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Invenergy, generators argue over interconnection costs for RI gas project

Two independent power producers want the Federal Energy Regulatory Commission to suspend the forward capacity supply contract for Invenergy LLC's proposed gas-fired Clear River Energy Center in Burrillville, R.I., amid permitting delays and disputes over whether the developer should foot the bill for interconnection costs.

In a complaint filed Dec. 21 with FERC, Calpine Corp. and LS Power Associates LP assert that the 1,080-MW Clear River project's contract to supply half of its capacity to the New England power grid for 2019-2020 should be suspended because a series of delays continue to push back the expected in-service date for the plant's first unit. (FERC Docket EL18-53)

An Invenergy subsidiary told Rhode Island regulators in November that the target date of June 2020 was postponed a year because local electricity distributor National Grid USA does not expect to finish a transmission line from an existing switching station to the plant until Dec. 1, 2020, because of permitting delays.

In light of that, Calpine and LS Power argue that Clear River's capacity contract will unjustly affect market prices and thus should be deferred a year as "any chance of the Clear River Project achieving even the newly 'targeted' commercial operation date of June 1, 2021, would appear to be out the window." In comparison, Clear River's delayed Unit 2 was disqualified for the same reason, for the third consecutive time, in November by regional grid overseer ISO New England from selling capacity for 2021-2022.

At the state level, the environmentalist Conservation Law Foundation and the town of Burrillville requested in a Dec. 11 letter that Rhode Island's Energy Facilities Siting Board also suspend the permit application for Clear River until FERC resolves open dockets on the project.

"Without knowing the result of that action at FERC ... we can't evaluate the cost of the facility because that's a cost that has heretofore not been contemplated as involved with the facility," said siting board chair Margaret Curran, according to a Dec. 26 article in the Providence R.I.) Journal.

ISO New England and National Grid on Nov. 29 filed with FERC a standard interconnection agreement for the Clear River project that Invenergy has refused to sign. The grid operator and utility asked FERC to require Invenergy to enter into the interconnection agreement that conforms to a FERC-approved ISO tariff. At dispute are interconnection costs for which Invenergy refuses to pay. (FERC Docket ER18-349)

"Clear River was fully aware throughout the process of the facilities and upgrades for which it would be responsible if it participated in [the 10th Forward Capacity Auction]," ISO New England and National Grid said. "Despite this, Clear River now wishes to retain its Queue Position, and retain the Capacity Supply Obligation it received in FCA-10, while having its cost responsibilities restudied in light of its changed Commercial Operation Date."

According to Invenergy's Nov. 17 complaint, National Grid will spend an estimated $60 million to connect the plant by building new network facilities, upgrading others and relocating an existing 345-kV transmission network. Invenergy also wants to avoid paying about $82 million of operation and maintenance costs for the interconnection over 20 years, or up to $164 million if the plant operates for 40 years. (FERC docket EL18-31)

Invenergy said the ISO tariff, if enforced, would continue to "unjustly and unreasonably" impose "hundreds of millions of dollars" in costs onto interconnection customers in New England, while enriching transmission customers.

"Shifting the O&M costs of the existing facilities from transmission customers to interconnection customers simply because the latter are required to pay to relocate or replace those facilities serves only to subsidize the transmission customers at the interconnection customer’s expense," Invenergy said.

Invenergy requested either the entire elimination of transferring the burden of O&M costs onto generators or, at the minimum, confirming that "O&M costs incurred in connection with the equipment to be relocated or replaced" be recovered by transmission owners in transmission rates.

An Invenergy representative on Dec. 27 declined to comment further or respond to the complaint filed by Calpine and LS Power.

National Grid USA is a subsidiary of U.K.-based National Grid plc.