An approach to analyze and evaluate transmission cost impacts for new generation proposals

The Federal Energy Regulatory Commission (FERC) has established a standardized process for interconnecting new generation that should be applied by responsible planning coordinators (ISO/RTO/TO). In a request for offer (RFO) of generation valuation and selection process, it is logical to seek for the most cost-effective solution that takes into account generation costs and transmission upgrade costs of all upgraded network elements. This paper describes a reasonable and robust methodology which can be used to assess the impacts of transmission costs in new generation procurement. Unlike previous methods discussed in the energy industry, this approach reflects the physical impact of new generation projects on the MW loading and short-circuit duties of required network upgrades to calculate transmission costs. This methodology can be suitably employed by any load serving entity (LSE) in the NERC region for including transmission costs in the request for offer (RFO) overall evaluation process for the procurement of new generation resources.