Chapter 2.6: Competitive Transmission
As part of FERC Order 1000, all jurisdictional public utility transmission providers were required to remove from their tariffs and agreements any provisions that granted a federal right of first refusal to construct new transmission facilities whose costs are regionally allocated. In implementing this requirement, MISO adopted the developer selection approach in its competitive transmission process. As a result, the MTEP process will continue to determine which regional transmission facilities will be constructed; however, the construction, ownership, operation and maintenance of eligible transmission facilities will now be open to competition rather than automatically assigned to incumbent utilities.
For any competitive transmission facility, MISO will solicit proposals from Qualified Transmission Developers, whether they are incumbents or new entrants. MISO’s competitive transmission process was filed in October of 2012; however MISO began to engage its stakeholders in discussions to further develop and refine the MISO competitive transmission process in 2014 through multiple stakeholder workshops. MISO used this process to define:
- The criteria by which MISO qualifies interested transmission developers for the process
- The criteria by which a qualified transmission developer will be selected to construct, own, and operate regional transmission facilities (located in states that do not contain Right of First Refusal legislation)
- The triggers for reevaluating a project and/or transmission developer(s)
These workshops helped create the collaborative environment needed for MISO and its stakeholders to refine and develop this competitive process and the associated governance (including tariff language and business practice manuals).
The stakeholder workshop participation averaged more than 50 registered participants, including transmission developers, transmission owners, regulators and other interested parties. As a result, the MISO Tariff was revised in September 2015 and October 2015 to incorporate the competitive transmission process refinements and modifications. In addition, MISO revised its Business Practice Manuals (BPM) as a part of the stakeholder workshops. The BPMs are a product of the significant stakeholder input received during the stakeholder workshops, as well as information provided by MISO’s subject-matter experts and expert consultants.
In 2015, MISO also conducted a dry run of the competitive transmission developer selection process to identify any process concerns, issues and improvements prior to the finalization of the process and its governing language. MISO created a hypothetical project and issued a Dry-Run Request for Proposals (RFP) to stakeholders on May 4, 2015. Participation in the dry run was voluntary and MISO received seven fictitious proposals from the following entities: Entergy Mississippi Inc./Entergy Arkansas Inc.; Xcel Energy Transmission Development Co.; Southern Indiana Gas & Electric Co., dba Vectren Energy Delivery; ITC Midwest LLC; Transource Energy LLC; Duke-American Transmission Co. LLC; and Public Service Enterprise Group. The dry run afforded MISO a tremendous opportunity to understand improvements to its internal processes and to identify potential process improvements for both MISO and participating entities. In addition, it allowed the volunteering participants to provide constructive feedback on the dry run with suggestions and comments to improve the process. MISO thanks those that volunteered their time and resources to this effort. The dry-run exercise was a useful and beneficial effort for both MISO and the participants, as the broader MISO stakeholder community will benefit from the application of those lessons learned.
The MISO Competitive Transmission Process has a defined life cycle (Figure 2.6-1).
The prequalification process is an annual cycle that opens in January. Any transmission developer that intends to bid on MISO competitive transmission projects must be designated by MISO as a Qualified Transmission Developer (QTD) to submit a proposal. To obtain QTD status, interested transmission developers must submit an application and be approved by MISO in the annual prequalification cycle. An existing QTD must renew its status annually during the annual QTD renewal cycle, which happens simultaneously with the prequalification cycle.
Transmission facilities eligible for competitive bidding are developed through the MISO Transmission Expansion Planning (MTEP) process. Eligible transmission facilities, referred to as Competitive Transmission Projects, contain transmission facilities that are approved by the MISO Board of Directors as part of a Market Efficiency Project (MEP) or a Multi-Value Project (MVP) (Figure 2.6-2). Eligible transmission facilities include those facilities that are not upgrades or otherwise assigned to an incumbent Transmission Owner due to Applicable Laws and Regulations pursuant to Attachment FF Section VIII.A of the MISO Tariff.
The MISO competitive transmission process has no impact on the MTEP process; however it uses the MTEP output to determine Competitive Transmission Projects. All Competitive Transmission Projects will be posted to the MISO website for competitive bidding within 30 days of the MISO Board of Directors’ approval of the MTEP report (typically in December of each year) (Figure 2.6-3). QTDs have six months to develop and submit their proposals; then MISO has six months after the submission deadline to evaluate the proposals and designate a Selected Proposal.
MTEP14 was the first MTEP cycle in which eligible transmission facilities were subject to MISO’s competitive transmission developer selection process and MTEP15 is the first MTEP cycle to recommend a project containing competitive transmission facilities. As discussed further in Chapter 5.3: Market Congestion Planning Study, MTEP15 recommends the approval of the Duff – Rockport – Coleman 345 kV Market Efficiency Project (MEP). This project contains Competitive Transmission Facilities eligible for the MISO competitive transmission developer selection process. Should the MISO Board of Directors approve the to-be-determined Market Efficiency Project as part of MTEP15, MISO will post a Request for Proposals for the to-be-determined Market Efficiency Project’s Competitive Transmission Facilities and solicit proposals from QTDs within 30 days of the MISO Board of Directors’ approval.
 The Transmission Developer Qualification and Selection page on the MISO website contains links to these stakeholder workshops.