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Upgrading New York’s Grid: IOUs to invest USD17 billion in T&D by 2030 [free access]

January 7, 2021

The US is steadily moving towards the adoption of clean energy generation and its integration into the grid. In particular, New York is working rigorously towards achieving its clean energy targets set by the Climate Leadership and Community Protection Act (CLCPA), which requires state-wide greenhouse gas (GHG) emissions to be 40 per cent lower than the 1990 levels by 2030 and 85 per cent lower by 2050. The state also has plans to develop 9,000 MW of offshore wind (OSW) by 2035.

 

To achieve the most aggressive climate policy legislation in the country through the CLCPA, the New York Public Service Commission (NYPSC) recognised that the state’s transmission and distribution (T&D) infrastructure required restructuring and repurposing, for which the State Governor introduced the Accelerated Renewable Energy Growth and Community Benefit (AREGCB) Act in April 2020. The AREGCB Act distinguishes between distribution, local transmission and bulk transmission assets. Herein, local transmission is referred to as transmission lines and substations that generally serve local load and transmission lines to transfer power to other service territories and operate at less than 200 kV. Whereas, the bulk power transmission facilities (BPTF) are planned and operated by the New York Independent System Operator (NYISO), pursuant to its tariff approved by the Federal Energy Regulatory Commission (FERC).

 

The AREGCB Act directs the identification of distribution system upgrades, local transmission upgrades, and investments in the bulk transmission system as necessary to achieve the CLCPA targets. In this context, the Act required NYPSC to establish a planning process to guide future investments in local transmission and distribution (LT&D) and establish a LT&D capital plan for each utility.

 

Owing to this, on November 2, 2020 New York’s investor-owned utilities (IOUs) jointly filed a report on T&D investment in New York. The IOUs—Avangrid subsidiaries New York State Electric and Gas (NYSEG) Corporation and Rochester Gas & Electric (RG&E) Corporation, Central Hudson Electric and Gas Corporation, Consolidated Edison Company of New York Inc. (CECONY), Long Island Power Authority (LIPA) and Orange and Rockland (O&R) Utilities, and National Grid subsidiary Niagara Mohawk Power—have collectively incorporated their proposals and recommendations in the report.

 

The report summarises the recommendations by the IOUs regarding incorporation of regulatory changes, predictive LT&D upgrades and technological advancements to be made to alleviate transmission system bottlenecks. Key takeaways from the report are as follows:

 

Categorising local transmission and distribution projects

The recommendations made by the IOUs in the Working Group Report consider two categories of LT&D projects based on project readiness and the complexity of regulatory issues that remain to be resolved:

 

Additionally, it has been recognised that achieving the requirements of the CLCPA and the AREGCB Act will also require changes to existing practices concerning cost allocation and cost recovery of projects.

 

Regulatory recommendations by the IOUs

The proposals and recommendations by the IOUs for various regulatory considerations include the following:

 

CLCPA Investment Criteria and Project Prioritisation

The utilities recommend a set of LT&D investment criteria that will be designed to meet CLCPA targets:

 

The use of these criteria will allow the IOUs to identify CLCPA-driven projects along with traditional reliability, safety and compliance projects. Going forward, the utilities recommend that these approaches should be integrated with existing LT&D planning processes.

 

Benefit Cost Analysis (BCA)

The utilities recommend that the NYPSC accept a set of local transmission-related BCA guidelines for CLCPA projects. These guidelines will comprise a simple and consistent mechanism to allow local transmission owners to prioritise CLCPA-related investments.

 

Stakeholder Engagement

The utilities recommend annual engagement with stakeholders via robust dialogue and data exchange as a supplement to existing mechanisms that provide transparency in T&D planning. The recommended stakeholder engagement opportunities specific to local transmission planning would be conducted by each New York jurisdictional utility.

 

Cost Allocation and Cost Recovery

It is anticipated that incorporating an increasing share of renewables into LT&D activities will entail additional costs. It is therefore imperative to draw clear cost allocation and recovery processes to ensure timely implementation and cost-effective project deployment. For this, the utilities propose the following:

 

Suggested LT&D upgrades

The report further identifies several potential LT&D upgrades suggested by the utilities as necessary to expedite the achievement of the CLCPA RE mandates. These include both immediately actionable local system upgrades (i.e. new facilities or enhancements to existing transmission or distribution facilities) and future potential upgrades (on a need-basis to achieve CLCPA targets), which will facilitate greater interconnection and use of clean energy resources throughout the state.

 

The proposed Phase I and Phase II local transmission upgrades by the utilities are given in the tables below.

 

Table 1: Proposed Phase I local transmission upgrades

Utility

Project

Description

Estimated cost

Proposed in-service date

Central Hudson

SK line

Rebuilding of a 115 kV line

USD4.4 million

2025

CECONY

2nd Rainey–Corona feeder

Installation of a new 345/138 kV-controlled feeder

NA

2023

3rd Gowanus–Greenwood feeder

Installation of a new 345/138 kV-controlled feeder

NA

2025

Goethals–Fox Hills

Installation of a new 345/138 kV-controlled feeder and rebuilding of Fox Hills 138 kV substation

NA

2025

LIPA

138 kV Riverhead–Canal new circuit

Installation of a new 138 kV circuit from the Riverhead substation to the Canal substation

USD83 million

2021

Wildwood–Riverhead 69 kV to 138 kV conversion

Conversion of the existing Wildwood–Riverhead circuit from 69 kV to 138 kV

USD10 million

2021

National Grid

115 kV Clarks Corners–Oneida terminal upgrades

Addressing all limiting 115 kV terminal equipment at various stations between Clarks Corners and Oneida

USD5 million

2023

115 kV Colton–Boonville terminal upgrades

Addressing all limiting 115 kV terminal equipment at various stations between Colton and Boonville

NA

2022

115 kV Coffeen–Black River terminal upgrades

Addressing all limiting 115 kV terminal equipment on lines connected to Coffeen

NA

2023

O&R

TL Lines 26 and 261

Upgrade of 138 kV transmission lines 26 and 261

NA

2036

TL Lines 12 and 13/131

Upgrade of transmission lines 12 and 13/131

NA

2027

NYSEG/RG&E

Lockport area Phase 1 upgrades

Rebuilding of Robinson Road substation and installation of a new transformer and rerouting several lines in this area

USD34million

2025

Retiring part of Hinman substation and rerouting existing lines to a nearby substation

NA

Reconductoring of a 115 kV line

USD10 million

Substation upgrades

NA

Lancaster area Phase 1 upgrades

Rebuilding and upgrade of Stolle Road substation

NA

2025

Installation of an additional transformer and reconfiguration of substation

NA

Reconductoring of 115 kV lines

NA

Note: NA - not available; CECONY - Consolidated Edison Company of New York Inc.; LIPA - Long Island Power Authority; NYSEG - New York State Electric and Gas Corporation; RG&E - Rochester Gas & Electric Corporation; O&R - Orange and Rockland utilities.

Source: Utility Transmission and Distribution Investment Working Group Report, 2020

 

Table 2: Proposed Phase II local transmission upgrades

Utility

Project

Description

Estimated cost

Proposed in-service date

Central Hudson

10 and T-7 line station connections

Upgrade of station connections to not limit line conductor

USD0.9 million

2030

Northwest reinforcement

Construction of a new 345/115 kV substation

USD56 million

2030

CECONY

NYC clean energy hub #1

Clean energy hub to provide additional POIs into local system

NA

2027

NYC clean energy hub #2

Clean energy hub to provide additional POIs into local system and enable load transfer

NA

2029

LIPA

LIPA central corridor 138 kV to 345 kV conversion

Conversion of the existing East Garden City–Newbridge Road circuit No. 4 from 138 kV to 345 kV

USD221 million

2025-2035

Conversion of the existing Newbridge Road–Ruland Road circuit No. 3 from 138 kV to 345 kV

Substation expansion and construction associated with the 345 kV conversion

LIPA

New 345 kV circuit on Shore Rd–Ruland Rd

Installation of a PAR-controlled new 345 kV circuit from the Shore Road substation to the Ruland Road substation.

USD647 million

2025-2035

Substation expansion and reconfiguration associated with the new 345 kV circuit.

National Grid

115 kV Lockport–Mortimer smart valve system

115 kV upgrade: adding a smart valve system to the Lockport–Mortimer lines

NA

2027

115 kV Black River–Lighthouse Hill line upgrade

115 kV upgrade: sections of Black River to Lighthouse Hill

NA

2025

115 kV Coffeen–Lyme line upgrade

115 kV Upgrade: sections of Coffeen to Lyme

NA

2030

NYSEG/RG&E

Lancaster area Phase 2 upgrades

Installation of up to 10 MW, six-hour energy storage

NA

2027

Installation of a new transformer and upgrade of substation

NA

2025

Reconductoring a 34.5 kV line

NA

2024

Geneva area Phase 2 upgrades

Building a new 115 kV line

NA

2025

Installation of up to 40 MW, six-hour energy storage

NA

2027

Note: NA - not available; POI-points of interconnection; CECONY - Consolidated Edison Company of New York Inc.; LIPA - Long Island Power Authority; NYSEG - New York State Electric and Gas Corporation; RG&E - Rochester Gas & Electric Corporation; O&R - Orange and Rockland utilities.

Source: Utility Transmission and Distribution Investment Working Group Report, 2020

 

Table 3: Proposed local transmission project estimates by IOUs

Utility

Type of project

Number of projects

Estimated costs (USD million)

Estimated project benefit (MW)

Central Hudson

Phase I

6

152

433*

Phase II

6

138

766

CECONY

Phase I

3

860

900*

Phase II

6

4,050

7,686

LIPA

Phase I

8

402

615*

Phase II

6

1,281

1,830

National Grid

Phase I

13

773

1,130*

Phase II

13

1,371

1,500

NYSEG/RG&E

Phase I

16

1,560

3,041*

Phase II

11

780

943

O&R

Phase I

6

417

500*

Phase II

NA

NA

NA

Total

Phase I

52

4,164

6,619*

Phase II

42

7,620

12,725

Note: NA - not available; CECONY - Consolidated Edison Company of New York Inc.; LIPA - Long Island Power Authority; NYSEG - New York State Electric and Gas Corporation; RG&E - Rochester Gas & Electric Corporation; O&R - Orange and Rockland utilities. *MW benefits for Phase I projects have been provided as an indicator of the relative benefit of each project. Once the BCA methodology is approved, the utilities will work to update this metric for Phase 2 projects.

Source: Utility Transmission and Distribution Investment Working Group Report, 2020

 

 

Technological advancements

The Advanced Technologies Working Group (ATWG) is facilitating the development of plans for the Utility Transmission and Distribution Investment Working Group, to further the goals of the CLCPA by considering roles and opportunities for grid investments in advanced technologies. The ATWG has prioritised several issues that need to be addressed, such as:

 

 

In response to these issues, the ATWG recommended potential technology solutions, as follows:

 

Further, suggestions for technological solutions that can be deployed include the use of transformer, cable and transmission line monitoring systems; advanced transmission and sub-transmission voltage regulation systems; energy storage for grid services; advanced high temperature low sag (HTLS) conductors; global information system utilisation; and improved ability of transmission lines to redirect flow to underused lines.

 

Conclusion

The report filed by the IOUs highlights the key issues in integrating RE resources into the state grid and the possible measures that can be adopted to address these issues in order to achieve CLCPA targets. In particular, regulatory considerations need to be designed and implemented such as a CLCPA investment criteria and basis of project prioritisation. Further, employing the use of local transmission-related BCA guidelines for CLCPA projects, robust engagement with stakeholders and drawing clear cost allocation and recovery processes will also lead to timely execution of projects. R&D on technological advancements is key to effectively optimise grid investments, allowing for better deliverability of RE throughout the state.

 

Each utility has incorporated its immediately actionable (Phase I) and proposed/conceptual (Phase II) local transmission upgrade projects, which can facilitate unbottling of constrained resources and achieve CLCPA objectives in a cost-effective manner.

 

In all, the utilities estimate about USD4,164 million worth of local transmission upgrades for Phase I projects, which would result in an approximately 6,619 MW benefit, and about USD7,620 million for Phase II upgrades, resulting in a 12,725 MW benefit.