April 23, 2018
FERC Lifts Veil on Large Generator Interconnection Process in Order No. 845
On April 19, 2018, the Federal Energy Regulatory Commission (“FERC”) issued Order No. 845 to reform its generation interconnection procedures for large generators above 20 MW. FERC’s order represents the most significant change to FERC’s large interconnection processes since its landmark Order No. 2003 (issued in 2003), and is set to make the interconnection process for large solar resources more transparent, and give developers additional information on transmission provider modeling assumptions and study processes, which greatly impact cost allocations to prospective projects. Order No. 845 impacts all transmission providers under FERC’s jurisdiction, meaning transmission providers in RTOs/ISOs (but excluding ERCOT) and regulated jurisdictions will have to comply with the new rule.
FERC’s proposed reforms fall into three main categories: improving certainty for interconnection customers, promoting more informed interconnection decisions, and enhancing the interconnection process. By requiring transmission providers to post information related to study assumptions and methodologies, project developers will be able to more effectively understand their potential cost responsibility for project-related upgrades. Further, Order No. 845 imposes reporting requirements on transmission providers so that they will now need to publically post statistics related to their performance in meeting deadlines in the LGIP, which they must use “reasonable efforts” to meet (although these deadlines are still not mandatory).
Order No. 845 is set to be an important decision that will hopefully streamline project development timelines and remove uncertainty inherent in utility and RTO/ISO interconnection processes that are present in jurisdictions across the United States.
New Jersey Law Boosts Renewables, Nuclear Units
Living up to its name as the Garden State, last week New Jersey took significant actions aimed at making its energy sector one of the cleanest in the country. Specifically, New Jersey passed key legislation aimed at boosting its renewable energy industry and also keeping its existing nuclear power plants online. The central piece of legislation, Assembly Bill 3723, sets the renewable energy goal and anchors much of the growth in wind and solar energy, aiming to hit 35 percent renewables by 2025 and eventually 50 percent by 2030. The bill was passed alongside a $300 million annual subsidy to the state’s remaining nuclear power plants, which provide the state with roughly 40 percent of its electricity. The new law also increases the state’s offshore wind goal to 3,500MW, sets an energy storage target of 2,000 MW by 2030, creates a community solar program, doubles the state’s net metering cap, and requires increases in energy efficiency from utilities.
The new law is poised to make New Jersey a leader in clean energy, and reflects the state’s commitment to not only achieving its climate goals, but also boosting economic growth.
New York Moves Forward on REV Reforms
Not to be outdone by its neighbor, on April 19, 2018, the New York Public Service Commission (“NY PSC”) approved a series of reforms in its ongoing REV proceeding. According to a news release from the NY PSV, the reforms include expanding the integration of larger energy storage technologies; moving forward with an upstate “energy smart” community project; creating an on-line platform to make it easier to share data amongst energy companies; and making it easier for farmers to use anaerobic digesters to produce electricity. On energy storage, the NY PSC opened the door to distributed generation suppliers seeking to connect energy storage technologies to the distribution system, allowing for projects up to 5 MW to come on-line, and enhanced the Standardized Interconnection Requirements (SIR) application and contract process. Meanwhile, the NY PSC approved NYSEG’s request to implement time differentiated electric rate options, on a pilot basis, for the Energy Smart Community (“ESC”) project. The ESC project, includes the deployment of advanced metering infrastructure (AMI) to approximately 12,000 customers, and the pilot rates, including the selection of on-peak and off-peak time periods, are designed to convey strong price signals that focus on the system peak.
With these reforms, New York is continuing to take a leading role in the future of retail market design, and is looking to open up new market opportunities for distributed energy resources and transform its power sector.
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