The good news and bad news for clean energy from LBNL’s nationwide interconnection study

Interconnection queues are an imperfect measure of the country’s pending generation capacity. Many of the power plants, wind and solar farms and energy storage projects that have staked a claim to connect to transmission grids across the U.S. are ​“real” projects with financial backing and counterparties committed to buy the power the plants will produce. Others may be more speculative, with little likelihood of being financed and built.

Despite that, Lawrence Berkeley National Laboratory’s latest interconnection queue study provides important insights into the state of the country’s coming generation mix. In fact, the comprehensive survey of the country’s seven transmission grid operators and 35 utilities, representing 85 percent of U.S. electricity load, highlights just how dominant clean energy is becoming in most of the country — and how much harder it has become for those projects to cross the finish line.

“I see this as a hopeful story,” Joe Rand, LBNL senior scientific engineering associate and lead author of the study, said in a Tuesday interview. Namely, the 671 gigawatts of wind and solar it tallied is ​“more than half of the wind and solar capacity that’s estimated to be needed to approach a zero-carbon electricity target” as proposed by the Biden administration.

“But there’s a big caveat after that — and that’s that the trends clearly indicate that a lot of this capacity is really struggling to connect to the transmission grid,” he said. ​“Transmission is needed, and transmission interconnection reform may also be needed, to unlock all this capacity in the queues.”

Rand’s comment is backed up by multiple studies over the past few years indicating that the country will need to double or triple its existing transmission capacity to meet the Biden administration’s carbon reduction goals. Other reports have highlighted regulatory roadblocks that force project-killing grid upgrade costs on pending projects.

The Biden administration is pledging $100 billion in transmission grid investments to unblock these constraints, while the Federal Energy Regulatory Commission is examining rule changes to reduce grid upgrade cost burdens and incentivize new technologies that could boost the carrying capacity of the existing grid.

At the same time, LBNL’s survey highlights that planned solar, wind and battery projects are breaking records, as falling costs coincide with more mandates for clean power to decarbonize the grid. Here are some key takeaways from the report.

1) The clean energy projects in queues today could get the U.S. more than halfway to net-zero electricity

Of the 750 gigawatts’ worth of projects LBNL tallied, 671 GW are wind and solar, while another 200 GW are for energy storage. Of the projects in the queues, 71 percent are expected to be online by the end of 2023. The country’s total utility-scale generation capacity last year stood at 1,117 GW. That means there’s enough clean energy in queue to replace more than half of the country’s mix of coal and natural-gas-powered electricity supply in the next decade.

To be clear, it’s highly unlikely that all of these projects will be built — but the trend lines are moving in the right direction for cleaner power. The U.S. Energy Information Administration forecasts that 39.7 GW of capacity will begin operating in 2021, 12.4 GW of it utility-scale solar and 12.2 GW of it wind power. Another 6.6 GW of natural-gas power plants are on the books for this year, while energy storage stands at 4.3 GW.

2) Technology price, geography and regulatory structures play a big role in what resources are being built where

LBNL finds that solar power is booming across almost all regions, including traditional hot spots like California, the intermountain West and Texas, but also in the Midwest and Southeast. Wind power dominates in the Great Plains states that constitute the territory of grid operator Southwest Power Pool, as well as in New York and New England, where much of the new capacity is to come from offshore wind.

Meanwhile, natural-gas interconnections are falling in every region except the Southeast, where they’ve risen to nearly 40 GW of new gas-fired power plants being proposed as of last year. Utilities in the region, including Duke Energy and Southern Company, operate outside the wholesale energy market constructs that exist in much of the rest of the country and are asking regulators for permission to build new gas plants to maintain grid reliability. Clean-energy groups are rallying against those plants, saying they will prevent those utilities from achieving their net-zero carbon goals.

3) Stand-alone batteries and solar-storage projects are on the rise

Of the projects tallied by LBNL, more than half are solar or solar-plus-storage. Most of the hybrid solar-battery projects are in California and the West, where the ratio stands at 3 to 1 compared to stand-alone solar — a reflection of the value of shifting already high levels of solar production from midday to afternoon and evening times of peak grid demand.

Overall, more than a third of proposed solar capacity is paired with storage, and half of storage is paired with generation, LBNL found. Stand-alone solar is most prevalent in the queues of the Midcontinent Independent System Operator (MISO) and mid-Atlantic grid operator PJM, where solar penetration hasn’t yet risen to levels that make storing and shifting it as pressing a matter.

4) The time it takes to get a project interconnected is increasing

The data here is less comprehensive, but LBNL’s survey of four of the country’s biggest grid operators — PJM, New York ISO, ISO New England and California’s CAISO — shows that the median number of days from interconnection request to commercial operations date has increased over the past decade, with average wait times growing from 1.9 years in the 2000s to 3.5 years in the past decade.

Data also shows that wind projects have faced the greatest increase in time from proposal to interconnection. That trend is most likely driven by problems in the Midwest territories of Southwest Power Pool and MISO, where the cost of grid upgrades to bring new wind farms online has led to many project cancellations. Just this week, wind power developer Tenaska Clear Creek filed a complaint with FERC demanding relief from $66 million in network upgrade costs allocated by SPP, nearly two years after the project cleared its final study, and after it had already been interconnected and started operating.

5) Fewer projects are being completed 

As we mentioned before, it’s hard to separate out the factors that contribute to the relatively low ratio of projects in interconnection queues that actually reach the finish line. But changes in the overall ratio over time represent an important data point — and on that measure, the trendlines aren’t looking good.

Data from grid operators CAISO, MISO, PJM, NYISO and ISO-NE indicates that only 19 percent of wind projects and 16 percent of solar projects in the queues reached commercial operations, compared to 24 percent for projects overall. And those completion rates have been falling over the past few years, as the following charts indicate.

Grid operator interconnection queues are flooded with new projects, which has slowed their progress. At the same time, clean energy developers and trade groups are calling for significant regulatory reforms to unblock the barriers to getting projects interconnected. Those range from creating new regulatory structures to manage the novel aspects of hybrid renewable-storage systems to beefing up federal authority to boost interregional transmission grid buildouts to enable the massive clean energy growth needed to reach the Biden administration’s goals of a net-zero carbon grid by 2035.

(Article image courtesy of American Public Power Association)