When the Ontario Ministry of Energy asked generators for their comments on how to establish standards of practice for key parts of the connection process, generators were happy to respond. Advice flowed in from the Ontario Waterpower Association, the Canadian Solar Industries Association and the Biogas Association. Although the procedures that distributors use for connecting generators are governed by the Distribution System Code (DSC), many of the specifics are left to the discretion of the local electrical distributor. A key part of the process is the production of a Connection Impact Assessment or CIA.
The work has its genesis in the Two-Year FIT Program Review, which recommended the establishment of best practices and processes for distributors and transmitters to improve communication, transparency, and coordination in the CIA process. Accordingly, the Ministry, together with the Ontario Power Authority, the Ontario Energy Board, the Independent Electricity System Operator and distributors, with the help of the Electricity Distributors’ Association, developed a series of draft best practices for the CIA process. In November 2012, the Ministry invited representatives from the generator community to attend consultation sessions and to submit comments.
All the generator associations said they were pleased with the Ministry’s initiative and they welcomed the idea of establishing a system of Best Management Practices or BMPs for CIAs.
In a December 7 letter to Ceiran Bishop, the Ministry’s Manager of Transmission Policy, the OWA identified three primary themes: the need to develop “case examples” as the basis for an improved common understanding of expectations in the connection process, the need to include the issue of connection costs, and the opportunity to build a broader dialogue.
All the generator organizations stressed that the level of connection costs and the dependability of connection cost estimates is a major concern. There have been instances where final connection costs were much larger than the initial estimates, sometimes dislocating or seriously disrupting plans for the generators. The range of circumstances that can cause a cost estimate to change is of course very wide. As a result there is a likely to be a significant process ahead in establishing the conditions that will allow for a great deal of improvement in the accuracy of initial cost estimates for generation connections.
The OWA said, “In our view, the cited objectives of improved service, enhanced clarity and greater clarity and transparency with respect to cost and cost estimations are absolutely fundamental to a positive and productive relationship between a generator and distributor/transmitter.” They recommended that “some generic material be developed collaboratively which provides indicative costs for core elements involved in connecting new generation.”
The OWA stressed an approach based on developing shared documents that would guide distributors and generators in their practices. Such materials could be designed “to improve the transparency of the relationship by developing a common understanding of expectations. In our view, effort should be directed to the creation and communication of a generic generation package, which could be customized by the distributor, but would establish a reasonable baseline for the generator community. This single initiative would address a number of the areas of proposed improvement in the draft, including providing the basis for a better common understanding of what constitutes a ‘complete application.’”
CanSIA’s submission agreed with the OWA and added a number of comments. One particularly significant recommendation was that to increase the transparency of technical capacity limits, the technical requirements for connecting to a distributor’s system should be published and updated regularly on the distributor’s website.” The organization also made a number of suggestions on timelines, focusing in particular on the maximum time allowed for a distributor to respond to applications.
A frequent concern appears to relate to how and when applicants are notified when their application is deemed to be complete. CanSIA suggested that a more automated process could effectively notify an applicant immediately when their application is deemed to be complete, saving a significant amount of time and costs for the generator and signaling the start time for CIA completion timelines.
Complications can arise if the upstream analysis isn’t working on the same schedule. CanSIA agreed with the Ministry’s suggested best practice that “Hydro One’s TS analysis be completed within the prescribed timeline for the distributor CIA.” They also agreed with the suggestion that “embedded and host distributor CIAs should be completed in parallel.” CanSIA also recommended that the allocation of capacity for PV up to a threshold of 10 MW, including the analysis of impacted transmission stations, should be assigned to the LDCs to manage.
Where further upstream analysis is needed by the IESO or the transmitter, the Ministry has suggested specific timelines be applied. CanSIA agreed and suggested automation of the process such that all participants use the same tools, have appropriate visibility of documents related to the application, and that LDCs should all be able to access files when appropriate and do what is required.” CanSIA stressed that, “It is essential to have clear and enforceable deadlines. Currently many LDCs have not been held accountable for a missing a 60 day deadline.”
Some other issues are primarily communication questions. For example with regards to a generator information package the previous small FIT terminology Capacity Allocation Exempt (CAE) did not exempt CAE contracts from capacity allocation processes. CanSIA suggested that a warning should be provided that states developers/owners should not purchase equipment until Capacity Allocation is confirmed. CanSIA agreed with the proposed best practice that Information packages from the distributor indicate that SLDs (Single line diagrams) must be signed and stamped by a Professional Engineer, adding that that SLDs are expected to contain appropriate qualifiers such as “Not For Construction,” at a “preliminary stage,” or ‘As-Built’ when submitted with Connection Applications.
In terms of Connection Cost Estimates, CanSIA said, “A mechanism should be in place, such that project developers can request clarification on the details and feasibility of the reports and require stronger assessments + or- 10% before being forced into a CCRA within 6 months.” CanSIA concluded with some challenging suggestions based in part on emulating connection procedures in California, Hawaii and Germany and made the following specific recommendations:
a) Require LDCs to administer the CIA process in its entirety, devolving responsibility for the TCIA analysis to the LDC, eliminating the necessity of HONI to produce a TCIA in a parallel process for large LDCs.
b) Report CIA application processing times on LDC websites, and to the OPA, with a hard limit whereby Capacity Allocation is deemed to have occurred if not completed within the DSC provided limit (currently 60 days).
c) Publish Station Capacity, DG applications and their allowed DG on a feeder as Hydro One does.
The Biogas Association agreed with many of the other comments and added some recommendations of its own:
“• Clarity is required to the generator on what changes trigger a new CIA. Specifically, what changes in generation equipment can be dealt with as ‘Equipment Clarification’ (i.e., no new CIA) and what changes trigger a ‘CIA Revision’ (i.e., – with new CIA study and cost estimate).
• Technical requirements should be posted on the LDCs website with links provided.
• The deemed complete date for CIA must be provided to generators.
• For timelines that are dependent on whether distribution expansion is required or where upstream LDC is involved, the LDC should inform the generator how the timeline is established (i.e., reason for set timeline of 60, 90 or 120 days).
• When delivering completed CIA and cost estimates, the LDC should also inform by way of cover letter when the capacity will be withdrawn if the generator does not execute a CCA or accept the offer to connect.
• The chart for small generators shows that capacity can be withdrawn 60 days after CIA (s6.2.12), but practice has been to 6 months (ref s6.2.4.1). Clarity needs to be provided whether moving forward, if 60 days is now going to be enforced for CAE projects. ….
• Additional clarity is necessary on what the requirements are for a revision after a CIA has been approved.”
“The Ministry appreciated the wide-ranging input from generators and is looking forward to the publication of the best practices, which will focus on connection timelines and processes and making them clearer and easier to understand,” said Ministry spokesperson Kirby Dier. “The best practices can also be a reference both for LDCs and for generators who are looking to better understand how the connection process can influence development timelines and milestones.”
Using the feedback from generator associations, the Ministry will be engaging distributors and other stakeholders, including the Electricity Distributors Association, for further discussion. “An important part of this effort is finding opportunities to balance developers’ priorities with the requirement that licensed distributors plan, operate and connect generators to their systems safely, reliably and in accordance with all regulatory codes,” the Ministry said. Discussions continue with the Electricity Distributors Association on the disseminations of the best practices.
The OWA letter concluded with the observation that “the CIA process is but one important component of the relationship between generators and distributors/transmitters during the lifecycle of a project.” The OWA noted earlier comments discussing the need for similar improvements in communication at the contract execution and Notice to Proceed stages of the project. The adoption of such approaches, including the development and communication of generic materials, can “help educate proponents contemplating a project, leading to a more informed business conversation with the LDC/Transmitter in the first instance.”
Clearly this is only the first stage in an important dialogue between generators and utilities to clarify the expectations and standards that will be used in dealing with future connections.