1. Transmission for Renewables- The New England Blueprint and Interconnection-Wide Planning
Paul J. Hibbard, Chairman Massachusetts Department of Public Utilities Roundtable
March 2010

2. Overview New England Blueprint Eastern Interconnect Planning
Quick reminder
Current status
Eastern Interconnect Planning
JCSP, EWITS, EIPC/EISPC
Modeling approaches
Observations
Potential Role in the Federal Context

3. The Blueprint’s Path September 2008 February 2009 March 2009 July 2009
NEGC Resolution
February 2009
Governors write to President Obama, Congressional leaders
March 2009
States request ISO-NE perform technical analysis
July 2009
ISO-NE issues draft Renewable Development Scenario Analysis
September 2009
NEGC Adopts Blueprint

4. Policy Choices Informed By Data
States asked ISO-NE to study “significant sources of renewable energy available to New England, the most effective means to integrate them into our power grid, and the estimated costs” and then developed study assumptions
ISO-NE conducted RDSA
Looks out 20 years
9 conceptual transmission scenarios
Focus on wind resources
Up to 12,000 MW of wind in New England
7,500 MW onshore & 4,500 MW offshore
Incremental cases from 2,000 to 8,000 MW

5. Conclusions
The New England region has a vast quantity of untapped renewable resources
More than 10,000 MW (nameplate) on & off-shore wind power potential
If developed at conservative levels, there are ample renewable resources to enable New England to meet renewable energy goals
More aggressive development could enable New England to export renewable power to neighboring regions

6. New England Governors’ and NEG/ECP Resolutions

7. Charge to Energy Officials
Consider available renewable resources identified in the Blueprint
New England onshore
New England offshore
Canada
Investigate mechanisms for competitive procurement and development
Coordinated or joint solicitations
Coordinated/collaborative siting
Workable contract and pricing structures
Regulatory approval mechanisms

8. Status, Timeline Initial policy review Current efforts Vast resources
Siting processes similar; coordination feasible
Contract approval mechanisms in place
Common theme: competitive procurement, lowest possible cost
Current efforts
Workplan – report to Governors by summer
Drafting RFP, considering procurement levels
Developing price structure alternatives, model terms and conditions
Deeper review: contract approval processes

9. Bottom Line
Region has a long history of working cooperatively to address energy and environmental policy issues
Recognize untapped renewable potential
Interested in “out-of-box” thinking on supporting renewable development
…without compromising commitment to markets, competition
Successful progress, promising outlook

10. The Federal Context Urgency around climate change
Problem: much of national terrestrial renewable potential is geographically-challenged
Concern: financial signals from cap/trade, RES not sufficient for investment calculus
Other issues/opportunities:
Integration of intermittent resources
Better capacity utilization
Seams elimination; loop flows; congestion relief
Jobs, economic benefit
Can widescale, coordinated planning help?
JCSP, EWITS, EIPC/EISPC

11. EWITS Emerged from JCSP; model for EIPC? Northeast has some concerns
Goal: review technical integration of large amounts of wind
Review costs, quantify benefits
But weight of analysis seems more focused on economic integration of wholesale electricity markets across the Eastern Interconnect
Confusion in the messaging?

12. EWITS: NESCOE Comments
Model Approach – focused more on transmission for all generation in Midwest, rather than integrating wind.
Coal By Wire: Transmission expansion likely to increase generation from Midwest traditional sources, undermining the goals of carbon control
Messaging In The National Context – Framed to suggest transmission should be charged to electricity customers, rather than generation owners that benefit
Production Profits Charged to East, Accrue to Midwest – All scenarios likely result in massive increases in generation from (and associated revenues to) power plants in the Midwest, relative to now
Limits Off-Shore Wind Potential – No more than six (6) miles off shore; no deep water wind resources
Canadian Provinces Neglected – Minimal expansion of Canadian resources
Feasibility and Cost of Underlying Network? – Scenarios could require significant in-region infrastructure

13. EWITS Steps in analysis Existing system, load grown to 2024
Pick “best” wind resources to meet 6%, 20%, 30% goals, with some regional allocation, ascribed 20% capacity value
EGEAS-based capacity addition for remaining needs
“Copper Sheet” dispatch of EI; determine economic power flows
Design transmission to accommodate this “economic” result (Even in the “Reference Case”)
Identify economic benefits by comparing to constrained dispatch
Identify wind integration issues (reserves)

14. EWITS - Conclusions Basic results:
We can integrate a lot of wind…
Provided we build massive transmission…
Which will deliver economic benefits to consumers by lowering LMPs…
Because it will move massive amounts of energy from Midwest fossil, nuclear, etc. generation to the East, displacing gas.
But wait! Wasn’t this supposed to be about wind??

15. EWITS - Conclusions Economic benefits (PROMOD IV)
Driven by price differential between midwest and eastern power markets
Increases in midwest generation, decreases in eastern gas (hundreds of TWh annually)
Lost generation revenues in East; gains in the Midwest
Net revenues to Midwest generation likely to exceed transmission cost
Does this help answer the cost allocation debate?

16. JCSP/EWITS: Price Separation…
JCSP, April, 2007

17. JCSP/EWITS: …Drives Power Flow Outcomes
JCSP, April, 2007

18. JCSP: Resulting Shift in Generation
JCSP, April, 2007

19. EWITS: Same Result…
EWITS Report

20. Dictates Transmission
EWITS Report

21. EIPC/EISPC Long Overdue
Interregional transmission plan coordination; greater cooperation across planning authorities
Review seams, loop flow issues, identify technical fixes
Consider projects to help integrate greater quantities of intermittent resources
Identify interregional projects to address intraregional reliability issues
Help quantify cost of policy approaches
Provide “scenario analysis” guidance for policy makers and stakeholders
Value of EE, renewables, nuclear, CCS
Info for development ventures

22. EIPC/EISPC: Caution
Emerging context: Federal integrated resource planning, federal siting, mandated cost allocation to load
Senate legislation: Begins with an Interconnect-wide plan
EIPC/EISPC meets the specs
Could this “scenario analysis” exercise turn into a federally-endorsed plan?
Need to get the analysis right
Real base case, in same year as “scenarios”
Clear identification of purpose (carbon? renewables? reliability? economic transfer?)
States must have primary role in guiding and interpreting analysis
EIPC analysis must be closely coordinated with EISPC
State share of EIPC stakeholder group

23. Wrap Up
Blueprint represents a unique collaboration among the New England states; focused on competitive mechanisms to deliver renewables; progress continuing
Federal context: similar goals in principle
New England experience with joint state-ISO Blueprint development is an excellent model for federal effort
EIPC can provide great value to the nation, provided
Goals are clear at the outset
Modeling is suited to the task, answers right questions
States provide guidance commensurate with public interest role

24. Paul J. Hibbard, Chairman MA Department of Public Utilities One South Station Boston, MA