Utility Integration

FERC proposes a ‘first ready, first served’ approach to interconnection backlog

FERC proposes a ‘first ready, first served’ approach to interconnection backlog
(Image by PublicDomainPictures from Pixabay )

The Federal Energy Regulatory Commission (FERC) issued and discussed a new Notice of Proposed Rulemaking (NOPR) that would make significant reforms to interconnection rules and processes for generation developers looking to connect their projects to the transmission grid.

The commission noted at its June 16 meeting that the current “first come, first served” process has created a significant backlog of projects. Chair Glick said there are currently 8,100 projects in the queue representing more than 1,000 GW of new generation capacity and an additional 400 GW of energy storage capacity. He said it takes an average of 3.7 years for a project to make it through the queue and be placed into service and that only around 23% of projects make it over the finish line.

The new rules, the commissioners believe, would increase the speed of interconnection by imposing deadlines on transmission owners to conduct studies (or face penalties) and requiring more stringent financial readiness for developers.

Four areas of the interconnection reforms proposed are outlined below.

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First-ready, first-served cluster study process

Under the proposed first-ready, first-served cluster study process, transmission providers would conduct larger interconnection studies encompassing numerous proposed generating facilities, rather than separate studies for each individual generating facility. This approach would increase the efficiency of the interconnection process and help minimize delays, said FERC.

Franklin Jackson from FERC’s Office of Energy Markets addressed the problem of speculative projects clogging the queue. Today, some developers enter the queue and, after learning the final cost for their project to interconnect, drop out. That action triggers a cascade of new studies that must be conducted. The new proposed cluster study approach would include a single annual period of re-studies, said Jackson.

“This should help contain the cascading effect of withdrawals,” he said.

In addition, two new mechanisms would allow developers to get the information they need without entering the queue. First, they could request that an informational interconnection study be conducted. Second, they could look at the transmission providers’ newly developed and publicly available interactive visual representation of available interconnection capacity, which FERC is also proposing in the NOPR.

In order to enter the queue at all, developers must demonstrate financial commitments and readiness.

Improve interconnection queue processing speed

The NOPR proposes to impose firm deadlines and establish penalties if transmission providers fail to complete interconnection studies on time, except in instances where force majeure is applicable. 

For the first time, transmission providers would have “real deadlines that they have to meet and if they don’t meet, they’ll be subject to penalties,” said Chair Glick.

Additionally, the NOPR proposes a more detailed affected-systems study process, including a specific modeling standard and pro forma affected system agreements. The NOPR also proposes reforms to administratively simplify the process of studying interconnection requests that are all related to the same state-authorized or mandated resource solicitation.

Incorporate technological advancements

The NOPR proposes requiring transmission providers to allow more than one resource to co-locate on a shared site behind a single point of interconnection, and share a single interconnection request. Today, a solar project coupled with energy storage, for example, is required to be studied twice even though the project might interconnect at a single point. The proposed reform would allow those hybrid projects to be treated as one.

In addition, non-synchronous (that is, inverter-based) projects entering the queue must have the ability to ride through abnormal frequency and voltage conditions in accordance with reliability standards PRC 24-3 or subsequent standards, said Edward Gross, of the FERC Office of Electric Reliability

This would create a minimum standard that would remove barriers for co-located resources by creating a more efficient standardized procedure for these types of configurations, said FERC. It would be in accordance with NERC’s recommendations for interconnecting inverter-based resources.

The NOPR also proposes allowing interconnection customers to add a generating facility to an existing interconnection request under certain circumstances without automatically losing their position in the queue. The NOPR also proposes requiring transmission providers to consider alternative transmission solutions if requested by the interconnection customer.  

Better modeling and operating assumptions

Finally, the NOPR proposes certain modeling, as well as the performance requirements, for non-synchronous generating facilities to address the unique characteristics of the changing resource mix. 

FERC is proposing that transmission providers, at the request of the interconnection customer, use operating assumptions for interconnection studies that reflect the proposed operation of an electric storage resource or co-located resources containing electric storage, including hybrid resources.

For example, if a developer sites energy storage next to a solar facility and only plans to use the storage to absorb excess solar generation at certain times and only feed it to the grid under certain parameters, then transmission owners must study it that way. Today, energy storage studies essentially assume that the asset is being fully deployed into the grid, even if it is not intended to be operated that way.

The draft NOPR proposes to allow transmission providers to hold interconnection customers to the intended operation of their electric storage resource either by memorializing the operation restrictions in the interconnection agreement or by installing control technologies. Failure to operate within the agreement paraments would trigger breach provisions.

“Taken as a whole, this proposed reform would allow some interconnection customers to avoid paying for unnecessary network upgrades without compromising reliability,” said Gross.

Comments on the NOPR are due 100 days after publication of the NOPR in the Federal Register, which should take place by June 23. Reply comments are due 130 days after that.