Working Paper: NBER ID: w31946
Authors: Sarah Johnston; Yifei Liu; Chenyu Yang
Abstract: Generators applying to connect to the U.S. power grid go through an interconnection queue. Most wind and solar generators that begin the process do not complete it. Using new data, we find that a long queue increases the average waiting time, and high interconnection costs are a key factor in a generator’s decision to withdraw. We develop and estimate a dynamic model of the queue and quantify the effects of policy reforms. Our simulations indicate that reducing waiting times can significantly increase completions. An alternative queuing mechanism can therefore increase completed capacity by removing certain generators to reduce congestion. A flat entry fee has a similar effect. We also quantify the effects of reforming how interconnection costs are assessed. These policy reforms lead to a substantial reduction in carbon emissions.
Keywords: interconnection queue; renewable energy; electricity market; policy reforms; carbon emissions
JEL Codes: D02; L0; Q00
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| policy design (G52) | operational outcomes (L21) |
| higher queued generators (C69) | study completion probability (C29) |
| interconnection costs (L96) | generator withdrawal (Y70) |
| waiting times (C41) | completed capacity (E22) |