Description of venture idea
Insurance that underwrites long-term congestion / curtailment risk. This enables project developers to apply for energy-only interconnection (which is a much faster process) with far greater revenue certainty.
Market needs this venture would address
For developers of renewables, battery storage, and large load (e.g. data centers), helps them get interconnected faster in order to start commercial operation sooner
Technical capabilities this venture might leverage
New software that performs congestion/curtailment analysis for all settlement points in a grid.
Business model
TBD
Team
Outstanding risks & critical hypotheses
- Limiting the financial exposure of a project to congestion would make energy-only interconnection much more attractive for developers and offtakers
- Projects can find ways to make up for the lack of capacity market revenue (unavailable for energy-only interconnection)
- This kind of analysis is technically feasible and would be reasonably accurate
- The financial math works out, i.e. attractive numbers for both the underwriter and the project
- ❌ In ERCOT, financing projects is challenging or expensive due to the curtailment risk