PJM Interconnection, the largest US grid operator, has given initial approval for a forward-looking strategy designed to bring renewable projects through the planning pipeline faster and help to clear a massive 225GW backlog of projects.
“We are going to see a better, faster, more efficient way to integrate projects into the system and enable states to meet their renewable portfolio goals,” said Ken Seiler, vice president of planning at PJM. “It’s going to help us long-term to prepare for the grid of the future.”
PJM – which is expected to fully greenlight the proposal and then file the necessary changes with the Federal Energy Regulatory Commission (FERC) – intends for the effective date of the transition to be in the fourth quarter or first quarter 2023.
FERC, which has a brief that includes regulation of the transmission and bulk sale of electricity in interstate commerce, is under pressure from Congress and stakeholders to facilitate efforts by grid operators to streamline interconnection processes holding back clean energy development.
Unless this happens in the near-term, it will complicate efforts by President Joe Biden to transition the US away from fossil fuels and achieve a carbon-free electric grid by 2035, according to analysts.
While PJM’s backlog of projects is twice as large as those at each of the next three largest balancing authorities, its interconnection renovation scheme – if successful – could provide a template for efforts elsewhere to de-clog queues and greenlight more renewables and storage capacity.
PJM, a non-profit, is a regional transmission organisation (RTO) that manages the bulk power system, transmission lines, and electricity market in all or parts of 13 mid-Atlantic and Great Lakes states and District of Colombia.
Seiler said while projects that entered the queue before 2021 will be given emphasis as part of the transition plan “We’re not closing the door on new projects,” he said.
PJM has more than 1,200 projects in the pre-2021 backlog, and most are renewables, storage, or hybrids of wind or solar with storage. They represent more than 100GW of nameplate capacity or about half the operating capacity on the PJM network.
'Focused on streamlining'
“We are focused on moving those through the system and streamlining the process as much as possible, and getting real projects interconnected to the queue,” said Seiler.
The queues are a waiting list of proposed projects seeking a grid connection in the coming months and years. Most that apply for interconnection are not subsequently built, in part because of costs associated with the long lead times. Still, data from queues provides a good general indicator for medium-term trends in market, developer, and investor interest.
Despite PJM being the largest US balancing authority, wind was a scant 4% of its generation mix and solar 0.4% in 2020, according to American Clean Power Association, a national trade group based in Washington, DC.
This compares with a combined wind and solar share of 31.2% in the Southwest Power Pool and 12.1% in MidContinent Independent System Operator (MISO), which operates multi-state grids west of PJM, and 25.2% in ERCOT in Texas.
The balance of PJM's generation includes 38.2% natural gas, 33.1% nuclear; 22% coal; 2% hydro and about 0.2% fuel oil.
PJM’s proposal for a streamlined new service study process has multiple aims. One is to address projects on a first-ready, first-served basis. Sponsors will need to show financial and site control milestones throughout the study process.
Another aim is to allow certain projects to complete the study process and proceed to a final agreement early. The focus is on those that don’t contribute to the need for network upgrades and/or don’t need facilities studies.
These process reforms will be accompanied by the proposed transition plan whose intent includes moving to the future process in a timely manner; fast-tracking about 450 pre-2021 projects; and eliminating, or at least limit, speculative projects from the queue that are unlikely to get built.