An Efficient Interconnection Process is Essential to the Grid of the Future
The following op-ed was originally published in Crain’s New York Business on October 30, 2023.
Just over a year ago the Inflation Reduction Act (IRA) was signed into law, making $370 billion available for clean energy and climate programs nationwide. Recent data from the White House states that the IRA, combined with complementary programs like the CHIPS and Science Act, have spurred billions of dollars in US manufacturing while accelerating growth in new renewable energy technologies.
In New York, we see real-world examples. In October 2022, Micron Technology announced plans to build a 1,400-acre semiconductor manufacturing plant near Syracuse, and site preparation is underway. Perhaps the best example of a response to new public policies is the influx of renewable energy projects entering the New York Independent System Operator’s interconnection queue.
The interconnection queue is where renewable energy projects and major manufacturing facilities seek approval to connect to the grid safely and reliably. As the wholesale electricity market administrator and grid operator, NYISO leads the process for New York. This requires significant coordination between utilities, developers, and state and local governments. The process was established to make sure projects can connect to the grid without harming the system or imposing undue costs on consumers.
New York had been leading the energy transition well before the IRA was passed. The state’s Climate Leadership and Community Protection Act (CLCPA) of 2019, which mandates 70% renewables by 2030, immediately jump-started investment in a decarbonized grid, and our interconnection queue grew virtually overnight. In 2019, 275 projects were under consideration. Today, the queue holds more than 500.
Like other grid operators, we are challenged by this growth. The grid was built over many decades to reliably connect sources of power to consumers and balance growth in demand with necessary supply. Reconfiguring the grid to accommodate new renewable resources cannot be rushed without disrupting that balance. In addition, the complexity of new proposals is increasing and often requires specialized analyses to accurately determine reliability impacts.
Interconnecting resources at the scale necessary to meet CLCPA goals requires a concerted effort by the state, utilities, developers, and the NYISO. Our recent studies predict that 20 gigawatts of new renewable resources will be needed by 2030 to reach the goals of the CLCPA while maintaining electric system reliability. To meet these challenges, the NYISO is working hard to improve the interconnection process.
In 2022, we implemented efficiencies to shorten the time it takes to study impacts to the grid – making it easier for projects to progress through the queue. More recently, we held numerous forums and focus groups with developers, utilities, regulators, and other stakeholders to identify necessary transparency improvements. Those enhancements are under active development.
We also recently made significant investments in our interconnection team and technology used by developers and utilities to track progress and provide deliverables. We have hired more planning engineers to perform system analyses as well as project managers and customer service agents that help guide developers through the process steps. This combination of people, process efficiencies, and upgraded technology is essential to our continued progress.
While we work to enhance the interconnection process, it is important to understand there are other factors that can delay or ultimately determine if clean energy projects are completed. The International Energy Agency and the American Clean Power Association have reported that disruptions in the global supply chain have contributed to project delays.
Many projects have also been impacted by inflation. The Alliance for Clean Energy New York recently petitioned the New York State Public Service Commission to adjust the funding provided by the New York State Energy Research and Development Authority for certain Clean Energy Standard contracts. The Alliance’s petition pointed to “unforeseen and severe market disruptions” to justify the contract adjustments. Some of these external factors were also identified in a recent report from the New York State Comptroller’s office. Like Comptroller DiNapoli, we remain optimistic that New York’s energy goals are within reach.
Maintaining a reliable electric system through this unprecedented grid transition is essential. We also know that delivering a cleaner, greener grid of the future is just as important for all New Yorkers. Working together, we can achieve both.