Competitive Renewable Energy Zones (CREZ)

Transcription

1 Competitive Renewable Energy Zones (CREZ) S.B. 20 (2005) (PURA ) RPS: additional 5000 MW by 2015; 10,000 MW by 2025 (500 MW non-wind) Designation of CREZs Approval of transmission CCNs for renewable resources within 6 months; not necessary to prove need if for a CREZ Purpose: to more closely align timeframes for the construction of renewable resources and the transmission facilities necessary to move their power to market

2 CREZ Rule A procedure for designating CREZs ERCOT to provide a study by PUC must consider level of financial commitment by generators; costs and benefits of constructing transmission Final order within 6 months Expressions of interest in constructing transmission for CREZ

3 CREZ Rule Plan to develop transmission capacity Selection of TSP(s) by PUC Application for CCN(s) within 1 year of CREZ order Posting of credit by developers Obligation to take transmission in a CREZ Disincentives for excess development in a CREZ

4 CREZ Cases I & II, Docket CREZ case (Part I) initiated by PUC staff, based on ERCOT filing of AWS Truewind study PUC considered, for each proposed zone, the quality of the wind resource, number of developers, level of financial commitment Testimony was also filed on proposed transmission enhancements

5 CREZ Case (Part I), Docket Interim order, issued , designates: Zones 5-6 (West Texas, near McCamey) Zone 9A (near Abilene) Zone 19 (just south of Panhandle) Zones 2A and 4 (Panhandle; Zone 1 included in 2A) Designated 4 tiers of transfer capability to be studied by ERCOT Zones 5-6 and 9A: existing and planned development transmission-constrained Panhandle developers desire ERCOT connection

6 CREZ Case, Part II ERCOT CREZ Transmission Optimization Study and GE Ancillary Services Study, filed April 2, Scenarios proposed: MW $2.95B 18,456 MW $4.83B 24,859 MW $6.22B 24,419MW $5.46B Scenario 2 chosen; Order issued

7 ERCOT CREZ Transmission Optimization Study

8 CREZ Case, Part III, Docket Designation of Transmission Service Providers (TSPs) to construct segments of the CREZ Transmission Plan (CTP) Criteria: capability to finance, license, construct, operate and maintain in a cost-effective manner; schedule for completion (PUC Rule ) 6 IOUs, 5 new TSPs, 4 coops, 3 munis, 2 consumer groups, 20 wind developers Hearing Dec. 1-5, 2008

9 CREZ Case, Part III, Docket Order on rehearing (5/09) Designated 13 TSPs to construct segments of the CREZ grid, including three new TSPs (Cross Texas, Lone Star, WETT) Priority lines to take precedence in implementation process Required sequencing of CCNs, reporting requirements, and compliance dockets (organizational structure, codes of conduct) CTP CCN applications by designated TSPs to be processed in 1 year (not necessary to prove need )

10

11 Docket Order - Aftermath CCN applications Appeal by City of Garland utility Order issued Jan. 15, 2010 Found certain factors underlying denial of CCN to munis legally irrelevant and not supported by evidence Remanded case back to PUC Garland sought intervention in CCN cases and requested that they be abated or dismissed Settlement: STEC will construct an awarded line and transfer ownership to Garland

12 Regulatory Challenges and Opportunities Ancillary Services to support large-scale deployment of renewable technologies Provided by TSPs or Generators? What is the renewable generator s responsibility? Who pays? Deployment of battery technologies A transmission or a generation asset? Which interconnection rules apply?

13 Regulatory Challenges and Opportunities How to incent investment in quick start generation and battery technology? Competitive, energy-only generation market Average wholesale market prices low and likely to remain that way Peaker Net Margin has not been achieved since 2005 Other than renewables and permitted baseload, no investment in new Texas generation except by munis/coops ERCOT to release new CDR report this month