Deal Friction

Deck: 

Why the green grid might do better without open access.

Fortnightly Magazine - April 2011
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Last month, on the Ides of March, the staff of the Federal Energy Regulatory Commission held a technical conference under the somewhat fuzzy rubric, “Priority Access to New Participant-Funded Transmission.” But by the time each panel participant was heard from, and the meeting wound up, it was clear the topic should have read, “So FERC’s Policy of Transmission Open Access Is Maybe Bad for Green Power—Now What?”

In theory at least, wind, solar, and even geothermal project developers ought to be friends with open access. FERC Order 2003, for example, confers on gen plants of all stripes the right to request interconnection service from incumbent transmission providers to hook up to the integrated grid network. And this right is nothing to scoff at, given the remote locations of many renewable energy projects.

Yet, as was noted at the conference, a developer may have good reason to decline interconnection service from an incumbent utility transmission provider and elect instead to finance and build its own lead line to connect to the grid, especially for projects built in stages. The American Wind Energy Association and the Solar Energy Industries Association brought that point home back in 2009, in defending the Milford Wind Corridor project for wanting to do just that:

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