The ISO Transmission Planning Process
The CAISO conducts transmission planning for the investor owner utilities (IOUs) and municipals that have joined the ISO as Participating Transmission Owners4. Currently, the Southern Cities5 are the only non-IOU participants in the CAISO planning process. Federal entities, such as the Western Area Power Administration (WAPA), and municipalities do not go through the CAISO planning process, although some coordination occurs. Municipal entities have their own project approval and development process. The CAISO does analysis on the impacts of proposed municipal transmission projects and if concerns arise they are addressed through the Western Electricity Coordinating Council (WECC) reliability assessment processes. In short, while the CAISO controls approximately 80% of the current transmission system and plays a prominent role in the State's transmission planning, California does not and will not have `one stop shopping' for transmission planning given the separate process that municipal and federal entities undergo.
There are essentially two types of transmission projects: 1) projects that are required to maintain system reliability; and 2) projects that are required for economic reasons (i.e. the cost savings to customers from building the project outweigh the project costs). The CAISO's transmission planning process has been primarily reliability focused, although the increase in transmission congestion, and its associated costs, has complicated transmission assessment and blurred the demarcation between economic and reliability projects. The ISO has been more equipped, from an expertise perspective, to evaluate the reliability components of a project than the economic aspects. However, given experience in the transmission planning process in the past several years and its in-house expertise in evaluating market dynamics, it is developing the economic expertise necessary to foster a comprehensive approach toward transmission evaluation.
The CAISO's overall transmission planning process has multiple components: 1) the annual control area study that incorporates the individual yearly transmission plans submitted by the Participating Transmission Owners; 2) yearly reliability must-run studies; 3) focused studies for especially large and complicated projects; and 4) interconnection studies.
A focal point for CAISO's current transmission planning is the enormous amount of new generation that has been built in the Southwest, Colorado, and Nevada to serve California. This new generation will have large implications for the transmission requirements in California. (See Attachment A for the list of generation projects).
4 Participating transmission owners (PTOs) are entities that turn over operational control of their transmission system to the CAISO. In addition, the PTOs have signed generator control agreements that give the CAISO the ability to dispatch generation. 5 The cities of Riverside, Azusa, Banning, and Anaheim are referred to as the Southern Cities.
