California energy agencies and key stakeholders have finished the first step of a statewide planning process to evaluate transmission needs in the state and the region. This process, called the Renewable Energy Transmission Initiative 2.0 (RETI 2.0), will culminate in recommendations to the legislature on where to increase transmission capacity to meet California’s new, more ambitious renewable energy mandate (see our summary of SB 350, which increased California’s Renewables Portfolio Standard (RPS) to 50% by 2030). RETI 2.0 is not a regulatory proceeding, but the resultant recommendations will frame and inform future transmission planning in California.

Background

RETI 2.0 was launched in September 2015 by the California Natural Resources Agency, the California Energy Commission (CEC), the California Public Utilities Commission, the California Independent System Operator (CAISO), and the US Bureau of Land Management California Office.

In December 2015, the managing agencies released a RETI 2.0 Workplan that divides the RETI 2.0 objectives between three overlapping working groups:

  1. The Plenary Group will identify high-value resources that need transmission, and then develop recommendations for next steps to facilitate connecting to those resources.
  2. The Environmental and Land Use Technical Group will gather existing environmental and land use data, evaluate the environmental impacts of new transmission, and propose recommendations for how to address those impacts.
  3. The Transmission Technical Input Group will compile relevant state-wide data and recommend methodologies for using the assembled data.

The CEC implemented a three-phase structure to accomplish the RETI 2.0 goals. Each phase will last for three months, corresponding to the first three quarters of the 2016 calendar year. Following each phase, the RETI 2.0 agency executives will lead a public workshop to report on the program’s progress.

In the first phase, the RETI 2.0 working groups defined goals, gathered existing relevant data, and proposed an approach for future phases. Additionally, the working groups selected Focus Areas, which are places in California with renewable resources that may be developed to meet California’s 2030 goals, but that may require additional transmission capacity to be accessed or integrated. These Focus Areas will form the basis of the RETI 2.0 recommendations.

Current Status

The concluding workshop for Phase 1 was held on May 2, 2016. There, the RETI 2.0 working groups and the management team presented updates on the program’s progress and the information gathered thus far:

  • Renewable Energy Sources in California. The Plenary Group presented one report on the range of renewable energy sources that California utilities may need to procure by 2030 to meet the state’s greenhouse gas-reduction targets. The report concluded that while low-cost solar is widespread, it raises long-term integration challenges. Additionally, the report found that land use constraints in California tend to favor out-of-state wind generation over in-state. The Plenary Group presented a second report on the RETI 2.0 planning goals, including the renewable energy expansion needed to meet the 2030 and 2050 greenhouse gas-reduction and RPS goals.
  • Existing Transmission Capacity. A CAISO representative presented on existing transmission system capacity and current plans to expand transmission. The CAISO reported that additional transmission deliverable capacity will be needed to meet the 50% RPS assuming full deliverability status of new renewable resources. Although renewable contracts have historically been based on full deliverability for a variety of economic and policy reasons, the CAISO considered transmission needs based on “energy only” contract assumptions and determined that transmission needs would be lower if renewable deliverability did not have to be guaranteed. The report also determined that importing renewable energy from neighboring states is technically viable, but is currently constrained by transfer capabilities at the interconnection point.
  • Focus Areas. The RETI 2.0 Agency Management team—to which all the working groups report—presented on Transmission Assessment Focus Areas. Their report highlighted the selected in-state and out-of-state Focus Areas. The in-state Areas are in the California Desert, the San Joaquin Valley, and Northern California. The out-of-state Focus Areas include wind energy in Wyoming and New Mexico, solar in Arizona, and solar and geothermal in Nevada.
  • Flexible Power Systems. An independent expert from Energy Innovation presented a report on Achieving a More Flexible Power System. The presentation identified four opportunities for making California’s grid more flexible. The first is to export excess California solar eastward. The second is to take advantage of coal retirements to add clean resources where transmission lines already exist. The third is to connect negatively correlated resources. And the fourth is to increase integration with the Southwest Intertie Project to reduce region-wide congestion.

Next Steps

The CEC accepted written comments on Phase 1 until May 16, 2016. Comments on future phases can be submitted electronically through the CEC’s e-commenting feature on the RETI 2.0 webpage, or by e-mail to: DOCKET@energy.ca.gov. Paper copies can be mailed to: Dockets Unit / California Energy Commission / Docket No. 15-RETI-02 / 1516 Ninth Street MS-4 / Sacramento, CA 95814-5512.

Phase 2 will conclude at the end of June 2016. During Phase 2, the working groups will propose renewable resource scenarios and review transmission, environmental, and land use implications in the Focus Areas. Phase 3 will commence in July 2016, and will last through the third quarter of 2016. In this final phase, the working groups will review information compiled in the first two phases. Ultimately, RETI 2.0 will provide recommendations for where to develop transmission capacity to accommodate and facilitate future renewable energy generation and help California meet its RPS and greenhouse gas-reduction goals.

Latham & Watkins Environment, Land and Resources attorneys are closely monitoring the RETI 2.0 process and will continue to report on the program’s progress and outcomes.

You may also be interested in reading:

RETI 2.0: CEC and CPUC Plan for New Renewable Energy Transmission Initiative to Meet California’s Increasing Clean Energy Commitments

Legislative Update: California Passes Groundbreaking Legislation Increasing Renewable Energy and Energy Efficiency Mandates, But Petroleum and Greenhouse Gas Reduction Measures Fail