A common question for renewable developers interconnecting to a transmission system is whether they should pay more and procure a network resource interconnection service (NRIS) or pay less for energy resource interconnection service (ERIS)? The difference is this: A network service reserves transmission capacity on the grid for the renewable developer whereas an energy service does not. With an energy resource, there is no guarantee that transmission capacity is available. If renewable resources external to a market wish to serve a load in the market, then they need an external network reservation.
In the past, distributed renewable energy developers did not concern themselves with transmission reservations because they were “behind-the-meter.” But now they must if they want to access wholesale energy market revenue streams.
What is Interconnection Service?
When a renewable developer submits an interconnection application to the transmission system operator, they start their journey as an interconnection customer. An interconnection customer is applying for interconnection service on the electric system. The output of an interconnection study shows how much the renewable developer will have to pay in upgrade costs to reserve the transmission capacity. The result of the interconnection study shows if the interconnection customer has entire network access or only a portion.
A renewable resource, if deemed “deliverable” by the transmission provider, is available for a Load Serving Entity (LSE) to meet that LSE’s resource adequacy requirements. In a nutshell, resource adequacy requirements ensure there is enough reserve generation capacity (reserve margin) available to serve the load even under emergency conditions. A generator deliverability study ensures generator groups have enough transmission capacity to “deliver” their combined output. The renewable project becomes a capacity resource once deliverable.
As part of transmission planning responsibilities, the transmission operator conducts annual deliverability studies to find out if any transmission constraints are restricting the output of network resources.
Network Resource Interconnection Service (NRIS)
NRIS gives the most certainty that a renewable resource has transmission capacity reserved on a “firm” basis. Under emergency conditions, firm transmission reservations are curtailed after non-firm reservations are cut. But interconnection customers must pay for the transmission upgrade costs to ensure firm transmission capacity availability. A heatwave that causes a rise in air conditioner load or a polar vortex that causes a rise in heating load are typical emergency conditions.
At MISO, restricted wind unit output was the result of extreme cold conditions in January 2019. This reduction led to an emergency condition called the maximum generation event. NRIS offers the best transmission reservation alternative to ensure renewable generation has transmission available leading up to an emergency event.
If a resource external to the MISO market, serves the load internal to MISO – then an External NRIS is needed. External NRIS ensures a renewable resource in PJM, for example, is deliverable to a load in MISO.
Energy Resource Interconnection Service (ERIS)
Why seek an ERIS if NRIS gives most certainty about transmission capacity reservation? If the interconnection customer does not want to pay for network upgrades, i.e., a transmission project to increase the transmission capacity on the grid, which in turn increases the chance of their renewable resource dispatch – then, the interconnection customer chooses to proceed with ERIS. And in most cases, it is not all or nothing. The interconnection customer can choose to go with ERIS only for the amount that is not deliverable.
Out of approximately 37,000 MW solar in the SPP interconnection queue in the active study phase, only 5,000 MW (13%) are requesting energy resource interconnection service. The remaining 32,000 MW are requesting both ER and NRIS. This ER/NR split holds true for wind resources also.
Energy Resource Interconnection Service does not ensure transmission reservations. If an external resource needs transmission service, there are two paths: network path and a more specific point to point path.
Network Integration Transmission Service (NITS)
A deliverable network resource has the transmission service to meet its load obligations. This transmission service is called Network Integration Transmission Service (NITS). Interconnection customers who use this service are called network customers. An external resource, i.e., non “designated network resource,” needs this NITS reservation to serve network load.
Open Access Same Time Information System (OASIS) is the platform for entering transmission service requests.
Point-to-Point (PTP) Transmission Service
The flip side of NITS is a transmission service reservation that only works for a designated transmission path with its source and the sink, i.e., where the reservation ends. This Point-to-Point comes in two primary flavors – firm and non-firm. Non-firm transmission reservations are cut first, before firm reservation under emergency conditions. And in both firm and non-firm, transmission customers can procure daily, weekly, and monthly. But can only procure hourly non-firm and yearly firm transmission service.
Utility-scale renewable developers have experience with transmission reservations in the organized market framework. With distributed renewable projects starting to explore options to interconnect at a transmission node, understanding transmission reservations and interconnection studies are quickly becoming important. Renewable technologies such as wind, solar, and now energy storage all must face the same rules since transmission reservation rules are technology agnostic.