Grid interconnection and integration of new generation resources is a time-consuming and often cumbersome process in most regions and/or energy markets in the US, if not globally. Significant logjams in terms of long generation interconnection queues, cluster studies that require significant time and cost commitments, re-studies, re-tools, cost implications, impacts of other queues on the fate of your project and the list of pitfalls associated with a typical generation interconnection process in a competitive energy market seem endless to the typical developer. The grid integration studies for new resources, typically coordinated and/or conducted by the system operator in conjunction with the host utility, follow a sequential assessment process to ensure grid reliability while integrating new generation development and utilizing the generated power to serve the ever-growing demand.
One of the more complex issues facing most developers today is to better understand the potential impact of competitor queue projects on their queue position. Understanding the intensity of the impact of competitors is an index of risk assessment for most developers. In fact, competitor queue impacts can be the make-or-break factor on new projects simply because of the quantum of impact on cost implications that the project may have to be responsible for. This blog post focuses on a unique tool (CQIAT) developed by EE that allows developers to assess all plausible scenarios in terms of impact of competitor queues on their project position in terms of generation interconnection cost allocation.
Identifying “which” and “how much” is the first step in understanding competitors’ impact. In many regions, network upgrades can have multiple resource entities that are assigned cost share based on their pro-rata share of contribution to the overload. This depends on the power flow contribution on the constraints of interest identified by the system operator. Scenarios of cost sharing can vary significantly in terms of cost implications. Sometimes there are numerous contributors to an overload thereby dividing the upgrade cost amongst all of them resulting in very low cost implications to any one project position. On contrary, there are scenraios where when power flow contributors reduce, that eliminates the need for upgrade itself. Here, less contributors is advantageous to the single developer.
Understanding the approximate cost share can aid in assessing the realistic costs involved in transitioning the project from an interconnection position to an actual project on the ground. For instance, a 100 MW project with an identified transmission system upgrade of $50M can become prohibitive. In reality, that upgrade could be shared by a few other impacting queues. This will reduce the final actual cost from $50M to a specific % based on the power flow contribution to the violation. For ease of explanation, if 5 same sized projects contribute equally to the power flow through the violating constraint and so share equally the cost, then the 100 MW project will end up having $10M which may reduce the burden on the project proforma in ways more than one. The ability to understand the system as and when this pool of significantly impacting competitors dynamically change in the events such as withdrawal or change in their project size form the most complex yet comprehensive task in making an informed risk assessment.
We at EEPlus have broken this down into simple, effective, business driven and highly automated modules that are now being widely used by our developer clients across various RTO/ISO-centric markets such as PJM, MISO, SPP, CAISO to name a few.
The salient features of the CQIAT, as developed by EE, incude:
- Ability of the user to identify
- Competitor queue positions impacting particular project
- Mangitude of the impact
- Contribution to the upgrade cost
- Client’s contribution to the upgrades cost
- User-defined Scenario Analysis
- One/many prior queues withdraw
- The user changes his own project size
- The possibility to increase the user’s project size
- Change in competitor queue project size
Please see below a short video demonstration of the CQIAT.
For any additional questions around the use, licensing and/or provision of services related to CQIAT, please contact: talati@eeplus.com