MISO's GIP are Changing (Again)
In the tradition of New Year's resolutions, MISO proposed Tariff changes on New Year's Eve 2015, resolving to improve its interconnection process in 2016 (Docket No. ER16-675). Like all New Year's resolutions, only time will tell whether good intentions lead to lasting improvements, but here are five changes to keep in mind:
- Slim down in 2016.
MISO will subdivide its study process and add "off-ramps" to reduce the number of projects being studied and to give projects more flexibility to exit and more certainty if they proceed. MISO's new study process seeks to minimize cascading restudies caused by project withdrawals by subdividing the Definitive Planning Phase (DPP), where Interconnection Studies occur, into three parts and providing two "off-ramps" to exit the study process with some milestone payments refunded.
MISO intends for each DPP Phase to provide an incrementally more accurate System Impact Study (SIS): (i) a preliminary SIS in DPP Phase I, (ii) a revised SIS in DPP Phase II, and (iii) a final SIS in DPP Phase III. To try to increase certainty, MISO's process would encourage withdrawals at two defined "off-ramps" (Decision Points I and II) at the end of DPP Phases I and II.
MISO displays its new timelines in a chart in Attachment A to the Testimony of Timothy Aliff (Tab A of MISO's December 31, 2015 filing in Docket No. ER16-675) or on MISO's website.
- Meet your deadlines.
Milestone payments provide deadlines and refund incentives to exit at "off-ramps." As an incentive to use the new Decision Point I and II off-ramps, MISO will add new milestone payments and will make two milestones (the existing M2 milestone and a new M3 milestone) refundable if a project uses an off-ramp. Therefore, a project will make a milestone payment to enter each DPP Phase: the M2 Milestone to enter DPP Phase I, the M3 Milestone to enter DPP Phase II, and the M4 Milestone to enter DPP Phase III. MISO would provide a 100 percent refund of the prior Milestone Payment as an incentive for the project to withdraw at two off-ramps after Phases I and II.
- Set up an easy payment plan.
MISO would change the amount and timing of the M2 milestone. MISO proposes replacing the current M2 formula calculation with a flat fee of $5,000 per MW of new gross nameplate capacity, based on the rationale that it reflects the average M2 amount collected across all projects, regardless of size, since the implementation of the M2 milestone in 2012. MISO's proposal would also move up the due date for the M2 Milestone payment by 15 Calendar Days, from 30 Calendar Days prior to the commencement of the DPP cycle to 45 Calendar Days before DPP Phase I.
- Be more self-assured.
Restudy of a project with a GIA will require a FERC order. In response to concerns with ongoing risk of restudy, MISO would eliminate seven of the eight restudy triggers in Article 11.3.1 of the pro forma GIA, and would allow restudies ordered by FERC only in order to break the link between higher-queued assumptions, lower-queued projects, and end cascading restudies.
- Plan for new opportunities.
Transition of existing projects to the new GIP will depend on where they are in the current process as of the granted effective date. MISO's requested March 30, 2016 effective date for its GIP revisions will have the changes apply differently to projects, depending on where they are in the current GIP process as of the effective date.
In fine New Year's tradition, MISO provides a "who's in and who's out" list for 2016:
OUT: Not subject to the new GIP process are:
- Projects that (1) have already executed a non-provisional GIA or (2) have requested that MISO file a non-provisional GIA unexecuted by the effective date of the new process.
- Projects that either (1) have GIA negotiations ongoing or (2) have a completed Network Upgrade Facilities Study for a project by the requested effective date will not be subject to the new requirements for that project.
IN: The new GIP would apply to all other projects, but would provide different options for projects at different points in the process:
- Projects with Network Upgrade Facilities Studies ongoing as of the effective date
These projects will continue on their path to a GIA, but MISO would complete the GIA negotiations in 90 Calendar Days after the Facilities Study under the new shortened time frame.
- Projects with Interconnection System Impact Studies ongoing at the time of the effective date
These projects will be placed in the Decision Point II of "Cycle 1" (MISO's first study cycle under the new process). These projects then have two options for reaching a GIA:
< >The first path would allow the project to proceed to DPP Phase III without paying the M3 Milestone if it pays the newly proposed M4 Milestone payment.The second path would allow the project not to proceed through Cycle 1 but allow it to be combined with "Cycle 2" projects (beginning in fall of 2016), which would be considered lower-queued to DPP Cycle 1 projects. These projects would pay M3 and M4 during Decision Points I and II, consistent with the new Tariff provisions.
- Projects that do not fall into one of the above categories
These projects will be required to pay the M2 milestone and proceed under the new procedures if they have a new request in 2016, or do not have an Interconnection System Impact Study started as of the effective date of the new process.
As with every New Year, the only constant is change. MISO's resolutions to revise the GIP will bring change in 2016, but uncertainties remain. However, with change comes opportunity. Stakeholders have raised questions about the new timing and payments that may influence change for the better for future and existing projects. The new process provides opportunity for interested parties to gain access to better information and use it to further advance ready projects. Existing projects will also need to move quickly to determine how they will be impacted by the transition.