FERC Order No. 2023: Streamlin...

Introduction

In July 2023, the Federal Energy Regulatory Commission (FERC) issued Order No. 2023 to reform the generator interconnection process. This order addresses the growing backlog of energy projects, especially renewable energy, waiting to connect to the electric grid. The primary goal is to improve the speed, transparency, and efficiency of interconnection procedures, particularly in the face of increasing clean energy developments. 

Key Objectives of Order No. 2023

The reforms introduced by FERC Order No. 2023 focus on three primary areas:

1. Implementing a Cluster Study Process: Moving from a serial study process to a more efficient first-ready, first-served cluster study method.

2. Increasing the Speed of Queue Processing: Introducing financial penalties for transmission providers who fail to meet study deadlines.

3. Incorporating Technological Advancements: Addressing the unique challenges posed by inverter-based resources and modern energy technologies.

Cluster Study Process

One of the most significant changes is the adoption of a cluster study process. This approach groups multiple interconnection requests together to be studied simultaneously. The goal is to reduce bottlenecks caused by serial processing. The process includes:

• A 45-day Cluster Request Window for submitting interconnection requests, accompanied by a $5,000 non-refundable application fee.

• Study Deposits based on the size of the facility:

o 20 MW to 80 MW: $35,000 + $1,000 per MW

o 80 MW to 200 MW: $150,000

o More than 200 MW: $250,000

• Mandatory scoping meetings to clarify study scope and expectations.

Reducing Queue Backlogs

FERC Order No. 2023 introduces financial penalties for transmission providers that fail to complete interconnection studies on time:

• $1,000 per business day for delayed cluster studies

• $2,000 per business day for delayed restudies

• $2,500 per business day for delayed facilities studies These penalties encourage prompt study completion, reducing the risk of prolonged project delays.

Incorporating Advanced Technologies

The order requires transmission providers to update interconnection study methods to better accommodate modern energy technologies, including:

• Co-located Resources: Allowing multiple generating facilities to share a single point of interconnection.

• EMT Models: Requiring electromagnetic transients models for nonsynchronous generating facilities when necessary.

• Ride-Through Capabilities: Mandating large generators to maintain power production during abnormal grid conditions.

Compliance and Implementation

Transmission providers are required to file compliance plans by April 2024. The new requirements aim to balance the need for grid reliability with the rapid expansion of renewable energy projects.

Conclusion

FERC Order No. 2023 represents a significant step toward modernizing the interconnection process. By adopting a cluster study approach, implementing strict deadlines, and incorporating new technologies, the order paves the way for a more reliable and efficient electric grid. Stakeholders, especially those in renewable energy development, should stay informed about compliance deadlines and the evolving landscape of interconnection procedures.