(a) Competitive Renewable Energy Zone Transmission
Projects. In considering an application for a certificate of convenience
and necessity (CCN) or CCN amendment for the addition of a second
345-kilovolt (kV) circuit on the Alibates-AJ Swope-Windmill-Ogallala-Tule
Canyon transmission line, the commission is not required to consider
the factors under Public Utility Regulatory Act (PURA) §37.056(c)(1)
and (2).
(b) Designation of Competitive Renewable Energy Zones.
The designation of Competitive Renewable Energy Zones (CREZs) pursuant
to PURA §39.904(g) shall be made through one or more contested-case
proceedings initiated by commission staff, for which the commission
shall establish a procedural schedule. The commission shall consider
the need for proceedings to determine CREZs in 2007.
(1) Commission staff shall initiate a contested case
proceeding upon receiving the information required by paragraph (2)
of this subsection. Any interested entity that participates in the
contested case may nominate a region for CREZ designation. An entity
may submit any evidence it deems appropriate in support of its nomination,
but it shall include information prescribed in paragraph (2)(A) -
(C) of this subsection.
(2) By December 1, 2006, the Electric Reliability Council
of Texas (ERCOT) shall provide to the commission a study of the wind
energy production potential statewide, and of the transmission constraints
that are most likely to limit the deliverability of electricity from
wind energy resources. ERCOT shall consult with other regional transmission
organizations, independent organizations, independent system operators,
or utilities in its analysis of regions of Texas outside the ERCOT
power region. At a minimum, the study submitted by ERCOT shall include:
(A) a map and geographic descriptions of regions that
can reasonably accommodate at least 1,000 megawatts (MW) of new wind-powered
generation resources;
(B) an estimate of the maximum generating capacity
in MW that each zone can reasonably accommodate and an estimate of
the zone's annual production potential;
(C) a description of the improvements necessary to
provide transmission service to the region, a preliminary estimate
of the cost, and identification of the transmission service provider
(TSP) or TSPs whose existing transmission facilities would be directly
affected;
(D) an analysis of any potential combinations of zones
that, in ERCOT's estimation, would result in significantly greater
efficiency if developed together; and
(E) the amount of generating capacity already in service
in the zone, the amount not in service but for which interconnection
agreements (IAs) have been executed, and the amount under study for.
(3) The Texas Department of Parks and Wildlife may
provide an analysis of wildlife habitat that may be affected by renewable
energy development in any candidate zone, and may submit recommendations
for mitigating harmful impacts on wildlife and habitat.
(4) In determining whether to designate an area as
a CREZ and the number of CREZs to designate, the commission shall
consider:
(A) whether renewable energy resources and suitable
land areas are sufficient to develop generating capacity from renewable
energy technologies;
(B) the level of financial commitment by generators;
and
(C) any other factors considered appropriate by the
commission as provided by PURA, including, but not limited to, the
estimated cost of constructing transmission capacity necessary to
deliver to electric customers the electric output from renewable energy
resources in the candidate zone, and the estimated benefits of renewable
energy produced in the candidate zone.
(5) The commission shall issue a final order within
six months of the initiation by commission staff of a CREZ proceeding,
unless it finds good cause to extend the deadline. For each new CREZ
it orders, the commission shall specify:
(A) the geographic extent of the CREZ;
(B) major transmission improvements necessary to deliver
to customers the energy generated by renewable resources in the CREZ,
in a manner that is most beneficial and cost-effective to the customers,
including new and upgraded lines identified by voltage level and a
general description of where any new lines will interconnect to the
existing grid;
(C) an estimate of the maximum generating capacity
that the commission expects the transmission ordered for the CREZ
to accommodate; and
(D) any other requirement considered appropriate by
the commission as provided by PURA.
(6) The commission may direct a utility outside of
ERCOT to file a plan for the development of a CREZ in or adjacent
to its service area. The plan shall include the maximum generating
capacity that each potential CREZ can reasonably accommodate; identify
the transmission improvements needed to provide service to each CREZ;
and include the cost of the improvements and a timetable for complying
with all applicable federal transmission tariff requirements.
(c) Level of financial commitment by generators for
designating a CREZ.
(1) A renewable energy developer's existing renewable
energy resources, and pending or signed IAs for planned renewable
energy resources, leasing agreements with landowners in a proposed
CREZ, and letters of credit representing dollars per MW of proposed
renewable generation resources, posted with ERCOT, that the developer
intends to install and the area of interest are examples of financial
commitment by developers to a CREZ. The commission may also consider
projects for which a TSP, ERCOT, or another independent system operator
is conducting an interconnection study; and any other factors for
which parties have provided evidence as indications of financial commitment.
(2) A non-utility entity's commitment to build and
own transmission facilities dedicated to delivering the output of
renewable energy resources in a proposed CREZ to the transmission
system of a TSP in Texas or a deposit or payment to secure or fund
the construction of such transmission facilities by an electric utility
or a transmission utility to deliver the output of a renewable generation
project in Texas is an indication of the entity's financial commitment
to a CREZ.
(d) Plan to develop transmission capacity.
(1) After the issuance of a final order in accordance
with subsection (b)(5) of this section, entities interested in constructing
the transmission improvements shall submit expressions of interest
to the commission. The commission shall select the entity or entities
responsible for constructing the transmission improvements, establish
a schedule by which the improvements shall be completed, and specify
any additional reporting requirements or other measures deemed appropriate
by the commission to ensure that entities complete the ordered improvements
in a timely manner.
(2) The commission shall develop a plan to construct
transmission capacity necessary to deliver to electric customers,
in a manner that is most beneficial and cost-effective to the customers,
the electric output from renewable energy technologies in the CREZ.
(3) In developing the transmission capacity plan, the
commission may consider:
(A) the estimated cost of constructing transmission
capacity necessary to deliver to electric customers the electric output
from renewable energy resources in the candidate zone;
(B) the estimated cost of additional ancillary services;
and
(C) any other factors considered appropriate by the
commission as provided by PURA.
(e) Certificates of convenience and necessity.
(1) Not later than three years after a commission final
order designating a CREZ, each TSP selected to build and own transmission
facilities for that CREZ shall file all required CREZ CCN applications.
The commission may grant an extension to this deadline for good cause.
The commission may establish a filing schedule for the CCN applications.
(2) A CCN application for a transmission project intended
to serve a CREZ, except an application filed pursuant to paragraph
(1) of this subsection or subsection (a) of this section, shall address
all the criteria in PURA §37.056, including the criteria in PURA §37.056(c)(1)
and (2).
(3) In determining whether financial commitment for
a CREZ is sufficient under PURA §39.904(g)(3) to grant CCNs for
transmission facilities for the CREZ, the commission shall consider
the following evidence of financial commitment by renewable generators:
(A) capacity represented by installed generation located
in one or more of the counties that lie in whole or in part within
the CREZ;
Cont'd... |