We write separately to discuss our approval of APS’s commercial readiness requirements, which incorporate both non-financial commercial readiness milestones as well as an option to provide a deposit in lieu of a commercial readiness demonstration.
Our determination in this proceeding is based on the applicable pre-Order No. 2023 precedent. Yet we are aware that in Order No. 2023 the Commission declined to adopt non-financial commercial readiness requirements,and future proposals to incorporate commercial readiness requirements will be assessed in light of Order No. 2023.
In both this and a recent proceeding accepting Public Service Company of Colorado’s commercial readiness requirements, protestors raised concerns that the readiness milestones may be unworkable for independent power producers. We emphasize that we take such concerns, and the obligation to ensure interconnection queue processes are not unduly discriminatory, seriously. In PSCo and here again, we accepted the proposals because the combination of non-financial and financial commercial readiness options offer a reasonable pathway for interconnection customers, including independent power producers, to progress through the queue with non-speculative projects. But we do not view our approval of these proposals as endorsing a one-way ratchet toward ever-increasing financial commercial readiness deposits.
Going forward, we will continue to weigh both the need for commercial readiness requirements as an important tool to deter non-viable projects and manage clogged interconnection queues, and whether the specific combination of commercial readiness requirements in a proposal provide a practical pathway for interconnection customers, including independent power producers, to enter and move through the queue. The analysis will necessarily be case-by-case. What is workable in one region may not be a workable option in another. While transmission providers may wish to reach for more stringent requirements in order to effectively manage growing interconnection queues, we expect them to continue to engage with stakeholders to ensure that the proposals they develop are workable for the diversity of interconnection customers in their region.
Willie L. Phillips