Interconnecting Wind & Solar Energy in Texas Wind and Solar Expo San Angelo, Texas August 30, 2016 Hala Ballouz, B.Sc., M.Sc. TAMU , P.E. President , Electric Power Engineers, Inc. Board member TREIA Board Member AWE Boar Member Wind Coalition

Offer consulting services to In business since 1968 Offer consulting services to Electric Cooperatives, Municipalities & Utilities Private Generators, in particular renewable energy generators Specialized in: Distribution & Transmission planning & design Energy Market Analysis Work Plans, Long Range Plans, Sectionalizing System Operation and Management Generation Grid Integration Studies 2

Overview Galileo Wind & Solar Grid Interconnection Basics ERCOT Generation Interconnection Queue Wind/Solar Transmission Expansion in ERCOT NEXT -- Distributed Resources Future Strategy 3 3

Galileo

Galileo –The Earth or the Sun?

2010 - Vision

2010 - Vision

2016 Vision  Recommendations Action Incorporate Solar and Energy Storage in City and Electric Cooperatives Planning Standards Build Substations with land provisions and connections for 3-5 MW Solar / Energy Storage Sub Action-> Engineering Services

2016 Vision Planning Together Resource & Transmission Mapping Collaboration In Resource Development Map the Resources Open Competition in Transmission Provide Ancillary Services OPTIMIZE

Wind & Solar

RESOURCE - Intensity Solar Wind Source: NREL

Solar Compliments Wind Production Profile RESOURCE - profile Load Solar Thermal Solar Compliments Wind Production Profile Solar PV Wind Source: NREL

ERCOT Interconnection Queue

Table of Current Wind and Solar Interconnection Queue in ERCOT Status Wind Solar Totals No. of MW Projects Capacity With Signed IA & Financial Security* 34 6,455 17 1,757 51 8,212 With Signed IA & without Financial Security* 14 3,952 5 532 19 4,484 Under Study 76 16,736 33 4,549 109 21,285 Total 124 27,143 55 6,838 179 33,981 Conventional Status Coal Gas Totals No. of MW Projects Capacity With Signed IA & Financial Security* -- 10 3,871 With Signed IA & without Financial Security* 1 240 14 10,276 15 10,516 Under Study 28 10,165 Total 52 24,312 53 24,552 Storage No. of MW Projects Capacity -- 1 324 3 320 4 644

ERCOT Queue – By Fuel Type

ERCOT Queue

ERCOT Queue

ERCOT Queue Legends Planned Wind, With Signed IA & SFS received by TSP Planned Wind, With Signed IA & No SFS received by TSP Planned Wind, Under Study Planned Solar, With Signed IA & SFS received by TSP Planned Coal, With Signed IA & No SFS received by TSP Planned Solar, With Signed IA & No SFS received by TSP Planned Storage, With Signed IA & No SFS received by TSP Planned Solar, Under Study Planned Storage, Under Study Planned Gas, With Signed IA & SFS received by TSP Planned Gas, With Signed IA & No SFS received by TSP Planned Gas, Under Study

Grid Interconnection Basics

Grid Basics Interconnection to the Transmission/ Distribution Grid is the first step in the process necessary for an electricity generator to deliver/sell energy to load.

Resource Location vs. Process for Interconnection The application process, information submittals, and timelines vary amongst the different ISOs and with the individual Utilities. Large generator interconnection process governed by RTOs/ISOs

ERCOT Process Linear Queue Process & Modest Study Fees

SPP Process Large deposits on initial application and studies . PPA / turbine supply requirements . Long duration Aggregate studies .

Interconnection Process Constraints Large Queue Transmission Congestion

Renewable Penetration ERCOT

ERCOT Wind / Solar Transmission Projects in ERCOT

Far West Texas Load Growth ERCOT Planning July 2015

Far West Texas 345 kV Grid Load+ Solar Expansion AEP/ONCOR Proposal April 2016

Panhandle Wind – Lubbock Load Integration

Panhandle – Lubbock Load Integration Second Circuit to be built -PUCT recommended moving forward with the second 345 kV circuit on the Alibates – AJ Swope – Windmill – Ogallala – Tule Canyon (AAWOT) line under the CREZ Order (PURA §39.904(g))at the September 24, 2015 Open Meeting. -Additional SVCs approved and on the way

ERCOT Long Term Studies 2031 Generation Additions and Retirements-- Current Trends (Presented at RPG , August, 16, 2016) Solar Additions: 20 GW by 2031 Unit Retirements: 13.5 GW by 2031

NEXT – Distributed Resources

Wind and Solar falling at and below $30/MWh Cost of Renewables Wind and Solar falling at and below $30/MWh

Interconnection and Project Size Distribution Interconnection < 1 MW: Small commercial or residential systems behind the meter applications to offset load. Typically no studies are required for projects less than 20 kW. Distribution Interconnection > 1 MW: Greater than 1 MW, less than 10 MW, and connected to a voltage less than 60 kV. Interconnection Study should be completed by Distribution Provider. Transmission Interconnection : Projects greater than 10 MW and connected to 60 kV or greater. Two study stages, the ERCOT Screening Study and the Transmission Provider Full Interconnection Study.

Innovation on Distribution Anticipate and Prepare for Distributed Generation (DG) Growth Integrate DG in the Wholesale Market Smarter Grid Cross barriers to allow integration and information interchange between our distribution network and transmission network

Faster Deployment of Smaller Projects TIMELINE ERCOT Interconnection Process Large Generation vs. Small Generator Large Generator : 10 MW or larger Goes through ERCOT Large Generator Interconnection Process Typical processing time ~ 1028 days Small Generator : less than 10 MW Bypasses ERCOT Large Generator Interconnection Process Process dictated by and completed directly with the Transmission Provider Average processing time ~ 90 days Faster Deployment of Smaller Projects

Specific DG-Related Statutes* Develops provisions for: Owners/operators to sell electric power Use of T&D Facilities to transport electric power Utilities to recover costs of facilities for used for interconnection PURA 35.036 – Distributed Natural Gas Generation Facilities Interconnection of DRG PUCT creation of rules and requirements for DRG Requirement for TDU to measure out-flow Ownership of Renewable Energy Credits Selling surplus electricity to REP PURA 39.916 – Interconnection of Distributed Renewable Generation Customers entitled to have access to on-site distributed generation PURA 39.101 – Customer Safeguards Allowing Independent School Districts to sell surplus energy form solar generation Requiring utilities to provide metering to allow sell of energy PURA 39.914 – Credit for Surplus Solar Generation by Public Schools *other statutes may be applicable to DG based on operation in the ERCOT wholesale market Source: ERCOT

DG DG interconnection application requirements vary by DSP for DG projects. A universal interconnection agreement is already available from PUC Texas and it is being used by DSPs. DG projects greater than 1 MW must register with ERCOT to be able to participate in the Wholesale Market. DG settlement will be paid at the appropriate Load Zone Price. No telemetry requirement for DG projects.

ERCOT Helpful Links More information on ERCOT process for generation interconnection: http://ercot.com/services/rq/re More information on Distributed Generation Resource Can be found under following link: http://www.ercot.com/services/rq/re/newgen-steps Texas PUC – Electric Substantive Rules – Chapter 25 – Technical Requirements for Interconnection and Parallel Operation of On-Site Distributed Generation can be found under following link: http://www.puc.texas.gov/agency/rulesnlaws/subrules/electric/25.212/25.212ei.aspx Texas PUC – Electric Substantive Rules – Chapter 25 – Interconnection of On-Site Distributed Generation (DG) can be found following link: http://www.puc.texas.gov/agency/rulesnlaws/subrules/electric/25.211/25.211ei.aspx

2016 Vision Planning Together Resource & Transmission Mapping Collaboration In Resource Development Map the Resources Open Competition in Transmission Provide Ancillary Services OPTIMIZE

Recommend pro-active solutions to West Coal Retirement and Solar West Expansion 2031 Generation Additions and Retirements-- Current Trends (Presented at RPG , August, 16, 2016) Solar Additions: 20 GW by 2031 Unit Retirements: 13.5 GW by 2031

2016 Vision  Recommendations Action Incorporate Solar and Energy Storage in City and Electric Cooperatives Planning Standards Build Substations with land provisions and connections for 3-5 MW Solar / Energy Storage Sub Action-> Engineering Services

4343 Q&As Please contact Hala Ballouz, P.E. (hballouz@epeconsulting.com) with any questions you may have. 43