The smart grid has meant a lot of things to a lot of people: a system that would be more efficient, robust, flexible, and—not least—green friendly. More than half the U.S. states have adopted so-called renewable portfolio standards requiring so-and-so much electricity to be green by such-and-such times. On June 26, the U.S. House of Representatives passed the American Clean Energy and Security Act, which mandates renewable energy standards for most of the country’s largest electric utilities. The act also includes a provision for a carbon cap-and-trade system that will make fossil fuels at least somewhat more expensive and low-carbon fuels more competitive.
But connecting new wind farms to the existing U.S. grid has already required entrepreneurs, operators, and regulators to bend and stretch rules almost to the breaking point. As pressure grows to integrate still more wind, as well as solar concentrators, biomass combustion, and perhaps even tidal generators, rules will have to change.
How much pressure are we talking about? A lot. One survey of 11 major U.S. transmission regions found last year that applications to connect new wind and solar generators came in aggregate to 250 gigawatts—that’s the equivalent of roughly 250 standard atomic power plants—while combined natural gas, coal, and nuclear applications came to just 180 GW, according to Peter Mark Jansson and Richard A. Michelfelder, writing in the July 2008 issue of Electricity Journal. When New Jersey offered unusually generous rebates to solar installation companies at the beginning of this decade, more than 100 installation companies cropped up in just a few years, and at the end of 2007 the state had to stop accepting additional applications for solar interconnections.
Wind and photovoltaic farms may be small and beautiful when contemplated one at a time, but when considered altogether they add up to a big, ugly regulatory headache. The queuing system widely used in the United States to determine who gets to build new generation and connect with the grid works like this: Regional transmission organizations (RTOs) and independent system operators (ISOs) are charged by the Federal Energy Regulatory Commission (FERC) with overseeing the operation of the nation’s grid. Among their duties is to conduct feasibility studies when generators make interconnection requests. Under current FERC rules, these requests are managed by means of ”queues,” on a first come, first served basis. This system has worked well enough for large fossil-fuel-based generators. But these days the typical queue is jammed with hundreds of requests for interconnection from small generators of renewable power.
FERC has recently approved a number of creative proposals for queue reform. For example, during the past 10 years the Bonneville Power Administration (BPA), headquartered in Portland, Ore., has had great difficulty making any major upgrades to its transmission system, while at the same time it has been struggling with a growing list of transmission service requests, many from wind power developers in the lower Columbia River area. (BPA is a federal entity that predates the RTO structure and operates a transmission system and wholesale electric market in the Pacific Northwest.) Bonneville Power adopted an innovative approach that changed the way customers requested transmission service and thus was able to achieve the critical mass of service contracts needed to get that transmission authorized. Because of its rich hydropower resources, of the 2000 MW of wind power currently generated in the BPA footprint, the vast majority serves the demand of other Northwest utilities.