Alternative Transmission Development Model

January 31, 2023
John Dalton

The CAISO has developed an alternative transmission development model, the Subscriber Participating Transmission Owner (PTO) model, to support the development of additional transmission necessary to achieve the state’s public policy requirements. Under the Subscriber PTO model the entity willing to build the transmission line finds subscribers that would pay for all or part of the transmission line. The Subscriber PTO would conduct an open season to solicit interest from third-parties, most likely IPPs or load serving entities that are seeking to contract for renewable energy from IPPs developing out of state renewable energy projects. This model allows the potential offtakers including California load serving entities to make their own economic decisions with respect to which out of state wind projects to contract with. The Subscriber PTO model could be employed by other RTOs that need to rely on out-of-state resources to achieve their clean energy requirements, e.g., ISO-NE and NYISO.

The Subscriber PTO Model allows California load serving entities to consider procurement of a bundled wind resource, including the cost of transmission. As a result, California load serving entities will be able to determine the most economic/best fit for their resource portfolios and avoids having the CAISO to decide on the transmission build-out or having all CAISO ratepayers fund the construction and operation of such projects.

In July 2022, TransWest Express LLC (TransWest) applied to CAISO to be the first Subscriber PTO. The CAISO approved TransWest’s application in December. TransWest would consist of three transmissions segments: (1) a 405-mile, 3,000 MW, HVDC line Wyoming and Utah; (2) a 278-mile, 1,500 MW, 500 kV HVAC line between Utah and Nevada; and (3) a 49-mile, 1,500 MW, 500 kV HVAC transmission line in Nevada connecting to the CAISO grid. The project is primarily intended to deliver power from wind resources in Wyoming to California and the Desert Southwest. California Energy Commission and California Public Utilities Commission provided a starting point scenario to CAISO for transmission planning studies that included 12,000 MW of out-of-state wind in 2040. Offshore wind (OSW) is a potential replacement for this out-of-state wind, with cost of the required out of state transmission facilities, enhancing the attractiveness of OSW. #renewableenergy #offshorewind #CAISO

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