1. 1 Wind and Transmission Corridors Western Central Chapter, American Planning Association August 13, 2010 Dave Olsen www.westerngrid.net

2. 2 About Western Grid Group 200 years state regulatory experience –Former chairmen, staff of 8 western PSCs 50 years experience as wind, solar, geothermal, hydroelectric power developers Non-profit NGO; works with Governors, utilities, regulators, agencies, advocates Formed 2003 to develop policies to accelerate transition to sustainable electricity, win transmission access for clean resources

3. 3 Presentation Overview 1. National energy policy context 2. Wind power development and major proposed transmission projects 3. Federal transmission policy 4. Transmission planning 5. Corridor fundamentals 6. Planning Challenges in the Transition to Low-Carbon Electricity

4. 4 1. National Energy Policy Context – Policy Drivers – Low-carbon electric sector – Scale of transmission likely required – DOE interconnection-wide planning

5. 5 Policy Drivers Energy security: rely more on indigenous, inexhaustible sources Jobs, economic development: clean energy economy Sustainability: reduce emissions, toxics, land/habitat, water, public health impacts

6. 6 Low-Carbon Electricity IPCC: 80% GHG reduction by 2050  Very low carbon electric sector Portfolio: Energy Efficiency, Demand Resources, Combined Heat-Power, Distributed Generation, Wind, Solar, Geothermal, Biomass; some Gas More reliable Potentially lower cost

7. 7 Scale of Transmission Needed With maximum Energy Efficiency, Distributed Generation, large amount utility-scale renewables needed 20% wind: ~300 GW Transmission needed to move power to cities in every region Regional plans underway; national plans considered

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9. 9 Interconnection-Wide Planning DOE funding 1st-ever plans for Eastern, Western and Texas interconnections Evaluate infrastructure needed by 2030 to support transition to low-carbon economy Requires utilities to coordinate power flow across different regions Involves range of stakeholders

10. 10 2. Status of Wind Power Development and Major Planned Transmission Projects DOE 2009 Wind Technologies Report National High Voltage Transmission Overlay Regional transmission projects

11. 11 U.S. Wind Power Up >40% in 2009

12. 12 Wind Power Contributed 39% of All New U.S. Generating Capacity in 2009 Wind the 2 nd -largest resource for the 5 th -straight year

13. 13 U.S Lags Others in Wind as a % of Electricity Consumption

14. 14 ~ 300 GW Wind in Transmission Interconnection Queues

15. 15 >90% Planned for Midwest, Mountain, ERCOT, PJM, SPP, NW Not all of this capacity will be built….

16. 16 No Offshore Projects Built Yet, but 13 Are In Advanced Development Three projects have signed or proposed power purchase agreements Cape Wind granted approval by Department of Interior

17. 17 State Policies Help Direct Location and Amount of Wind Development KS established mandatory RPS in 2009; total now 29 states and D.C. State renewable funds, tax incentives, utility resource planning, voluntary green power, carbon concerns played a role in 2009

18. 18 American Electric Power’s Transmission Vision

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23. 23 3. Federal Transmission Policy  Policy Basics  Open Access  Location-Constrained Resources  Federal-State jurisdiction boundaries

24. 24 Transmission Policy Basics Transmission = ≥ 230 kV –Deemed to be in interstate commerce –FERC sets rates; state PSCs pass through FERC jurisdictional transmission costs Distribution = ≤ 230 kV –Rates set by state PSCs Congestion = limits on ability to deliver power; raises power costs Key Issues: Planning, Permitting, Paying

25. 25 Open Access Vertically integrated utilities use transmission to protect their generation from competition FERC Orders 888, 889 (1996) unbundle transmission from generation Regional Transmission Organizations (RTOs) provide regional service over utility-owned assets Drivers: Competitive neutrality, efficiency; regionalization, for economics, reliability

26. 26 Location-Constrained Resources Large generating projects can support dedicated major transmission lines Gas generators can locate projects to access existing or planned transmission Small, dispersed wind/solar projects cannot support major lines; can’t move generation sites FERC policy now allows transmission to be built to wind projects, financed initially by utilities

27. 27 Federal v. State Siting Natural gas: FERC siting authority Electricity: state siting authority –Complicates development of interstate transmission –State PSCs have authority only to borders Proposed legislation: give FERC backstop siting authority, if states won’t approve needed transmission

28. 28 4. Transmission Planning  Planning practices evolving  Interconnection animus  Proposed planning standards

29. 29 Planning Practices Evolving Until recently: Consider only reliability, congestion, cost Little regional planning; utility service areas only Electrical experts only Little environmental, land-use input Now, increasingly: New stakeholders, more environmental input New standards to earn public consent

30. 30 Interconnection Animus Many benefits of more interconnectedness –Can’t be considered in transmission approvals 500 kV project: significant local impacts, and often local opposition –But small addition to regional grid –Regional benefits potentially large –State approvals restrict consideration of regional benefits

31. 31 New Planning Standards Earn public consent for new infrastructure Energy security, jobs/economic impacts, environment, public health of most concern –Can’t be considered in most planning New standards to incorporate emissions, land, wildlife, water, jobs, consumer benefits, energy independence More stakeholder input => better plans

32. 32 5. Corridor Fundamentals Wind utilization of line capacity AC and DC lines Minimizing ROW, maximizing power transfer Right-Sizing transmission projects

33. 33 Wind Line Utilization Wind uses ~35% of tx line capacity –Wind-only lines=>higher delivered power cost To use more line capacity: –Combine with solar – good diurnal match –Over-build wind capacity, curtail at times –Design line to access different wind regimes Some projects target 75% wind, 25% gas

34. 34 AC and DC Lines HVDC less expensive over long distances –But on/off-ramps very expensive; little benefit to states not having them –Can be under-grounded (at high cost) HVAC lines less expensive to access generation, deliver power in each state –Approval often easier for interstate projects

35. 35 Corridor Power Transfer Maximize power transfer to minimize new corridors 765 kV line carries as much power as six 345 kV lines Reliability impacts manageable Dynamic line ratings increase transfer –Wind cools lines, allows more flow

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37. 37 Right-Sizing Transmission Design projects to carry more power than needed at present –Long-term economic savings –Significant environmental benefits Requires paying upfront cost of larger project; risk that extra capacity not used –Should customers pay? Government?

38. 38 6. Planning Challenges in the Transition to Low-Carbon Electricity Some key challenges Routing design issues Aligning project planning with local land-use plans

39. 39 Some Key Challenges Building county/state support for large-scale regional transmission projects Modeling land, wildlife, water impacts in electric planning –Need consistent state data, new models Interstate siting, cost allocation approvals –use planning venues to coordinate across state lines, build record on which decisions based Designing to optimize wind-solar transfer

40. 40 Routing Design Issues Smart From the Start – Projects planned to protect habitat, ecosystems Decision-support software – Allows communities to weight attributes of routing alternatives, sync with local land use plans Make planning case for Right-sizing, maximizing power in corridors plans

41. 41 Align with Local Land-Use Plans Ensure compatibility with local comprehensive land-use, zoning plans Minimize conflicts with local conservation acquisition priorities Ensure consistency with regional transportation and infrastructure plans

42. 42 For More Information, 1 Wind industry status, prospects 2009 Wind Technologies Market Report: http://eetd.lbl.gov/ea/ems/re- pubs.html http://eetd.lbl.gov/ea/ems/re- pubs.html DOE 20% Wind by 2030: http://www.20percentwind.org/ DOE Interconnection-wide Planning Eastern: http://www.eipconline.com/ Western: http://www.wecc.biz/Planning/TransmissionExpansion/RTEP/Pages/default.aspx Emerging system planning standards FERC Planning-Cost Allocation NOPR ( Docket No. RM10-23-000, June 17, 2010) : http://www.ferc.gov/whats-new/comm-meet/2010/061710/E-9.pdf

43. 43 For More Information, 2 Power transfer in corridors American Electric Power, Right-of-Way Stewardship, http://www.aep.com/about/i765project/docs/LookingTowardstheFuture.pdf http://www.aep.com/about/i765project/docs/LookingTowardstheFuture.pdf Routing Alternatives Decision Support Facet Decision Systems, web-based scenario modeling: http://www.facet.com/ourcapabilities.html: “Smart from the Start” Project Design Nevada Wilderness Project: http://www.wildnevada.org/smartfromthestart.html