State regulators, utilities support SPP fast-track interconnection plan

• State utility regulators and utilities such as American Electric Power and Southwestern Public Service Co. are urging the Federal Energy Regulatory Commission to approve the Southwest Power Pool’s fast-track interconnection proposal, according to filings at the agency on Thursday.
• However, NextEra Energy Resources, other independent power producers, clean energy trade groups and environmental groups asked FERC to reject the proposal, which they contend would give utilities and other “load-responsible entities” the sole ability to select projects for the process without state regulatory review.
• “We are concerned that [SPP’s Expedited Resource Adequacy Study] framework will undermine open access and enable preferential grid access for utility-affiliated generation, elevating the risk of uneconomic resources advancing through the queue, locking up transmission capacity, and raising costs for consumers,” the Clean Energy Buyers Association said in a filing.

Like some other grid operators, SPP is proposing to address near-term power supply needs by creating a temporary interconnection process that would run separately from its normal interconnection queue.

SPP expects available capacity to drop below its reserve margins by 2027, according to its proposal, which it filed on May 22, a week after FERC rejected a similar proposal from the Midcontinent Independent System Operator.

Under the proposal, load-responsible entities must verify whether a project can help close their resource adequacy deficiency, according to SPP. To enter the ERAS process, projects must meet readiness standards and other requirements.

State oversight will help prevent utilities and other load-responsible entities from exercising undue preference, according to SPP. “LREs are subject to state regulation that mandates certain processes for resource selection and scrutinizes the prudence of the utility’s resource adequacy procurements, including ensuring cost-effective procurement to protect consumers,” the grid operator said in its proposal.

The ERAS proposal was unanimously supported by the SPP Regional State Committee, which represents utility regulators from 12 states.

“Based on a detailed assessment of projected demand growth, declining reserve margins, and generation interconnection uncertainties, the RSC concludes that the SPP ERAS is essential for maintaining reliability across the SPP region,” the committee said in a Tuesday filing at FERC.

In support of the ERAS proposal, a group of utilities said it also furthers the Trump administration’s national energy dominance policy priorities, which were outlined in executive orders from the president.

“ERAS … squarely addresses the executive orders issued after the declaration of the energy national emergency, answering the call for a more resilient grid that will meet the rising demand in load caused by the need for artificial intelligence dominance,” said the utilities, which include AEP, Evergy, Xcel Energy’s SWEPCO and Nebraska Public Power District.

Independent power producers contend that ERAS would allow utilities to act as a gatekeeper to the interconnection process.

“ERAS represents an unprecedented departure from nearly thirty years of open access policy that will empower LREs to provide their own and affiliated resources with preferential access to interconnection service while erecting barriers to entry to competing suppliers,” NextEra, Geronimo Power, Pine Gate Renewables, Enel Green Power North America, EDF Renewables, EDP Renewables North America and Clearway Energy Group said in a joint filing.

SPP’s plan has the same flaw as MISO’s version of ERAS, the group’s filing says: it lacks objective criteria to make sure that resources admitted to the process are better suited to meet identified reliability needs than those excluded from the process.

The cap on how much capacity that load-responsible entities can propose for including in ERAS is based on their own resource adequacy forecasts, the companies said, noting that SPP’s proposal allows utilities and other load-responsible entities to update their peak demand values seven days after the opening of the ERAS window.

Clean energy trade groups argued the proposed process lacks adequate oversight.

“ERAS would facilitate utility self-dealing by allowing LREs to access preferential queue treatment with self-supplied generation resources, and lock up valuable transmission capacity — long before a state regulator ever sees the proposed resource, let alone conducts a review for public convenience and necessity,” Advanced Energy United, Advanced Power Alliance, the American Clean Power Association, the Solar Energy Industries Association, the Interwest Energy Alliance and the Colorado Solar and Storage Association said in a joint filing.

SPP’s proposal is based on flawed assumptions and biased evaluations that overstate the grid operator’s estimates of its resource needs, according to the Natural Resources Defense Council, Sierra Club and Sustainable FERC Project in another joint filing.

SPP underestimated how much new generation will come online before 2030, in part because it did not consider the grid operator’s efforts to speed up its interconnection review process, the groups said.