Midcontinent Independent System Operator (MISO), which is the US’ first Federal Energy Regulatory Commission (FERC)-approved regional transmission organisation (RTO), recently released its approved 2023 MISO Transmission Expansion Plan (MTEP23). The scale and pace of grid evolution in the region, driven by the plans of electricity companies to decarbonise their generation mix and tackle anticipated load growth and ageing infrastructure, require prompt attention in order to develop the most efficient and cost-effective investments that will ensure grid reliability in future.
Grid investments are imperative to cope with the expected change in the generation mix. Over the next two decades, the region is expected to more than double its installed capacity, add over 300 GW of renewable energy and retire over 100 GW of existing capacity. In fact, MISO’s Generator interconnection (GI) queue has experienced extremely high volumes over the last several years. In 2022, MISO received 956 individual project requests, the majority of which were from solar, storage and hybrid project developers. As of August 2023, the queue had 1,365 projects representing 235.23 GW of capacity. However, not all projects will fructify. Generators have been exiting the queue with generator interconnection agreements (GIA) due to project delays caused by supply chain, regulatory and contractor issues. MISO had nearly 50 GW of new generators with GIAs that were not yet online as of August 2023. MISO has refined its queue process to make improvements, and is now tackling additional reforms to improve entry and exit into the queue to further streamline the GI process and meet MISO’s need to bring new resources into the system quickly.
MISO undertakes a comprehensive grid planning process annually to evaluate transmission solutions in order to build and maintain a reliable and economic infrastructure for the region covered by it through MTEP. Since its inception in 2003, over USD58 billion of MTEP projects have been approved by MISO’s board of directors. The projects included in MTEP represent the recommendations of the board and require approvals from other regulators for completion. With around USD34 billion of MTEP projects already in service, over 120,701 km of transmission networks provide electricity to about 45 million people across 15 US states and the Canadian province of Manitoba.
Notably, MTEP23 marks the largest plan in MISO’s history in terms of both scale and investment [excluding the two years of accounted multi-value projects (MVP) and long-range transmission planning (LRTP) portfolios]. MTEP23 has allocated USD9 billion to fund 572 projects, primarily focusing on critical aspects such as ageing infrastructure, accommodating new load requirements and integrating additional generation capacity necessitated by the retirement of traditional resources. These projects collectively span around 742 miles (1,194.1 km) of new or upgraded transmission lines.
This article presents a brief overview of MISO’s planning process and the highlights of MTEP23…
MISO planning process
The latest planning guiding principles, adopted by the MISO board in June 2023, will be enacted by MISO through its value-based planning approach, ensuring that local needs are integrated with regional requirements. This approach includes local planning (based on member plans and reliability standard requirements in the near term [less than 10 years]), regional planning (longer-term broader system needs including LRTP efforts), policy assessment (to study the impact on the transmission system and resource mix), resource planning (system changes required to accommodate new resources) and interregional planning (through collaborations with neighbouring grid operators).
Local planning:MTEP aims to identify and support the development of cost-effective transmission infrastructure that is robust enough to meet reliability needs, enable a competitive energy market, support policy goals and allow for competition among transmission developers in the assignment of transmission projects. The local planning process ensures compliance with FERC Order 890 (on the regulation of electricity transmission access and charges) transparency requirements for transmission owner submissions. Depending on the project submissions, MISO’s role ranges from alternative assessment, need validation (including compliance with applicable National Electric Reliability Organization (NERC) and Regional Reliability Organization (RRO) reliability standards), no-harm tests (to ensure that the submitted project does not create a system issue) and transparency requirements (also known as post-only, which are miscellaneous and substation projects that do not impact the physics of the transmission system). Approved projects are recorded under Appendix A of the MTEP report and represent the preferred solutions to the identified transmission needs of the MISO transmission planning process. MISO is responsible for monitoring all previously approved Appendix A projects.
Among the previous MTEP cycles, MTEP11 (worth USD7.3 billion, driven by the MVP portfolio) and MTEP21 (USD13.4 billion owing to LRTP Tranche 1) witnessed higher-than-average MTEP investments of less than USD4.5 billion. Between 2023 and 2030, approximately 6,250 circuit (ckt) miles (10,058.4 ckt km) of planned new or upgraded transmission lines are expected to be built under Appendix A. This includes 3,915 ckt miles (6,300 ckt km) of upgraded transmission lines on existing corridors, of which 59 per cent will be at ≤230 kV, and 41 per cent at 345 kV and above voltages. Further, 2,335 ckt miles (3,757.8 ckt km) of new transmission lines are expected to be built on new corridors, of which 63 per cent will be at 345 kV and above voltages, and 37 per cent at 230 kV and below voltages. In terms of investments, there has been a shift in the last six cycles (MTEP17-MTEP22) towards substation and line upgrade investments, as against new lines dominating investments prior to that. Further, 50 per cent of the total active investments (USD29 billion) has occurred in the last five MTEPs.
Regional planning:MISO is undertaking regional planning through LRTP, identifying regional portfolios to address future needs in the longer term (10 to 20 years). LRTP is not replacing the annual MTEP efforts, but is complementing its local reliability and interregional planning studies, to establish a regional transmission backbone. It consists of four tranches. In July 2022, the MISO Board approved the USD10.3 billion LRTP Tranche 1, focusing on the Midwest subregion to enable around 56 GW of new renewables. Studies for Tranche 2, also focusing on the Midwest, are underway with targeted approval in 2024. It will meet the needs outlined in MISO’s “Futures”, which are forward-looking scenarios developed by MISO to serve as guides for its grid planning initiatives, including MTEP. The MISO South subregion will be the focus of Tranche 3 of LRTP, while Tranche 4 will examine the portion of the system that connects the Midwest and South subregions.
Resource planning and adequacy:In 2023, MISO introduced new naming conventions for MISO Futures, with cohorts of Futures being referred to by series. Series 1 MISO Future scenarios were used in LRTP Tranche 1. No new Future scenarios were developed specifically for MTEP23, but within the framework of LRTP Tranche 2, Series 1A scenario development commenced in 2022. LRTP Tranche 2 will develop a portfolio that meets the needs of Future 2A (F2A) within Series 1A. Based on refreshed input data gathered from updated member plans, F2A illustrates the continuing impacts of the energy transition, with a significant acceleration in thermal retirements, renewable capacity build-out and decarbonisation. Under F2A, the MISO region’s installed capacity is projected to increase from 200 GW in 2022 to 466 GW in 2042, including 103 GW of retirements and 369 GW of new additions, largely renewables.
To adequately meet their forecasted electricity demand and required levels of reserves, Load Serving Entities (LSEs) in the MISO region are required to have sufficient resources. Notably, for 2023-24, LSEs have adequate capacity mainly due to the delay of some previously announced retirements, and the region obtaining additional capacity via imports. Further, this year’s resource planning survey of LSEs by MISO and the Organization of MISO States (OMS), comprising state regulatory agencies, indicates a similar trend for 2024-25, with a surplus of 1.5 GW. However, the survey indicates that the region could have a capacity deficit of 2.1 GW in the summer of 2025-26, which is expected to increase consistently in subsequent years to 9.5 GW by 2028-29. This indicates that actions taken this year to provide capacity may not be available in the future, and more generation capacity needs to be built.
Interregional planning:In addition to LRTP, MISO collaborated with Southwest Power Pool (SPP) for the Joint Targeted Interconnection Queue (JTIQ) study which identified a five-project portfolio (at 345 kV) with an estimated cost of USD1.06 billion to address the significant transmission limitations restricting the interconnection of new generating resources near the MISO-SPP seam. MISO, SPP, Minnesota state agencies and transmission owners have applied for the US Department of Energy (DOE) Grid Resilience and Innovative Partnership (GRIP) programme, the award for which is pending.
MTEP2023 – key highlights
MTEP2023 includes five types of projects – baseline reliability projects (BRPs), generator interconnection projects (GIPs), market participant-funded projects (MPFPs), MVPs and others. BRP refers to network upgrades identified in the base case to ensure that the system complies with applicable NERC and RRO standards. Related project costs are allocated to local transmission pricing zones. GIP refers to new transmission access projects, the costs of which are mainly borne by generators. However, upgrades at 345 kV and above are eligible for 10 per cent cost recovery from load on a system-wide basis. MPFP refers to network upgrades fully funded by one or more market participants, but owned and operated by a transmission owner. MVP refers to those that provide regional or sub-regional public policy, economic and/or reliability benefits. Costs are shared for loads and export transactions in proportion to energy withdrawals or export schedules. Projects that provide local economic benefits but do not qualify as any of the above projects are categorised as “others”.
Table 1: MISO’s MTEP23 investment summary by region and category (USD million)
Source: MISO’s MTEP23, Global Transmission Report
MTEP23 includes 45 BRPs worth USD1,723 million, 142 GIPs worth USD1,227 million, an MVP project worth USD4 million, two MPFPs worth USD1 million and 382 other projects totalling USD6,023 million. Of the latter, 56 per cent are driven by reliability issues, including those pertaining to reliability of load additions and generation retirements; and 25 per cent by age and condition. The majority of other projects address localised reliability issues caused by load growth needs, local specific reliability needs and ageing transmission infrastructure.
Figure 1: MISO’s MTEP23 investment summary by type of project
Note: BRP – Baseline reliability projects; GIP – Generator interconnection projects; MPFP – Market participant funded projects; MVP – Multi-value project
Source: MISO’s MTEP23, Global Transmission Report
The projects are spread across the whole region served by MISO. Except for the larger-than-usual 47 per cent share of total investment dedicated to the South region (which includes Arkansas, Louisiana, Mississippi and parts of Texas), the investment distribution across MISO’s footprint is consistent with recent MTEP cycles — 25 per cent of the total for the Central region (including Missouri, Illinois, Indiana and Kentucky), 20 per cent for the West (including parts of North Dakota, South Dakota, Montana, Michigan and Illinois, and all of Iowa, Minnesota and Wisconsin) and 8 per cent for the East (including Michigan).
Among the states, Louisiana and Texas together accounted for 44 per cent of the total investment at USD3.9 billion. This was due to generation retirements and the heightened load associated with economic development in these areas.
Figure 2: MISO’s MTEP23 project investment summary by state
Source: MISO’s MTEP23, Global Transmission Report
The investments also vary by project type, with 44 per cent dedicated to new lines under new right-of-way permissions in the MISO region; 30 per cent to substation- or switching station-related construction and maintenance (includes new substations as well as terminal equipment work, circuit breaker additions and replacements); 20 per cent to transmission line upgrades (includes rebuilds, conversions and relocations); and the remaining 6 per cent to voltage devices, transformers and miscellaneous categories. Notably, the South region accounts for close to 82 per cent of the total new line investment. Overall, over 70 per cent of all projects are scheduled to come online by 2026.
Figure 3: MISO’s MTEP23 project investment summary by category
Source: MISO’s MTEP23, Global Transmission Report
In terms of the transmission lines, MTEP23 projects aggregate to approximately 742 miles (1,194.1 km) of new or upgraded lines. Of this, 55 per cent will go into service within the next three years (2026) and 86 per cent within five years (2028). The majority of the lines, that is, 87 per cent or 643 miles (1,034.8 km), will be at 161 kV or below, while only 76 miles (122.3 km) are projected to be at 230 kV or above.
The top ten projects based on investment represent roughly 43 per cent or USD3.9 billion of MTEP23. Entergy will execute the top three projects, which involve an investment of over USD3.1 billion.
Table 2: Top 10 projects in MISO’s MTEP23 by investment
Source: MISO’s MTEP23, Global Transmission Report
Figure 4: Map of top 10 projects in MISO’s MTEP23 by investment
Source: MISO’s MTEP23
The energy landscape of the MISO region is evolving rapidly, driven by the energy transition ambitions of its members and the anticipated load growth. Grid evolution has driven record investment in MTEP23. These investments will ensure that robust and resilient transmission systems are in place to effectively and efficiently move energy to demand areas at all hours of the year. The key lies in the timely implementation of new as well as previous MTEP projects.
