EL26-70-000 · 2026-08-12 · Sparkfund
Comments of Sparkfund on Midcontinent Independent System Operator Inc.’s Informational Report filed on 07/20/2026
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UNITED STATES OF AMERICA
BEFORE THE
FEDERAL ENERGY REGULATORY COMMISSION
Midcontinent Independent System Operator,
Inc.
Docket No. EL26-70-000
COMMENTS OF SPARKFUND ON MISO’S INFORMATIONAL REPORT
Spark Community Investment Fund (d/b/a Sparkfund) appreciates the informational
report filed by the Midcontinent Independent System Operator (MISO) describing the efforts
MISO is undertaking to integrate large loads. Sparkfund submits these comments to provide
further information on how MISO’s existing and pending DER models are enabling DERs to be
a means to integrate large loads, and how this model can be further replicated throughout MISO.
Distributed resources are increasingly providing capacity to integrate large loads, through
utility programs and MISO’s existing participation models. This distributed capacity potential is
documented through Rewiring America’s Homegrown Energy blueprint;1 the recent 16 GW
nationwide VPP announced by Tesla, Sunrun, and Renew Home;2 and Voltus’s Bring Your Own
Capacity model.3 While MISO diligently works towards full implementation of FERC Order
2222 in 2029/2030, aggregators and utilities within MISO are able to deploy distributed
resources as capacity today using the existing participation models.
One example illustrates how a MISO utility is already leveraging the distribution system
to deploy power plant scale capacity to integrate large loads. The Minnesota Public Utilities
3 Voltus Launches “Bring Your Own Capacity” Product to Support Data Center Growth and Grid Resiliency (Sept.
30, 2025), available at https://www.voltus.co/press/bring-your-own-capacity-data-centers.
2 See vppcapacity.com, documenting hundreds of megawatts available in MISO states through existing batteries and
HVAC loads.
1 Rewiring America, Homegrown Energy (May 2026), available at
https://www.rewiringamerica.org/research/homegrown-energy-report-policy-affordable-household-upgrades.
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Commission recently approved Xcel Energy’s Capacity*Connect program, to deploy up to 200
MW of front-of-the-meter, distribution-sited 1-3 MW battery energy storage systems (BESS) by
the end of 2028,4 with the potential for 500 MW by 2031.5 The Capacity*Connect program is a
form of distributed capacity procurement (DCP), in which the BESS would be owned and
operated by Xcel, and intentionally sited where the resources could best benefit the distribution
grid.6 The BESS will use MISO’s DRR Type 1 Participation model, which allows the resources
to participate in MISO’s energy and ancillary service markets.7 DRRs can act as capacity
resources that count towards an LSE’s Planning Reserve Margin Requirement (PRMR), just like
a generator.8
Xcel’s Capacity*Connect program illustrates several points about distributed capacity
supporting large load integration in MISO. First, MISO’s existing participation models provide
several options for utilities and third-parties within MISO to deploy distributed energy resources
that, in aggregate, reach power plant scale.9 Second, Capacity*Connect provides a mechanism to
deploy new capacity to serve data centers while also delivering localized, distribution-level
benefits: Google’s new Pine Island, MN data center facility has entered an Electric Service
Agreement that includes $50 million towards Xcel’s Capacity*Connect battery portfolio in
exchange for matched capacity credits. Google’s purchase of capacity credits from
Capacity*Connect offsets a portion of Xcel’s total cost.10
10 Id. at 10.
9 Id. at 8 discussing multiple participation pathways in MISO’s market.
8 Id. at n. 14.
7 Capacity*Connect Briefing Papers at 8.
6 Capacity*Connect Order at 4-5.
5 Staff Briefing Papers at 7, In the Matter of the Petition of Northern States Power Company, d/b/a Xcel Energy, for
Approval of Capacity*Connect, a Distributed Capacity Procurement Program, Docket No. E-002/M-25-378 (Mar.
18, 2026) (Capacity*Connect Briefing Papers).
4 Order at 5, In the Matter of the Petition of Northern States Power Company, d/b/a Xcel Energy, for Approval of
Capacity*Connect, a Distributed Capacity Procurement Program, Docket No. E-002/M-25-378 (May 13, 2026)
(“Capacity*Connect Order”).
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Third, when well-designed programs align with functioning markets the combination can
be net negative on residential electricity bills. Xcel’s compliance filing calculates that
Capacity*Connect will deliver average residential bill savings of approximately $0.13 per month
over the twenty-year analysis period, with Google’s $50 million contribution further increasing
those savings by another $0.04 per month, to approximately $0.17 per month.11
Capacity*Connect therefore demonstrates that distributed capacity can be deployed to integrate
large loads while simultaneously lowering residential bills.
Fourth, distributed capacity could meaningfully contribute to MISO’s resource adequacy:
multiple utilities deploying 200-500 MW of utility-owned and operated distributed capacity
could amount to gigawatts across the MISO footprint. Other utilities within the MISO footprint
have taken notice of Capacity*Connect and are actively exploring and establishing distributed
capacity programs of their own. This exploration is taking shape across multiple regulatory and
commercial pathways, including existing integrated resource planning (IRP) processes, both
existing and newly-proposed large-load tariffs designed to serve data center customers, and
emerging bring-you-own-capacity (BYOC) structures. These efforts are particularly notable
given the potential for distributed batteries to value-stack across both wholesale market
opportunities and distribution-level benefits, an opportunity that Xcel has detailed for the
Minnesota Public Utilities Commission during its review of the Capacity*Connect.12
Finally, distributed capacity is a way to “right size” the capacity to meet load growth
needs. For example, 127 MW of distributed capacity could be deployed as a bridge solution
while traditional thermal generation is being built.
12 Capacity*Connect Order at 4-6.
11 See Compliance Filing – Bill Impact Analysis, at 2-5, In the Matter of the Petition of Northern States Power
Company, d/b/a Xcel Energy, for Approval of Capacity*Connect, a Distributed Capacity Procurement Program,
Docket No. E-002/M-25-378 (Apr. 24, 2026).
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Sparkfund provides the above information to spotlight what distributed capacity is
capable of doing in MISO today, while noting that this potential only grows as MISO and other
markets implement FERC Order No. 2222.
Dated: August 12, 2026
Sincerely,
Allison Bates Wannop
Vice President, Regulatory Affairs and Wholesale Markets
Sparkfund
allison.wannop@sparkfund.com
617-548-6221
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