ITC Holdings (NYSE:ITC) views “transmission as the backbone to everything,” as it connects people to the electricity supply, Jason Minalga, director, Grid Development, ITC Holdings, said on June 28 during TransmissionHub’s TransForum West event in Denver.
As noted in his presentation, which he delivered during the “Executive Perspectives” panel, a national view is needed to achieve the “Grid of the Future,” and that involves a combination of technologies, anchored by a high-voltage AC network with a DC overlay, as well as providing consumers and businesses with greater choice, reliability and security when it comes to their energy needs.
Given the rapidly changing energy landscape, there is a need to build and maintain a robust and capable transmission grid to manage 21st century dynamics, his presentation noted, adding that productive dialogue is needed.
Electric transmission, Minalga said, is an enabler and it is “the critical piece of the system.”
While some claim that as such resources as distributed generation are coming in, there is no need for transmission, “we beg to differ,” he said, adding, “[D]istributed generation is no substitute for transmission.”
He also discussed FERC Order 1000, noting that FERC held a two-day Competitive Transmission Development Technical Conference in Washington, D.C., to address the order and other matters.
“At ITC, we’re waiting to see what happens,” he said, adding that in the East Coast, in particular, “there’s a lot of struggle on interregional” projects.
As noted in his presentation, more work is needed on interregional planning as seams between RTOs lack the infrastructure needed to tie the grid together effectively, and no currently functional planning process exists for approving interregional projects across RTO seams.
His presentation also noted that ITC continues to work within the Midcontinent ISO, Southwest Power Pool, PJM Interconnection, New York ISO and other regions to identify opportunities. Much work remains to be done at the RTO level, according to his presentation, which also noted that transmission projects can take up to 10 years to build, and Order 1000 has layered on even more time with competitive processes and the vetting of bidders, which has added to the complexity and time involved in building transmission.
“[W]hat we’re trying to do from ITC’s perspective is participate in those regulatory proceedings, work with our peers in the industry and figure out what’s the right way to get this done and not have 25 people bidding and competing, investing time and money for a $10m, $20m project,” Minalga said.
Also speaking on the panel was Joe Bladow, senior vice president, Transmission, Tri-State Generation and Transmission Association, who also listed regulatory changes at the state and federal level – for instance, with FERC and the U.S. Environmental Protection Agency(EPA) – among challenges that his company is facing.
Other challenges he discussed involved planning, permitting, affordability and technology matters.
Regarding planning, he said, “The big question that always comes to my mind is what are you planning for?”
That is, does the plan involve distributed generation or centralized generation, for instance, he said.
Other issues involve reliability standards, he said, adding, that Tri-State has to “try to harmonize” the various regulatory visions in the states it serves, including Colorado, New Mexico and Wyoming.
Regarding permitting challenges, he said, that “one of the things that we always do is we heavily engage in the planning process,” and give people the opportunity to participate in that process.
Also speaking on the panel was Lynn Chapman Greene, CEO, Lucky Corridor LLC, who noted that her company has acquired more than 60 miles of right of way (ROW) for its projects and has the support of more than 400,000 acres of landowners in the resource region.
As noted in her presentation, the Lucky Corridor region is in need of economic recovery and tax base. The median household income in the region was 25% lower than New Mexico as a whole in 2014, and the region ranks second in New Mexico for the highest poverty rate with more than 30% of children in the region living in poverty. The presentation further noted that due in part to the lack of living-wage jobs, individuals aged 30 to 49 have migrated out of the area, and the population in the Lucky Corridor region fell by as much as 18% between 2010 to 2014.
“This is [a] challenge that only a FERC Transco could really answer,” Greene said.
As noted in her presentation, the market needs FERC Transcos like Lucky Corridor and not just retail utilities’ projects because FERC Transcos like Lucky Corridor can look at the big picture, not just needs in a retail area. That is, “[e]lectrons we are moving from the resource zones toward the West Coast would go where we tell them to go if we improve WECC Path 48, which is our Transco’s goal,” her presentation said.
Among other things, her presentation further noted that there is a need to de-carbonize as quickly as possible. “[C]limate change impacts are very serious in the West and elsewhere, so incenting transcos is part of the work needed to get the grid to move away from coal centers and toward clean energy resource zones.”