Dive Brief:
- Tariff changes proposed by ISO New England aim to give states “greater control in achieving their environmental policies and goals,” the grid operator said Wednesday. The changes would create new review metrics around project costs, environmental impacts, siting and other aspects, and would allow states additional opportunities to provide input into the planning process.
- The ISO filed the proposed Phase 2 Longer-Term Transmission Planning tariff changes with the Federal Energy Regulatory Commission on May 9, and requested a response from the commission by July 9.
- The LTTP proposal is the result of a process that began in 2020, when the New England States Committee on Electricity, or NESCOE, called for the grid operator to take a longer view of transmission planning. FERC accepted changes resulting from the first phase of the process in 2022, including a mechanism allowing states to request the ISO perform system planning analysis beyond a 10-year planning horizon.
Dive Insight:
ISO officials say the proposed Phase 2 LTTP changes would give states more authority to advance transmission projects, including laying out a process for groups of states to pay for projects others in the region may not support.
ISO New England serves six states: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. The region’s energy system is rapidly changing, with the development of more renewable resources and electrification of heating and transportation systems. The grid operator anticipates net annual energy to grow 1.8% annually from 2024 to 2033, according to a 10-year forecast of capacity, energy, loads and transmission published earlier this month.
To meet the growing demand, the ISO is considering a host of changes, including to its capacity market and how it will deal with potential energy shortages.
The transmission planning changes proposed last week include a package of processes that will enable states “to advance from the state-requested, scenario-based [Longer-Term Transmission Studies] to regional transmission solutions and cost allocation for such solutions needed for the states to achieve their energy and environmental policy objectives,” according to the ISO’s filing.
Under the proposed changes, the ISO would issue and evaluate requests for proposals to address transmission needs identified by the states. Depending on the costs and benefits, the ISO said either it or NESCOE — on behalf of a subset of the New England states — would select projects for construction.
Other grid operators have developed similar approaches to transmission planning, including the Midcontinent ISO’s Multi-Value Projects and PJM Interconnection’s State Agreement Approach, the ISO said.
FERC on Monday finalized transmission planning and cost allocation reforms that aims to help the U.S. develop new transmission. New England’s LTTP “positions the ISO to meet objectives set forth” in FERC’s order, the ISO said, though the grid operator added that it is still examining the rule and will need to make a separate compliance filing.
Clean energy groups praised New England’s new transmission planning approach.
The LTTP will “propel us towards the much-needed build-out of the future grid and help us reach urgent state energy and climate policy requirements,” according to Advanced Energy United.
“Perhaps the most significant aspect of Phase 2 is that it solidifies an agreement amongst all six states on cost allocation,” AEU Senior Principal Alex Lawton wrote in an April blog post ahead of the LTTP filing with FERC. “Agreement on who pays and how much for new interstate transmission projects has been a sticking point, subverting efforts for many years to build new transmission solutions to advance state policies.”
Claire Lang-Ree, an advocate for the Natural Resource Defense Council’s Sustainable FERC Project, called the proposed planning process “a model for other regions” because it is forward-looking, scenario-based, includes broad benefit metrics and calls for regionally-allocated costs.
The proposal “aims to keep costs low for residents of New England while achieving a well-planned system powered by clean energy,” she wrote in an April blog post.
Among other changes New England is considering, the ISO wants to shift from an annual Forward Capacity Market auction process that procures energy resource commitments three years in advance to a “prompt/seasonal” model it says would better reflect changing demand and available resources.
The grid operator is also considering development of a Regional Energy Shortfall Threshold, which would establish a level of energy shortage risk that the region is comfortable with, and lay out defined actions the ISO or states could take when such a risk is identified.
