Commissioner James Danly Statement
May 12, 2020
Docket Nos. ER20-924-000, ER20-924-001
Concurrence Regarding PacifiCorp
Today, the Commission accepts PacifiCorp’s proposed tariff revisions, subject to a compliance filing, to transition PacifiCorp’s Large Generator Interconnection Procedures (LGIP) and Small Generator Interconnection Procedures (SGIP) from the current, serial “first-come, first-served” interconnection queue process to a clustered “first-ready, first-served” interconnection queue process. I support this action, which represents an important first step in clearing the backlog in PacifiCorp’s interconnection queue and in allowing PacifiCorp to process future interconnection requests more efficiently. I write separately not because I disagree with the Commission taking action to bring order to interconnection queues, but because I think that the Commission’s orders to date have not gone nearly far enough.
PacifiCorp argues that the current process encourages speculative projects to enter the queue because it does not require any progress toward commercial viability and does not penalize withdrawals from the queue.[1] I agree.
I recognize that the Commission intends for its interconnection policy to enhance the ability of new generation resources to interconnect with the transmission system, thereby promoting competition in wholesale electric markets. I share that goal. Ironically, however, the Commission’s efforts in pursuit of that objective have had the opposite effect. As PacifiCorp explains, as of October 28, 2019, it had 161 Commission-jurisdictional LGIP requests in its interconnection queue for a total of 37,393 MW, and 2,741 MW of state-jurisdictional and SGIP requests.[2] This is over 300% more capacity than PacifiCorp’s peak load, which is approximately 12,600 MW.[3] PacifiCorp’s situation is not unique. For example, in a recent filing, Public Service Company of Colorado indicated that it served approximately 6,900 MW of native load in its balancing authority area, but had over 22,000 MW of generation interconnection requests pending in its LGIP interconnection queue.[4] And the Midcontinent Independent System Operator, Inc. (MISO) has a massive interconnection queue—as of September 15, 2019, the queue included 590 projects totaling 91.6 gigawatts.[5] The resulting lengthy interconnection queues have overwhelmed transmission providers who struggle to process interconnection requests efficiently and on a timely basis, increasing uncertainty and impeding critical business decisions. This ultimately discourages, rather than encourages, the interconnection of new generation resources.
Moreover, the interconnection queues impose a cost beyond the delays directly suffered by the applicants. For example, PacifiCorp notes that about 75% of all interconnection requests ultimately withdraw from the queue, and those withdrawals are themselves a cause of further delay because they trigger restudies.[6]
I therefore urge transmission utilities to explore new queue procedures and to submit tariff revisions aimed at reducing the substantial existing backlogs and ensuring that such backlogs do not occur again in the future. I recognize that taking steps to impose additional requirements on new interconnection applications almost certainly will discourage some number of beneficial projects at the margins, in addition to cutting down on speculative applications. However, I am confident that streamlining interconnection queues by reducing the number of speculative applications would result in benefits that more than make up for the loss of such projects.
For these reasons, I respectfully concur.