Rooftop

Xcel’s latest plan for 250 MW solar at Sherco may delay rooftop solar

Xcel’s latest plan for 250 MW solar at Sherco may delay rooftop solar
Brian Lawson and Kenesaw Burwell work on panels that the Energy Department is using to leverage a Power Purchase Agreement with Sun Edison and Xcel Energy. (Courtesy: Science in HD/Unslash)

Xcel Energy in Minnesota announced a plan for 250 MW utility-scale solar on top of the 460 MW at the Sherburne County (“Sherco”) site in Becker, Minnesota. This announcement is bad news for Minnesota’s distributed solar and storage prospects because ratepayers must pay for additional transmission to deliver this energy.

There are alternatives available to Xcel sitting in its distribution interconnection queue. Instead of working on interconnecting rooftop solar and home battery solutions, Xcel is increasing utility-scale solar and neglecting rooftop solar concerns.

Minnesota Public Utilities Commission (PUC) approved Xcel’s 460 MW solar project last fall. Xcel can build a large utility-scale solar project bypassing the new generator interconnection queue process at MISO because Xcel is “replacing” coal with solar and qualifies as a “generator replacement” project.

But MN PUC also approved Xcel’s 2019 Integrated Resource Plan (IRP) after an extensive stakeholder process in February 2022 (an order was issued in April 2022), which ordered Xcel to model distributed solar and plan for aggregations of distributed energy resources (DERs). These distributed resources could be at risk with this latest 250 MW solar announcement.

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In that 2019 IRP decision issued in April 2022, the PUC ordered Xcel to take 5 steps to correct the misalignment between resource and distribution planning – to “integrate” the Integrated Resource Planning and Integrated Distribution Planning.

Those 5 steps are:
1. “Set the forecasts for distributed energy resources consistently in its resource plan and its Integrated Distribution Plan.
2. Conduct advanced forecasting to better project the levels of distributed energy resource deployment at a feeder level, using Xcel’s advanced planning tool.
3. Proactively plan investments in hosting capacity and other necessary system capacity to allow distributed generation and electric vehicle additions consistent with the forecast for distributed energy resources.
4. Improve non-wires alternatives analysis, including market solicitations for deferral opportunities to make sure Xcel can take advantage of distributed energy resources to address discrete distribution system costs.
5. Plan for aggregated distributed energy resources to provide system value including energy/capacity during peak hours.”

Xcel Energy’s 2.2 GW Sherco coal-fired power plant in Becker, Minnesota. (Courtesy: MPCA/Flickr)

Xcel’s actions post-April 2022 do not indicate progress toward advancing integrating distributed resources interconnection and forecasting.

Vote Solar and other solar advocates rejoiced when the PUC decision came out due to the prospects for distributed solar. But so far, Xcel has not taken steps to integrate distributed solar, specifically aggregations of DERs. In April 2022, Xcel and other MISO transmission utilities pushed MISO’s proposed implementation date for FERC Order 2222 to 2030. FERC has not decided yet on MISO’s compliance proposal.

Even though FERC has yet to weigh in on MISO’s Aggregation of DERs proposal, Xcel convinced MISO and other transmission utilities to adopt an Affected Systems Studies for DERs, opposite FERC’s intent behind Order 2222. The Xcel Energy – MISO study agreement was the starting point for DER interconnection coordination at MISO. FERC declined to exercise jurisdiction over distribution system interconnection issues in Order 2222 and didn’t ask aggregators to enter the MISO generator interconnection queue. But that is the intent with MISO’s Affected Systems Studies for DERs since Affected Systems Studies are part of FERC-jurisdictional generator interconnection studies. Most utility-scale solar projects are tied up in the MISO queue due to these affected systems studies – where MISO is waiting on results from PJM, for example, for a project close to PJM’s transmission system.

Xcel also asked the MN PUC not to allow Aggregators of Retail Customers (ARCs) in a March filing. These ARCs provide demand flexibility to integrate additional renewables. Minnesota is one of the “opt-out” states that do not allow their retail demand response programs to participate in wholesale markets. Michigan lifted its ban on ARCs last December after seeing higher MISO capacity prices twice in past auctions. MISO’s latest capacity auction results will be announced this Friday.

Xcel also got PUC approval for a resiliency service program in March this year. All Energy Solar, Blue Horizon Energy, and Sunnova Energy have filed petitions for reconsideration due to the potential for Xcel’s monopoly on providing resiliency services in Minnesota. PUC is taking up these petitions for reconsideration on Thursday, May 18.

All these actions by Xcel – convincing MISO to push out FERC Order 2222 implementation until 2030, bringing Affected Systems Studies to study DERs, not allowing ARCs, and gaining approval for monopolizing the resiliency service program, do not indicate as of now how Xcel would meet PUC’s 2019 IRP order on integrating distribution and resource planning. Xcel’s next IRP must be filed by February 1, 2024. Distributed solar advocates might have to sharpen the pencils again for distributed resources since Xcel is doubling down on the utility-scale solar at Sherco.