Analysis: MISO to see 1.7 GW of renewables capacity come online by end of 2019: report

Renewable generation totaling 1.7 GW under construction in the Midcontinent Independent System Operator footprint is now slated for completion by the end of 2019, but 1.4 GW that previously had an in-service date in 2019 will now be delivered in 2020 or 2021, according to a report released Monday.

The additional wind generation is likely to put pressure on power prices, particularly in the wind-heavy MISO North region, where transmission constraints may be contributing to construction completion delays, an analyst said.

The grid operator's latest Generation Interconnection Queue report indicates 1,264 MW of generation that has come online so far in 2019 in MISO, led by Entergy's 904-MW (summer capacity) natural gas-fired, combined-cycle plant in St. Charles Parish, Louisiana.

But all except 55 MW of the generation under construction and has a negotiated in-service date in 2019 is wind powered. The remaining 55 MW is a hydroelectricity project in Iowa.

"Winter and summer, it should have a pronounced effect of lowering average [locational marginal] prices, especially for MISO North," Campbell Faulkner, senior vice president and chief data analyst at OTC Global Holdings, an interdealer commodities broker.

"Next summer it could cause some instability in dispatch, but the effect will be significantly smaller" than what would occur in the Electric Reliability Council of Texas, where the wind fleet makes up a much larger proportion of the generation mix, Faulkner said.

According to a MISO corporate fact sheet released in June, the grid operator has about 175,528 MW of capacity and a historic summer peakload of 127,125 MW. MISO's natural gas-fired fleet makes up 43% of that total, followed by coal with 32%, wind with about 11%, nuclear with about 8%, and others, including other types of renewables, making up the remainder.

In ERCOT, the wind fleet makes up 23.4% of total capacity, which is led by natural gas at 52.4%, and where coal makes up less than 16% and nuclear makes up about 5.4%.

This past summer in ERCOT, heat waves coincided with falling wind output in mid-August and early September, causing real-time locational marginal prices to spike to quadruple-digit levels during these periods and Energy Emergency Alerts to be declared on two days.

1.4 GW POSTPONED

When it comes to the postponed in-service dates for 1.4 GW of generation under construction, which MISO in September listed as having 2019 in-service dates, Faulkner attributed the delays to transmission constraints.

"MISO in the north is very capacity constrained," Faulkner said Monday. "It has been an ongoing issue since MISO began the massive build out of wind two decades ago. Overall, MISO has problems wheeling power to where it's needed from the rural generating regions."

Matthew Cordaro, a former MISO president and CEO who now resides in New York, also attributed the postponements to "overly optimistic" timelines presented by developers.

"One reason for this is developers in the beginning try to make their projects appear more attractive to potential financiers and also quite simply they overlook the many pitfalls that are out there," Cordaro said Monday. "This has been the case ever since the independent power alternative emerged in the evolution of deregulation."

-- Mark Watson, markham.watson@spglobal.com

-- Edited by Keiron Greenhalgh, newsdesk@spglobal.com