As 2016 TransForum East approaches, TransmissionHub presents roundup of last year’s event

As the 2016 TransForum East approaches, TransmissionHub presents a roundup of coverage from last year’s event.

Transmission is needed to support the Clean Power Plan, Brian Thumm, director, Regional Planning, with ITC Holdings, said during the Dec. 1, 2015, panel on the U.S. Environmental Protection Agency’s (EPA) Clean Power Plan and its effect on transmission. Thumm noted that the plan is purported to be a game-changer for the industry with large changes in generation portfolios, resource fuel mixes and an aggressive compliance timeline.

Noting the difficulty in planning a transmission system while not knowing which generation sources will retire, for instance, he said that only when the state implementation plans have been finalized as to what their individual approaches will be for Clean Power Plan implementation can companies like ITC and others “realistically approach a transmission solution to specifically implement the policy shift.”

Also speaking on the panel, Michael Ferguson, associate director, Ratings Services, with Standard & Poor’s, said that it is expected that the concept of carbon trading is going to be reinvigorated by the Clean Power Plan.
“Now, the exact form of that is currently unknown,” he said, adding that such questions include whether the form will be in a carbon tax or carbon fees.

“[I]f this is intended to be a market-based approach that can reduce carbon and can create incentives to reduce carbon, we suspect that there is going to be a cost attached to that in some way or another in most states,” he said.

Elliot Roseman, vice president, ICF International, said during the panel that there is a lot of opportunity for electric transmission with regard to the Clean Power Plan.

As noted in his presentation, EPA projects coal retirements by 2030 to rise about 50%. Referencing the EPA’s projections, Roseman said that there is an anticipated baseline of about 60 GW of coal retirements, adding, “[D]epending on whether you take … the mass approach, which means a total number of tons that you’re trying to achieve of emissions, or a rate approach, which is pounds per megawatt-hour approach, there will be different impacts, but … [by] 2030 … you’re looking at an incremental 20-plus GW, possibly 30 or more GW of additional retirements of coal generation that would result from the implementation of the Clean Power Plan.”

Besides the Clean Power Plan, a lot of other factors are affecting the coal fleet, including low gas prices, aging infrastructure, low load growth and the proliferation of distributed energy, Roseman said.

As PennWell’s GenerationHub reported, a panel of legal experts told a Bipartisan Policy Center forum Oct. 4 in Washington, D.C., that whatever happens with the D.C. Circuit they expect the legal dispute over the Clean Power Plan will ultimately be decided by the U.S. Supreme Court.

The legal experts, split evenly between supporters and opponents of the EPA carbon dioxide (CO2) control rule, also expect the question of whether the CPP requires shifting sources of generation to accomplish climate goals will weigh heavily in the D.C. Circuit’s decision.

The full U.S. Court of Appeals for the District of Columbia Circuit heard about seven hours of legal arguments Sept. 27.

At the start of last year’s TransForum East event, former FERC Commissioner Philip Moeller delivered the keynote address. 

The “ROE debate is one that’s been very painful over the last several years,” Moeller said at the event on Dec. 1, 2015. “I, generally, was known as someone who was on the higher end of promoting transmission development. I was comfortable with higher ROEs because” of the value of transmission, the enabling aspect of transmission investments, and the fact that for the most part, transmission costs account for “no more than 15% of a consumer’s bill.”

He continued, “[W]e’ve been in a period of extraordinary monetary policy with basically subsidized interest rates and that, of course, affected the ROE debate and the returns were getting kicked down to points where we thought it was generally unacceptable. So, a couple of years ago, the commission undertook an attempt … [and] came up with a policy that wasn’t unanimous and some would say it was good or bad.”
Moeller said that FERC “has to be very, very weary of seeing those returns get kicked down … because, obviously, the capital will flow wherever those higher returns are, and the need for transmission will continue.”

The issue of siting continues to be one that is very frustrating, Moeller said.

During the second day of TransForum East on Dec. 2, 2015, speakers noted that in recent years, New England has seen its power generation market become much more dependent on natural gas and this is a trend that is also occurring in other areas.

Speakers noted that transmission proposals, gas pipeline projects and renewable energy, including hydro power from Canada, are playing a larger role in Eastern markets.

"We lost some oil and coal plants," in recent years, said ISO New England (ISO-NE) Senior Regulatory Counsel Kevin Flynn.

The region is also losing some nuclear assets as well.

Flynn also noted that the Salem Harbor coal plant is being replaced by a gas plant at the same location.

Flynn and New England States Committee on Electricity (NESCOE) General Counsel Jason Marshall also noted that New England is also losing its nuclear generation.

"We need more pipes and more wires in New England," Flynn said.

New England is at the “end of the pipeline system” and lacks adequate underground storage, he said.

New England has significant wind power potential but could use more electric transmission to link renewable energy to load centers. Northern New England has land available for renewable energy but the sites tend to be further from demand centers, Flynn said. Several transmission projects are advancing in New England, Flynn said.

Combining the storage capabilities of hydropower plants in Canada with wind power facilities being added in the Northeast could help address the intermittency of the wind resources, Seth Parker, vice president and principal at Levitan & Associates, said during a panel that focused on major transmission projects in the East. Being able to smooth out the deliveries from renewable facilities in the region has a lot of potential in the long term as more renewable resources are developed several years from now, Parker said.

The next TransForum East will take place on Nov. 15-16 at The Capital Hilton hotel in Washington, D.C.

More information about this year’s event, including the agenda and full list of speakers, can be found here.

About Corina Rivera-Linares 3058 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 15 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines. She can be reached at clinares@endeavorb2b.com.