FERC, in a May 24 order, denied First Wind’s request for rehearing of a September 2011 order that involved a proposed wind project’s interconnection process.
In October 2011, Gallo Canyon Wind, Vaughn Wind and First Wind New Mexico Holdings – collectively, First Wind – filed a request for limited and clarifying rehearing of the order in which FERC conditionally accepted Public Service Company of New Mexico’s (PNM) revisions to its large generator interconnection procedures (LGIP) transitioning its interconnection study process from a serial study approach to a cluster study approach.
Over the last several years, PNM has experienced a surge in generation interconnection requests, FERC said, noting that PNM said it had 44 large generator interconnection requests totaling 14,918 MW in its balancing authority area, which has a historic peak load of about 2,600 MW.
PNM said the magnitude of requests in its queue overwhelmed its manpower resources and led to a backlog in the study process. The company has employed a serial process for studying interconnection requests and found this unfeasible in managing the interconnection queue backlog.
FERC also said PNM found there were viable projects in the queue that could be placed in service sooner if such requests could be processed more quickly by implementing a first-ready, first-served LGIP study approach.
The company proposed to conduct cluster interconnection studies through two interconnection queues, namely, the preliminary interconnection system impact study queue and the definitive interconnection system impact study queue.
FERC said it accepted PNM’s proposed limited transition stage, which provided that interconnection requests for which a facilities study agreement had been executed would not be required to participate in the revised LGIP and interconnection requests for which a facilities study agreement had not been executed as of the effective date of the revised LGIP would be subject to the revised LGIP.
According to First Wind, FERC failed to include in the transition those projects for which a feasibility study had begun, so that they could continue in the serial study queue rather than being moved into the cluster study process.
First Wind said that since PNM’s original filing, the feasibility study for Vaughn Wind has been completed and a system impact study agreement has been executed. First Wind also said it has shown site control and paid the requisite deposit. Furthermore, as of October 2011, the parties were on track to have completed the system impact study and execute a facilities study agreement by the end of 2011.
FERC also said that according to First Wind, PNM notified it that under the new cluster process the first cluster study group would not close until after Nov. 29, 2011, and the definitive interconnection system studies would not be done until at least 13 months thereafter. Since FERC was unaware of the progress PNM and First Wind had made on the Vaughn Wind project, it should consider its decision and allow the project to continue in the serial queue transition process rather than move to the cluster study process, First Wind said.
“As we stated in the September 30 order, to allow Vaughn Wind, or other such projects only in the feasibility study process, to remain in the existing serial queue would upset the balance struck by PNM in effectively transitioning from a serial to a clustering approach,” FERC said. “We affirm our findings in the September 30 order that the cutoff chosen by PNM for customers to be eligible to continue with the serial study approach, was reasonable and the result is a just and reasonable transition approach.”
Given the unusually large number of interconnection requests PNM received, processing under PNM’s serial approach based upon the date of the interconnection requests presented PNM with complications in processing requests in a timely manner, FERC said, adding that the result was an enormous backlog in the interconnection queue.
Among other things, FERC said PNM’s transition process, which required a project to have an executed facilities study agreement, allows more advanced projects to move forward in an efficient and timely fashion under the serial approach. Those projects, like Vaughn Wind, which did not yet have an executed facilities study agreement, would be required, under the transition process, to proceed under the cluster approach.
“While we recognize that moving from the serial approach to the cluster study approach could cause some initial delay for projects midway in the process, it is necessary in order to resolve current backlogs,” FERC said.
PNM is a subsidiary of PNM Resources (NYSE:PNM).