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Court Advances South San Joaquin Irrigation District Bid To Replace PG&E As Local Power Provider

January 3, 2022

by Paul Ciampoli
APPA News Director
January 3, 2022

California’s South San Joaquin Irrigation District (SSJID) was recently handed a key victory by an appeals court in SSJID’s ongoing bid to replace investor-owned Pacific Gas & Electric (PG&E) as the local retail electric service provider.

The December decision issued by the Third District Court of Appeal validated the Local Agency Formation Commission’s approval of SSJID’s ability and authority to provide retail electric utility service to its customers. The decision also allows the district to move forward with the ability to provide those services by purchasing PG&E’s facilities through the process of eminent domain.

Since 2004, SSJID has been actively working to replace PG&E as the electric utility for customers in Manteca, Escalon, Ripon and surrounding areas.

As part of that process, SSJID was required to obtain approval from a San Joaquin County agency called the Local Agency Formation Commission.

In 2014, after five independent studies and a public workshop before the Local Agency Formation Commission, it found that SSJID’s business plan was sound and that SSJID has the ability to carry out its service commitments.

PG&E filed a lawsuit to have the decision overturned in San Joaquin County Superior Court. After continued litigation and some favorable court decisions for SSJID, SSJID offered to purchase local electric distribution assets from PG&E in 2016.

After PG&E indicated its assets were not for sale, the District filed a lawsuit to gain the right to purchase the assets from PG&E, through a process called eminent domain

On March 25, 2020, SSJID and PG&E stipulated to a “relief from stay” in a hearing in a PG&E bankruptcy proceeding that would allow ongoing litigation between the two parties to continue. This stipulation allowed for final briefs to be filed and for the appellate court to take the appeals under consideration.

SSJID has offered to pay PG&E $116 million for the power lines, substations and transmission infrastructure required to deliver electricity to the region.

SSJID was established in 1909 and is headquartered in Manteca, Calif.

SSJID provides agricultural irrigation water to about 56,000 acres surrounding Escalon, Ripon and Manteca, and wholesale drinking water to the cities of Manteca, Lathrop, Tracy, indirectly serving over 193,000 residents, and in the future, the city of Escalon.

SSJID, along with Oakdale Irrigation District, owns and operates the Tri-Dam Project, a series of storage reservoirs and electric generation facilities that produce zero-carbon hydropower in the Stanislaus Riverwater shed.

New Mexico Lawmakers Ask Utility Regulators To Consider Public Power Option

January 3, 2022

by Paul Ciampoli
APPA News Director
January 3, 2022

A group of New Mexico lawmakers is asking state utility regulators to launch a study that would evaluate shifting the state’s electric sector to public power.

The lawmakers said in their petition filed at the New Mexico Public Regulatory Commission (PRC) that they “believe that it is probable that public ownership of the electrical utilities that serve New Mexico would benefit New Mexico’s ratepayers, New Mexico’s businesses, and New Mexico’s state, local and tribal governments.”

The lawmakers said that the PRC should oversee a comprehensive study that would address questions that would include, among others:

The lawmakers said that within the next decade trillions of dollars will be invested in energy infrastructure across the United States. “From federal policies to market forces to the inevitable replacement of retiring fossil fuel plants, the transition to renewable energy sources will necessitate a massive restructuring of not only the power grid and generation sources, but energy markets, ownership and control,” the petition said.

“With some of the highest solar and wind capacity of any state in the nation and the ability to deliver terawatts of energy to our neighbors and beyond, New Mexico will be presented with numerous opportunities and important decisions as this transition unfolds.”

But the lawmakers argued that the transition is not being facilitated effectively by the state’s current IOU structure. “Despite New Mexico’s abundant natural resources, second in the country for solar potential and 11th in the country for wind potential, and the sun Zia on our flag, each of the state’s investor-owned-utilities have relatively small percentages of renewables in their energy portfolios.”

They said that under the current energy model, investor-owned-utilities’ plant ownership and energy investments “require a return on equity that creates a perverse incentive NOT to invest in energy sources with fixed capital costs and no fuel costs.” 

The lawmakers said that under the IOU model, returns on investments and profits — at least in the case of Public Service Company of New Mexico, with a return that is 9.575% annually, are exported to Wall Street.

Lakeland Electric’s Joel Ivy Accepts Position To Lead Lubbock Power & Light

January 2, 2022

by Paul Ciampoli
APPA News Director
January 2, 2022

Joel Ivy, general manager of Florida public power utility Lakeland Electric, has accepted a position with Lubbock Power & Light (LP&L).

Ivy will oversee the Texas municipal utility after their current Director, David McCalla, announced his retirement earlier in 2021. 

A final vote on the offer of employment for Ivy is scheduled for December 29th in front of the Lubbock City Council. After the formal approval by the Lubbock City Council, Ivy is expected to report to LP&L in early May 2022 with his last day at Lakeland Electric taking place in April 2022.
 
Ivy was hired as the General Manager for Lakeland Electric on July 30, 2012.  He has currently served in that position for over nine years. 

During his tenure at Lakeland Electric, Ivy concentrated efforts to strengthen the utility’s financial position, improve credit ratings and enhance the customer experience. He also worked to increase renewable solar facilities into the energy mix at Lakeland Electric.

Lakeland Electric said that Ivy and his team have been instrumental in developing a robust outage notification system, taking Lakeland Electric forward with the decommissioning of Unit 3, the aging coal fire generator, and securing future generation for the utility.

Chelan PUD Re-Energizes Fire-Hardened Transmission Line

January 2, 2022

by Paul Ciampoli
APPA News Director
January 2, 2022

Washington State’s Chelan PUD has re-energized a high-voltage transmission line rebuilt in fire-resistant steel for better reliability in the Chelan Valley.

The months-long upgrade is part of a comprehensive plan to protect customer-owners and the electrical grid in Chelan County from the growing threat of wildfire.

The transmission line powers the Chelan and Union Valley substations, which serve about 3,500 homes. The line burned down in a 2015 wildfire that blackened the shrub-steppe area. The Chelan Valley went without power for 36 hours while crews worked around the clock to rebuild the line.

As crews replaced 34 structures along the four-mile line from July to December 2021, Chelan PUD re-routed power to maintain reliable electrical service for customers in the area. The $2.7 million project was finished on time, under budget and with no outages.

The fire-hardening project is one of several by Chelan PUD to reduce fire risk and improve reliability. The utility’s wildfire risk mitigation plan calls for more frequent line inspections, hazard tree removal and fire-resistant paint.

In 2021, Chelan PUD increased its vegetation management budget from $1.5 million to $3.5 million to accomplish the work required by a more-frequent inspection and pruning cycle. By the end of 2021, Chelan PUD planned to remove about 8,000 hazard trees — a seven-fold increase compared to five years ago.

Chelan PUD is also working with the Washington State Department of Natural Resources, Cascadia Conservation District and other agencies to coordinate fuel reduction efforts and secure grant funding for projects that will lower wildfire risk in the county’s most vulnerable areas.

NERC Report Sees Potential Reliability Issues Tied To Weather, Renewables

January 2, 2022

by Peter Maloney
APPA News
January 2, 2022

Reserve margins could fall below recommended levels sooner than previously expected, the North American Electric Reliability Corp. (NERC) reported in its 2021 Long-Term Reliability Assessment (LTRA).

In the Midcontinent Independent System Operator (MISO) region, anticipated reserves fall below the Reference Margin Level (RML) beginning in 2024 instead of 2025 as previously estimated. MISO could be facing the retirement of over 13 gigawatts (GW) between 2021 and 2024 based on its annual survey of members.

The potential retirements include 10.5 GW of coal-fired capacity and 2.4 GW of natural gas-fired capacity. Those projected retirements are not confirmed, NERC noted, but if they were to take place without new generation beyond the 8 GW already in development coming online MISO could be short over 560 megawatts (MW) in 2024, NERC said.

The NERC report also singled out California, specifically the California-Mexico (CA/MX) part of the Western Electricity Coordinating Council (WECC) where the planned retirement of the 2,200-MW Diablo Canyon nuclear plant in 2024 and 2025 could contribute to a capacity shortfall beginning in 2026.

“However, energy risks are present today as electricity resources are insufficient to manage the risk of load loss when wide-area heat events occur,” the NERC report warned. The risk is most acute in late afternoon when solar photovoltaic resource output diminishes, creating a sharp rise in demand. Analysis shows up to 10 hours of potential in-day load loss beginning in 2022 and as much as 75,000 megawatt hours (MWh) of unserved energy in extreme conditions in 2024, NERC said.

Furthermore, the amount of flexible generation sources needed to meet demand have fallen in California, as well as in Texas and the Northwest to the point that projected peak demand cannot be met without some combination of weather-dependent wind and solar generation along with external imports.

“Changes in climate that drive extreme weather conditions raise the likelihood for one or more of these resources to fall short of forecasts, leaving other resources to make up the gap, or load will need to be shed,” NERC said.

The increasing amounts of variable generating resources in the Northwest and Southwest are raising the risk of energy shortfalls, according to the LTRA. There were 23 load-loss hours in the Northwest in 2022, and the Southwest faces potential load-loss hours beginning in 2024, NERC said.

“As resource planners in parts of the Western Interconnection turn increasingly to external transfers for sufficient capacity and energy to meet demand, the need for regional coordination and resource adequacy planning is growing,” NERC said.

The LTRA also identified the vulnerabilities created by the shortcoming of natural gas delivery infrastructure. Many generators in New England, California, and the Southwest rely on gas, making them vulnerable to gas supply disruptions that could affect winter reliability, NERC said.

Extreme cold weather in areas not accustomed to it, such as parts of MISO, the Southwest Power Pool (SPP) and Texas, also presents “significant” risks to winter reliability until new winterization requirements highlighted in NERC’s February 2021 Cold Weather Outages Report are in effect, NERC said.

The threat of extreme cold weather is exacerbated by the “increasing volatility and uncertainty” of electricity demand that makes “accurate load forecasting a challenge,” NERC said.

“Extreme weather is a core condition to consider in resource planning,” NERC said, advocating for a “comprehensive resource planning construct” that focuses attention on “energy sufficiency with the understanding that capacity alone does not provide for reliability unless the fuel behind it is assured even in extreme weather.”

Variable energy resources, meanwhile, continue to grow, NERC said, noting that since its 2020 LTRA, the capacity of solar projects in all stages of development has increased from 390 GW to 504 GW for the next 10 years and wind power capacity is projected to total 360 GW over the next 10 years, up from 250 GW since the 2020 LTRA projection. Battery energy storage installations have also grown with 113 GW in development through 2024, a sharp rise from the 47 GW reported in the 2020 LTRA.

Solar photovoltaic distributed energy resources (DER) also continue to grow and are expected to reach 60 GW over the next 10 years, with some regions doubling their solar DER footprint by 2031, NERC said.

The growth of DERs underscores the need for generation operators to have “flexibleresources, including adequate dispatchable, fuel-assured, and weatherized generation, at their disposal,” NERC said.

Until storage technology is fully developed and deployed at scale, which NERC sees as beyond the 10-year scope of the 2021 LTRA, gas-fired generation will remain a necessary balancing resource to provide increasing flexibility needs, NERC said.

With increasing reliance on gas-fired generation will come the need to “deeply understand natural gas and electric system interdependencies,” and to improve the coordination between natural gas and electricity.

The natural gas system was not built or operated with electric reliability as the first concern,” NERC asserted.  The lack of coordination between the two industries was a “major contributor to the devastation” in the Electric Reliability Council of Texas (ERCOT) during winter storm Uri in 2021, NERC said. “

The “regulatory structure and oversight of natural gas supply for electric generation needs to be rethought to assure reliable fuel supply for electric generation to support the reliable operation” of the bulk power system, NERC said.

NERC also recommended that further work is necessary to improve the modeling needed to reliably integrate interconnecting inverter-based resources (IBRs), such as wind and solar power and batteries, into the bulk power system.

Industry planners also should update interconnection agreements to address the performance specifications for IBRs, NERC said, adding that the Federal Energy Regulatory Commission should update its pro forma interconnection agreement for large and small generators to include IBR performance specifications.

NYPA Launches Challenge For Innovative Heat Pump

December 21, 2021

by Paul Ciampoli
APPA News Director
December 21, 2021

The New York City Housing Authority (NYCHA), New York Power Authority (NYPA) and New York State Energy Research and Development Authority (NYSERDA) on Dec. 20 launched an industry competition directed at heating and cooling equipment manufacturers to develop a new electrification product that can better serve the needs of existing multifamily buildings.

“By leveraging NYCHA’s building portfolio, the Clean Heat for All Challenge is designed to spur innovation by positioning the Authority as an early adopter of this technology, providing public housing residents with access to clean sources of energy through engagement with service providers and manufacturers of heat pump technologies,” NYPA said.

The challenge calls upon manufacturers to develop a packaged cold climate heat pump that can be installed through an existing window opening to provide heating and cooling on a room-by-room basis.

The envisioned product would enable rapid, low-cost electrification of multifamily buildings by reducing or eliminating many of the cost drivers inherent to existing heat pump technologies when used in resident occupied apartments. These include costly electrical upgrades, long refrigerant pipe runs, drilling through walls and floors and other construction aspects which result in high project costs, and significant disruption to residents.

NYCHA, NYPA, and NYSERDA have also engaged with the Consortium of Energy Efficiency to engage manufacturers and encourage broad industry participation in the Clean Heat for All Challenge.

The request for proposals issued by NYPA identifies a list of product specifications that manufacturers will be challenged to meet.

To incentivize participation, NYCHA will commit to purchasing the first 24,000 units from the awarded vendor or vendors that will be installed at six developments currently slated for heating plant replacement over the next five years.

NYSERDA is supporting the effort by providing additional funding from the Regional Greenhouse Gas Initiative operating plan, which calls for the electrification of heating in New York City public housing to improve energy performance, decrease emissions, and improve resident comfort. NYSERDA will provide assistance drafting the product specifications and performing commissioning as well as measurement and verification for the demonstration units.

NYCHA will invest $250 million, in addition to the NYSERDA grant, to purchase and install the new equipment as well as provide additional improvements to the building envelopes and hot water systems.

The initiative is based on a similar product challenge that NYCHA and NYPA partnered on in the 1990s and which produced some of the first Energy Star rated refrigerators, reducing the energy use of refrigerators by over 50 percent.

If the technology developed from the Clean Heat for All Challenge is successful, NYCHA will deploy at more than 50,000 apartments over the next 10 years, to meet space heating and cooling needs with zero on-site emissions.

The type of solutions this initiative is seeking will be broadly applicable to the multifamily sector across the Northeast, NYPA said.

The New York City Department of Housing Preservation and Development and New York State Homes and Community Renewal have already confirmed their strong interest in utilizing this new type of product for their preservation and new construction pipelines.

In addition, NYCHA and NYSERDA are working together with other large public housing authorities and housing agencies in the U.S. and Canada to aggregate a larger potential demand.

These new type of heat pumps will also be applicable for net zero carbon retrofits under NYSERDA’s RetrofitNY initiative. Through the RetrofitNY Pledge, building owners have already pledged to install cost effective net-zero carbon retrofit solutions in over 400,000 dwelling units when they become available.

NYCHA and NYPA are also partnering to replace the aging gas-and-oil-fueled heating and hot water systems at a 20-story high-rise in Manhattan, with a high-efficient electric Variable Flow Refrigerant (VRF) heat pump system.

The $28 million design-build electrification project will eliminate the use of on-site fossil fuel for heating and hot water while also providing central heating and cooling to 100 percent of apartments, replacing the old, inefficient window air conditioning units that have come to define many New York City-based facades. Once complete, residents will be able to individually control the temperature in each room of their apartment.

NYCHA has been an energy customer of NYPA since 1996, partnering to complete $211 million in energy efficiency projects, saving $23 million annually and reducing greenhouse gas emissions by 75,000 tons a year.

Texas Utility Regulators Approve Reforms To Wholesale Electricity Market

December 20, 2021

by Paul Ciampoli
APPA News Director
December 20, 2021

The Public Utility Commission of Texas (PUCT) on Dec. 16 voted to enact major reforms to the state’s wholesale electricity market.

Some changes will take effect very quickly to be in place this winter, the PUCT said, while other changes “will provide long-term incentives for investment in reliable power generation infrastructure to ensure Texas will have the power the state needs for decades.”

Key Changes

The changes approved by the PUCT will provide earlier price signals to bring additional generation online and for large consumers to adjust their demand, it said.

The PUCT said its approved reforms increase the market incentives for large consumers to decrease electricity usage in response to prices and grid conditions. This includes virtual power plants where groups of customers can come together into a single resource for the grid.

Emergency Response Service (ERS) is an existing program for large customers to register with ERCOT to decrease their electricity demand when the grid needs additional power. Previously, this tool was only available during an emergency. Now ERS can be used to avoid emergency conditions.

The commission also approved new or revamped ancillary services that include paying generators for having onsite fuel storage, for the ability to respond quickly to changes in the frequency of the grid, and for the capacity to react to abrupt swings in electricity supply and demand.

These improvements are part of Phase 1 of the Commission’s work to improve grid reliability and the wholesale electricity market. Phase 2 will include a review of a backstop reliability service and a load-side reliability mechanism.

These will provide further market signals for reliable generation, the PUCT said.

PUCT staff and Electric Reliability Council of Texas staff will develop phase 2 policies over the coming weeks and report back to the commissioners.

U.S. Power Sector’s Use Of Water Continued Downward Trend

December 20, 2021

by Paul Ciampoli
APPA News Director
December 20, 2021

The U.S. electric power sector’s cooling water withdrawals fell 10.5% from 53.1 trillion gallons in 2019 to 47.5 trillion gallons in 2020, continuing the downward trend in withdrawals, the U.S. Energy Information Administration (EIA) reported on Dec.17.

The decline has been driven by the increased use of renewable and natural gas-fired generation in place of coal-fired generation, as well as less use of once-through cooling technologies, EIA noted.

As the fuel mix has shifted to less water-intensive energy sources, the water intensity of U.S. power generation — the average amount of water withdrawn per unit of electricity generated — has declined from 14,928 gallons per megawatt hour (gal/MWh) in 2015 to 11,857 gal/MWh in 2020, EIA said.

It noted that thermoelectric power plants — including coal, nuclear, and natural gas plants — boil water to create steam, which then spins a turbine to generate electricity. Cooling water is passed through the steam leaving the turbine to cool and condense the steam. This step reduces the steam’s exit pressure and recaptures its heat, which is then used to preheat fluid entering the boiler.

According to EIA, U.S. thermoelectric plants are the largest source of U.S. water withdrawals, accounting for more than 40% of total U.S. water withdrawals in 2015.

The changing U.S. electricity generation mix accounts for approximately 80% of the downward trend in water withdrawals by the electric power sector.

EIA noted that natural gas-fired generation uses a more energy-efficient technology to produce electricity than coal and has a lower water withdrawal intensity than coal. Natural gas combined-cycle generation had an average water withdrawal intensity of 2,793 gal/MWh in 2020, compared with 21,406 gal/MWh for coal.

The share of renewable generation, which on average has a very low water withdrawal intensity, also significantly increased from 2015 to 2020.

The remaining 20% of water withdrawal reductions came from the reduced use of once-through cooling systems.

FERC Seeks Comment On Recovery, Reporting Of Industry Dues, Expenses

December 20, 2021

by Paul Ciampoli
APPA News Director
December 20, 2021

The Federal Energy Regulatory Commission (FERC) has issued a Notice of Inquiry (NOI) to examine the rate recovery, reporting and accounting treatment of industry association dues and certain civic, political and related expenses, as well as whether additional transparency is needed with respect to defining donations for charitable, social or community welfare purposes.

The Commission also is requesting comments on whether any changes are necessary to ensure those expenditures are properly accounted for and recovered in rates regulated by FERC.

FERC’s NOI seeks comment on 22 questions focused in three areas:

FERC generally allows utilities to recover a portion of their industry association dues, but certain expenses, such as the portion of dues relating to industry association lobbying, are generally supposed to be excluded from the costs passed on to customers.

The NOI explains that FERC does not have a “bright-line rule” delineating between recoverable expenses and those excluded from rate recovery.  Instead, FERC allows regulated entities to determine the portion of their industry association dues to include in recoverable accounts, based on information provided by the industry associations about their activities and associated costs. Currently, the Commission generally considers the appropriate delineation between the two classes of expenses on a case-by-case basis, determined based on the facts presented.

Initial comments on the NOI are due 60 days after the date of publication of the NOI in the Federal Register. Reply comments are due 90 days after the date of publication in the Federal Register.

APPA, Other Groups Seek FCC Rulemaking for 6 GHz Low Power Indoor Devices

December 20, 2021

by Paul Ciampoli
APPA News Director
December 20, 2021

The American Public Power Association (APPA) and a coalition of critical infrastructure industries on Dec. 7 asked the Federal Communications Commission (FCC) to adopt a rulemaking that develops new rules for 6 GHz low-power indoor (LPI) devices.

While seeking a new rule, APPA and the other industry groups also sought an immediate stay of equipment authorization of unlicensed 6 GHz LPI devices. The stay, pending development of rules that are proven to avoid interference from these devices, will prevent harm to currently licensed microwave systems in the 6 GHz band.

Background

The FCC’s Report and Order (R&O) to open the 6 GHz band of spectrum to unlicensed usage went into effect in July 2020. 

The R&O allows two types of unlicensed operations — low powered indoor use and outdoor use protected with an automated frequency coordination (AFC) technology.

A broad coalition of incumbent license holders filed extensive comments raising concerns about interference to operations that could result from opening the band to unlicensed users and requesting further testing and protections from the FCC. Those concerns and comments were not addressed, leading APPA and others in the electric sector to file legal challenges.

In April 2021, investor-owned utility Southern Company and the Electric Power Research Institute (EPRI) acquired 6 GHz devices available on the market to conduct real world testing on impacts to electric utilities.

They operated them near a Southern Company microwave link operating between Fortson and Columbus, Ga., using the FCC thresholds for reportable interference. The tests showed that, even at low powered indoor use, the unlicensed devices would “cause harmful interference to licensed fixed microwave systems” greater than the FCC’s acceptable levels. This report was filed and presented to FCC staff. 

Petition For Rulemaking

The petition for rulemaking states that the current rules for LPI use are flawed because they rely on modeling and not real-world data and, as such, must be modified to protect incumbent license holders from harmful interference.

The petition further states that LPI devices should be controlled by an AFC system, the FCC should adopt rules for licensees to recover costs from monitoring and mitigating potential interference created by unlicensed systems, and the FCC should conduct independent testing to determine if new rules should be developed for standard power devices.

“Recent real-world tests have determined that 6 GHz LPI devices will cause harmful interference to licensed microwave systems in the band, due in part to beacon signals that will transmit constantly and thus endanger the functioning of services to public safety and critical infrastructure industries and seriously degrade, obstruct, or repeatedly interrupt their radio communications services,” the groups said.

“These tests also demonstrate that the data and the assumptions for the Commission’s rules for 6 GHz LPI devices are fundamentally flawed.”

The FCC should therefore exercise its rulemaking authority “to revise the rules and conduct open and transparent testing to prove these rules effectively prevent interference to licensed microwave systems.  In that regard, the Commission should require 6 GHz LPI devices to be controlled by AFC or use some other interference protection mechanism.”  

The groups also said that the FCC should establish a mechanism for cost recovery by incumbents to reimburse them for mitigating and resolving interference from unlicensed 6 GHz operations. 

They said that this is consistent with the Commission’s emerging technologies framework and Commission precedent. 

“Also, due to the flawed data and assumptions upon which the Commission relied, the Commission should conduct independent tests of standard power access devices to determine if new rules need to be developed that will prevent interference from these devices to licensed microwave systems in the band.”

Request For Stay

The request for stay asks the FCC to put a temporary halt on the equipment authorization of unlicensed 6 GHz LPI devices pending the adoption of rules that are proven to prevent interference to licensed systems.

The stay is necessary to prevent the imminent risk of irreparable harm from the interference that these unlicensed 6 GHz LPI devices are certain to cause to incumbent licensed systems in the band, such as electric utility SCADA and other system monitoring equipment. 

A temporary stay will not significantly harm the interests of other stakeholders, “and the public interest favors granting the stay immediately to protect public safety and critical infrastructure industries who provide essential services to the public at large” the petitioners stated.

APPA was joined in the filings by: