to check “yes” or “no” for the specific queue request – “yes” indicates the request qualifies and “no” indicates the request does not qualify  to move forward into the cluster.  The Load Serving Entity would have its own internal controls around how far along in the negotiation process they need to be before indicating to MISO that the project should move ahead.  MISO can also track the success and failure rate of projects named by the different Load Serving Entities to watch for behaviors contrary to proper functioning of the queue.

This approach also frees MISO up from policing the submittals from the Interconnection Customers, as the Load Serving Entity provides an appropriate check and balance on the process.

Site Control

Regarding site control provision from the generator site to POI.  MISO should explicitly state that property already controlled by the TO is exempt from the site control provisions/calculations.  G&T’s have some experiences where an IC demanded an easement across TO owned property to satisfy site control requirements. A TO granting an easement across TO owned property to a substation as part of the interconnection process invites anti-competitive behavior.  Depending on the distance between the POI and the generator site, as well as the size of the TO owned property, its possible 50% site control is not possible without easement across TO owned property.

MidAmerican supports including Interconnection Customers that are Market Participants serving Load in the Transmission Provider Region or serving Load on behalf of a Load Serving Entity (LSE), or other Market Participants pursuant of Module E-1 of the MISO tariff, in the exceptions to submit interconnection requests after the queue study cycle megawatt value is reached per section 4.1.1.3 of Attachment X GIP Queue Reform Revisions dated September 19, 2023.

New Feedback:

• The addition of the $1,000/MW security for M3 and M4 is still puzzling to us. If MISO is holding on to previous security above the milestone threshold (20%/30% of Network Upgrades), and that previous security is not immediately returned, then paying an additional $1,000 is excessive and unjustified. The $1,000/MW security makes even less sense for M4 when considering the milestone payment true-down that occurs in DPP Phase III (Attachment X Section 7.3.2.4.2). If M2+M3 ≥ 30% NUs, a project must post $1,000/MW to proceed to DPP Phase III. Once DPP Phase III begins, that project would then receive a refund of any excess security above 30% NUs, i.e. the $1,000/MW just posted plus any additional surplus. Tying up security like this is unnecessary and harmful to developers.
• In addition to posting the MW queue cap on the MISO public website 90 days before the start of the next study cycle, we also request that MISO post the reasoning behind how the number was determined. We ask that this detail be added to the BPM redlines in Section 4.2.2.2.

Continued Disagreement:

• The removal of the developer MW cap, while still retaining a queue MW cap, unfairly favors larger developers. Quickness into the queue does not correlate to good projects and the potential for large or numerous projects from a select few companies to fill up the queue cap is harmful to those who have small or few projects.
• We continue to disagree with MISO’s proposed penalty on withdrawing projects that do not harm others. In the current process, a project that does not share costs of Common Use Upgrades, Shared Network Upgrades, or Network Upgrades is able to withdraw from the interconnection queue without additional costs. MISO’s proposed change to implement an Automatic Withdrawal Penalty would punish these same generators even when no additional ‘harm’ is put on the rest of the cycle. These withdrawing generators have paid their fair share of study costs, and no additional restudy would be required since they do not share Network Upgrades. The addition of the Automatic Withdrawal Penalty on ‘no-harm withdrawals’ is unjustified and needless.

Attachment X Redline Cleanup:

• Numerous references to “Definitive Planning Phase I (M2)” in Section 7.3.1.4 are updated to “M3” but also need to be updated to “Phase II”
• Numerous references to “Definitive Planning Phase II (M3)” in Section 7.3.2.4 are updated to “M4” but also need to be updated to “Phase III”
• Section 7.3.2.4.2 should be updated to the proposed M4 milestone, i.e. 30% of NUs instead of 20%
• The addition of “less any applicable Automatic Withdrawal Penalty amounts” in Section 7.3.2.4.2 does not make sense to us. The true-down of milestone payments is not tied to withdrawal, and we don’t understand how MISO would justify holding additional security above the 30% of NUs.
• In the last sentence of Section 7.8.1, we believe “…total l study…” should be “…total of all study…”
• With the redlines, Section 7.9.3 reads: “… but the Definitive Planning Phase entry milestone (M2,M3 and M4) payments become non-refundable…” MISO should clarify whether they are referring to just the “DPP entry milestone” (M2) – or to all of the milestones M2/M3/M4.

BPM-015 Redline Cleanup:

• The DPP overview in Figure 5-1 is extremely useful to stakeholders. We request that MISO update this process diagram to account for all proposed changes (Automatic Withdrawal Penalty, updated M3/M4 calculations, POI site control, etc.).
• The Automatic Withdrawal Penalty example on slide 13 of the presentation is also very helpful to stakeholders. We request that MISO add this example, or one similar, to the BPM.