Energy industry welcomes FERC’s order on electric generation interconnection rules
The renewable energy industry said this week’s high-profile release of the Federal Energy Regulatory Commission’s final generator interconnection rules was a welcome step forward in accommodating the growth of green electricity, although further measures will likely be required to reduce the current permitting backlog for renewable-generation projects.
The FERC commissioners Thursday voted to approve Order 2023, which makes changes to its rules on connecting new generating facilities to their regional grids that make the process more standardized and speed up the deployment of new power supply.
“This action will help provide relief to the nearly two terawatts of renewables and energy storage that are currently waiting to interconnect,” the American Clean Power Association (ACP) said in a written statement. “ACP looks forward to reviewing the final order and working in all regions of the country to expedite the ability of clean energy resources to interconnect in a timely manner.”
The relatively glacial pace of bringing new solar, wind and storage resources onto the grid has been a high-profile snag in the process of reducing the energy industries climate footprint. FERC Chairman Willie Phillips told reporters Thursday the new order addressed the major roadblocks in the current process, and called it a “watershed moment for our nation’s transmission grid.”
“This new rule will enable America’s vast power generation resources to connect to the grid in a reliable, efficient, transparent, and timely manner,” Phillips said.
FERC said the key components of the order included:
- Implement a first-ready, first-served cluster study process: Transmission providers will conduct larger-scale interconnection studies encompassing numerous proposed generating facilities, rather than separate studies for each individual generating facility. Interconnection customers will be subject to specific requirements, including financial deposits to enter and remain in the interconnection queue.
- Speed up interconnection queue processing: The final rule imposes firm deadlines and penalties if transmission providers fail to complete interconnection studies on time, although transmission providers may appeal to the commission.
- Establish an effective date and a transition process: Compliance filings are due 90 days after publication of the final rule in the Federal Register.
- Incorporate technological advancements into the interconnection process: Transmission providers will be required to allow more than one generating facility to co-locate on a shared site behind a single point of interconnection and share a single interconnection request. This reform creates a more efficient standardized procedure for the configuration of these types of generating facilities.
“The reforms are intended to address interconnection queue backlogs, improve cost and timing certainty, and prevent undue discrimination for new technologies,” FERC staff members said in their presentation to the commissioners, “thereby ensuring that the pro forma generator interconnection procedures and agreements are just and reasonable and not unduly discriminatory or preferential.”
The staff noted a hefty volume of public comments on the order, and industry representatives said after the vote that further digging into the myriad details of the order, which may have been changed over the rulemaking process, would be necessary.
“We applaud Chairman Phillips and the other commissioners for developing bipartisan solutions that require key changes, such as cluster studies and increased financial commitments, that will reduce interconnection backlogs,” said Phil Moeller, Executive Vice President of the Business Operations Group and Regulatory Affairs at Edison Electric Institute (EEI), which represents all U.S. investor-owned electric companies. “There are several modifications from the Notice of Proposed Rulemaking that we are still reviewing.”
“We look forward to continuing to work with the Commission, regional planners, and project developers on the compliance process to ensure our customers have access to affordable, reliable clean energy,” Moeller added.
Aside from due diligence on the order itself, the solar industry urged FERC to continue their efforts, including addressing regional and interregional electric transmission planning and cost allocation. “While this is a decisive step forward, we have a long way to go before we clear the two terawatts of generation and storage that are trapped in the interconnection queue,” said Melissa Alfano, Director of Energy Markets and Counsel at the Solar Energy Industries Association.
Phillips agreed that FERC still had work to do as it tightened up the interconnection process. “Our transmission policies must keep pace with the rapid changes in the makeup of our nation’s power generation resource mix,” Phillips said. “The Commission is working diligently on how to address the key issues of regional transmission planning and cost allocation.”
“We need to take a longer-term, forward-looking approach to planning for essential transmission facilities and to allocate the costs of those facilities in a just and reasonable manner while enhancing the reliability and resilience of the grid,” Phillips added. “Today’s rule is an important milestone, but there is so much more to do.”
