Responding to requests for rehearing of its Order No. 845, the Federal Energy Regulatory Commission on Feb. 21 clarified certain reforms included in the final rule issued last year aimed at enhancing certainty, transparency, and efficiency in the generator interconnection process.
Order No. 845 adopted reforms to improve certainty for interconnection customers, promote more informed interconnection decisions, and enhance the interconnection process.
The final rule adopted 10 of 14 reforms proposed in the Commission’s Dec. 15, 2016 Notice of Proposed Rulemaking in Docket No. RM17-8-000. Specifically, it revised FERC’s standard, or “pro forma” Large Generator Interconnection Procedures and the pro forma Large Generator Interconnection Agreement, which apply to generators larger than 20 megawatts.
FERC received twelve requests for rehearing and/or clarification of Order No. 845, including a joint clarification and rehearing request filed by APPA, the Large Public Power Council and the National Rural Electric Cooperative Association.
The order approved by FERC on Feb. 21 at its monthly open meeting granted in part and denied in part the requests for rehearing and clarification.
The majority of reforms remain unchanged, but the order did grant rehearing and clarification as to certain reforms.
Specifically, the order grants rehearing with regard to two aspects of the reform to remove limitations on the interconnection customer’s option to build interconnection facilities and stand alone network upgrades necessary to accommodate a generator’s interconnection to the transmission grid.
First, the order requires that, in the case of a disagreement between the interconnection customer and the transmission provider over whether the customer has the option to build, transmission providers must provide a written explanation why they do not consider a specific network upgrade to be a stand-alone network upgrade subject to the option to build, and second, allows transmission providers to recover option to build oversight costs.
The order also granted clarification with regard to two aspects of the option to build reform by finding, first, that the Order No. 845 option to build provisions apply to all “public utility” transmission providers, including those that reimburse interconnection customers for network upgrades, and second, that the option to build does not apply to stand alone network upgrades on affected systems.
(FERC refers to electric utilities it regulates as “public” utilities; however, these are not municipal utilities, but rather investor-owned utilities).
The order also granted rehearing with respect to the reform to create a surplus interconnection service process, explaining that the Commission does not intend to limit the ability of regional transmission organizations and independent system operators to argue that an independent entity variation from FERC’s usual rules is appropriate for individual RTOs and ISOs. The Commission generally denied other challenges to the new surplus interconnection service, including APPA’s rehearing request on this issue.
In addition, FERC granted two clarifications with regard to study model and assumption transparency. In response to APPA’s clarification request, the Commission found that transmission providers may use FERC’s critical energy/electric infrastructure information regulations as a model for evaluating entities that request network model information and assumptions.
FERC also said that the phrase “current system conditions” does not require transmission providers to maintain network models that reflect current real-time operating conditions of the transmission provider’s system but should reflect the system conditions currently used in interconnection studies.
With respect to the reform to institute interconnection study deadline reporting requirements, FERC granted clarification regarding the date for measuring study performance metrics and clarified that the reporting requirements do not require transmission providers to post 2017 interconnection study metrics. Instead, the first required report will be for the first quarter of 2020.
With respect to the reform on requesting interconnection service below generating facility capacity, FERC granted rehearing in part to find that an interconnection customer may propose control technologies at any time at which it is permitted to request interconnection service below generating facility capacity.
FERC also granted clarification that a transmission provider must provide a detailed explanation if it determines additional studies at the full generating facility capacity are necessary when the interconnection customer has requested service below full generating facility capacity. The order denied all other requests for rehearing and clarification.
The order becomes effective 75 days after publication in the Federal Register. Each public utility transmission provider must submit a single compliance filing, within 90 days of the issuance of the order, to comply with Order No. 845 and the Feb. 21 order on rehearing and clarification.
“As I’ve said on a number of occasions, I think Order No. 845 was an important step forward to help improve interconnection processes and facilitate the interconnection of new technologies like storage,” said FERC chairman Neil Chatterjee at FERC’s monthly meeting.
The action taken by FERC is also significant, he said, because it “officially starts the clock for submitting compliance filings.”
Commissioner Richard Glick said that the changes to the interconnection process adopted in Order No. 845 “reflect one of the Commission’s most significant areas of responsibility – ensuring that the rules of the road” are adapted to industry transformations.
He said that the reforms “we have adopted and affirmed today will enable interconnection customers to better utilize the interconnection processes and procedures and ultimately make more efficient use of the existing transmission grid.”
At the same time, Glick said “by no means should we consider this job complete. We still have important work to do, particularly as we continue to consider reforms related to effective systems coordination and as we review and consider each compliance filing to today’s rule.”