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Grid ready projects move to front line -- MISO reforms working

Transmission queue reforms instituted last summer by the Midwest Independent Transmission System Operator (MISO) are working to unclog the interconnection path for grid-ready wind projects. But the needed long-term solution -- more transmission capacity for carrying electricity to load centres -- is still blocked for lack of proper regulation.

MISO, which operates the grid in much of 15 states and the Canadian province of Manitoba (map), changed from a traditional "first come, first served" system of queue management to a "first ready, first served" method by adopting a set of milestones that includes feasibility studies, system planning analysis and impact studies, and connection fees based on project size rather than a flat rate. Previously, transmission system operators have traditionally allowed virtually anyone proposing a wind project to enter the queue and assume a sequential place in line.

"It used to be very cheap to get in the queue and so a lot of people tied up a lot of queue positions without any real projects," says Betsy Engelking of Xcel, a Minnesota-based utility with operations in seven states. "The new process is moving people who can demonstrate the reality of their projects to the front of the line."

Another big difference is that MISO now looks at clusters of regional proposals in an effort to make transmission upgrades that help connect several projects at once, says Natalie McIntire, a transmission consultant advising the American Wind Energy Association (AWEA). "MISO is a little out ahead of the other operators on this process overall," McIntire says. "I would say that others are looking at what MISO has done."

MISO submitted its reform proposal to the Federal Energy Regulatory Commission a year ago this month in an effort to help speed the integration of more than 84 GW of requested generation. Since August, when the revisions went into effect, roughly 10 GW of unready projects dropped out of MISO's queue, according to Beth Soholt of Wind on the Wires, a Minnesota renewable energy advocacy group. "Queue reform has provided near-term opportunities for projects to move forward," she says. Soholt, however, stresses that the long-term barriers for wind farm developers remain. "The larger story is still the lack of transmission infrastructure. And in order to get that piece going, we need to solve cost allocation on a broad scale."

Stuck on costs

Soholt says that new projects are often expected to foot an inordinate amount of the bill for new transmission. "It's not fair to ask the new generators to be the only ones to share costs with transmission providers to fund these large upgrades. You're talking about $700 million for a new transmission line that's a decent size. So we're stuck on the question of cost allocation."

Through the end of 2008, MISO was running a system with 4 GW of wind power, part of about 75 GW of operating capacity in winter and 100 GW in summer. Come September, however, MISO will add 7 GW of generating capability to its wires by incorporating the independent transmission system of MidAmerican Energy -- meaning most of Iowa will soon be under the MISO umbrella.

"This deal gives us a broader access to markets to buy and sell our energy," says Ann Thelen of MidAmerican, an Iowa-based utility that owns nearly 1300 MW of wind power generation in its home state. "It also allows us to operate our power plants more efficiently." Among other things, merging the systems allows for easier management of the variable output of wind plant by having a wider area over which to balance supply and demand.

MidAmerican will also benefit from any upgrades made to the MISO system, which will also help it to more easily integrate its growing fleet of wind power stations. "Mid American will have a wider balancing area over which to spread their variability," says McIntire. "To have them included in the MISO market will bring greater efficiencies and more opportunities for wind. So it's really a positive thing."

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