EDPR executive projects pipeline impacts from MISO queue reforms

With more than 2 GW operating in MISO and other projects coming online over the next 18 months, EDP Renewables North America is considering impacts to its pipeline as MISO finalizes its ongoing queue reform process.

NPM spoke with EDPR NA’s Executive VP of Eastern Region and Canada and Government Affairs Tom LoTurco, who says the firm is “intricately involved” in stakeholder discussions with MISO as it finalizes its queue reform proposals that it first unveiled last month. LoTurco says while he does sympathize with MISO’s goals of limiting the number of projects entering the queue, he says there are some key differences in methodology he hopes is implemented before the final proposal is unveiled at the end of the summer.

“There is no good way to properly model 171 GW, so I have sympathy for MISO in trying to fix a problem that is pretty unprecedented,” LoTurco said.

LoTurco says he has found that MISO “has a tendency to put more emphasis on project maturity” through its implementation of land maturity requirements and withdrawal fees. But what he says will be more effective is targeting speculation.

“There are clearly a lot of speculative bets going on in MISO,” LoTurco said. “These bets are guided by land control first without looking at congestion.”

LoTurco admits EDPR itself may be impacted by MISO’s proposed limits on the capacity a developer can submit into a cluster year, but he says it is a sacrifice the firm is willing to make in order to help increase selectivity for projects going into the queue.

Although EDPR Executive VP of Central and Western Regions and Mexico, Environmental Affairs and Energy Storage Analytics Kris Cheney previously told NPM the firm had adopted a strategy of putting more projects into the queue than it expected to complete, LoTurco says the company does “do its due diligence” before entering projects. Specifically, he says the firm is particularly focused on siting around retiring coal plants and along corridors of projects planned as part of MISO’s Long-term Regional Transmission Plan transmission upgrades.

LoTurco says he is heartened by MISO’s efforts to “incentivize long-term investors in the space,” specifically its requirement for developers to wait to sell off projects until after DPP Phase 2 is completed. This is essentially MISO’s system impact study, which takes place after it has completed Phase 1’s feasibility study. LoTurco says this requirement will be significant as reaching DPP Phase 2 often takes two to three years, though one of MISO’s goals is to cut that time down to 1 year.

“We’ve seen a lot of short-term investors that want to come in, put together a portfolio very quickly, and then sell it off,” LoTurco said. “So having this requirement is great; we never make any real decision about a project until it reaches DPP Phase 2.”

However, LoTurco says he is concerned about MISO’s proposed site control requirements, which would require developers to maintain full control of the project’s interconnection corridor much earlier than they do now. He says this will have significant impact on EDPR’s pipeline as there are times when the firm doesn’t have full land control “right up until construction.”

LoTurco says the impacts from this could be severe, including longer land agreements than many projects currently need. He says this could make entering the queue prohibitively expensive for some, and could also lead landowners to raise prices since the project’s success will ride on landowner cooperation.

LoTurco says his other chief concern with the MISO proposals is its first come, first served system for filling each cluster year, which he says will “compel developers to make decisions that are not in keeping with the best actions required for the project.”

“It’s all about ticking boxes which I don’t think aids in selectivity and could lead to inferior projects,” LoTurco said. “That’s just ugly. There’s got to be a different way to do it.”

*This story was originally published exclusively for NPM subscribers last month.


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