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The US faces a critical bottleneck in connecting new electricity generation and storage to the grid, with over 2.2 terawatts of projects currently in queues. While the US Department of Energy has pushed for streamlined load interconnection for data centers, the author argues that this is insufficient without parallel reforms to generator interconnection. Current processes are characterized by long delays—averaging nearly five years from request to operation in 2024—and high network upgrade costs that often exceed 10% of project capex, leading to high attrition rates. The brief proposes several solutions: adopting advanced AI and automation software for studies, integrating Grid-enhancing technologies (GETs) to reduce costs, improving transparency in network upgrade construction, and implementing 'fast track' pathways such as energy-only interconnection, surplus interconnection service, and generator replacement.

The report analyzes the impact of a 30% Investment Tax Credit (ITC) on interconnection costs for onshore wind and solar projects in the U.S. It finds that this credit could reduce overall project costs by 3% for solar and 1.7% for wind. More significantly, the analysis suggests the ITC could have bridged the cost gap for 22 GW of withdrawn projects and 15 GW of active projects across five regions, potentially bringing a total of 26-37 GW of capacity to fruition.

The document describes a methodology for assessing the economic viability of gas-fired power plants in MISO and SPP during 2019. By comparing day-ahead market revenues against fuel and variable operating expenses, the authors calculated hourly cash flows for 436 facilities. The process involved converting EPA gross generation data to net generation, mapping plants to the nearest market pricing nodes, and utilizing S&P Global data for fuel costs and variable operations and maintenance (O&M) expenses.

The report finds that gas-fired power plants in MISO and SPP frequently operate at a loss, costing ratepayers an estimated $117 million in 2019. This uneconomic generation is most prevalent in steam turbines and gas turbines, often driven by practices like self-scheduling and self-commitment. The authors argue that these inefficiencies, combined with rising fuel costs and the growth of renewables, make gas-fired power an increasingly risky and expensive investment compared to clean energy portfolios.

The document challenges the notion that wind curtailment results from an oversupply of wind, using analysis of the Southwest Power Pool (SPP) to show that higher-cost coal plants often remain online while wind is curtailed. It identifies three primary drivers of this waste: inadequate transmission capacity, the practice of coal plants 'self-committing' to avoid being turned off, and a lack of battery storage. The author argues that addressing these infrastructure and operational shortcomings would reduce costs for consumers and lower carbon emissions.

The report argues that rate-regulated utilities use 'self-commitment' to bypass market merit order, running coal plants that are objectively uneconomic and passing the resulting losses to captive customers through state fuel-cost-recovery processes. Using PLEXOS modeling for the MISO region in 2018, the authors find that this practice cost customers $350 million and suppressed regional market clearing prices by 2.4%. The report identifies Cleco and DTE Energy as significant contributors to these distortions and recommends that state regulators disallow the recovery of imprudent, above-market costs to incentivize efficient dispatch.

The Southwest Power Pool (SPP) has emerged as a leader in renewable energy, offering significant opportunities for corporate buyers through wind power purchase agreements (PPAs). Market improvements since 2014, including the integration of the Integrated System (IS) transmission system, have increased dispatch efficiency and reduced energy costs. The region possesses some of the highest wind resource quality in the U.S., with nine of the top 10 states for high-capacity-factor wind generation located within the SPP footprint. This high capacity factor allows for lower unit costs and more competitive PPA prices. While there is a strong pipeline of planned wind capacity—including an estimated 19 GW of planned additions and nearly 7 GW expected in 2017—corporate buyers are cautioned to monitor the pace of transmission infrastructure investment to avoid curtailment risks and track regional policy changes, such as potential tax credit eliminations in Oklahoma.

The paper argues that the variability of renewable energy can be managed through optimized geographic dispersion and the cross-firming of wind and solar resources. By analyzing data from the MRO, SPP, and ERCOT regions, the study demonstrates that expanding the geographic scope of a renewable portfolio significantly reduces system variability and the frequency of zero-power production. It also finds that combining solar and wind resources further lowers variability compared to wind-only portfolios. The authors conclude that these strategies, combined with demand response, energy storage (such as xEVs), and smart grid communications, can reduce the reliance on conventional baseload power.