Rule2023-16628
Improvements to Generator Interconnection Procedures and Agreements
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Published
September 6, 2023
Effective
November 6, 2023
Issuing agencies
Energy DepartmentFederal Energy Regulatory Commission
Abstract
The Federal Energy Regulatory Commission (Commission or FERC) is adopting reforms to its pro forma Large Generator Interconnection Procedures, pro forma Small Generator Interconnection Procedures, pro forma Large Generator Interconnection Agreement, and pro forma Small Generator Interconnection Agreement to address interconnection queue backlogs, improve certainty, and prevent undue discrimination for new technologies. The reforms are intended to ensure that the generator interconnection process is just, reasonable, and not unduly discriminatory or preferential.
Full Text
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[Federal Register Volume 88, Number 171 (Wednesday, September 6, 2023)]
[Rules and Regulations]
[Pages 61014-61349]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-16628]
[[Page 61013]]
Vol. 88
Wednesday,
No. 171
September 6, 2023
Part II
Department of Energy
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Federal Energy Regulatory Commission
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18 CFR Part 35
Improvements to Generator Interconnection Procedures and Agreements;
Final Rule
Federal Register / Vol. 88, No. 171 / Wednesday, September 6, 2023 /
Rules and Regulations
[[Page 61014]]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 35
[Docket No. RM22-14-000; Order No. 2023]
Improvements to Generator Interconnection Procedures and
Agreements
AGENCY: Federal Energy Regulatory Commission, Department of Energy.
ACTION: Final rule.
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SUMMARY: The Federal Energy Regulatory Commission (Commission or FERC)
is adopting reforms to its pro forma Large Generator Interconnection
Procedures, pro forma Small Generator Interconnection Procedures, pro
forma Large Generator Interconnection Agreement, and pro forma Small
Generator Interconnection Agreement to address interconnection queue
backlogs, improve certainty, and prevent undue discrimination for new
technologies. The reforms are intended to ensure that the generator
interconnection process is just, reasonable, and not unduly
discriminatory or preferential.
DATES: This final rule is effective November 6, 2023.
FOR FURTHER INFORMATION CONTACT: Tristan Kessler (Technical
Information), Office of Energy Policy and Innovation, 888 First Street
NE, Washington, DC 20426, (202) 502-6608, <a href="/cdn-cgi/l/email-protection#c1b5b3a8b2b5a0afefaaa4b2b2ada4b381a7a4b3a2efa6aeb7"><span class="__cf_email__" data-cfemail="eb9f9982989f8a85c5808e9898878e99ab8d8e9988c58c849d">[email protected]</span></a>.
Franklin Jackson (Technical Information), Office of Energy Market
Regulation, 888 First Street NE, Washington, DC 20426, (202) 502-6464,
<a href="/cdn-cgi/l/email-protection#e48296858a8f888d8aca8e85878f978b8aa482819687ca838b92"><span class="__cf_email__" data-cfemail="99ffebf8f7f2f5f0f7b7f3f8faf2eaf6f7d9fffcebfab7fef6ef">[email protected]</span></a>.
Sarah Greenberg (Legal Information), Office of the General Counsel,
888 First Street NE, Washington, DC 20426, (202) 502-6230,
<a href="/cdn-cgi/l/email-protection#16657764777e38716473737874736471567073647538717960"><span class="__cf_email__" data-cfemail="ef9c8e9d8e87c1889d8a8a818d8a9d88af898a9d8cc1888099">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
Table of Contents
Paragraph Numbers
I. Introduction 1
A. Historical Framework: Order Nos. 2003, 2006, and 845 11.
B. Regional Transmission Planning and Cost Allocation and
Generator Interconnection Advance Notice of Proposed Rulemaking 18
C. Notice of Proposed Rulemaking 20
D. Joint Federal-State Task Force on Electric Transmission 25
II. Overall Need for Reform 27
A. NOPR 27
B. Comments 30
C. Commission Determination 37
III. Reforms 61
A. Reforms To Implement a First-Ready, First-Served Cluster
Study Process 61
1. Interconnection Information Access 61
2. Cluster Study Process 165
3. Allocation of Cluster Study Costs 405
4. Allocation of Cluster Network Upgrade Costs 422
5. Shared Network Upgrades 468
6. Increased Financial Commitments and Readiness Requirements
490
7. Transition Process 814
B. Reforms To Increase the Speed of Interconnection Queue
Processing 872
1. Elimination of the Reasonable Efforts Standard 872
2. Affected Systems 1026
3. Optional Resource Solicitation Study 1294
C. Reforms To Incorporate Technological Advancements Into the
Interconnection Process 1324
1. Increasing Flexibility in the Generator Interconnection
Process 1324
2. Incorporating the Enumerated Alternative Transmission
Technologies Into the Generator Interconnection Process 1534
3. Modeling and Ride-Through Requirements for Non-Synchronous
Generating Facilities 1621
D. Issues Beyond the Scope of this Rulemaking 1736
1. Comments 1736
2. Commission Determination 1743
IV. Compliance Procedures 1744
A. NOPR Proposal 1744
B. Comments 1747
1. Compliance Filing Deadline 1747
2. Regional Flexibility 1750
3. Reciprocity Tariffs 1759
4. Effective Date 1760
5. Miscellaneous 1761
C. Commission Determination 1762
V. Information Collection Statement 1772
VI. Environmental Analysis 1779
VII. Regulatory Flexibility Act 1780
VIII. Document Availability 1783
IX. Effective Date and Congressional Notification 1785
I. Introduction
1. This final rule requires all public utility transmission
providers to adopt revised pro forma Large Generator Interconnection
Procedures (LGIP), pro forma Small Generator Interconnection Procedures
(SGIP), pro forma Large Generator Interconnection Agreements (LGIA),
and pro forma Small Generator Interconnection Agreements (SGIA).\1\
These revisions will ensure that interconnection customers are able to
interconnect to the transmission system in a reliable, efficient,
transparent, and timely manner, and will prevent undue discrimination.
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\1\ Section 201(e) of the Federal Power Act (FPA) defines
``public utility'' to mean ``any person who owns or operates
facilities subject to the jurisdiction of the Commission under this
subchapter.'' 16 U.S.C. 824(e). A non-public utility that seeks
voluntary compliance with the reciprocity condition of a tariff may
satisfy that condition by filing a tariff, which includes the pro
forma LGIP, the pro forma SGIP, the pro forma LGIA, and the pro
forma SGIA. See Standardization of Generator Interconnection
Agreements & Procs., Order No. 2003, 68 FR 49846 (Aug. 19, 2003),
104 FERC ] 61,103, at PP 1, 616 (2003), order on reh'g, Order No.
2003-A, 69 FR 15932 (Mar. 5, 2004), 106 FERC ] 61,220, order on
reh'g, Order No. 2003-B, 70 FR 265 (Jan. 19, 2005), 109 FERC ]
61,287 (2004), order on reh'g, Order No. 2003-C, 70 FR 37661 (July
18, 2005), 111 FERC ] 61,401 (2005), aff'd sub nom. Nat'l Ass'n of
Regul. Util. Comm'rs v. FERC, 475 F.3d 1277 (D.C. Cir. 2007) (NARUC
v. FERC). As stated in the pro forma LGIP, pro forma LGIA, pro forma
SGIP, and pro forma SGIA, transmission provider ``shall mean the
public utility (or its designated agent) that owns, controls, or
operates transmission or distribution facilities used for the
transmission of electric energy in interstate commerce and provides
transmission service under the [Transmission Provider's Tariff]. The
term . . . should be read to include the Transmission Owner when the
Transmission Owner is separate from the Transmission Provider.'' Pro
forma LGIP section 1; pro forma LGIA art. 1; pro forma SGIP attach.
1; pro forma SGIA attach. 1.
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2. Twenty years ago the Commission issued Order No. 2003, in which
the Commission required all public utilities that own, control, or
operate facilities used for transmitting electric energy in interstate
commerce to have on file standard procedures and a standard agreement
for interconnecting generating facilities larger than 20 megawatts (MW)
(called the pro forma LGIP and the pro forma LGIA).\2\ The Commission
stated its expectation that the changes would prevent undue
discrimination, preserve reliability, increase energy supply, and lower
wholesale prices for customers by increasing the amount and variety of
new generation that would compete in the wholesale electricity
market.\3\ The Commission further stated that the standard procedures
would facilitate market entry for generation competitors by reducing
interconnection costs and time.\4\ In Order No. 2006, the Commission
adopted standard procedures and a standard agreement for
interconnecting generating facilities no larger than 20 MW (called the
pro forma SGIP and the pro forma SGIA), citing the same purposes
outlined in Order No. 2003.\5\
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\2\ Order No. 2003, 104 FERC ] 61,103 at P 2.
\3\ Id. P 1.
\4\ Id. P 12.
\5\ Standardization of Small Generator Interconnection
Agreements & Procs., Order No. 2006, 111 FERC ] 61,220, at PP 15,
35-36, order on reh'g, Order No. 2006-A, 70 FR 71760 (Dec. 30,
2005), 113 FERC ] 61,195 (2005), order granting clarification, Order
No. 2006-B, 71 FR 42587 (July 27, 2006), 116 FERC ] 61,046 (2006).
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3. The electricity sector has transformed significantly since the
issuance of Order Nos. 2003 and 2006. The growth of new resources
seeking to interconnect to the transmission system and the differing
characteristics of those resources have created new challenges for the
generator interconnection process. These new challenges are creating
large interconnection queue
[[Page 61015]]
backlogs and uncertainty regarding the cost and timing of
interconnecting to the transmission system, increasing costs for
consumers. Backlogs in the generator interconnection process, in turn,
can create reliability issues as needed new generating facilities are
unable to come online in an efficient and timely manner. While the
Commission recognized these issues and sought to address them in Order
No. 845,\6\ it is clear that further action is needed. Therefore, we
believe that it is necessary to reform the Commission's standard
interconnection procedures and agreements to ensure that
interconnection customers are able to interconnect to the transmission
system in a reliable, efficient, transparent, and timely manner,
thereby ensuring that rates, terms, and conditions for Commission-
jurisdictional services are just, reasonable, and not unduly
discriminatory or preferential.
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\6\ See Reform of Generator Interconnection Procs. & Agreements,
Order No. 845, 83 FR 21342 (May 9, 2018), 163 FERC ] 61,043, at P 24
(2018), order on reh'g, Order No. 845-A, 84 FR 8156 (Mar. 6, 2019)
166 FERC ] 61,137, order on reh'g, Order No. 845-B, 168 FERC ]
61,092 (2019).
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4. Accordingly, we adopt reforms to the Commission's pro forma LGIP
and pro forma LGIA. Specifically, as explained in detail in this final
rule, we adopt reforms to: (1) implement a first-ready, first-served
cluster study process; \7\ (2) increase the speed of interconnection
queue processing; and (3) incorporate technological advancements into
the interconnection process.
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\7\ A first-ready, first-served cluster study process improves
efficiency in the interconnection study process by including the
following elements: increased access to information prior to
entering the queue; a mechanism to study interconnection requests in
groups where all interconnection requests in the group are equally
queued and of equal study priority; and increased financial
commitments and readiness requirements to enter and proceed through
the queue. In contrast, the existing first-come, first-served serial
study process in the pro forma LGIA and LGIP provides limited
information to interconnection customers prior to entering the
queue, assigns interconnection requests an individual queue position
based solely on the date of entry into the queue, and contains
limited financial and readiness requirements.
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5. First, in order to implement a first-ready, first-served cluster
study process, this final rule requires: (1) transmission providers to
publicly post available information pertaining to generator
interconnection; (2) transmission providers to use cluster studies as
the interconnection study method; (3) transmission providers to
allocate cluster study costs on a pro rata and per capita basis; (4)
transmission providers to allocate network upgrade costs based on a
proportional impact method; (5) interconnection customers to pay study
and commercial readiness deposits as part of the cluster study process;
(6) interconnection customers to demonstrate site control at the time
of submission of the interconnection request; and (7) transmission
providers to impose withdrawal penalties on interconnection customers
for withdrawing from the interconnection queue, with certain
exceptions. We also require transmission providers to adopt a
transition process to move from the existing serial interconnection
process to the new cluster study process.
6. Second, in order to increase the speed of interconnection queue
processing, this final rule: (1) eliminates the reasonable efforts
standard for conducting interconnection studies and imposes a financial
penalty on transmission providers that fail to meet interconnection
study deadlines; and (2) establishes an affected system study process
and associated pro forma affected system agreements.
7. Third, in order to incorporate technological advancements into
the interconnection process, this final rule requires transmission
providers to: (1) 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; (2) evaluate the proposed addition of a
generating facility at the same point of interconnection prior to
deeming such an addition a material modification if the addition does
not change the originally requested interconnection service level; (3)
allow interconnection customers to access the surplus interconnection
service process once the original interconnection customer has an
executed LGIA or requests the filing of an unexecuted LGIA; (4) use
operating assumptions in interconnection studies that reflect the
proposed charging behavior of an electric storage resource; and (5)
evaluate the list of alternative transmission technologies enumerated
in this final rule during the generator interconnection study process.
This final rule also requires interconnection customers requesting to
interconnect a non-synchronous generating facility to: (1) provide the
transmission provider with the models needed for accurate
interconnection studies; and (2) have the ability to maintain power
production at pre-disturbance levels and provide dynamic reactive power
to maintain system voltage during transmission system disturbances and
within physical limits. Finally, this final rule requires that all
newly interconnecting large generating facilities provide ride through
capability consistent with any standards and guidelines that are
applied to other generating facilities in the balancing authority area
on a comparable basis.
8. We also adopt reforms to the pro forma SGIP and pro forma SGIA.
Specifically, as explained in detail in this final rule, for small
generating facilities we propose reforms to incorporate the enumerated
alternative transmission technologies into the interconnection process,
and to provide modeling and ride through requirements for non-
synchronous generating facilities.
9. Many of the reforms adopted in this final rule track the notice
of proposed rulemaking's \8\ (NOPR) proposed reforms closely. However,
as discussed more fully below, we have revised aspects of the reforms
pertaining to the cluster study process, allocation of cluster study
and network upgrade costs, increased financial commitments and
readiness requirements, financial penalties for delayed interconnection
studies, the affected system study process, pro forma affected system
agreements, the material modification process, operating assumptions
for interconnection studies, incorporating the enumerated alternative
transmission technologies, and ride through requirements. Additionally,
as discussed more fully below, we decline to adopt the NOPR proposals
pertaining to informational interconnection studies, shared network
upgrades, the optional resource solicitation study, and the alternative
transmission technologies annual report.
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\8\ Improvements to Generator Interconnection Procs. &
Agreements, 87 FR 39934 (July 5, 2022), 179 FERC ] 61,194 (2022)
(NOPR).
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10. We recognize that transmission providers have undertaken
efforts to address interconnection queue management issues. This final
rule is not intended to divert or slow the potential progress
represented by those efforts, and we encourage transmission providers
to continue to innovate to remedy their identified interconnection
queue management issues. We note that the compliance obligations that
result from this final rule will be evaluated in light of the
independent entity variation standard for regional transmission
organizations (RTO) and independent system operators (ISO) and the
consistent with or superior to standard for non-RTO/ISO transmission
providers.\9\
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\9\ Order No. 2003, 104 FERC ] 61,103 at P 26; see infra section
IV.
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A. Historical Framework: Order Nos. 2003, 2006, and 845
11. In Order No. 2003, the Commission recognized a need for a
[[Page 61016]]
standard set of interconnection procedures for transmission providers
and a single, uniformly applicable interconnection agreement for large
generating facilities.\10\ The Commission noted that generator
interconnection is a ``critical component of open access transmission
service and thus is subject to the requirement that utilities offer
comparable service under the [pro forma open access transmission tariff
(tariff)].'' \11\ The Commission found that it was appropriate to
establish a standard set of generator interconnection procedures to
``minimize opportunities for undue discrimination and expedite the
development of new generation, while protecting reliability and
ensuring that rates are just and reasonable.'' \12\ To this end, the
Commission adopted the pro forma LGIP and pro forma LGIA and amended
its regulations to require all transmission providers to incorporate
these standard procedures and agreement into their tariffs.\13\
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\10\ Order No. 2003, 104 FERC ] 61,103 at P 11. Large generating
facilities are defined to mean ``a Generating Facility having a
Generating Facility Capacity of more than 20 MW.'' Pro forma LGIP
section 1.
\11\ Order No. 2003, 104 FERC ] 61,103 at P 9 (citing Tenn.
Power Co., 90 FERC ] 61,238 (2000)).
\12\ Id. P 11.
\13\ 18 CFR 35.28(f)(1) (2022).
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12. To initiate the generator interconnection process set forth in
the Commission's pro forma LGIP,\14\ the interconnection customer
submits an interconnection request for its proposed generating facility
that includes preliminary documentation of the site of the proposed
generating facility, certain technical information about the proposed
generating facility, and the expected commercial operation date of the
proposed generating facility, along with a refundable deposit of
$10,000.\15\ After the transmission provider determines that the
interconnection request is complete, the interconnection request enters
the transmission provider's interconnection queue with other pending
interconnection requests and is assigned a queue position based on the
time and date of its receipt.\16\ The queue position determines the
order in which the transmission provider studies the interconnection
requests in its interconnection queue.\17\
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\14\ While we provide a broad description of the process in the
Commission's pro forma LGIP as background here, we recognize that
many transmission providers have adopted (and the Commission has
accepted) variations to many of the terms in the Commission's pro
forma LGIP and pro forma LGIA. Consequently, some or many of the
details of a particular transmission provider's generator
interconnection procedures may vary considerably from the broad
description provided here.
\15\ Order No. 2003, 104 FERC ] 61,103 at P 35; pro forma LGIP
sections 3.1, 3.4.
\16\ Pro forma LGIP section 4.1.
\17\ Id.
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13. Transmission providers must schedule a scoping meeting with the
interconnection customer to discuss possible points of interconnection
for the proposed generating facility and exchange technical
information, which is followed by a series of interconnection studies
to evaluate the proposed interconnection in detail.\18\ Transmission
providers study interconnection requests in three phases: (1) the
interconnection feasibility study (feasibility study); \19\ (2) the
interconnection system impact study (system impact study); \20\ and (3)
the interconnection facilities study (facilities study).\21\ These
studies contain the power flow, short circuit, and stability analyses
necessary to: (1) identify any adverse impacts on the transmission
providers' transmission system or any affected systems; \22\ (2)
determine the interconnection facilities and network upgrades \23\
needed to reliably interconnect the generating facility; and (3)
estimate the interconnection customer's cost responsibility for these
facilities.\24\ The pro forma LGIP requires that transmission providers
use reasonable efforts to complete: (1) feasibility studies within 45
calendar days; (2) system impact studies within 90 calendar days; and
(3) facilities studies within 90 or 180 calendar days, depending on the
interconnection customer's requested accuracy margin.\25\
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\18\ Order No. 2003, 104 FERC ] 61,103 at P 36; pro forma LGIP
sections 3.4.4, 6-8.
\19\ The pro forma LGIP defines a feasibility study as ``a
preliminary evaluation of the system impact and cost of
interconnecting the Generating Facility to the Transmission
Provider's Transmission System.'' The scope of a feasibility study
is described in section 6 of the pro forma LGIP. Pro forma LGIP
sections 1, 6.
\20\ The pro forma LGIP defines a system impact study as ``an
engineering study that evaluates the impact of the proposed
interconnection on the safety and reliability of Transmission
Provider's Transmission System and, if applicable, an Affected
System.'' In particular, a system impact study identifies and
details ``the system impacts that would result if the Generating
Facility were interconnected without project modifications or system
modifications, focusing on the Adverse System Impacts identified in
the [feasibility study], or to study potential impacts, including
but not limited to those identified in the Scoping Meeting.'' Id.
section 1.
\21\ The pro forma LGIP defines a facilities study as ``a study
conducted by the Transmission Provider or a third-party consultant
for the Interconnection Customer to determine a list of facilities
(including Transmission Provider's Interconnection Facilities and
Network Upgrades as identified in the [system impact study]), the
cost of those facilities, and the time required to interconnect the
Generating Facility with the Transmission Provider's Transmission
System.'' The scope of a facilities study is described in section 8
of the pro forma LGIP. Id. sections 1, 8.
\22\ The pro forma LGIP defines an affected system as an
electric system other than the transmission provider's transmission
system that may be affected by the proposed interconnection. Id.
section 1; pro forma LGIA art. 1.
\23\ For purposes of this final rule, unless otherwise noted,
``network upgrades'' refer to interconnection-related network
upgrades. More specifically, the pro forma LGIP and pro forma LGIA
provide that, ``Network Upgrades shall mean the additions,
modifications, and upgrades to the Transmission Provider's
Transmission System required at or beyond the point at which the
Interconnection Facilities connect to the Transmission Provider's
Transmission System to accommodate the interconnection of the Large
Generating Facility to the Transmission Provider's Transmission
System.'' Pro forma LGIP section 1; pro forma LGIA art. 1.
\24\ Order No. 2003, 104 FERC ] 61,103 at PP 35-37; pro forma
LGIP sections 6-8. The interconnection customer is responsible for
the actual costs of interconnection studies and any necessary
restudies. Pro forma LGIP section 13.3.
\25\ Pro forma LGIP sections 6.3, 7.4, 8.3.
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14. At the completion of the facilities study, the pro forma LGIP
requires the transmission provider to issue a report on the best
estimate of the costs to effectuate the requested interconnection and
provide a draft generator interconnection agreement to the
interconnection customer.\26\ If the interconnection customer wishes to
proceed, after negotiations, the interconnection customer enters into a
generator interconnection agreement with the transmission provider or,
in specific circumstances, requests that the transmission provider file
the agreement with the Commission unexecuted.\27\ The transmission
provider is responsible for the construction of all network upgrades,
but, as further discussed below, the interconnection customer has the
option to build these facilities in certain circumstances.\28\
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\26\ Order No. 2003, 104 FERC ] 61,103 at P 38. Section 11.1 of
the pro forma LGIP requires the transmission provider to tender a
draft LGIA to the interconnection customer ``in the form of
Transmission Provider's FERC-approved standard form LGIA.''
\27\ If the transmission provider and interconnection customer
execute an LGIA that conforms to the transmission provider's
Commission-approved standard form LGIA, the agreement does not need
to be filed with the Commission (if the transmission provider has
such a standard form LGIA on file and submits an Electronic
Quarterly Report). Alternatively, the transmission provider must
file an LGIA with the Commission for review and approval if: (1) the
interconnection customer determines that negotiations with the
transmission provider over the terms of an LGIA are at an impasse
and requests submission of the unexecuted LGIA with the Commission;
or (2) the LGIA does not conform to the transmission provider's
Commission-approved standard form LGIA. See Order No. 2003-A, 106
FERC ] 61,220 at P 201; pro forma LGIP sections 11.2-11.3.
\28\ Order No. 2003, 104 FERC ] 61,103 at PP 351-354; pro forma
LGIA art. 5.1.3.
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15. Similar to Order No. 2003, in Order No. 2006, the Commission
recognized the need for standardized
[[Page 61017]]
interconnection procedures and agreements for small generating
facilities with a capacity of 20 MW or less.\29\ In addition to
establishing a pro forma interconnection study process for small
generating facilities similar to the process for large generating
facilities established in Order No. 2003, the Commission included: (1)
a ``fast track process'' \30\ that uses technical screens to evaluate a
certified small generating facility no larger than 2 MW; and (2) a ``10
[kilowatt (kW)] inverter process'' \31\ that uses the same technical
screens to evaluate a certified inverter-based small generating
facility no larger than 10 kW.\32\ The Commission later issued Order
No. 792,\33\ in which the Commission revised the pro forma SGIP and pro
forma SGIA to provide for interconnection customers to receive point of
interconnection information in advance of submitting an interconnection
request, increase the threshold for participation in the fast track
process to five MW, and to specifically include electric storage
devices.\34\
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\29\ Order No. 2006, 111 FERC ] 61,220 at P 36.
\30\ Pro forma SGIP section 2.1.
\31\ Id. attach. 5.
\32\ Order No. 2006, 111 FERC ] 61,220 at PP 36, 38-39.
\33\ Small Generator Interconnection Agreements & Procs., Order
No. 792, 78 FR 73240 (Dec. 5, 2013), 145 FERC ] 61,159 (2013),
clarifying, Order No. 792-A, 146 FERC ] 61,214 (2014).
\34\ See Order No. 792, 145 FERC ] 61,159 at P 1.
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16. In response to concerns voiced to the Commission about
interconnection queue management, in 2007, the Commission held a
technical conference,\35\ and later issued an order \36\ addressing
interconnection queue issues in RTOs/ISOs. In the order, the Commission
noted that some transmission providers were not processing their
interconnection queues within the timelines established in the pro
forma LGIP, and in certain cases, were greatly exceeding them.\37\ The
Commission stated that, although it ``may need to [impose solutions] if
the RTOs and ISOs do not act themselves,'' each RTO/ISO would have an
opportunity to work with its stakeholders to develop its own
solutions.\38\ As further discussed below, following the order,
multiple RTOs/ISOs submitted queue reform proposals to the Commission,
some of which moved away from a so-called ``first-come, first-served''
approach (whereby interconnection requests are processed in the order
they are received) to a so-called ``first-ready, first-served''
approach (whereby interconnection requests are processed based on when
interconnection customers meet certain project development
milestones).\39\ The reason for this move was to allow interconnection
customers with interconnection requests for generating facilities more
likely to achieve commercial operation to move faster instead of being
delayed by interconnection requests that were higher in the
interconnection queue but making limited or no progress towards
commercial operation and creating unreasonable queue delays.
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\35\ Interconnection Queuing Practices, Notice of Technical
Conference, Docket No. AD08-2-000 (issued Nov. 2, 2007).
\36\ Interconnection Queuing Pracs., 122 FERC ] 61,252 (2008)
(2008 Technical Conference Order).
\37\ Id. P 3.
\38\ Id. P 8.
\39\ See, e.g., Sw. Power Pool, Inc., 128 FERC ] 61,114 (2009);
Midwest Indep. Transmission Sys. Operator, Inc., 124 FERC ] 61,183
(2008); Cal. Indep. Sys. Operator Corp., 124 FERC ] 61,292 (2008).
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17. In 2018, the Commission issued Order No. 845, in which the
Commission made the most comprehensive revisions to the pro forma LGIP
and pro forma LGIA since their adoption in Order No. 2003. In Order No.
845, the Commission concluded that reforms to the pro forma LGIP and
pro forma LGIA were needed to mitigate concerns regarding systemic
inefficiencies, remedy discriminatory practices, and address recent
developments, including changes in the resource mix and emergence of
new technologies.\40\ The Commission therefore adopted reforms designed
to improve certainty for interconnection customers, promote more
informed interconnection decisions, and enhance the generator
interconnection process.\41\
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\40\ Order No. 845, 163 FERC ] 61,043 at P 7.
\41\ Id. P 2.
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B. Regional Transmission Planning and Cost Allocation and Generator
Interconnection Advance Notice of Proposed Rulemaking
18. On July 15, 2021, the Commission issued an advance notice of
proposed rulemaking (ANOPR) in Docket No. RM21-17-000, presenting
potential reforms to the Commission's requirements governing the
regional transmission planning and cost allocation and generator
interconnection processes.\42\ Specific to the generator
interconnection process, the Commission sought comment on whether and
which reforms may be necessary to ensure a more purposeful integration
of the generator interconnection process with the regional transmission
planning and cost allocation processes, establish a faster and more
efficient interconnection queueing process, and promote a more
efficient and cost-effective allocation of network upgrade costs.\43\
For instance, the Commission noted that the cost of network upgrades
can depend largely on both the timing of when the interconnection
customer enters the interconnection queue and where the interconnection
customer proposes to interconnect its generating facility. Therefore,
the Commission noted, interconnection customers may submit multiple
interconnection requests in an effort to determine the most favorable
point of interconnection \44\ that minimizes their network upgrade
costs.\45\ The Commission stated that this practice, in turn, may lead
to late-stage withdrawals of the excess interconnection requests, which
can then impede the transmission provider's ability to process its
interconnection queue in an efficient manner. As a result, the
Commission stated that it may be time to consider reforms to the
generator interconnection process that would make it more efficient and
ensure that generating facilities that are more ``ready'' than others
are not unduly delayed in the interconnection queue.
---------------------------------------------------------------------------
\42\ Bldg. for the Future Through Elec. Reg'l Transmission
Planning & Cost Allocation & Generator Interconnection, 86 FR 40266
(July 15, 2021), 176 FERC ] 61,024 (2021) (ANOPR).
\43\ Id. P 5.
\44\ The pro forma LGIP defines point of interconnection as
``the point, as set forth in Appendix A to the Standard Large
Generator Interconnection Agreement, where the Interconnection
Facilities connect to the Transmission Provider's Transmission
System.'' Pro forma LGIP section 1.
\45\ ANOPR, 176 FERC ] 61,024 at P 41.
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19. On April 21, 2022, the Commission issued a notice of proposed
rulemaking (Transmission Planning and Cost Allocation NOPR) proposing
reforms to its existing regional transmission planning and cost
allocation requirements in the same proceeding as it issued the
ANOPR.\46\ While the Transmission Planning and Cost Allocation NOPR did
not address many of the concerns raised by the Commission in the ANOPR
with respect to the generator interconnection queue process, the
Commission noted in the Transmission Planning and Cost Allocation NOPR
that it would continue to review the record and that it expected to
address possible inadequacies through subsequent proceedings that
propose reforms, as warranted, related to that topic.\47\ The
Commission took that next step with the reforms proposed
[[Page 61018]]
in the NOPR in this proceeding, many of which we adopt in this final
rule.
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\46\ Bldg. for the Future Through Elec. Reg'l Transmission Plan.
& Cost Allocation & Generator Interconnection, 87 FR 26504 (May 4,
2022), 179 FERC ] 61,028 (2022).
\47\ Id. P 10.
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C. Notice of Proposed Rulemaking
20. On June 16, 2022, the Commission issued the NOPR, proposing
reforms focused on improving aspects of the pro forma LGIP, pro forma
LGIA, pro forma SGIP, and pro forma SGIA. The Commission also sought
comment on, but did not propose, tariff revisions on other issues.
21. First, the Commission proposed reforms focused on improving
interconnection processes to ensure interconnection customers can
proceed in an efficient and timely manner.\48\ Among those, the
Commission proposed to: (1) require transmission providers to offer an
optional informational interconnection study to serve as additional
information for prospective interconnection customers in deciding
whether to submit an interconnection request and set minimum
requirements for transmission providers to publicly post available
information pertaining to generator interconnection; \49\ (2) require
transmission providers to implement a first-ready, first-served cluster
study process that allocates costs associated with cluster studies and
identified network upgrades consistent with the discussion below; \50\
and (3) impose more stringent financial commitments and readiness
requirements on interconnection customers, including increased study
deposits, more stringent site control requirements, a commercial
readiness framework, and higher withdrawal penalties.\51\ To implement
these reforms, the Commission also proposed to require transmission
providers to establish a transition process.\52\
---------------------------------------------------------------------------
\48\ NOPR, 179 FERC ] 61,194 at P 4.
\49\ Id. PP 42-52.
\50\ Id. PP 56-101.
\51\ Id. PP 104-148.
\52\ Id. PP 150-160.
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22. Second, the Commission proposed three reforms to increase the
speed of interconnection queue processing, including: (1) revisions to
eliminate the reasonable efforts standard for interconnection study
processing; \53\ (2) revisions to establish an affected system study
process, along with necessary pro forma affected system agreements;
\54\ and (3) revisions to establish an optional resource solicitation
study.\55\
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\53\ Id. PP 168-173.
\54\ Id. PP 182-215.
\55\ Id. PP 223-237.
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23. Finally, the Commission proposed three reforms to incorporate
technological advancements into the interconnection study process. With
these reforms, the Commission proposed to require transmission
providers to: (1) increase flexibility in the generator interconnection
process by allowing generating facilities to co-locate, allow the
interconnection customer to request the addition of a generating
facility to an existing interconnection request, increase the
availability of surplus interconnection service, and allow
interconnection customers to propose operating assumptions for their
generating facilities; \56\ (2) incorporate the enumerated alternative
transmission technologies into the interconnection study process at the
request of the interconnection customer; \57\ and (3) list required
modeling standards for inclusion in all interconnection requests that
include inverter-based resources (IBRs), as well as require certain
performance standards from IBRs during system disturbances.\58\
---------------------------------------------------------------------------
\56\ Id. PP 242-288.
\57\ Id. PP 297-302.
\58\ Id. PP 328-341.
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24. In response to the NOPR, 189 comments were filed.\59\ These
comments have informed our determinations in this final rule.
---------------------------------------------------------------------------
\59\ Appendix A lists the entities that submitted comments on
the NOPR and the shortened names used through this final rule to
describe those entities.
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D. Joint Federal-State Task Force on Electric Transmission
25. On June 17, 2021, the Commission established a Joint Federal-
State Task Force on Electric Transmission (Task Force) to formally
explore broad categories of transmission-related topics.\60\ The
Commission explained that the development of new transmission
infrastructure implicated a host of different issues, including
generator interconnection. The Task Force is comprised of all FERC
Commissioners as well as representatives from 10 state commissions
nominated by the National Association of Regulatory Utility
Commissioners (NARUC), with two originating from each NARUC region.\61\
The Task Force convenes for multiple formal meetings annually, which
are open to the public. Since its creation and as of the date of
issuance of this final rule, the Task Force has met seven times.
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\60\ Joint Fed.-State Task Force on Elec. Transmission, 175 FERC
] 61,224, at PP 1, 6 (2021).
\61\ An up-to-date list of Task Force members, as well as
additional information on the Task Force, is available on the
Commission's website at: <a href="https://www.ferc.gov/TFSOET">https://www.ferc.gov/TFSOET</a>. Public
materials related to the Task Force, including transcripts from
public meetings, are available in the Commission's eLibrary in
Docket No. AD21-15-000.
---------------------------------------------------------------------------
26. The discussion at the May 2022 meeting focused on
interconnection issues, including generator interconnection queue
processes and backlogs. The Task Force members discussed: the primary
challenges preventing more efficient processing of interconnection
queues; specific improvements to interconnection processes (such as
tighter applicant requirements to enter and remain in the queue,
clustering, fast tracking, tighter deadlines on transmission providers
completing studies, and minimizing reiterative studies); and how to
balance near-term improvements to the interconnection procedures with
longer-term regional transmission planning and development.\62\
---------------------------------------------------------------------------
\62\ Joint Fed.-State Task Force on Elec. Transmission, Notice
of Meeting, Docket No. AD21-15-000 (issued Apr. 22, 2022).
---------------------------------------------------------------------------
II. Overall Need for Reform
A. NOPR
27. In the NOPR, the Commission noted that the serial first-come,
first-served study process was adopted at a time when most
interconnection requests were for large traditional generating
facilities that would use readily available transmission capacity.\63\
The Commission stated that the continued use of this process in the
face of dramatic changes to the electric power industry, principally
the surge in interconnection requests, the rapidly changing resource
mix, evolving market forces, and the emergence of new technologies, has
led to a growing backlog of interconnection requests and study delays
for many transmission providers.\64\ The Commission also stated that
these interconnection queue backlogs and study delays create
uncertainty and inhibit project developers' ability to interconnect
generating facilities to the transmission system.\65\ The Commission
preliminarily found that the existing pro forma LGIP, pro forma LGIA,
pro forma SGIP, and pro forma SGIA may be insufficient to ensure that
new generating facilities are able to interconnect to the transmission
system in a reliable, efficient, transparent, and timely manner and to
thereby ensure that rates, terms, and conditions for Commission-
jurisdictional services are just, reasonable, and not unduly
[[Page 61019]]
discriminatory or preferential.\66\ Further, because the
interconnection queue backlogs and study delays afflicting generator
interconnection service nationwide hinder the timely development of new
generation and thereby stifle competition in the wholesale electric
markets, the Commission also preliminarily found that the Commission's
pro forma LGIP, pro forma LGIA, pro forma SGIP, and pro forma SGIA
result in rates, terms, and conditions in the wholesale electric
markets that are unjust, unreasonable, and unduly discriminatory or
preferential.
---------------------------------------------------------------------------
\63\ NOPR, 179 FERC ] 61,194 at P 18.
\64\ Id. PP 18-20.
\65\ Id. P 19 (citing Joint Fed.-State Task Force on Elec.
Transmission, Technical Conference, Docket No. AD21-15-000, Tr.
15:21-16:1 (Ted Thomas) (May 6, 2022) (May Joint Task Force Tr.)
(``Houston, we have a problem. As stated in the NARUC ANOPR
comments, existing methods for interconnecting new resources to the
transmission grid are inadequate and inefficient because of the time
necessary to interconnect new resources and the corresponding
network upgrade costs.'')).
\66\ Id. P 22 (citing May Joint Task Force Tr. 23:6-11 (Riley
Allen) (``Ultimately, this system is not working efficiently now and
those inefficiencies translate into costs. It's not just cost on the
developers, but I find from my decades of experience that, if there
are inefficiencies in the system, they ultimately have to be borne
by the loads and ratepayer interests.'')).
---------------------------------------------------------------------------
28. The Commission stated that its preliminary findings were based
on several features of the Commission's existing generator
interconnection procedures and agreements that are of concern,
specifically: (1) the information (or lack thereof) available to
prospective interconnection customers and the commitments required of
them to enter and progress through the interconnection queue; (2) the
reliance on a serial first-come, first-served study process and the
standard to which transmission providers are held for meeting
interconnection study deadlines; (3) the protocols for affected systems
studies; (4) the provisions for studying new or hybrid generation
technologies and considering alternative transmission technologies; and
(5) the performance requirements for non-synchronous generating
facilities, including wind, solar, and electric storage facilities.\67\
---------------------------------------------------------------------------
\67\ Id. PP 23-36 (citing May Joint Task Force Tr. 70:20-71:6
(Matthew Nelson) (analogizing reiterative studies to going to the
supermarket to buy ingredients for a recipe without knowing how much
the ingredients cost, finding out at the register that they cost too
much for your budget, and having to ``go home, get a new recipe, and
start it all over again'')).
---------------------------------------------------------------------------
29. The Commission found that some of the same issues persist in
the small generating facility context and, therefore, proposed limited
reforms to the pro forma SGIP and pro forma SGIA to incorporate
alternative transmission technologies into the interconnection process
and to provide modeling and performance requirements for non-
synchronous generating facilities.\68\
---------------------------------------------------------------------------
\68\ Id. P 5.
---------------------------------------------------------------------------
B. Comments
30. The vast majority of commenters overwhelmingly agree with the
Commission's preliminary conclusion that there is a need to reform the
Commission's pro forma interconnection procedures and agreements to
ensure that interconnection customers are able to interconnect to the
transmission system in a reliable, efficient, transparent, and timely
manner, thereby ensuring that rates, terms, and conditions for
Commission-jurisdictional services are just, reasonable, and not unduly
discriminatory or preferential.\69\ These commenters generally agree
that the unprecedented volume of generation in the interconnection
queue, which is almost equal to the current U.S. generation fleet, has
resulted in severe backlogs in interconnection processes across the
country.\70\ For example, the Ohio Commission Consumer Advocate states
that ``there is an urgent need to clear the current generator
interconnection queue backlog and to facilitate timely and economic
interconnection of new resources in a way that responds to current and
future market conditions.'' \71\ EEI recognizes that, despite many
efforts underway across the country to fix individual transmission
provider interconnection queue processes, there is still a need for the
Commission to address backlogs and improve certainty in the
interconnection queue process.\72\ Several commenters assert that these
interconnection backlogs have resulted in commercial uncertainty
regarding both the magnitude of identified upgrade costs and the
timeline for completion of interconnection studies, delayed project
development, increased costs for consumers due to the prevention of new
supply from reaching the market, and impaired reliability.\73\ Senators
Hickenlooper and King note that, in the past decade, 23% of proposed
generating facilities reached commercial operation, while 72% were
withdrawn.\74\ ELCON and APPA-LPPC both argue that uncertainty, on the
part of both transmission provider and generator project developer,
inevitably leads to an increase in costs to consumers.\75\ U.S. DOE
submits a recent report published by the Lawrence Berkeley National
Laboratory, which finds that interconnection costs in MISO have
escalated as the number of interconnection requests has increased.\76\
Specifically, the report finds that interconnection costs in MISO
doubled for projects completed between 2019-2021 compared to projects
completed prior to 2018, and cost estimates tripled for projects still
active in the queue between the same time periods. Some commenters
agree that the existing interconnection rules in the pro forma LGIP and
pro forma LGIA create an incentive for interconnection customers to
submit interconnection requests even if they are not prepared to
[[Page 61020]]
move forward with their projects, in order to secure a favorable
position in the interconnection queue or in an attempt to obtain
locations with available transmission capacity.\77\ They assert that
the withdrawal of each speculative interconnection request triggers
reassessments and possible restudies by the transmission provider that
can increase the timing and interconnection cost for lower-queued
interconnection requests. Several commenters point to ambitious climate
goals (such as the United States' commitment to reducing net greenhouse
gas emissions by 50-52% by 2030 under the Paris Climate Agreement) and
argue that: (1) these changes will likely spur greater investment in
new generation and exacerbate the delays in processing interconnection
requests; and/or (2) without an efficient and transparent
interconnection process, none of the clean energy generating facilities
intended to meet these goals can be effectively deployed.\78\ Consumers
Energy argues that delays in processing interconnection requests will
exacerbate resource adequacy challenges.\79\
---------------------------------------------------------------------------
\69\ ACE-NY Initial Comments at 2; ACE-NY Reply Comments at 5;
AEE Initial Comments at 3, 5; AEE Reply Comments at 5; AES Initial
Comments at 2; Affected Interconnection Customers Initial Comments
at 2; Ameren Initial Comments at 2; APPA-LPPC Reply Comments at 2;
Avangrid Initial Comments at 6, 8; Bonneville Initial Comments at 3;
CESA Initial Comments at 3; CESA Reply Comments at 1; Clean Energy
Associations Initial Comments at 8; Clean Energy Buyers Initial
Comments at 3; Clean Energy States Initial Comments at 2-3; Colorado
Commission Initial Comments at 1; Consumers Energy Initial Comments
at 2; Cypress Creek Initial Comments at 1; Dominion Initial Comments
at 4; EEI Initial Comments at 2; EEI Reply Comments at 3; EDF
Renewables Initial Comments at 1-2; Enel Initial Comments at 2;
Energy Keepers Initial Comments at 2; Evergreen Action Initial
Comments at 1; Eversource Initial Comments at 2; Fervo Energy
Initial Comments at 2; Google Initial Comments at 2; Guzman Energy
Initial Comments at 2; Hannon Armstrong Initial Comments at 1;
Hydropower Commenters Initial Comments at 5; Illinois Commission
Initial Comments at 2-3, 5; Interwest Initial Comments at 3;
Interwest Reply Comments at 2; ISO-NE Initial Comments at 2-3; MISO
TOs Initial Comments at 2, 6; NARUC Initial Comments at 3; New
Jersey Commission Initial Comments at 4-9; NY Commission and NYSERDA
Initial Comments at 3; NV Energy Initial Comments at 3; Ohio
Commission Consumer Advocate Initial Comments at 3-4; OMS Initial
Comments at 2; [Oslash]rsted Initial Comments at 5; Pine Gate
Initial Comments at 8; PJM Initial Comments at 1, 4; PJM Coalition
Initial Comments at 1; RWE Renewables Initial Comments at 1;
Senators Hickenlooper and King Initial Comments at 1-2; Shell
Initial Comments at 5-6; State Agencies Initial Comments at 1-2;
TAPS Initial Comments at 1; Union of Concerned Scientists Reply
Comments at 1; UMPA Initial Comments at 1; WATT Coalition Initial
Comments at 1; Xcel Initial Comments at 8.
\70\ AEE Initial Comments at 3; Apple Initial Comments at 1;
Bonneville Initial Comments at 3; Clean Energy Buyers Initial
Comments at 3; Colorado Commission Initial Comments at 2, 8-11; EDF
Renewables Initial Comments at 2; Evergreen Action Initial Comments
at 1; Eversource Initial Comments at 2; Interwest Initial Comments
at 1-2; NV Energy Initial Comments at 2-3; Ohio Commission Consumer
Advocate Initial Comments at 3-4; [Oslash]rsted Initial Comments at
2; Senators Hickenlooper and King Initial Comments at 1-2; U.S.
Chamber of Commerce Initial Comments at 5; UMPA Initial Comments at
1.
\71\ Ohio Commission Consumer Advocate Initial Comments at 3-4.
\72\ EEI Reply Comments at 3.
\73\ ACE-NY Initial Comments at 2; AEE Initial Comments at 4;
EDF Renewables Initial Comments at 2; ELCON Initial Comments at 2;
Fervo Energy Initial Comments at 2; PJM Coalition Initial Comments
at 2; Xcel Reply Comments at 1.
\74\ Senators Hickenlooper and King Initial Comments at 1
(citing Joseph Rand et al., Lawrence Berkeley Nat'l Lab., Queued Up:
Characteristics of Power Plants Seeking Transmission Interconnection
(Apr. 2022) (Queued Up 2022), <a href="https://emp.lbl.gov/sites/default/files/queued_up_2021_04-13-2022.pdf">https://emp.lbl.gov/sites/default/files/queued_up_2021_04-13-2022.pdf</a>)).
\75\ ELCON Initial Comments at 2; APPA-LPPC Initial Comments at
2.
\76\ U.S. DOE Initial Comments at 1 (citing Joachim Seel et al.,
Lawrence Berkeley Nat'l Lab., Interconnection Cost Analysis in the
MISO Territory at 1 (Oct. 2022)).
\77\ Clean Energy Buyers Initial Comments at 3; Dominion Initial
Comments at 4-5; PJM Initial Comments at 12; U.S. Chamber of
Commerce Initial Comments at 4-5.
\78\ AEP Initial Comments at 2; Affected Interconnection
Customers Initial Comments at 2; Allen Meyer Initial Comments at 1;
Apple Initial Comments at 1; Bretton C Little Initial Comments at 1;
Colorado Commission Initial Comments at 13-14; EDF Renewables
Initial Comments at 2-3 (referencing Inflation Reduction Act, Pub.
L. 117-169 (2022)); ELCON Initial Comments at 2; Evergreen Action
Initial Comments at 2; GSCE Initial Comments at 5-6; Individual
Signatories Initial Comments at 1-2; Interwest Comments at 1-2;
National Grid Initial Comments at 2; Payton Alaama Reply Comments at
1; Pine Gate Reply Comments at 3-4; Rick K Lathrop Reply Comments at
1; Shell Initial Comments at 6; State Agencies Initial Comments at
8-9 (citing Int'l Energy Agency, Net Zero by 2050: A Roadmap for the
Global Energy Sector (2021) <a href="https://www.iea.org/reports/net-zero-by-2050">https://www.iea.org/reports/net-zero-by-2050</a>; The United States' Nationally Determined Contribution (2021),
<a href="https://www4.unfccc.int/sites/ndcstaging/PublishedDocuments/United%20States%20of%20America%20First/United%20States%20NDC%20April%2021%202021%20Final.pdf">https://www4.unfccc.int/sites/ndcstaging/PublishedDocuments/United%20States%20of%20America%20First/United%20States%20NDC%20April%2021%202021%20Final.pdf</a>; White House,
FACT SHEET: Biden Administration Jumpstarts Offshore Wind Energy
Projects to Create Jobs (Mar. 29, 2021), <a href="https://www.whitehouse.gov/briefing-room/statements-releases/2021/03/29/fact-sheet-biden-administration-jumpstarts-offshore-wind-energy-projects-to-create-jobs/">https://www.whitehouse.gov/briefing-room/statements-releases/2021/03/29/fact-sheet-biden-administration-jumpstarts-offshore-wind-energy-projects-to-create-jobs/</a>); Sue Hilton Initial Comments at 1; Union of Concerned
Scientists Reply Comments at 6; Vistra Initial Comments at 4.
\79\ Consumers Energy Initial Comments at 7.
---------------------------------------------------------------------------
31. A small subset of commenters, while supporting an overall need
for reform, disagree with some of the Commission's preliminary
conclusions about the need for reform.\80\ A few other commenters claim
that there is no basis for the Commission's preliminary conclusion that
speculative projects that enter the interconnection queue and later
withdraw, causing cascading restudies, are responsible for
interconnection queue backlogs.\81\ A few commenters assert that the
Commission did not take into account pertinent factors affecting
interconnection queue sizes, such as an increase in the development of
smaller, more diverse generating facilities.\82\
---------------------------------------------------------------------------
\80\ For instance, Affected Interconnection Customers disagree
with the Commission's reference to a nationwide shortage of
qualified engineers and contend that the Commission fails to support
this conclusion with any evidence beyond statements made by CAISO
and MISO. Affected Interconnection Customers Initial Comments at 14
(citing NOPR, 179 FERC ] 61,194 at P 20 n.67).
\81\ CREA and NewSun Initial Comments at 35-37 (countering that
interconnection requests do not reach commercial operation due to
other reasons such as permitting or financing difficulties); NextEra
Initial Comments at 4; Public Interest Organizations Initial
Comments at 1-7 (arguing that the rate of queue withdrawal has been
consistent over the last decade); SEIA Reply Comments at 1.
\82\ AEE Initial Comments at 6-7; Pine Gate Reply Comments at 4;
SEIA Reply Comments at 1.
---------------------------------------------------------------------------
32. Three comments note that various transmission providers use
vastly different interconnection procedures from the pro forma
procedures established in Order No. 2003 and argue that there is an
insufficient legal foundation under FPA section 206 to demonstrate that
all of these approved interconnection procedures are unjust,
unreasonable, and unduly discriminatory or preferential.\83\ Southern
disagrees entirely with the Commission's preliminary conclusion that
there is a need for reform.\84\ Southern argues that the Commission
based its proposed actions in the NOPR on conjecture and thus failed to
provide substantial evidence or engage in reasoned decision-making to
demonstrate that the current interconnection processes are unjust and
unreasonable.\85\ In addition, Southern contends that the Commission's
proposals are arbitrary and capricious because they impose a broadly
applicable remedy to a problem that does not exist uniformly.\86\
---------------------------------------------------------------------------
\83\ Early Adopters Coalition Initial Comments at 1-2;
PacifiCorp Initial Comments at 9; Southern Initial Comments at 10-
11.
\84\ Southern Initial Comments at 10-12; Southern Reply Comments
at 1, 4.
\85\ Southern Initial Comments at 10 (citing Emera Me. v. FERC,
854 F.3d 9, 24 (D.C. Cir. 2017)); Southern Reply Comments at 1, 4.
\86\ Southern Initial Comments at 11-12.
---------------------------------------------------------------------------
33. Southern further asserts that the Commission failed to provide
any actual evidence that its proposals will reduce interconnection
queue backlogs or increase certainty for interconnection customers.\87\
---------------------------------------------------------------------------
\87\ Id. at 10; Southern Reply Comments at 5.
---------------------------------------------------------------------------
34. Some commenters argue that the sum of the NOPR may actually
slow study processes, increase backlogs, and may unintentionally
increase costs to ratepayers.\88\ For example, CAISO asserts that
shortening study timelines results in rushed, unreliable studies which
would ultimately require more iteration and longer interconnection
queue processing times.\89\ Additionally, NextEra argues that the NOPR
provides few, if any, solutions relevant to those regions that have
already implemented cluster studies yet continue to experience
significant study delays.\90\ Further, some commenters oppose any
generic one-size-fits-all reform, arguing that queue reform is best
left to the regional level.\91\
---------------------------------------------------------------------------
\88\ CAISO Initial Comments at 3; Dominion Initial Comments at
7; New York State Department Initial Comments at 2; NextEra Reply
Comments at 2; NRECA Initial Comments at 7.
\89\ CAISO Initial Comments at 3.
\90\ NextEra Reply Comments at 7.
\91\ Avangrid Initial Comments at 36-37; Southern Initial
Comments at 14-15.
---------------------------------------------------------------------------
35. Several commenters generally support the suite of proposed
reforms in their entirety.\92\ As discussed in detail in each section
below discussing individual reforms, most commenters either support
specific proposals or suggest that the Commission prioritize certain
proposed reforms. For instance, Consumers Energy supports reforms that
increase the speed of interconnection queue processing because it
claims that the reforms provide clarity for resource planners and
interconnection customers as well as improve the reliability of the
bulk electric system and the clean energy resource transformation.\93\
Google urges the Commission to prioritize reforms that provide a level
playing field for both utility-backed resources and independent power
producer-developed resources.\94\ Google also expresses concern that
the layering of increased study deposits, more stringent site control
requirements, the proposed commercial readiness requirements, and
withdrawal penalties may place undue burden on interconnection
customers if the Commission does not also adopt proposals for more
publicly available interconnection information, firm study deadlines,
and penalties for missed study deadlines.\95\
---------------------------------------------------------------------------
\92\ APPA-LPPC Initial Comments at 2-3; APPA-LPPC Reply Comments
at 2; Apple Initial Comments at 1; ACORE Initial Comments at 2;
Amazon Initial Comments at 2; Evergreen Action Initial Comments at
1-4; Individual Signatories Initial Comments at 1; PJM Coalition
Initial Comments at 2.
\93\ Consumers Energy Initial Comments at 10-11.
\94\ Google Initial Comments at 3.
\95\ Id. at 16.
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36. Some commenters support adopting most or all of the limited
[[Page 61021]]
reforms to the pro forma SGIP and pro forma SGIA proposed in the
NOPR.\96\ For instance, Microgrid Resources asserts that including the
proposed reforms in the pro forma SGIP is necessary to reflect the
operating assumptions of, and to provide equitable treatment for,
microgrids and other behind-the-meter resources.\97\ Microgrid
Resources asserts that, if the Commission succeeds in expediting
interconnections for large generating facilities, while small
generating facility interconnections languish, it will bias the system
against smaller local generating facilities that are the backbone of
community resilience.
---------------------------------------------------------------------------
\96\ Bonneville Initial Comments at 24 (supporting applying some
of the Commission's proposed reforms to the pro forma SGIP and pro
forma SGIA (e.g., commercial readiness requirements), but asking
that transmission providers be granted flexibility to determine
which reforms should be applicable to small generator procedures and
agreements); IREC Initial Comments at 3 (stating that the pro forma
SGIP lacks the necessary provisions to safely and reliably
interconnect storage to the electric grid while enabling its unique
operating characteristics); Microgrid Resources Initial Comments at
8-9; Xcel Initial Comments at 19 (supporting applying reforms to
small generating facilities requesting energy only interconnection
service).
\97\ Microgrid Resources Initial Comments at 8-9.
---------------------------------------------------------------------------
C. Commission Determination
37. Based on the record, including comments submitted in response
to the NOPR, as discussed below, we find that there is substantial
evidence to support the conclusion that the existing pro forma
generator interconnection procedures and agreements are unjust,
unreasonable, and unduly discriminatory or preferential.\98\ We
therefore adopt the preliminary findings in the NOPR concerning the
need for reform \99\ and, pursuant to FPA section 206, conclude that
certain revisions to the pro forma open access transmission tariff and
the Commission's regulations are necessary to ensure rates that are
just, reasonable, and not unduly discriminatory or preferential.
Specifically, we find that the existing pro forma generator
interconnection procedures and agreements are insufficient to ensure
that interconnection customers are able to interconnect to the
transmission system in a reliable, efficient, transparent, and timely
manner, thereby ensuring that rates, terms, and conditions for
Commission-jurisdictional services are just, reasonable, and not unduly
discriminatory or preferential. Absent reform, the current
interconnection process will continue to cause interconnection queue
backlogs, longer development timelines, and increased uncertainty
regarding the cost \100\ and timing of interconnecting to the
transmission system. These backlogs and delays, and the resulting
timing and cost uncertainty,\101\ hinder the timely development of new
generation and thereby stifle competition in the wholesale electric
markets resulting in rates, terms, and conditions that are unjust,
unreasonable, and unduly discriminatory or preferential.
---------------------------------------------------------------------------
\98\ 16 U.S.C. 824e(a); 18 CFR 385.206 (2022).
\99\ NOPR, 179 FERC ] 61,194 at PP 18-36.
\100\ See May Joint Task Force Tr. 74:9-21 (Andrew French)
(stating that generator developers complain principally about cost
certainty and cost sharing and that ``cost certainty is the much
bigger issue'' given that ``an essential element of being able to
sell a product is to know what your inputs are so you can market
it'').
\101\ See May Joint Task Force Tr. 23:18-25 (Jason Stanek)
(expressing frustration with the status quo and agreement that it is
``no longer tenable'' considering the inability of generators to
interconnect in a timely manner, e.g., there are ``2,500 projects
under study [in the MACRUC region] and about a half of them have
been in the queue since at least 2001'').
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38. Indeed, recent data support the Commission's preliminary
findings in the NOPR that the dramatic increase in the number of
interconnection requests and limited transmission capacity are
increasing interconnection queue backlogs across all regions of the
country.\102\ As of the end of 2022, there were over 10,000 active
interconnection requests in interconnection queues throughout the
United States, representing over 2,000 gigawatts (GW) of potential
generation and storage capacity.\103\ This potential generation is the
largest interconnection queue size on record, more than four times the
total volume (in GW) of the interconnection queues in 2010, and a 40%
increase over the interconnection queue size from just the year
prior.\104\ These trends are not exclusive to any one region of the
country. Instead, every single region has faced an increase in both
interconnection queue size and the length of time interconnection
customers are spending in the interconnection queue prior to commercial
operation in recent years.\105\ This is true for RTO/ISO and non-RTO/
ISO regions alike. The non-RTO/ISO west and southeast regions both have
faced queue size increases ranging from tripling to a 12-fold increase
while also seeing longer timelines between interconnection requests and
commercial operation dates.\106\ Furthermore, the uncertainty and
delays in the interconnection queues have resulted in fewer than 25% of
interconnection requests, by capacity, reaching commercial operation
between 2000 and 2017 in any region of the country--with some regions
as low as 8%.\107\
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\102\ Joseph Rand et al., Lawrence Berkeley Nat'l Lab., Queued
Up: Characteristics of Power Plants Seeking Transmission
Interconnection, at 7-8 (Apr. 2023) (Queued Up 2023), <a href="https://emp.lbl.gov/sites/default/files/queued_up_2022_04-06-2023.pdf">https://emp.lbl.gov/sites/default/files/queued_up_2022_04-06-2023.pdf</a>; see
also Order No. 845, 163 FERC ] 61,043 at P 305 (requiring
transmission providers to post interconnection study metrics). See
appendix B to this final rule, which provides an overview of recent
data based on reporting by transmission providers in compliance with
Order No. 845.
\103\ Queued Up 2023 at 7-8.
\104\ Id. at 10.
\105\ Id. at 9, 32.
\106\ Id. at 9, 32.
\107\ Id. at 3, 21.
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39. Additionally, recent data continue to show that interconnection
customers are waiting longer in the interconnection queue before
withdrawing their interconnection requests,\108\ even as overall
interconnection study timelines are increasing in many regions.\109\
For example, AEE states that, as of February 2022, all 2,274 projects
waiting for an interconnection agreement in the PJM interconnection
queue had been waiting for a year or more; 33% (758 projects) had been
waiting more than 500 days, 22% (497 projects) have been stuck for more
than two years, and 7% (166 projects) have been waiting more than three
years.\110\ NV Energy explains that several western utilities that are
not currently part of an RTO/ISO are experiencing an unprecedented high
volume of requests in excess of the utility's peak load.\111\ AEE notes
that wait times for generating facilities in interconnection queues
nationwide have increased from 2.1 years for generating facilities
built in 2000-2010 to 3.7 years for those built in 2011-2021.\112\ And
despite efforts to address
[[Page 61022]]
these challenges,\113\ interconnection queue backlogs and delays have
persisted and worsened. For generating facilities built in 2022, wait
times in the interconnection queue saw a marked increase to now roughly
five years.\114\
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\108\ Id. at 25 (reporting that, although the median withdrawal
duration has been relatively consistent over time, the mean
withdrawal duration and distributions have edged higher in recent
years).
\109\ Id. at 27.
\110\ AEE Initial Comments at 4 (citing Advanced Energy Economy,
``In PJM, Renewable Energy Projects Are Getting Stuck'' (February
2022), <a href="https://blog.aee.net/in-pjm-renewable-energy-projects-are-getting-stuck">https://blog.aee.net/in-pjm-renewable-energy-projects-are-getting-stuck</a>).
\111\ NV Energy Initial Comments at 2-3. NV Energy explains that
it has a peak load of 9,400 MW with an interconnection queue backlog
for projects totaling more than 27,000 MW; Idaho Power has a peak
load of 3,751 MW with an interconnection queue backlog of over
18,000 MW; PacifiCorp has a peak load of 13,000 MW with an
interconnection queue backlog of over 45,000 MW; and APS has a peak
load of 7,600 MW with an interconnection queue backlog of over
50,000 MW.
\112\ AEE Initial Comments at 4 (citing Queued Up 2022); see
also ACE-NY Initial Comments at 2 (arguing that the ability of New
York to meet its clean energy goals is threatened by an
interconnection process that is too slow); Affected System
Interconnection Customers Initial Comments at 2 (stating that
Affected System Interconnection Customers have navigated the
generator interconnection queues of various transmission providers
around the country and experienced firsthand the inefficiencies and
delays, which represent the greatest obstacle to achieving
commercial operation of a new energy project); GSCE Initial Comments
at 5-6 (contending that an average of 6,000 MW of new solar, wind,
and batteries must be added each year until 2045 to reach
California's electric sector carbon-neutrality requirement, but that
over the past decade California has only succeeded with adding an
average of 1,000 MW of utility-scale solar and 300 MW of wind to the
transmission system each year).
\113\ Order No. 845, 163 FERC ] 61,043 at P 24.
\114\ Queued Up 2023 at 31; see also Shell Initial Comments at 6
(describing multiple instances of five to six years until execution
of an interconnection agreement, four years waiting for an initial
``kick-off'' call, two years waiting for a feasibility study, three
years waiting for a system impact study, and over two years waiting
for a facilities study).
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40. Delays in the interconnection study process are an important
contributor to interconnection queue backlogs nationwide. For instance,
based on the recent interconnection study metrics transmission
providers posted in compliance with Order No. 845, of the 2,179
interconnection studies completed in 2022, 68% were issued late.\115\
Furthermore, at the end of 2022, an additional 2,544 studies were
delayed (i.e., ongoing and past their deadline).\116\ All of the RTOs/
ISOs except CAISO and 14 non-RTO/ISO transmission providers reported
delayed studies at the end of 2022.\117\
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\115\ This is based on data provided by transmission providers
in compliance with Order No. 845. See appendix B to this final rule
for the underlying data. Note that data from SPP is omitted here and
in follow-on references to Order No. 845 data in this determination.
This is because during 2022, SPP was transitioning to a new
interconnection study process, and thus its data is not comparable
to the other transmission providers.
\116\ Id. Note that the vast majority of these studies (2,211)
were in PJM.
\117\ Id. CAISO revised the interconnection study deadlines of
their queue cluster 14 to account for the unprecedented increase in
interconnection requests. Cal. Indep. Sys. Operator Corp., 176 FERC
] 61,207 (2021).
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41. Consistent with the NOPR, we find that numerous factors have
contributed to the increasing volume of interconnection requests,
including a rapidly changing resource mix, market forces, and emerging
technologies. For example, the interconnection queues in all parts of
the country are now predominantly made up of comparatively new
technologies that have operating characteristics and generally shorter
construction cycles that were not taken into account when the
Commission issued Order No. 2003, such as solar, battery storage, and
hybrid resources, as older, larger generating facilities retire.\118\
The Colorado Commission notes that solar projects account for roughly
half of the cumulative requests in the five RTO/ISO queues and likely
an even greater percentage of the most recent requests.\119\ In
addition to the drastic increase in the number of interconnection
requests in all regions of the country, evidence shows that
interconnection studies have increased in complexity since the
Commission issued Order No. 2003, potentially straining transmission
provider resources.\120\ At the same time, we find that available
transmission capacity has been largely or fully utilized in many
regions, creating situations where interconnection customers face
significant network upgrade cost assignments to interconnect their
proposed generating facilities.\121\ For example, as referenced by the
U.S. DOE, a recent report finds that interconnection costs in MISO
doubled for generating facilities for which the interconnection studies
were completed between 2019 and 2021 as compared to those completed
prior to 2019, and cost estimates tripled for proposed generating
facilities still active in the interconnection queue between the same
time periods.\122\ These cost increases are similar to those being
faced in NYISO and PJM, where interconnection costs, per kW, have
doubled (or more) for recently completed generating facilities.\123\ As
a result, we find that this combination of increased volume of diverse
interconnection requests and insufficient transmission capacity leading
to higher costs to interconnect, which can result in interconnection
request withdrawals, has resulted in longer interconnection queue
processing times and larger, more delayed interconnection queues.
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\118\ Queued Up 2023 at 9; see also Colorado Commission Comments
at 9 (stating that the growth of solar project interconnection
requests is a significant cause of the overall supply and demand
imbalance across all RTOs/ISOs as well as other regions).
\119\ Colorado Commission Initial Comments at 9.
\120\ See, e.g., NYISO Initial Comments at 6-7 (stating that
``[s]tudies are only becoming more complex with the expanding scope
of ISO/RTOs' interconnection responsibilities''); Xcel Initial
Comments at 7 (stating that ``in many cases study models with large
clusters are difficult to solve . . . Ensuring new transmission
lines are realistic and even validating substation designs and
locations takes significant work to be done properly'').
\121\ See, e.g., ACORE Initial Comments at 2 (noting that
``upgrades based on generation interconnection may be a sub-optimal,
expensive, and ultimately ineffective way to accomplish transmission
expansion''); AEE Initial Comments at 3 (asserting that
``inefficient and impeded interconnection processes lead to
unacceptable delays and artificially high interconnection costs'');
EDF Renewables Initial Comments at 3.
\122\ Joachim Seel et al., Generator Interconnection Cost
Analysis in the Midcontinent Independent System Operator (MISO)
Territory, at 1, 4-5 (2022), <a href="https://emp.lbl.gov/interconnection_costs">https://emp.lbl.gov/interconnection_costs</a>.
\123\ Julia Mulvaney Kemp et al., Interconnection Cost Analysis
in the NYISO Territory (2023), <a href="https://emp.lbl.gov/publications/interconnection-cost-analysis-nyiso">https://emp.lbl.gov/publications/interconnection-cost-analysis-nyiso</a> (showing that costs have doubled
for generating facilities studied since 2017, relative to costs for
generating facilities studied from 2006 to 2016); Joachim Seel et
al., Interconnection Cost Analysis in the PJM Territory (2023),
<a href="https://emp.lbl.gov/publications/interconnection-cost-analysis-pjm">https://emp.lbl.gov/publications/interconnection-cost-analysis-pjm</a>
(showing that costs for recent ``complete'' generating facilities
have doubled on average relative to costs from 2000-2019).
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42. In response to comments asserting that the Commission did not
take into account other factors affecting interconnection queue sizes,
such as the development of smaller, more diverse generating facilities,
in its preliminary findings on the need for reform in the NOPR,\124\ we
find that the record shows that interconnection queue sizes are
increasing in both number of interconnection requests and in total MW
capacity in all regions of the country and such increases are not due
to an influx of any particular size of proposed generating facility.
Moreover, data show that the median duration for all generating
facilities that enter the interconnection queue hovers around 30
months, independent of the size of the interconnection request.\125\
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\124\ See, e.g., Pine Gate Reply Comments at 4 (stating that
``the days of . . . large, conventional resources are waning as the
majority of interconnection requests are now comprised of smaller,
more diverse resource'' and that ``[l]arger interconnection queues
are, to a certain extent, a natural byproduct of this change'');
SEIA Reply Comments at 1 (contending that interconnection requests
have increased in number ``because newer projects are smaller and
have less capacity'' and ``[m]ore interconnection requests are
needed to integrate the same amount of generation capacity into the
grid'').
\125\ Queued Up 2023 at 29.
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43. Interconnection queue backlogs and delays have created
uncertainty for interconnection customers regarding the timing and cost
of ultimately interconnecting to the transmission system. We agree with
commenters that such uncertainty, on the part of both transmission
provider and interconnection customer, may lead to an increase in costs
to consumers.\126\ First, delayed interconnection study results or
unexpected cost increases can disrupt numerous aspects of generating
facility development.\127\ Cost
[[Page 61023]]
uncertainty poses an especially significant obstacle because
interconnection customers may not be able to finance substantial
increases in unexpected interconnection costs. Second, transmission
providers may face uncertainty regarding the size and makeup of the
interconnection queue and the commercial viability of the project in
the interconnection queue, creating inefficiencies in the study
process, increasing interconnection study costs, and delayed study
results. Such uncertainty, either on the part of transmission providers
or interconnection customers, are ultimately passed through to
consumers through higher transmission or energy rates.\128\ Increases
in energy rates may result from wholesale customers having limited
access to new and more competitive supplies of generation. Conversely,
efficient interconnection queues and well-functioning wholesale markets
deliver benefits to consumers by driving down wholesale electricity
costs.
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\126\ See, e.g., Ameren Initial Comments at 2; ELCON Initial
Comments at 2; ELCON Initial Comments at 2; Xcel Initial Comments at
8.
\127\ See, e.g., Interwest Initial Comments at 8 (contending
that ``[t]he harm to interconnection customers associated with
interconnection study delays can be significant and costly,
including liquidated damages if compliance with a commercial
operation deadline is at risk'').
\128\ Ameren Initial Comments at 2.
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44. As the interconnection queue backlogs and study delays continue
and even increase, we find that the Commission's existing rules
contained in the pro forma LGIP, pro forma LGIA, pro forma SGIP, and
pro forma SGIA result in rates, terms, and conditions for Commission-
jurisdictional services that are unjust, unreasonable, and unduly
discriminatory or preferential. Not only do the problems described
above lead to an inability of interconnection customers to interconnect
to the transmission system in a reliable, efficient, transparent, and
timely manner, they also hinder the timely development of new
generation, thereby stifling competition in the wholesale electric
markets. We, therefore, find that reform to the Commission's existing
pro forma generator interconnection procedures and agreements is
necessary.
45. Our findings that the existing pro forma LGIP, pro forma LGIA,
pro forma SGIP, and pro forma SGIA must be reformed are based on the
following features of these existing rules: (1) the information (or
lack thereof) available to prospective interconnection customers and
the commitments required of them to enter and progress through the
interconnection queue; (2) the reliance on a serial first-come, first-
served study process and the ``reasonable efforts'' standard that
transmission providers are held to for meeting interconnection study
deadlines; (3) the protocols (or lack thereof) for affected system
studies; (4) the provisions for studying new generating facility
technologies and evaluating the list of alternative transmission
technologies enumerated in this final rule; and (5) the modeling or
performance requirements (or lack thereof) for non-synchronous
generating facilities, including wind, solar, and electric storage
facilities. We discuss each of these five features below.
46. First, we find that existing pro forma generator
interconnection procedures and agreements fail to contain a process by
which an interconnection customer can obtain information about
potential interconnection costs at a specific location or point of
interconnection prior to submitting an interconnection request. Without
this information, it is difficult for interconnection customers to
assess the commercial viability of a specific proposed generating
facility prior to entering the interconnection queue.\129\ Furthermore,
we find that for interconnection customers, the pro forma
interconnection procedures and agreements fail to include meaningful
financial commitment requirements to enter and stay in the
interconnection queue and lack of stringent requirements to establish
the commercial viability of proposed generating facilities.\130\ As a
result, interconnection customers often submit multiple interconnection
requests for proposed generating facilities at various points of
interconnection, knowing that not all of the proposed generating
facilities will reach commercial operation, as an exploratory mechanism
to obtain information to allow the interconnection customer to choose
to proceed with the interconnection request representing the most
favorable site in terms of potential interconnection-related
costs.\131\ For instance, recent interconnection study metrics posted
by transmission providers continue to show that some interconnection
customers are withdrawing interconnection requests before any studies
are completed.\132\ While interconnection customers may withdraw at any
stage of the interconnection process, to do so before any study is
completed indicates that interconnection customers may lack information
prior to entering the interconnection queue and are entering to obtain
valuable information about the commercial viability of their proposed
projects vis-[agrave]-vis other interconnection customers in the queue
or cluster.
---------------------------------------------------------------------------
\129\ See, e.g., Fervo Energy Initial Comments at 2-3 (stating
that ``the incidence of interconnection applications simply intended
to solicit information discovery from the transmission provider . .
. is a significant defect in today's queue process''); Google
Initial Comments at 4 (asserting that ``there is extreme information
asymmetry in the interconnection process,'' with transmission owners
and their affiliates having greater access than independent power
producers to information on the relative cost of interconnection at
different points).
\130\ See, e.g., Dominion Initial Comments at 4 (stating that
``owners of speculative projects remain in the queue process for as
long as they possibly can in the hopes that their project somehow
becomes viable''); U.S. Chamber of Commerce Initial Comments at 5
(concurring with the NOPR that there is a ``lack of stringent
financial commitments and readiness requirements on interconnection
customers'').
\131\ See, e.g., Clean Energy Associations Initial Comments at
11 (stating that ``[i]n most cases, customers must actually enter
the queue to ascertain what upgrade costs they will be responsible
for''); Clean Energy Buyers Initial Comments at 3 (stating that
inefficiencies in the serial study queue are ``compounded by
exploratory interconnection requests that are based on developers'
attempts to obtain locations with available transmission
capacity''); NY Commission and NYSERDA Initial Comments at 6-7
(stating that ``increased access to valuable information . . . could
deter developers from submitting multiple, speculative
[interconnection requests]'').
\132\ Based on data provided by transmission providers in
compliance with Order No. 845 (showing that 35% of withdrawals in
2022 took place before any studies had been completed). See appendix
B to this final rule for the underlying data.
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47. Second, the existing serial first-come, first-served study
process in the pro forma LGIP requires transmission providers to
process interconnection requests in the order in which the transmission
provider receives them. This approach creates incentives for
interconnection customers to submit exploratory or speculative
interconnection requests pursuant to which interconnection customers
seek to secure valuable queue positions as early as possible, even if
they are not prepared to move forward with the proposed generating
facility. Such generating facilities are often not commercially viable
and, thus, the interconnection customers ultimately withdraw from the
interconnection queue. We agree with commenters that the withdrawal of
speculative interconnection requests that trigger reassessments and
possible restudies by the transmission provider can delay the timing
and increase the cost to interconnect for lower-queued interconnection
requests.
48. In summary, we find that the lack of (1) access of information
about a specific location or point of interconnection prior to
submitting an interconnection request and (2) meaningful financial
commitments in the pro forma interconnection procedures and agreements
for interconnection customers to enter and stay in the interconnection
queue, as well as the existing serial first-come,
[[Page 61024]]
first-served study process, all incentivize interconnection customers
to submit speculative interconnection requests that contribute to
interconnection study backlogs, delays, and uncertainty, and, in turn,
unjust and unreasonable Commission-jurisdictional rates.
49. We disagree with commenters' assertions that there is no basis
to find that speculative interconnection requests are responsible for
interconnection queue backlog and delays. We highlight that more than
70% of interconnection requests were withdrawn from the interconnection
queue between 2000 and 2017.\133\ Although we recognize that there are
various reasons an interconnection customer may withdraw its request
from the interconnection queue, a withdrawal indicates an inability to
reach commercial operation. Because a withdrawal can trigger costly
restudies and create uncertainty in the interconnection process for
interconnection customers and transmission providers alike, withdrawals
of commercially non-viable interconnection requests from the
interconnection queue is a significant contributing factor to
interconnection queue backlogs and delays.\134\ Late-stage withdrawals
of interconnection requests are also increasing.\135\ Late-stage
withdrawals present a significant problem, as they can trigger
restudies for other interconnection customers that can result in
significant increases to the interconnection costs attributed to those
customers and the timeline for completion of interconnection studies,
which can result in further late-stage withdrawals, thus exacerbating
the interconnection queue backlogs and delays.\136\
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\133\ Queued Up 2023 at 18 (reporting that 72% of all
interconnection requests submitted from 2000-2017 were withdrawn).
\134\ See, e.g., Ohio Commission Consumer Advocate Initial
Comments at 8 (stating that ``[e]ach withdrawn project entails PJM
restudy on lower-queued projects, which delays the processing of new
service queues and may have the consequence of a cascade of
withdrawals'').
\135\ Queued Up 2023 at 22.
\136\ See, e.g., AEE Initial Comments at 4-5; Queued Up 2023 at
22.
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50. We also find that interconnection queue backlogs and delays,
and the accompanying uncertainty, are further compounded because
transmission providers have limited incentive to perform
interconnection studies in a timely manner. Under the pro forma LGIP,
transmission providers are held to a ``reasonable efforts'' standard in
completing interconnection studies consistent with their tariff-imposed
deadlines. However, this standard offers significant discretion to the
transmission providers in extending their own deadlines. The record
demonstrates that a majority of transmission providers across the
country regularly fail to meet interconnection study deadlines.\137\
Despite pervasive delays in completing interconnection studies by
transmission providers, we acknowledge that transmission providers have
faced few, if any, consequences for failing to meet their tariff-
imposed study deadlines under the reasonable efforts standard.\138\
This outcome stands in stark contrast to interconnection customers that
face financial and commercial consequences due to late interconnection
study results and may be considered withdrawn from the interconnection
queue for failing to meet their tariff-imposed deadlines.\139\ For
these reasons, we find that the existing pro forma LGIP requirement for
transmission providers to make a reasonable effort to meet
interconnection study deadlines contributes to the interconnection
study backlogs, delays, and uncertainty that erects barriers to new
generation.\140\ Therefore, we find that the use of a reasonable
efforts standard in the existing pro forma LGIP results in Commission-
jurisdictional rates that are unjust and unreasonable.
---------------------------------------------------------------------------
\137\ For example, based on data submitted by transmission
providers in compliance with Order No. 845, 80% of transmission
providers had delayed studies in at least one of the past three
years (2020-2022) and 57% had delayed studies in at least two.b See
also NARUC Initial Comments at 13 (stating ``nearly all transmission
providers across the country, including many transmission providers
that have implemented queue reforms, regularly fail to meet
interconnection study deadlines'').
\138\ See, e.g., Clean Energy Associations Initial Comments at
43-44 (stating that ``[a]t present, there is no specific incentive
for delivering on-time and accurate studies, and late or inaccurate
studies bring few if any consequences'').
\139\ See, e.g., ACE-NY Initial Comments at 3 (``Project
developers have strict deadlines they must adhere to in the
interconnection process, with penalties that include the forced
withdrawal of the project from the queue.'').
\140\ See, e.g., NARUC Initial Comments at 13-14 (contending
that ``the tendency to miss deadlines introduces uncertainty in a
process that is important to bringing new generation online in a
timely and cost-effective manner'').
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51. Third, the pro forma LGIP includes no requirements regarding
how or when transmission providers should complete affected system
studies. Without requirements, affected system studies often lag behind
those completed by the transmission provider to whose transmission
system the interconnection customer proposes to interconnect (the so-
called host transmission provider) and are sometimes completed very
late in the interconnection process, causing an additional round of
delays and cost uncertainty for interconnection customers.\141\
Additionally, for transmission providers that have procedures for how
to complete affected system studies in their tariffs or other documents
(e.g., business practice manuals or joint operating agreements), the
procedures are not consistent, may be hard for interconnection
customers to locate, and may not represent the actual practices in use
by the transmission provider, thus still creating uncertainty for
interconnection customers. As a result, we find that the lack of
consistent requirements for affected system modeling and procedures
results in Commission-jurisdictional rates that are unjust,
unreasonable, and unduly discriminatory or preferential.
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\141\ See, e.g., MISO Initial Comments at 72 (stating that ``the
need to wait for affected systems studies is the cause of the
majority of delays in the MISO study process''); May Joint Task
Force Tr. 65:2-8 (Dan Scripps) (citing affected systems studies as
``a growing source of delay and cost uncertainty for interconnection
customers, both in terms of just the timelines involved and the
difficulty in pinning those down'').
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52. Fourth, we find that the Commission's pro forma LGIP fails to
accommodate the operating characteristics and technical capabilities of
electric storage resources when it comes to specific interconnection
procedures and modeling. As stated above, the interconnection queues
predominantly consist of new technologies which have operating
characteristics that differ from synchronous resources and were not
anticipated when the Commission established the pro forma generator
interconnection procedures and agreements in Order Nos. 2003 and 2006.
Specifically, electric storage resources can be charged and dispatched
on a flexible, as-available basis, and are less likely than synchronous
generating facilities to withdraw energy from the transmission system
during peak load conditions or discharge during light load
conditions.\142\ However, the existing pro forma generator
interconnection procedures and agreements do not contemplate these
operating characteristics or technical capabilities of electric storage
resources. As a result, we find that electric storage resources
[[Page 61025]]
(whether standalone, co-located generating facilities, or part of a
hybrid generating facility), may be studied under inappropriate
operating assumptions (e.g., charging at full capacity during peak load
conditions) that result in assigning unnecessary network upgrades and
increased costs to interconnection customers. Therefore, we find that
the Commission's pro forma LGIP's lack of ability to modify operating
assumptions for electric storage resources results in Commission-
jurisdictional rates that are unjust, unreasonable, and unduly
discriminatory or preferential.
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\142\ See, e.g., Bonneville Initial Comments at 22-23 (stating
that ``storage resources are less likely to charge during peak load
conditions or discharge during light load conditions, and . . .
those considerations can be factored into assumptions used in
interconnection studies''); NARUC Initial Comments at 37 (stating
that ``assuming that an energy storage device will withdraw energy
during peak demand . . . fails to recognize that those resources are
likely to be highly responsive to price signals from the
transmission provider and can improve reliability'').
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53. Additionally, the record supports a finding that the existing
pro forma interconnection procedures regarding material modifications
do not provide for consistent evaluation of technology additions to an
existing interconnection request.\143\ We find that the record
demonstrates that automatically deeming a request to add a generating
facility to an existing interconnection request to be a material
modification creates a significant barrier to access to the
transmission system.\144\ As a result, we find the existing pro forma
LGIP and pro forma LGIA results in Commission-jurisdictional rates that
are unjust and unreasonable.
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\143\ See, e.g., NARUC Initial Comments at 35 (stating that the
``loss of queue position as a result of adding a generating facility
that does not increase the requested service level or cause
reliability issues . . . is an inefficient and discriminatory
outcome'').
\144\ See, e.g., AEE Initial Comments at 40-41; Public Interest
Organizations Initial Comments at 45-47; SEIA Initial Comments at
38-39.
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54. Finally, the record supports a finding that the Commission's
pro forma LGIP and pro forma SGIP fail to require the consideration of
alternative transmission technologies that can be deployed more quickly
to be used as network upgrades in place of, and at a lower cost than,
traditional network upgrades.\145\ In addition, commenters contend that
some alternative transmission technologies could provide substantial
benefits by resolving thermal overloads and avoiding voltage collapse,
allowing for better use of the existing transmission system, improving
reliability, and reducing interconnection request withdrawals,
restudies, and overall interconnection delays.\146\ We find that
failing to require transmission providers to evaluate the list of
alternative transmission technologies enumerated in this final rule
results in interconnection customers paying more than is just and
reasonable to reliably interconnect new generating facilities,
resulting in Commission-jurisdictional rates that are unjust,
unreasonable, and unduly discriminatory or preferential. Because the
benefits of the enumerated alternative transmission technologies
identified above are present across all interconnection processes,
regardless of the size of the interconnection request, we find that the
failure to evaluate the enumerated alternative transmission
technologies results in both the pro forma LGIP and pro forma SGIP
being unjust, unreasonable, and unduly discriminatory or preferential.
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\145\ See, e.g., NARUC Initial Comments at 38 (stating that
``failing to consider alternative transmission technologies that can
be deployed both more quickly and at lower costs than network
upgrades may render Commission-jurisdictional rates unjust and
unreasonable''); OMS Initial Comments at 19 (agreeing that ``failing
to consider these alternative transmission technologies runs the
risk of implementing longer lead-time network upgrades at a higher
cost'').
\146\ See, e.g., AEE Initial Comments at 42 (stating that
alternative transmission technologies ``provide benefits beyond
potential costs savings, including maximizing limited rights-of-way
and potentially avooiding or minimizing environmental and property
impacts taht can bog down siting and permitting proceedings''); Ohio
Commission Consumer Advocate Initial Comments at 15 (stating that
``[t]hese grid-enhancing technologies (`GETs') can improve
opertations, enhance system reliability, contribute to capacity, and
more'' and ``[s]ome [grid-enhancing technologies] could provide
substantial benefits by resolving thermal overloads and avoiding
voltage collapse, among other things''); WATT Coalition Initial
Comments at 2 (referring to the report Unlocking the Queue with Grid
Enhancing Technologies that showed that application of the three
grid-enhancing technologies in the Kansas and Oklahoma transmission
systems would enable twice as much renewable energy to interconnect
out of the queues without any traditional transmission upgrades.).
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55. Fifth, we find that the Commission's existing pro forma LGIP
and pro forma SGIP do not include a modeling requirement for non-
synchronous generating facilities, which is necessary to enable the
transmission provider to assess and model the facility's ability to
respond appropriately to transmission system disturbances. These
modeling requirements include: (1) a validated, user-defined root mean
square (RMS) positive sequence dynamic model; (2) an appropriately
parameterized, generic library RMS positive sequence dynamic model; and
(3) a validated electromagnetic transient (EMT) model, if the
transmission provider performs an EMT study as part of the
interconnection study process. Additionally, we find that accurate and
validated models are necessary to address study delays and to ensure
that transmission providers identify the necessary interconnection
facilities and network upgrades to accommodate the interconnection
request and appropriate assignment of interconnection costs. As a
result, we find that the lack of a modeling requirement for non-
synchronous generating facilities in the pro forma LGIP and pro forma
SGIP results in rates that are unjust, unreasonable, and unduly
discriminatory or preferential.
56. Furthermore, the physical characteristics of synchronous
generating facilities allow them to continue to inject electric current
during transmission system disturbances, as required by the pro forma
LGIA and pro forma SGIA.\147\ However, non-synchronous generating
facilities do not face a comparable requirement and many cease
injecting current through ``momentary cessation,'' which creates
reliability issues on the transmission system.\148\ Moreover, without
requirements for non-synchronous generating facilities to remain
connected to and synchronized with the transmission system,
interconnection studies may not accurately model expected behavior and
identify the appropriate interconnection facilities and network
upgrades to accommodate the interconnection request, skewing the
assignment of interconnection costs. As a result, we find that the lack
of comparable requirements for non-synchronous generating facilities to
remain ``connected to and synchronized with the [t]ransmission
[s]ystem'' in the pro forma LGIA and pro forma SGIA results in rates
that are unjust, unreasonable, and unduly discriminatory or
preferential.
---------------------------------------------------------------------------
\147\ Pro forma LGIA art. 9.7.3 and pro forma SGIA art. 1.5.7
require synchronous generating facilities to remain ``connected to
and synchronized with'' the transmission system during system
disturbances.
\148\ See, e.g., NERC Initial Comments at 9 (stating that
``improper planning and operation of [non-synchronous resources] can
pose a significant risk to . . . reliability'' and adding that
``risk mitigation measures . . . have been inconsistently adopted by
industry''); MISO TOs Initial Comments at 32-33 (concurring with the
Commission that ``with more and more non-synchronous generation
facilities entering the interconnection queue, the lack of a
requirement for such resources to respond to system disturbances
becomes `more consequential' '').
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57. In response to commenters that express broad opposition to the
need for reform, we disagree with assertions that the existence of
regional variation in interconnection procedures across the country
creates an insufficient legal foundation under FPA section 206 to
demonstrate that rates are unjust, unreasonable, and unduly
discriminatory or preferential. Similarly, we disagree with assertions
that reforms to the pro forma generator interconnection procedures and
agreements are arbitrary and capricious because the problems identified
herein do not exist uniformly. As an initial matter, the ``Commission
may rely on `generic' or `general' findings of a systemic problem to
support imposition
[[Page 61026]]
of an industry-wide solution.'' \149\ That some interconnection
processes may fare better in the face of industry-wide challenges would
be ``as unastonishing as it is irrelevant.'' \150\ The Commission may
reasonably rely on rulemaking to address the systemic drivers leading
to widespread interconnection queue backlogs and delays,
notwithstanding regional variation among interconnection procedures.
---------------------------------------------------------------------------
\149\ S.C. Pub. Serv. Auth. v. FERC, 762 F.3d 41, 67 (D.C. Cir.
2014) (quoting Interstate Nat. Gas Ass'n of Am. v. FERC, 285 F.3d
18, 37 (2002)).
\150\ Id. (quoting Wis. Gas v. FERC, 770 F.2d 1144, 1157 (D.C.
Cir. 1985)).
---------------------------------------------------------------------------
58. Moreover, as noted above, every region of the country is seeing
an increase in both interconnection queue size and the length of time
interconnection customers are spending in the interconnection queue
prior to commercial operation in recent years.\151\ Furthermore, the
uncertainty and delays in the interconnection queues have resulted in
fewer than 25% of interconnection requests, by capacity, reaching
commercial operation between 2000 and 2017 in any region of the
country--with some regions as low as 8%.\152\ For example, only 10% of
interconnection requests, by capacity, have reached commercial
operation in the non-RTO/ISO southeast region between 2000 and
2017.\153\ Additionally, the challenges being faced across the country
will be further compounded in the future given the recent spikes in
interconnection queue sizes. In the non-RTO/ISO southeast region, the
interconnection queue size has more than tripled between 2014 and 2022,
with the increase predominantly made up of solar, storage, and hybrid
generating facilities, adding potential complexity to future
interconnection queue study processes.\154\ To the extent existing pro
forma interconnection procedures, such as first-come, first-served
study processes, have worked in the past for smaller or less complex
queues, such experience is not indicative of what will be necessary in
the future to ensure that a growing number of interconnection requests
are processed in a reliable, efficient, transparent, and timely
manner.\155\ Finally, as recognized in Order No. 2003, interconnection
queue delays may ``provide[] an unfair advantage to utilities that own
both transmission and generation facilities,'' \156\ making it
exceedingly necessary that interconnection delays are addressed in all
regions of the country, especially those where transmission providers
continue to own both transmission and generation.\157\ As discussed
above, because interconnection queue backlogs and delays afflict
generator interconnection service nationwide, which hinders the timely
development of new generation and thereby stifles competition in the
wholesale electric markets, reforms are necessary to ensure Commission-
jurisdictional rates are just, reasonable, and not unduly
discriminatory or preferential.
---------------------------------------------------------------------------
\151\ Queued Up 2023 at 9, 32.
\152\ Id. at 3, 21.
\153\ Id. at 21.
\154\ Id. at 9.
\155\ See, e.g., Public Interest Organization Initial Comments
at 17; R Street Initial Comments at 3.
\156\ Order No. 2003, 104 FERC ] 61,103 at P 11.
\157\ See, e.g., Pine Gate Initial Comments at 15; AEE Reply
Comments at 22.
---------------------------------------------------------------------------
59. We are not persuaded by commenters' concerns that the reforms
proposed in the NOPR, many of which we adopt in this final rule, will
be counterproductive in addressing the need for reform. As discussed in
more detail throughout this final rule, we believe that the reforms
adopted herein, as a whole, will improve the efficiency of study
processes, reduce interconnection queue backlogs, and thereby ensure
just, reasonable, and not unduly discriminatory or preferential rates.
We believe that, on balance, the reforms will produce efficiencies by,
for example, reducing speculative interconnection requests and
interconnection request withdrawals, which in turn will reduce the time
and resources spent in interconnection studies and restudies thereby
decreasing interconnection queue backlogs and delays. Additionally, the
majority of the individual reforms that the Commission proposed in the
NOPR and we adopt in this final rule have already been implemented in
one or more regions in order to improve the interconnection process,
demonstrating incremental improvements. This final rule uses some of
these individual and incremental improvements as a basis for a broad
suite of reforms that, in their entirety, have not yet been adopted by
any region and we believe will ensure that interconnection customers
are able to interconnect to the transmission system in a reliable,
efficient, transparent, and timely manner. In some cases, such as for
the commercial readiness reforms adopted in this final rule, we have
significantly modified the NOPR proposal based on comments received.
60. Having concluded that the existing pro forma generator
interconnection procedures and agreements are unjust, unreasonable, and
unduly discriminatory or preferential, we turn, as we are required to
do under FPA section 206,\158\ to determining the replacement rate,
described--at some length--below.
---------------------------------------------------------------------------
\158\ 16 U.S.C. 824e(a); see, e.g., FERC v. Electric Power
Supply Ass'n, 577 US 260, 277 (2016) (``If FERC sees a violation of
[the just and reasonable] standard, it must take remedial action.'')
---------------------------------------------------------------------------
III. Reforms
A. Reforms To Implement a First-Ready, First-Served Cluster Study
Process
1. Interconnection Information Access
a. Need for Reform
i. NOPR
61. The Commission noted its concern regarding the lack of
information available to prospective interconnection customers
regarding potential interconnection costs prior to submitting an
interconnection request.\159\ The Commission stated that, without this
information, it is difficult for interconnection customers to assess
the viability of a specific proposed generating facility. Subsequently,
interconnection customers submit multiple speculative interconnection
requests in an attempt to obtain information through the system impact
study process about the costs associated with various project
configurations. The Commission preliminarily found that the
Commission's pro forma LGIP and pro forma LGIA are unjust,
unreasonable, and unduly discriminatory or preferential and that
reforms are needed to allow interconnection customers to interconnect
in a reliable, efficient, transparent, and timely manner, thereby
ensuring that rates, terms, and conditions for Commission-
jurisdictional services are just, reasonable, and not unduly
discriminatory or preferential.\160\
---------------------------------------------------------------------------
\159\ NOPR, 179 FERC ] 61,194 at P 40.
\160\ Id. P 39.
---------------------------------------------------------------------------
ii. Comments
62. Several commenters contend that it is a rational response to a
lack of pre-interconnection queue information for interconnection
customers to submit multiple interconnection requests to gain
information on which interconnection sites are favorable and hedge
risks, which leads to withdrawals that exacerbate unmanageable
interconnection queue backlogs.\161\ ELCON and Environmental Defense
[[Page 61027]]
Fund argue that the lack of sufficient information and unexpected cost
escalation are the primary reasons interconnection requests are
withdrawn, leading to delays and inefficiencies.\162\
---------------------------------------------------------------------------
\161\ AES Initial Comments at 3; Affected Interconnection
Customers Initial Comments at 30; Clean Energy Buyers Initial
Comments at 5-6; CREA and NewSun Initial Comments at 45;
Environmental Defense Fund Initial Comments at 3; ELCON Initial
Comments at 3; Northwest and Intermountain Initial Comments at 5;
Public Interest Organizations Initial Comments at 18.
\162\ Environmental Defense Fund Initial Comments at 3; ELCON
Initial Comments at 4.
---------------------------------------------------------------------------
63. Many commenters agree with the goal of providing additional
information prior to entering the interconnection queue.\163\ Some
commenters state that additional information prior to entering the
interconnection queue is beneficial,\164\ in particular access to
information on potential network upgrades and the cost and time to
interconnect.\165\ Many commenters expect that potential
interconnection customers' access to additional information prior to
entering the interconnection queue will reduce speculative
interconnection requests, thus promoting reliability and cost savings
by encouraging more optimal interconnection requests that can be
processed more efficiently and at lower overall cost.\166\
---------------------------------------------------------------------------
\163\ ACORE Reply Comments at 3; AEE Initial Comments at 9; AEP
Initial Comments at 12; AES Initial Comments at 3; Affected
Interconnection Customers Initial Comments at 30; APS Initial
Comments at 4; Bonneville Initial Comments at 5; Clean Energy Buyers
Initial Comments at 7; CREA and NewSun Initial Comments at 44; ELCON
Initial Comments at 3-4; Enel Initial Comments at 9; Google Initial
Comments at 15; MISO Initial Comments at 20-21; NARUC Initial
Comments at 4; NESCOE Reply Comments at 2-3; NY Commission and
NYSERDA Initial Comments at 6-8; NYISO Initial Comments at 16; NYTOs
Initial Comments at 8; Pacific Northwest Utilities Initial Comments
at 13; PJM Initial Comments at 45; Puget Sound Initial Comments at
5; WAPA Initial Comments at 5.
\164\ AEP Initial Comments at 12; APS Initial Comments at 4.
\165\ EEI Reply Comments at 7-8; New Jersey Commission Initial
Comments at 23; NV Energy Initial Comments at 13.
\166\ Affected Interconnection Customers Initial Comments at 30;
Clean Energy States Initial Comments at 3; Duke Southeast Utilities
Initial Comments at 6; Environmental Defense Fund Initial Comments
at 3; ELCON Initial Comments at 3-4; Fervo Energy Initial Comments
at 2-3; Google Initial Comments at 4-5; NARUC Initial Comments at 4-
5; NESCOE Reply Comments at 3; New Jersey Commission Initial
Comments at 20-22; New York State Department Initial Comments at 8;
Pacific Northwest Utilities Initial Comments at 13; Public Interest
Organizations Initial Comments at 18; Puget Sound Initial Comments
at 5; SDG&E Initial Comments at 3-4.
---------------------------------------------------------------------------
64. Several commenters note the importance of additional
interconnection information access in light of the other reforms
proposed in the NOPR. AES contends that it would be inequitable for the
Commission to increase security deposits to stay in the interconnection
queue under the NOPR proposal to increase study and LGIA deposits
without requiring transmission providers to provide sufficient
information to interconnection customers.\167\ Vistra asserts that the
proposals to provide additional information will complement the
exclusive site control proposals and provide an avenue for prospective
interconnection customers to select the most viable sites on which to
obtain rights and develop a location, which is a costly and time-
consuming process, before entering the interconnection queue.\168\
Northwest and Intermountain argue that, in order for the other proposed
reforms in the NOPR to be effective, potential interconnection
customers must have a solution to the problem of identifying optimal
interconnection locations and configurations that is timely, cost-
effective, and accurate.\169\
---------------------------------------------------------------------------
\167\ AES Initial Comments at 13.
\168\ Vistra Initial Comments at 4.
\169\ Northwest and Intermountain Initial Comments at 9.
---------------------------------------------------------------------------
65. Google contends that pre-queue information is necessary because
there is an extreme information asymmetry between independent power
producers and transmission owners and their generating affiliates,
which have greater access to planning information, including load
growth, relative cost of interconnecting at different points, points of
chronic congestion where upgrades might be needed, and planned local
upgrades.\170\ Google asserts that this information asymmetry is
particularly pronounced in the non-RTO/ISO regions, and allows
transmission owners and their affiliates to identify the best locations
for interconnection more quickly than independent power producers.
---------------------------------------------------------------------------
\170\ Google Initial Comments at 3-4.
---------------------------------------------------------------------------
66. On the other hand, Dominion argues that there is no evidence in
the record that a lack of information is slowing down the
interconnection queue process or that transmission providers are not
engaged in good faith reviews of interconnection requests.\171\
According to Dominion, the Commission should focus on making the
interconnection process more efficient and speedier, and the best way
to achieve these goals is through the first-ready, first-served cluster
study reform. While APPA-LPPC support transparency in the generator
interconnection process and share the Commission's view that the
availability of transmission system information should reduce the
incentive to submit speculative interconnection requests, they argue
that sufficient information is currently publicly available.\172\
---------------------------------------------------------------------------
\171\ Dominion Reply Comments at 8-9.
\172\ APPA-LPPC Initial Comments at 11.
---------------------------------------------------------------------------
iii. Commission Determination
67. We find that, absent reforms to require transmission providers
to provide additional interconnection information, which can be used by
interconnection customers prior to submitting an interconnection
request, speculative interconnection requests will likely remain at
current levels and continue to contribute to interconnection study
delays and add costs to the interconnection process. Although
submitting multiple interconnection requests to gain information may be
a rational response to a lack of pre-interconnection queue information,
this practice increases interconnection study delays.\173\ We also
agree with commenters that additional access to interconnection
information is a valuable goal \174\ as it can increase the likelihood
that an interconnection request is viable when submitted. We disagree
with commenters that current information requirements are
sufficient.\175\ While certain information is currently available
through the feasibility study process, as part of our reforms discussed
below, we eliminate the feasibility study. Therefore, we find it
necessary to provide a means for interconnection customers to obtain
additional information prior to entering the interconnection queue. We
concur with comments that additional access to interconnection
information prior to entering the interconnection queue is important
for interconnection customers to make informed decisions, particularly
given the increased requirements for interconnection customers adopted
in this final rule, such as increased study deposits and site control,
as discussed
[[Page 61028]]
below.\176\ We also agree that commenters raise a valid concern that an
information asymmetry exists between independent power producers and
transmission owner affiliates, in particular in non-RTO/ISO
regions.\177\
---------------------------------------------------------------------------
\173\ See AES Initial Comments at 3; Affected Interconnection
Customers Initial Comments at 30; Clean Energy Buyers Initial
Comments at 5-6; CREA and NewSun Initial Comments at 45;
Enviornmental Defense Fund Initial Comments at 3; ELCON Initial
Comments at 3; Northwest and Intermountain Initial Comments at 5;
Public Interest Organizations Initial Comments at 18.
\174\ ACORE Reply Comments at 3; AEE Initial Comments at 9; AEP
Initial Comments at 12; AES Initial Comments at 3; Affected
Interconnection Customers Initial Comments at 30; APS Initial
Comments at 4; Bonneville Initial Comments at 5; Clean Energy Buyers
Initial Comments at 7; CREA and NewSun Initial Comments at 44; ELCON
Initial Comments at 3-4; Enel Initial Comments at 9; Google Initial
Comments at 15; MISO Initial Comments at 20-21; NARUC Initial
Comments at 4; NESCOE Reply Comments at 2-3; NY Commission and
NYSERDA Initial Comments at 6-8; NYISO Initial Comments at 16; NYTOs
Initial Comments at 8; Pacific Northwest Utilities Initial
Comments at 13; PJM Initial Comments at 45; Puget Sound Initial
Comments at 5; WAPA Initial Comments at 5.
\175\ APPA-LPPC Initial Comments at 9.
\176\ AES Initial Comments at 13; Northwest and Intermountain
Initial Comments at 9; Vistra Initial Comments at 4.
\177\ Google Initial Comments at 3-5.
---------------------------------------------------------------------------
b. Informational Interconnection Study
i. NOPR Proposal
68. In the NOPR, the Commission proposed to revise the Commission's
pro forma LGIP to require transmission providers to offer an
informational interconnection study for prospective interconnection
customers.\178\ The Commission proposed that the informational
interconnection study would provide cost estimates for the transmission
provider's interconnection facilities and network upgrade costs
specific to the interconnection scenario detailed in the study
agreement. The Commission also proposed to include new definitions for
an informational interconnection study and informational
interconnection study agreement.
---------------------------------------------------------------------------
\178\ NOPR, 179 FERC ] 61,194 at P 42.
---------------------------------------------------------------------------
69. Under the Commission's proposal, prospective interconnection
customers could request up to five separate informational
interconnection studies at a time.\179\ The Commission explained that
each configuration of an interconnection request would require a
separate informational interconnection study. The Commission proposed
that the informational interconnection study would be at the
interconnection customer's expense, and each study would require a
$10,000 deposit, subject to a true-up based on actual study costs.
---------------------------------------------------------------------------
\179\ Id. P 43.
---------------------------------------------------------------------------
70. The Commission proposed that, within seven business days of the
receipt of a prospective interconnection customer's request for an
informational interconnection study, the transmission provider would
have to provide the prospective interconnection customer with an
informational interconnection study agreement.\180\ The Commission
explained that the informational interconnection study agreement would
specify the technical data that the prospective interconnection
customer must provide and an estimate of the expected costs of the
study, including, to the extent known by the transmission provider, an
estimate of the study costs expected to be incurred by any relevant
affected systems. Under the proposal, the prospective interconnection
customer would have 10 business days to execute the agreement and
deliver it to the transmission provider, along with the relevant
technical data and study deposit, after which the transmission provider
would have 45 calendar days to complete the study.
---------------------------------------------------------------------------
\180\ Id. P 44.
---------------------------------------------------------------------------
71. The Commission proposed that the informational interconnection
study would consist of a sensitivity analysis based on the assumptions
specified in the informational interconnection study agreement.\181\
Under the proposal, the informational interconnection study would
identify potential interconnection facilities and network upgrades that
may be required to interconnect the prospective interconnection
customer's proposed generating facility, including an approximation of
the costs of such interconnection facilities and network upgrades. The
Commission noted that the transmission provider would also coordinate
with affected systems that may be impacted by the prospective
interconnection customer's request to provide information on affected
systems-related issues.
---------------------------------------------------------------------------
\181\ Id. P 45.
---------------------------------------------------------------------------
72. The Commission proposed an informational interconnection study
agreement form, which explains that the informational interconnection
study is performed solely for informational purposes and is not binding
on either party.\182\ The proposed agreement also requires the study
report to provide specific information, including, at a minimum: (1)
preliminary identification of any circuit breaker short circuit
capability limits exceeded; (2) preliminary identification of any
thermal overload or voltage limit violations; and (3) estimated network
upgrade costs related to the identified overloads and violations.
---------------------------------------------------------------------------
\182\ Id. P 46.
---------------------------------------------------------------------------
73. The Commission sought comment on: (1) whether the informational
interconnection study, as proposed, would provide prospective
interconnection customers with sufficient and timely information to
inform decision-making prior to submitting an interconnection request;
(2) whether transmission providers should be required to establish a
request window of a limited number of days each year in which potential
interconnection customers can request an optional informational
interconnection study; and (3) the burdens on transmission providers of
conducting informational studies and whether other options, such as the
proposal discussed below for public interconnection information, might
strike a better balance of providing interconnection customers with
useful information while making efficient use of transmission provider
resources.\183\
---------------------------------------------------------------------------
\183\ Id. PP 47-48.
---------------------------------------------------------------------------
74. Additionally, the Commission proposed to add new section 3.1.2
to the pro forma LGIP, which provides that interconnection customers
evaluating different options (such as different sizes, sites, or
voltages) are encouraged but not required to use the new informational
interconnection study proposed in the NOPR before entering the cluster
study.\184\
---------------------------------------------------------------------------
\184\ Id. P 66.
---------------------------------------------------------------------------
ii. Comments
(a) Comments in Support
75. Several commenters support the NOPR proposal to require
transmission providers to offer an informational interconnection study
to prospective interconnection customers.\185\ Several commenters agree
that the informational interconnection study proposal could reduce the
number of speculative or other interconnection requests \186\ and
improve the efficiency of siting decisions.\187\ Some commenters expect
that these changes will have other benefits for the interconnection
process, including cost savings from fewer and more viable
interconnection requests,\188\ a reduced need for project withdrawals
and queue restudies,\189\ and reduced burden on transmission providers,
which will result in fewer interconnection study delays.\190\
---------------------------------------------------------------------------
\185\ Affected Interconnection Customers Initial Comments at 30;
Clean Energy States Initial Comments at 4; Consumers Energy Initial
Comments at 3; Duke Southeast Utilities Initial Comments at 6;
Evergreen Action Initial Comments at 3; Fervo Energy Initial
Comments at 2; Illinois Commission Initial Comments at 6; Interwest
Initial Comments at 4, 7; NESCOE Reply Comments at 2; Public
Interest Organizations Initial Comments at 18; Southern Initial
Comments at 28; Tesla Initial Comments at 4; Tri-State Initial
Comments at 5.
\186\ Fervo Energy Initial Comments at 2-3; Google Initial
Comments at 4; NRECA Initial Comments at 13; NY Commission and
NYSERDA Initial Comments at 6-8.
\187\ Duke Southeast Utilities Initial Comments at 6-7; ISO-NE
Initial Comments at 18; NARUC Initial Comments at 5; NRECA Initial
Comments at 13; Pine Gate Initial Comments at 13-14; Tesla Initial
Comments at 4.
\188\ Evergreen Action Initial Comments at 3; NARUC Initial
Comments at 5.
\189\ Evergreen Action Initial Comments at 3; NRECA Initial
Comments at 13.
\190\ Google Initial Comments at 4.
---------------------------------------------------------------------------
76. MISO and Fervo Energy state that it is helpful for a
prospective interconnection customer to compare how various MW sizes,
points of interconnection, or other scenarios could affect costs,
especially for prospective interconnection customers that cannot
perform such analysis in house, and that the NOPR's
[[Page 61029]]
informational interconnection study proposal would assist in these
goals.\191\ Pacific Northwest Organizations argue that, without upfront
interconnection cost information, independent power producers may be
discouraged from entering the interconnection queue if they are
subjected to higher withdrawal fees, which may result in preventing
them from being considered in request for proposals (RFPs) in the
Pacific Northwest.\192\
---------------------------------------------------------------------------
\191\ Fervo Energy Initial Comments at 2; MISO Initial Comments
at 22.
\192\ Pacific Northwest Organizations Initial Comments at 3-4.
---------------------------------------------------------------------------
77. Some commenters stress the importance of the informational
interconnection study in light of the other reforms proposed in the
NOPR. For instance, Northwest and Intermountain aver that the
informational study will be the primary resource for interconnection
customers to demonstrate the feasibility and cost effectiveness of
their interconnection plan and will serve as the foundation for
subsequent negotiations for the documents that will establish
commercial readiness of their project for the cluster study
process.\193\ Pacific Northwest Organizations assert that the NOPR's
proposed commercial readiness framework would be problematic in the
region without something like the informational interconnection study
to discover costs before entering the queue.\194\
---------------------------------------------------------------------------
\193\ Northwest and Intermountain Initial Comments at 6-7.
\194\ Pacific Northwest Organizations Initial Comments at 3.
---------------------------------------------------------------------------
78. Several commenters are generally supportive of the NOPR
proposal but either (1) offer qualifications to that support \195\ or
(2) request specific changes to the proposal.\196\
---------------------------------------------------------------------------
\195\ Idaho Power Initial Comments at 3 (stating that it only
supports the proposal if the informational interconnection study
requirements are less prescriptive and allow for more flexibility);
NRECA Initial Comments at 8 (stating that it does not oppose the
proposal as long as the final rule includes a larger package of
reforms to reduce speculative interconnection requests and speed up
interconnection queues as well as affords reasonable flexibility on
compliance); Ohio Commission Consumer Advocate Initial Comments at 6
(stating that informational studies should not interfere with other
interconnection studies).
\196\ ACE-NY Initial Comments at 10; Avangrid Initial Comments
at 21; Clean Energy Buyers Initial Comments at 7; ELCON Initial
Comments at 4-5; NY Commission and NYSERDA Initial Comments at 6-7;
Pattern Energy Initial Comments at 20; Pine Gate Initial Comments at
11-13; Southern Initial Comments at 28.
---------------------------------------------------------------------------
(b) Comments in Opposition
79. Many commenters oppose the NOPR proposal to require
transmission providers to offer an informational interconnection study
to prospective interconnection customers.\197\ Many commenters argue
that the informational interconnection study proposal could be a burden
or divert resources,\198\ which they contend would increase delays for
the interconnection queue and other studies.\199\ Dominion insists that
the decision as to whether to offer informational interconnection
studies should be the transmission provider's and must have
limits.\200\ Longroad Energy states that transmission-interconnected
generating facilities are typically complex facilities with unique
operating characteristics which would be poorly approximated in
simplified studies.\201\ Environmental Defense Fund states that, while
it supported the informational interconnection studies proposal in its
initial comments, after review of the other comments submitted, it
recommends that the Commission reconsider the proposal and ensure that
any informational interconnection study reform not delay other
interconnection processes.\202\
---------------------------------------------------------------------------
\197\ AECI Initial Comments at 3; AEP Initial Comments at 7; AEP
Reply Comments at 2; APPA-LPPC Initial Comments at 3; Avangrid
Initial Comments at 21; Bonneville Initial Comments at 3; CAISO
Initial Comments at 5; Clean Energy Associations Initial Comments at
13; Dominion Reply Comments at 5; EEI Initial Comments at 11; EEI
Reply Comments at 7-8; Enel Initial Comments at 9; ENGIE Initial
Comments at 2; Eversource Initial Comments at 5; Indicated PJM TOs
Initial Comments at 12; Indicated PJM TOs Reply Comments at 14;
Longroad Energy Reply Comments at 3; NextEra Initial Comments at 5;
NextEra Reply Comments at 8; North Dakota Commission Initial
Comments at 3-4; NV Energy Initial Comments at 14; OMS Initial
Comments at 5; [Oslash]rstead Initial Comments at 7; PG&E Initial
Comments at 9; PJM Initial Comments at 45; PPL Initial Comments at
4; SEIA Initial Comments at 3; SPP Initial Comments at 2, 3-4;
Vermont Electric and Vermont Transco Initial Comments at 3; WIRES
Initial Comments at 8.
\198\ AECI Initial Comments at 3; AEE Reply Comments at 5-6; AEP
Initial Comments at 7-8; AEP Reply Comments at 2; AES Initial
Comments at 4; Alliant Energy Initial Comments at 4; APPA-LPPC
Initial Comments at 9; APS Initial Comments at 5; Bonneville Initial
Comments at 3; CAISO Initial Comments at 6; Clean Energy Buyers
Initial Comments at 6; Clean Energy States Initial Comments at 4;
Dominion Reply Comments at 5-6; Environmental Defense Fund Reply
Comments at 5; EEI Initial Comments at 11-12; EEI Reply Comments at
8-9; ELCON Initial Comments at 4-5; Enel Initial Comments at 9;
ENGIE Initial Comments at 2; Eversource Initial Comments at 5;
Google Initial Comments at 5; Idaho Power Initial Comments at 3;
Indicated PJM TOs Initial Comments at 12; Indicated PJM TOs Reply
Comments at 14; Longroad Energy Reply Comments at 4-5; MISO Reply
Comments at 17; National Grid Initial Comments at 9; NESCOE Reply
Comments at 2; NextEra Reply Comments at 8-9, 11-12; New Jersey
Commission Initial Comments at 21; North Dakota Commission Initial
Comments at 3-4; NRECA Initial Comments at 14; NV Energy Initial
Comments at 14; NYISO Initial Comments at 16; OMS Initial Comments
at 5; Pine Gate Initial Comments at 12; PPL Initial Comments at 4-6;
SDG&E Initial Comments at 3-4; SEIA Initial Comments at 3; SEIA
Reply Comments at 4; SoCal Edison Initial Comments at 12; Tesla
Initial Comments at 4; Vermont Electric and Vermont Transco Initial
Comments at 3; WIRES Initial Comments at 8.
\199\ AECI Initial Comments at 3; AEP Initial Comments at 7-8;
AEP Reply Comments at 2-3; AES Initial Comments at 4; Alliant Energy
Initial Comments at 4; APS Initial Comments at 4; Bonneville Initial
Comments at 3; CAISO Initial Comments at 6; Dominion Initial
Comments at 9; Duke Southeast Utilities Initial Comments at 7-8;
Environmental Defense Fund Reply Comments at 5; EEI Initial Comments
at 11; ELCON Initial Comments at 4-5; Eversource Initial Comments at
5-6; Google Initial Comments at 5; Idaho Power Initial Comments at
3; Indicated PJM TOs Initial Comments at 13; MISO Reply Comments at
17; National Grid Initial Comments at 7, 10-11; NESCOE Reply
Comments at 2; NextEra Reply Comments at 8; New Jersey Commission
Initial Comments at 21; North Dakota Commission Initial Comments at
3-4; NRECA Initial Comments at 14; NYISO Initial Comments at 16-19;
OMS Initial Comments at 5; Pennsylvania Commission Initial Comments
at 11; PG&E Initial Comments at 9; PG&E Reply Comments at 5; Pine
Gate Initial Comments at 12; PJM Initial Comments at 45; PPL Initial
Comments at 4; SEIA Initial Comments at 4; SoCal Edison Initial
Comments at 12; Tesla Initial Comments at 4.
\200\ Dominion Reply Comments at 5.
\201\ Longroad Energy Reply Comments at 7.
\202\ Environmental Defense Fund Reply Comments at 5.
---------------------------------------------------------------------------
80. Several commenters contend that the informational
interconnection study proposal would not likely be valuable.\203\ Clean
Energy Associations assert that the proposed informational
interconnection study would provide no information related to
stability-driven network upgrades, rendering it near-useless in areas
where stability limits are most typically the driver of network
upgrades.\204\ APPA-LPPC warn that informational interconnection
studies could engender controversy because prospective interconnection
customers would, notwithstanding the informational nature of the
studies, likely rely upon the study results in
[[Page 61030]]
making investment decisions, even though the informational study
results would inevitably diverge from the actual interconnection study
results.\205\
---------------------------------------------------------------------------
\203\ AEE Initial Comments at 9-10; AEE Reply Comments at 5-6;
AEP Initial Comments at 7; AEP Reply Comments at 2; Alliant Energy
Initial Comments at 4; CAISO Initial Comments at 5-6; Clean Energy
Associations Initial Comments at 14; CREA and NewSun Initial
Comments at 42; Dominion Reply Comments at 5; EEI Initial Comments
at 12; EEI Reply Comments at 8; Enel Initial Comments at 9; ENGIE
Initial Comments at 2; Eversource Initial Comments at 5-6; Indicated
PJM TOs Initial Comments at 12; Indicated PJM TOs Reply Comments at
14; ISO-NE Initial Comments at 19; Longroad Energy Reply Comments at
3; MISO Initial Comments at 20-21; MISO Reply Comments at 17-18;
NextEra Initial Comments at 5, 10-11; NextEra Reply Comments at 9;
North Dakota Commission Initial Comments at 4; NRECA Initial
Comments at 14; NV Energy Initial Comments at 14; NYISO Initial
Comments at 17; OMS Initial Comments at 5; Pacific Northwest
Utilities Initial Comments at 8 n.13; PG&E Initial Comments at 9;
PG&E Reply Comments at 4; PJM Initial Comments at 45; SDG&E Initial
Comments at 3-4; SEIA Initial Comments at 3; SEIA Reply Comments at
3; SoCal Edison Initial Comments at 11-12; WIRES Initial Comments at
8.
\204\ Clean Energy Associations Initial Comments at 14.
\205\ APPA-LPPC Initial Comments at 12.
---------------------------------------------------------------------------
81. Several commenters argue that the proposal is not an
improvement over the status quo.\206\ National Grid and NextEra assert
that it is unclear how the proposal would save any time compared to the
status quo, and that the best way for an interconnection customer to
obtain the necessary information is by entering and proceeding through
the interconnection queue with transmission providers focusing on
actual studies.\207\ NextEra adds that the proposed informational
interconnection study is only informative in extreme cases, such as
very limited capacity available on a transmission line, which the
interconnection customer should be able to identify themselves.\208\
---------------------------------------------------------------------------
\206\ National Grid Initial Comments at 9; New Jersey Commission
Initial Comments at 21; Vermont Electric and Vermont Transco Initial
Comments at 3.
\207\ National Grid Initial Comments at 9; NextEra Initial
Comments at 12.
\208\ NextEra Initial Comments at 12.
---------------------------------------------------------------------------
82. CREA and NewSun express concern that the NOPR proposal places
too much reliance on the usefulness of the informational
interconnection study in order to justify the financial readiness and
commitment NOPR proposals.\209\ They assert that the informational
interconnection study is not a useful replacement for the feasibility
study, which takes into account the impact of other interconnection
customers in the interconnection queue cluster. Therefore, CREA and
NewSun ask the Commission to instead retain the feasibility study as
part of the cluster study process to allow interconnection customers to
obtain cluster-level information on likely costs and network upgrades
before proceeding further with major deposits and irretrievable
commitments.
---------------------------------------------------------------------------
\209\ CREA and NewSun Initial Comments at 46-47.
---------------------------------------------------------------------------
83. Several commenters point to the experience with similar studies
in SPP and MISO as evidence that the optional informational
interconnection study proposal will be little-used in practice.\210\
SPP reports that its interconnection customers explained that their
time could be more effectively spent working on the more definitive
system impact studies, that the feasibility and preliminary impact
studies did not provide results that could be relied on in making
business decisions, and that this same outcome would be true of the
proposed informational interconnection study.\211\
---------------------------------------------------------------------------
\210\ AEE Initial Comments at 10; AEP Initial Comments at 8,12;
Clean Energy Associations Initial Comments at 14; Enel Initial
Comments at 9-10; Longroad Energy Reply Comments at 3-4; MISO
Initial Comments at 21; NextEra Reply Comments at 8; Omaha Public
Power Initial Comments at 3; SEIA Reply Comments at 3; SPP Initial
Comments at 3. NextEra argues that transmission providers with large
numbers of interconnection requests have tried optional
interconnection studies and have not found them to be useful.
NextEra Reply Comments at 10.
\211\ SPP Initial Comments at 3.
---------------------------------------------------------------------------
84. Several commenters point to the inability of the informational
interconnection studies to provide reliable cost estimates \212\ and
believe that the information provided in these studies will be quickly
outdated.\213\ The New Jersey Commission is concerned that this
approach may not materially reduce the uncertainty interconnection
customers currently face.\214\ In particular, many commenters contend
that the informational interconnection study is not meaningful in the
context of a cluster interconnection
---------------------------------------------------------------------------
\212\ AEP Initial Comments at 8; Ameren Initial Comments at 5;
CAISO Initial Comments at 5; Clean Energy Associations Initial
Comments at 14; CREA and NewSun Initial Comments at 43; Cyprus Creek
Initial Comments at 13; Enel Initial Comments at 9; Interwest
Initial Comments at 7-8; NextEra Initial Comments at 5; NRECA
Initial Comments at 14; PJM Initial Comments at 45; SoCal Edison
Initial Comments at 11-12.
\213\ AEP Initial Comments at 8; Alliant Energy Initial Comments
at 4; Dominion Initial Comments at 10; Enel Initial Comments at 9;
Eversource Initial Comments at 9; Interwest Initial Comments at 7-8;
PJM Initial Comments at 45; PJM TOs Initial Comments at 13; SEIA
Reply Comments at 4.
\214\ New Jersey Commission Initial Comments at 21.
---------------------------------------------------------------------------
process.\215\ Commenters argue that, because the informational
interconnection study does not provide information on other
interconnection customers that would enter the interconnection queue at
the same time, there is no guarantee that the study results will even
approximate the actual network upgrade costs determined by the cluster
results.\216\
---------------------------------------------------------------------------
\215\ Id.; AEE Initial Comments at 9-10; Avangrid Initial
Comments at 23-24; Clean Energy Associations Initial Comments at 14;
CREA and NewSun Initial Comments at 43; Dominion Reply Comments at
6; EEI Initial Comments at 12; EEI Reply Comments at 8; Enel Initial
Comments at 9; Eversource Initial Comments at 9-10; ISO-NE Initial
Comments at 18-19; MISO Initial Comments at 21; NRECA Initial
Comments at 14; NV Energy Initial Comments at 14; PJM Initial
Comments at 45; PPL Initial Comments at 5; SEIA Initial Comments at
4-5; SEIA Reply Comments at 3-4; SoCal Edison Initial Comments at
12; SPP Initial Comments at 2-3.
\216\ AEE Initial Comments at 9-10; CAISO Initial Comments at 5-
6; CREA and NewSun Initial Comments at 44; Dominion Initial Comments
at 10; Duke Southeast Utilities Initial Comments at 7; EEI Reply
Comments at 8; Indicated PJM TOs Initial Comments at 13; ISO-NE
Initial Comments at 18-19; MISO Initial Comments at 22; NextEra
Initial Comments at 11-12; New Jersey Commission Initial Comments at
21; PG&E Reply Comments at 5; PPL Initial Comments at 5; SEIA Reply
Comments at 3-4; SoCal Edison Initial Comments at 12.
---------------------------------------------------------------------------
85. Some commenters expect the proposal will work against the
Commission's goal of faster interconnection queue processing.\217\ Some
commenters state that any reduction in speculative interconnection
requests will be offset by an increase in speculative informational
interconnection requests, which would require transmission providers to
shift their focus from the actual interconnection queue to this more
burdensome informational interconnection process, which is outside of
their interconnection study process.\218\ NRECA states that, if the
proposal is included in the final rule, the Commission should ensure
that it is limited and is not expanded into an elaborate serial study
process prior to the cluster study process.\219\ Avangrid notes that
some transmission providers have recently eliminated interconnection
studies to reduce interconnection queue processing time.\220\
Pennsylvania Commission asserts that the Commission should assess the
results of the NOPR's proposed reforms before requiring any new study
processes that may further slow the interconnection queue process.\221\
---------------------------------------------------------------------------
\217\ AEE Reply Comments at 6; AEP Initial Comments at 11;
Avangrid Initial Comments at 22-23; CAISO Initial Comments at 6;
Dominion Reply Comments at 6-7; National Grid Initial Comments at 7;
NESCOE Reply Comments at 2; NV Energy Initial Comments at 14;
Pennsylvania Commission Initial Comments at 11-12.
\218\ AECI Initial Comments at 4; AEP Initial Comments at 11;
APPA-LPPC Initial Comments at 11-12; Bonneville Initial Comments at
3 (citing NOPR, 179 FERC ] 61,194 at PP 20, 22, 166); Clean Energy
Buyers Initial Comments at 6; Dominion Reply Comments at 6; NextEra
Initial Comments at 12; NYISO Initial Comments at 17; Pennsylvania
Commission Initial Comments at 11 (explaining that because the
informational study is not binding on any party, the study does not
move projects through the interconnection queue).
\219\ NRECA Initial Comments at 14.
\220\ Avangrid Initial Comments at 23 (citing NOPR, 179 FERC ]
61,194 at P 56 n.111).
\221\ Pennsylvania Commission Initial Comments at 11-12.
---------------------------------------------------------------------------
86. Several commenters note the challenge of staffing to fulfill
the informational interconnection study requirements given the limited
number of qualified planners and engineers.\222\
---------------------------------------------------------------------------
\222\ Id. at 11; AEP Initial Comments at 10-11; APPA-LPPC
Initial Comments at 12; Avangrid Initial Comments at 22-23;
Bonneville Initial Comments at 5; Eversource Initial Comments at 5-
6; Indicated PJM TOs Initial Comments at 12; Indicated PJM TOs Reply
Comments at 14; LADWP Initial Comments at 2; OMS Initial Comments at
5.
---------------------------------------------------------------------------
87. Several commenters urge the Commission to weigh the benefits
against the burdens to determine whether to adopt the informational
interconnection study proposal.\223\
[[Page 61031]]
WAPA states that, while it agrees that it is important to provide
prospective interconnection customers with additional information, it
has concerns about the proposed timelines and penalties, the potential
amount of informational interconnection study requests it could
receive, and its ability to process up to five simultaneous
informational interconnection study requests per interconnection
customer.\224\ According to Vermont Electric and Vermont Transco, even
if the informational interconnection studies envisioned by the NOPR
provide interconnection customer benefits, the burdens of providing
informational interconnection studies with cost estimates under the
NOPR's short proposed time frames and low deposit amounts would be
considerable especially for smaller companies such as Vermont Electric
and Vermont Transco.\225\ Other commenters contend that the
informational interconnection study proposal has insufficient
benefits.\226\
---------------------------------------------------------------------------
\223\ Ameren Initial Comments at 5; R Street Initial Comments at
9; Xcel Initial Comments at 20.
\224\ WAPA Initial Comments at 4-5.
\225\ Vermont Electric and Vermont Transco Initial Comments at
3.
\226\ Id.; AEP Initial Comments at 7; AES Initial Comments at 4;
EEI Initial Comments at 11; ENGIE Initial Comments at 2; NextEra
Initial Comments at 10-11; [Oslash]rstead Initial Comments at 7; PJM
Initial Comments at 45; SEIA Initial Comments at 3.
---------------------------------------------------------------------------
88. Given PJM's opposition to the informational interconnect study,
it recommends modifying the proposed new section 3.1.2 to the pro forma
LGIP to encourage, but not require, interconnection customers
evaluating different project characteristics to use a prescreening
tool, such as the queue scope tool PJM is developing, prior to
submitting an interconnection request.\227\
---------------------------------------------------------------------------
\227\ PJM Initial Comments at 19 (explaining that the queue
scope is an interactive prescreening tool that will allow
interconnection customers to screen potential points of
interconnection and assess grid capacity (head room) based on a
given amount of MW injection or withdrawal at a given point of
interconnection and that the tool will be available at no charge).
PJM's proposed section 3.1.2 of the pro forma LGIP would read:
``Interconnection Customers evaluating different options . . . to
use the prescreening tool (Section 6.1 of this LGIP) before entering
the Cluster Study.''
---------------------------------------------------------------------------
iii. Commission Determination
89. We decline to adopt the NOPR proposal to modify the pro forma
LGIP to require transmission providers to offer an informational
interconnection study for prospective interconnection customers. We are
persuaded by commenters' concerns that requiring an informational
interconnection study could divert the transmission provider's
resources away from the cluster studies we require in this final rule
and undermine the benefits of those reforms that seek to reduce
interconnection study delays, costs, and burden on constrained
engineering labor. Moreover, we agree with commenters that highlight
the various limitations of an informational interconnection study.
Notably, an informational interconnection study, as proposed in the
NOPR, would have provided a serial, snapshot-in-time analysis on the
impact of a single interconnection request, but, in the context of the
subsequent cluster study, the actual impact of an interconnection
request within a larger cluster would reflect different assumptions and
differ from the informational interconnection study, providing minimal
or no value to interconnection customers. The cost estimates that
result from such an informational interconnection study would bear
little correspondence to costs determined during a cluster study
process and thus provide minimal value to interconnection customers.
90. We also find persuasive comments that the informational
interconnection study requirement proposed in the NOPR is not the most
effective way to provide interconnection customers with the needed pre-
interconnection queue information. At the same time, we continue to
believe that there is a lack of information available to prospective
interconnection customers prior to entering the interconnection queue,
especially given other interconnection customer-related reforms adopted
in this final rule.\228\ Therefore, as discussed below, we adopt the
NOPR proposal to set minimum requirements for transmission providers to
publicly post available information pertaining to generator
interconnection.\229\ We find that the posting of this information
provides a better balance between the benefits of additional
information for prospective interconnection customers and the burdens
on transmission providers.
---------------------------------------------------------------------------
\228\ See Northwest and Intermountain Initial Comments at 6-7.
\229\ See infra section III.A.1.c.iii.
---------------------------------------------------------------------------
91. In response to commenters that support the informational
interconnection study NOPR proposal, below we explain how several of
the NOPR proposals that we adopt in this final rule address their
specific concerns. To address commenters' concerns with the number of
speculative interconnection requests,\230\ we adopt more stringent site
control requirements and increased commercial readiness deposit
requirements,\231\ which we believe will better address these concerns
than the informational interconnection study proposal. Additionally, we
find that the minimum requirements for transmission providers to
publicly post available information pertaining to generator
interconnection \232\ and the existing requirements in section 2.3 of
the pro forma LGIP for transmission providers to post up-to-date base
case study models on their Open Access Same-time Information System
(OASIS) or other password-protected websites will improve the
efficiency of siting decisions \233\ and will provide interconnection
customers with information about the feasibility of their
interconnection plans.\234\
---------------------------------------------------------------------------
\230\ Fervo Energy Initial Comments at 2-3; Google Initial
Comments at 4; NRECA Initial Comments at 13; NY Commission and
NYSERDA Initial Comments at 6-8.
\231\ See infra sections III.A.6.b.iii, III.A.6.c.iii.
\232\ See infra section III.A.1.c.iii.
\233\ Duke Southeast Utilities Initial Comments at 6-7; ISO-NE
Initial Comments at 18; NARUC Initial Comments at 5; NRECA Initial
Comments at 13; Pine Gate Initial Comments at 13-14; Tesla Initial
Comments at 4.
\234\ Northwest and Intermountain Initial Comments at 6-7;
Pacific Northwest Organizations Initial Comments at 3.
---------------------------------------------------------------------------
92. We are not persuaded that the informational interconnection
study proposal would benefit the interconnection process through: (1)
cost savings from fewer, more feasible interconnection requests; \235\
(2) a reduced need for interconnection request withdrawals and
restudies; \236\ and (3) accurate upfront interconnection cost
information.\237\ On the contrary, the Commission's adoption of the
cluster study reforms in this final rule \238\ means that the serial
nature of the informational interconnection study would fail to reflect
the outcome of the cluster study, and thus would provide minimal, if
any, benefits to interconnection customers.\239\ We also no longer
believe that adopting the informational interconnection study
[[Page 61032]]
proposal would reduce burdens on transmission providers.\240\ This is
because the record overwhelmingly demonstrates that the proposal would
result in additional burdens on transmission providers and would likely
cause transmission providers to divert resources from their cluster
study process to conduct informational interconnection studies,\241\
thus increasing study delays and costs. Similarly, we decline CREA and
NewSun's request that the Commission retain the feasibility study
instead of the informational interconnection study. As we discuss
below, the feasibility study was required for the serial study process
but is no longer relevant for the cluster study process.\242\ We
believe that our requirement for transmission providers to publicly
post certain interconnection information will provide interconnection
customers with the information they need prior to entering the
interconnection queue, and therefore decline to adopt CREA and NewSun's
request to maintain the feasibility study.
---------------------------------------------------------------------------
\235\ Evergreen Action Initial Comments at 3; NARUC Initial
Comments at 5.
\236\ Evergreen Action Initial Comments at 3; NRECA Initial
Comments at 13.
\237\ Fervo Energy Initial Comments at 2; MISO Initial Comments
at 22; Pacific Northwest Organizations Initial Comments at 3-4.
\238\ See infra section III.A.2.
\239\ See AEE Initial Comments at 9-10; Avangrid Initial
Comments at 23-24; Clean Energy Associations Initial Comments at 14;
CREA and NewSun Initial Comments at 43; Dominion Reply Comments at
6; EEI Initial Comments at 12; EEI Reply Comments at 8; Enel Initial
Comments at 9; Eversource Initial Comments at 9-10; ISO-NE Initial
Comments at 18-19; MISO Initial Comments at 21; New Jersey
Commission Initial Comments at 21; NRECA Initial Comments at 14; NV
Energy Initial Comments at 14; PJM Initial Comments at 45; PPL
Initial Comments at 5; SEIA Initial Comments at 4-5; SEIA Reply
Comments at 3-4; SoCal Edison Initial Comments at 12; SPP Initial
Comments at 2-3.
\240\ See Google Initial Comments at 5 (arguing that the
informational interconnection study requirement alone would likely
increase the burden on transmission providers in a way that would
lengthen delays).
\241\ Id.; AECI Initial Comments at 3; AEE Reply Comments at 5-
6; AEP Initial Comments at 7-8; AEP Reply Comments at 2; AES Initial
Comments at 4; Alliant Energy Initial Comments at 4; APPA-LPPC
Initial Comments at 9; APS Initial Comments at 5; Bonneville Initial
Comments at 3; CAISO Initial Comments at 6; Clean Energy Buyers
Initial Comments at 6; Clean Energy States Initial Comments at 4;
Dominion Reply Comments at 5-6; Environmental Defense Fund Reply
Comments at 5; EEI Initial Comments at 11-12; EEI Reply Comments at
8-9; ELCON Initial Comments at 4-5; Enel Initial Comments at 9;
ENGIE Initial Comments at 2; Eversource Initial Comments at 5; Idaho
Power Initial Comments at 3; Indicated PJM TOs Initial Comments at
12; Indicated PJM TOs Reply Comments at 14; Longroad Energy Reply
Comments at 4-5; MISO Reply Comments at 17; National Grid Initial
Comments at 9; NESCOE Reply Comments at 2; New Jersey Commission
Initial Comments at 21; NextEra Reply Comments at 8-9, 11-12; North
Dakota Commission Initial Comments at 3-4; NRECA Initial Comments at
14; NV Energy Initial Comments at 14; NYISO Initial Comments at 16;
OMS Initial Comments at 5; Pine Gate Initial Comments at 12; PPL
Initial Comments at 4-6; SDG&E Initial Comments at 3-4; SEIA Initial
Comments at 3; SEIA Reply Comments at 4; SoCal Edison Initial
Comments at 12; Tesla Initial Comments at 4; Vermont Electric and
Vermont Transco Initial Comments at 3; WIRES Initial Comments at 8.
\242\ See infra section III.A.2.f.iii.
---------------------------------------------------------------------------
93. Because we do not adopt the NOPR proposal to require
transmission providers to offer an informational interconnection study,
we decline to adopt the proposal to add new section 3.1.2 to the pro
forma LGIP to encourage interconnection customers to use the
informational interconnection study.
c. Public Interconnection Information
i. NOPR Proposal
94. In the NOPR, the Commission proposed to require transmission
providers to maintain and make publicly available an interactive visual
representation of available interconnection capacity (commonly known as
a ``heatmap'') as well as a table of relevant interconnection metrics
that allow prospective interconnection customers to see certain
estimates of a potential generating facility's effect on the
transmission provider's transmission system.\243\ Specifically, the
Commission proposed to revise section 6.4 of the pro forma LGIP to
require transmission providers to post on their public website a
heatmap of estimated incremental injection capacity (in MW) available
at each bus in the transmission provider's footprint under N-1
conditions, as well as provide a table of results showing the estimated
impact of the addition of a proposed project (based on the user-
specified MW amount, voltage level, and point of interconnection) for
each monitored facility impacted by the proposed project on: (1) the
distribution factor; (2) the MW impact (based on the proposed project
size and the distribution factor); (3) the percentage impact on the
monitored facility (based on the MW values of the proposed project and
the monitored facility rating); (4) the percentage of power flow on the
monitored facility before the proposed project; and (5) the percentage
power flow on the monitored facility after the injection of the
proposed project. The Commission explained that these metrics would be
calculated based on the power flow model of the cluster study or
restudy with the transfer simulated from each bus to the whole
transmission provider's footprint (to approximate Network Resource
Interconnection Service (NRIS)), and with the incremental capacity at
each bus decremented by the existing and queued generation in the
cluster (based on the existing or requested interconnection service
limit of the generation). The Commission proposed to require
transmission providers to update this information within 30 days after
the completion of each cluster study and restudy.
---------------------------------------------------------------------------
\243\ NOPR, 179 FERC ] 61,194 at P 51.
---------------------------------------------------------------------------
95. The Commission sought comment on whether: (1) there are any
security concerns with this proposed requirement; and (2) the
assumptions specified for the analysis are the right set of
assumptions.\244\
---------------------------------------------------------------------------
\244\ Id. P 52.
---------------------------------------------------------------------------
ii. Comments
(a) Comments in Support
96. Many commenters express support for the NOPR's proposal to
require transmission providers to provide public interconnection
information.\245\ Several commenters agree that the NOPR proposal will
provide valuable information to interconnection customers before they
enter the interconnection queue.\246\ Several commenters aver that the
proposal could reduce the number of interconnection requests withdrawn
\247\ and therefore could reduce costs for all parties.\248\ Alliant
Energy and Clean Energy Associations also see value in the standardized
format of the proposed
[[Page 61033]]
public interconnection information.\249\ R Street states that a
properly done visual representation of interconnection capacity can be
a ``powerful decentralized self-screening tool.'' \250\ R Street states
that better information and simpler deliverability requirements shift
congestion performance risk to generating facilities while reducing
barriers to entry.\251\ The Ohio Commission Consumer Advocate states
that the visual map of available interconnection capacity would be
useful both to transmission providers and interconnection customers and
would encourage information sharing on transmission system congestion
during the interconnection process.\252\ Google argues that making
these data publicly available to consumers would allow buyers to make
informed choices regarding power procurement.\253\ Additionally, Google
asserts that there needs to be a standard of reasonable care applied to
ensure that the publicly available information is reasonably current
and useful to avoid exploratory interconnection requests.\254\ SEIA
argues that greater transparency will increase competition between
merchant and utility developed generating facilities, benefiting
consumers.\255\ Illinois Commission contends that, if properly
implemented, the NOPR proposal will increase the pace at which new
generating facilities can connect to the transmission system,
furthering state policy objectives.\256\
---------------------------------------------------------------------------
\245\ ACE-NY Initial Comments at 11; AES Initial Comments at 3;
Affected Interconnection Customers Initial Comments at 30; APPA-LPPC
Initial Comments at 13; CAISO Initial Comments at 7; CESA Initial
Comments at 7; Clean Energy Associations Initial Comments at 12;
Clean Energy Buyers Initial Comments at 6-7; Colorado Commission
Initial Comments at 8; Consumers Energy Initial Comments at 3; CREA
and NewSun Initial Comments at 44-45; Duke Southeast Utilities
Initial Comments at 6; Environmental Defense Fund Initial Comments
at 3; Environmental Defense Fund Reply Comments at 2-3; ELCON
Initial Comments at 4; ENGIE Initial Comments at 2; Evergreen Action
Initial Comments at 3; Fervo Energy Initial Comments at 2; Google
Initial Comments at 14; Google Reply Comments at 6; Illinois
Commission Initial Comments at 6; Interwest Initial Comments at 7;
New Jersey Commission Initial Comments at 11-12; Northwest and
Intermountain Initial Comments at 9-10; NY Commission and NYSERDA
Initial Comments at 8; [Oslash]rsted Initial Comments at 7; Pattern
Energy Initial Comments at 23; Pine Gate Initial Comments at 13;
Public Interest Organizations Initial Comments at 18-19; R Street
Initial Comments at 8, 10; Southern Initial Comments at 28; Tesla
Initial Comments at 6-7; Vistra Initial Comments at 1, 4.
\246\ Alliant Energy Initial Comments at 5; Clean Energy
Associations Initial Comments at 12; CREA and NewSun Initial
Comments at 44-45; Duke Southeast Utilities Initial Comments at 6;
EEI Initial Comments at 12-13; ELCON Initial Comments at 6; ENGIE
Initial Comments at 2; Evergreen Action Initial Comments at 3; Fervo
Energy Initial Comments at 2-3; Illinois Commission Initial Comments
at 6; Indicated PJM TOs Initial Comments at 14; Indicated PJM TOs
Reply Comments 6; ISO-NE Initial Comments at 26-27; New Jersey
Commission Initial Comments at 12; NY Commission and NYSERDA Initial
Comments at 8; Ohio Commission Consumer Advocate Initial Comments at
7; Pacific Northwest Utilities Initial Comments at 13; SEIA Initial
Comments at 5.
\247\ CESA Initial Comments at 9; CESA Reply Comments at 3;
Consumers Energy Initial Comments at 3; CREA and NewSun Initial
Comments at 44-45; Duke Southeast Utilities Initial Comments at 6;
Environmental Defense Fund Initial Comments at 3; EEI Initial
Comments at 12-13; ELCON Initial Comments at 6; Evergreen Action
Initial Comments at 3; Google Initial Comments at 14; Illinois
Commission Initial Comments at 6-7; New Jersey Commission Initial
Comments at 12; NY Commission and NYSERDA Initial Comments at 8;
Pacific Northwest Utilities Initial Comments at 13; SEIA Initial
Comments at 5.
\248\ Evergreen Action Initial Comments at 3; New Jersey
Commission Initial Comments at 12.
\249\ Alliant Energy Initial Comments at 5; Clean Energy
Associations Initial Comments at 12.
\250\ R Street Initial Comments at 10.
\251\ R Street Reply Comments at 2.
\252\ Ohio Commission Consumer Advocate Initial Comments at 7.
\253\ Google Initial Comments at 4.
\254\ Google Reply Comments at 7.
\255\ SEIA Reply Comments at 5.
\256\ Illinois Commission Initial Comments at 6.
---------------------------------------------------------------------------
97. Some commenters contend that the proposal to provide public
interconnection information is not overly burdensome.\257\ APPA-LPPC
members report that the information posting and interactive capability
described in the NOPR could be feasibly implemented with available
industry system simulation tools.\258\ Clean Energy Associations state
that heatmaps should be as automated as possible, without significant
commitments of staff or resources.\259\
---------------------------------------------------------------------------
\257\ APPA-LPPC Initial Comments at 16; Clean Energy
Associations Initial Comments at 12-13; Google Initial Comments at
14; New York State Department Initial Comments at 8; Pennsylvania
Commission Initial Comments at 13; SEIA Initial Comments at 6.
\258\ APPA-LPPC Initial Comments at 16.
\259\ Clean Energy Associations Initial Comments at 13.
---------------------------------------------------------------------------
98. Several commenters point to the fact that some transmission
providers are already developing such tools as evidence that these
tools are unlikely to cause further delays to stressed interconnection
queues or additional burden on transmission providers.\260\ For
instance, some commenters note that MISO already offers a heatmap that
represents geographically advantageous siting locations.\261\ Several
commenters also note that PJM is developing such a tool.\262\ PJM
states that in 2023 its queue scope tool will provide a congestion map
with colors or symbols indicating the worst flowgate loading at each
point of interconnection.\263\ SPP states that it is also developing a
tool to be implemented by 2025 that would provide much of the
functionality described in the Commission's public information proposal
to new interconnections.\264\
---------------------------------------------------------------------------
\260\ Id. at 12; Environmental Defense Fund Reply Comments at 3;
ENGIE Initial Comments at 2-3; Pennsylvania Commission Initial
Comments at 13.
\261\ CESA Reply Comments at 5; Fervo Energy Reply Comments at
3; OMS Initial Comments at 3, 6; R Street Initial Comments at 10;
SEIA Initial Comments at 6.
\262\ CESA Reply Comments at 4; Fervo Energy Reply Comments at
3; Indicated PJM TOs Initial Comments at 14; Ohio Commission
Consumer Advocate Initial Comments at 7; Pennsylvania Commission
Initial Comments at 13; PJM Initial Comments at 48; PPL Initial
Comments at 9; R Street Initial Comments at 10; SEIA Initial
Comments at 6.
\263\ PJM Initial Comments at 46-47.
\264\ SPP Initial Comments at 4.
---------------------------------------------------------------------------
99. Several commenters contend that the public information proposal
is a more reasonable balance of costs and benefits relative to the
informational interconnection study proposal.\265\ Pennsylvania
Commission states that, once a public information tool is established,
it may require fewer ongoing resources, continuing to inform
interconnection customers while freeing those resources for additional
interconnection studies as compared to the proposed informational
interconnection study.\266\
---------------------------------------------------------------------------
\265\ Ameren Initial Comments at 5; APPA-LPPC Initial Comments
at 16; APS Initial Comments at 5; Bonneville Initial Comments at 5;
Pennsylvania Commission Initial Comments at 13; PJM Initial Comments
at 45-48; R Street Initial Comments at 10.
\266\ Pennsylvania Commission Initial Comments at 13.
---------------------------------------------------------------------------
(b) Comments in Opposition
100. A few commenters oppose the NOPR proposal to require
transmission providers to provide public interconnection
information.\267\ A larger number of commenters express reservations
about the proposal,\268\ in particular regarding its usefulness \269\
or the burden it creates.\270\ Other commenters request that the
Commission make public interconnection information posting
optional.\271\
---------------------------------------------------------------------------
\267\ Avangrid Reply Comments at 4; El Paso Electric Initial
Comments at 8; PG&E Initial Comments at 9.
\268\ AEP Initial Comments at 13; Idaho Power Initial Comments
at 3; NextEra Initial Comments at 12-13; Omaha Public Power Initial
Comments at 4; PacifiCorp Initial Comments at 13-14; SPP Initial
Comments at 4; Tri-State Initial Comments at 4; WAPA Initial
Comments at 7-8.
\269\ AEP Initial Comments at 13; Idaho Power Initial Comments
at 3; ISO-NE Initial Comments at 17; Longroad Energy Reply Comments
at 7; Omaha Public Power Initial Comments at 4; PacifiCorp Initial
Comments at 13-14; SPP Initial Comments at 4; WAPA Initial Comments
at 7-8.
\270\ AECI Initial Comments at 5; Dominion Initial Comments at
12; National Grid Initial Comments at 7; NextEra Initial Comments at
12-13; Omaha Public Power Initial Comments at 4; PacifiCorp Initial
Comments at 13-14; SPP Initial Comments at 4.
\271\ AEP Initial Comments at 13; Avangrid Initial Comments at
21-22; SPP Initial Comments at 4.
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101. Several commenters argue that the proposal to require
transmission providers to provide public interconnection information is
not useful,\272\ particularly because it might not provide sufficient
detail \273\ or commercially actionable information for interconnection
customers.\274\ Commenters explain that heatmaps are specific to a
moment in time and thus not representative of actual available
injection across the transmission system, which is ever-changing.\275\
NextEra observes that heatmaps do not contain actionable information
for interconnection and instead focus on energy prices and
congestion.\276\ ISO-NE, MISO, and Omaha Public Power note that a
visual representation of interconnection capacity cannot account for
all of the conditions identified in a system impact study, including
different system stresses, operability issues (e.g., N-1-1), stability
and voltage issues, and weak transmission system issues.\277\
[[Page 61034]]
Longroad Energy asserts that generator interconnection heatmaps or
hosting capacity maps can be of some use for interconnections to the
distribution system but are unlikely to be beneficial for projects
interconnecting at transmission voltages.\278\
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\272\ Dominion Initial Comments at 13; Idaho Power Initial
Comments at 3; ISO-NE Initial Comments at 17; NextEra Initial
Comments at 12; New York State Department Initial Comments at 8;
NYISO Initial Comments at 17; Omaha Public Power Initial Comments at
4; PacifiCorp Initial Comments at 14.
\273\ AECI Initial Comments at 5; Dominion Initial Comments at
13; Longroad Energy Reply Comments at 7; National Grid Initial
Comments at 8; New York State Department Initial Comments at 8;
Omaha Public Power Initial Comments at 4.
\274\ AEE Initial Comments at 9; Cypress Creek Initial Comments
at 13; NextEra Initial Comments at 12.
\275\ AECI Initial Comments at 5; AEP Initial Comments at 13;
New York State Department Initial Comments at 8; NYISO Initial
Comments at 17.
\276\ NextEra Initial Comments at 12.
\277\ ISO-NE Initial Comments at 17; MISO Initial Comments at 26
(citing NOPR, 179 FERC ] 61,194 at P 50 & n.105); Omaha Public Power
Initial Comments at 4.
\278\ Longroad Energy Reply Comments at 7.
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102. Some commenters do not believe that the heatmap proposal will
appreciably reduce speculative interconnection requests.\279\ MISO
explains that, in its experience, few interconnection customers use its
interconnection heatmap tool and instead tend to use their own
tools.\280\ Puget Sound states that, even with a heatmap, if an
interconnection customer has a request that would require energy
transfer across balancing authorities, it would have to submit an
interconnection request to get information on the scope of necessary
network upgrades.\281\ NV Energy asserts that a heatmap of its
transmission system would be of little value, appearing as though there
is no available transfer capacity, because the generation in its
interconnection queue is more than five times the level of NV Energy
load.\282\ Meanwhile, Puget Sound states that a heatmap of its
territory would only account for generation and interconnection
capacity in its balancing authority footprint even though its
transmission goes beyond this footprint.\283\
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\279\ Idaho Power Initial Comments at 3; PPL Initial Comments at
9.
\280\ MISO Initial Comments at 25-26.
\281\ Puget Sound Initial Comments at 6.
\282\ NV Energy Initial Comments at 10.
\283\ Puget Sound Initial Comments at 6.
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103. Several commenters contend that a heatmap tool as proposed
would be less useful in a cluster study than it is in a serial process
because it cannot include similarly queued generation.\284\ Ohio
Commission Consumer Advocate questions whether it will capture the
``dynamic elements'' of cluster studies and restudies.\285\ PacifiCorp
and AEP state that the mere fact that an area is not shown as congested
on a heatmap does not mean that it will be a suitable interconnection
location, particularly if multiple interconnection customers seek to
interconnect there.\286\
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\284\ CAISO Initial Comments at 8; CREA and NewSun Initial
Comments at 48; Duke Southeast Utilities Initial Comments at 6-7;
MISO Initial Comments at 26; Ohio Commission Consumer Advocate
Initial Comments at 7; PacifiCorp Initial Comments at 15.
\285\ Ohio Commission Consumer Advocate Initial Comments at 7.
\286\ AEP Initial Comments at 13; PacifiCorp Initial Comments at
15.
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104. Longroad Energy and PacifiCorp express concern that the
heatmap tools would not be restricted to prospective interconnection
customers and could instead be used by third-party consultants for
their own business interests; for instance, real estate speculators
could use the information to secure exclusive site control for
locations that show significant generator interconnection
capacity.\287\ According to Longroad Energy, such risk is particularly
harmful to wind and solar generation interconnection customers' needs
for large tracts of land to accommodate their generation
equipment.\288\
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\287\ Longroad Energy Reply Comments at 7; PacifiCorp Initial
Comments at 15.
\288\ Longroad Energy Reply Comments at 7.
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105. Some commenters assert that maintaining the heatmap and
posting required information on available interconnection capacity
would be burdensome for transmission providers, especially in non-RTO/
ISO regions.\289\ Similarly, NV Energy states that it participates in
the CAISO energy imbalance market and its energy management system does
not currently have the technical functionality to build an interactive
map that shows information like the available interconnection
capacity.\290\ Some commenters argue that the heatmaps may provide
insufficient benefit to justify cost, resources, and time it would take
to produce them.\291\ Omaha Public Power further asserts that
interconnection customers will likely find it more valuable for a
transmission provider invest in more reliable and consequential
studies.\292\ Pacific Northwest Utilities assert that the Commission
should present additional data regarding the benefits of requiring a
heatmap before mandating their use.\293\ Clean Energy Associations
recommend that the Commission consider other means of increasing
information to prospective interconnection customers, such as public
scoping meetings prior to the prospective interconnection customers
entering the interconnection queue.\294\
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\289\ National Grid Initial Comments at 7-8; PacifiCorp Initial
Comments at 13; Tri-State Initial Comments at 7.
\290\ NV Energy Initial Comments at 10.
\291\ Dominion Initial Comments at 13; National Grid Initial
Comments at 8; NextEra Initial Comments at 12; New York State
Department Initial Comments at 8; Omaha Public Power Initial
Comments at 4; Pacific Northwest Utilities Initial Comments at 14;
PPL Initial Comments at 9; Tri-State Initial Comments at 4; WAPA
Initial Comments at 7.
\292\ Omaha Public Power Initial Comments at 4.
\293\ Pacific Northwest Utilities Initial Comments at 14.
\294\ Clean Energy Associations Initial Comments at 14.
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106. Some commenters express concern that the public information
proposal will impose new costs on ratepayers and market
participants.\295\ WAPA states that, given its defined appropriations
and budgets, it is difficult to create new programs, unlike for larger
investor-owned utilities or RTOs/ISOs.\296\ Dominion estimates that
implementation would require a large up-front financial commitment,
potentially for third-party software and personnel hours, and longer-
term financial commitment to maintain such a site.\297\ NV Energy
contends that creating such a heatmap showing interconnection
capabilities would require finding an eligible software, an ongoing
expense.\298\
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\295\ New York State Department Initial Comments at 8; SoCal
Edison Initial Comments at 13.
\296\ WAPA Initial Comments at 7.
\297\ Dominion Initial Comments at 12.
\298\ NV Energy Initial Comments at 10.
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107. Several commenters speak to the burden of additional staffing
needs to provide public interconnection information. National Grid
states that the interactive visual representation tool, even if
contracted from a third party, would require significant time
commitments from numerous personnel with relevant and advanced
expertise in transmission and interconnection engineering.\299\ Tri-
State notes that the Commission has recognized the lack of available
engineers and that imposing a heatmap requirement would exacerbate the
problem.\300\ Dominion and Duke Southeast Utilities state that any
additional process would require additional financial and personnel
resources, and also burden the same personnel that are already engaged
in managing the interconnection queue.\301\ El Paso Electric argues
that transmission providers should not be required to allocate human
resources from interconnection studies to monthly transmission line
capacity estimates because the staff reallocation could cause
interconnection study backlogs.\302\ PacifiCorp states that this burden
will be particularly onerous to transmission providers outside RTO/ISO
regions, which have comparatively few transmission staff
available.\303\
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\299\ National Grid Initial Comments at 7-8.
\300\ Tri-State Initial Comments at 8.
\301\ Dominion Initial Comments at 13; Duke Southeast Utilities
Initial Comments at 7.
\302\ El Paso Electric Initial Comments at 7.
\303\ PacifiCorp Initial Comments at 13.
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108. Several commenters suggest that interconnection customers, on
their own or with consultants, can perform studies with the available
information that would provide estimates on available capacity similar
to that produced under
[[Page 61035]]
the NOPR proposal.\304\ PPL states that interconnection customers can
make their own such maps using transmission planning models the
Commission makes available following a Freedom of Information Act
request.\305\ APPA-LPPC argue that the Commission fails to establish
that the information already available to prospective interconnection
customers under the existing pro forma LGIP, along with the substantial
supplement implemented with Order No. 845, is inadequate.\306\ SoCal
Edison states that the information included in the NOPR proposal and
more is already available if interconnection customers request it from
the Commission for their own studies or use studies developed by
transmission providers.\307\ The Ohio Commission Consumer Advocate
states that the determination of a suitable site depends largely on the
location and geography of the resources, which is publicly available
from national labs and the U.S. Energy Information Administration.\308\
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\304\ Id. at 15; AEP Initial Comments at 8; APPA-LPPC Initial
Comments at 9; El Paso Electric Initial Comments at 7; PPL Initial
Comments at 9; SoCal Edison Initial Comments at 14.
\305\ PPL Initial Comments at 9.
\306\ APPA-LPPC Initial Comments at 9.
\307\ SoCal Edison Initial Comments at 14.
\308\ Ohio Commission Consumer Advocate Initial Comments at 6-7.
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109. Several commenters state that sufficient data are already
required to be posted on OASIS.\309\ According to Idaho Power, Order
No. 2003-A required interconnection study reports to be publicly
available and provide locational and cost information for previously
studied interconnections, but this has not reduced the amount of
interconnection requests at congested locations.\310\ SoCal Edison and
NYISO state that this information is already available in FERC Form
715, where it is protected with a non-disclosure agreement as critical
energy infrastructure information (CEII) and has the benefit of being
available in one centralized location.\311\ On the other hand, ACE-NY
disagrees with the assertion that FERC Form 715 provides sufficient
information for interconnection customers to do their own analysis,
asserting that the FERC Form 715 database base cases do not contain
sufficient data about the generation interconnection queue and study
assumptions and are therefore inadequate.\312\ Rather, ACE-NY argues
that more detailed base cases such as those currently being made
available by MISO and PJM, should be required.
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\309\ Duke Southeast Utilities Initial Comments at 6-7; Idaho
Power Initial Comments at 3; NV Energy Initial Comments at 10;
PacifiCorp Initial Comments at 14-15.
\310\ Idaho Power Initial Comments at 3.
\311\ NYISO Initial Comments at 17; SoCal Edison Initial
Comments at 14.
\312\ ACE-NY Reply Comments at 3-4.
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110. Several commenters state that the usefulness of public
interconnection information proposal will depend on the implementation
details.\313\ For example, Illinois Commission and CESA recognize that
the accuracy of the heatmaps is an important part of how useful they
will be.\314\ Puget Sound states that it has considered creating such a
heatmap but has concerns about its effectiveness given implementation
challenges.\315\ SPP states that technology, information, and tools are
quickly evolving and that a standardization tool might be obsolete
before it is implemented.\316\ CESA explains that currently CAISO
provides static, snapshot-in-time transmission capability estimates
that are helpful but do not capture locational granularity or other
projects already in the interconnection queue, making it difficult to
make an informed project siting decision and at times requiring data
requests of CAISO.\317\ For this reason, CESA stresses that the
heatmaps and associated data must be made available in a user-friendly
format. CREA and NewSun argue that the Commission should be careful not
to overestimate the ability to forecast interconnection costs and
project viability that will ultimately result from a cluster
study.\318\ Several commenters stress that any potential increase in
transparency and interconnection process performance resulting from
this proposal must outweigh the additional burden imposed on
transmission providers.\319\
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\313\ CESA Initial Comments at 8-9; Illinois Commission Initial
Comments at 6; Puget Sound Initial Comments at 6; SPP Initial
Comments at 4.
\314\ CESA Initial Comments at 9; Illinois Commission Initial
Comments at 6.
\315\ Puget Sound Initial Comments at 6.
\316\ SPP Initial Comments at 4.
\317\ CESA Initial Comments at 8.
\318\ CREA and NewSun Initial Comments at 48.
\319\ Cypress Creek Initial Comments at 14; EEI Initial Comments
at 12-13; Eversource Initial Comments at 11; New Jersey Commission
Initial Comments at 22-23; New York State Department Initial
Comments at 8-9.
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(c) Comments on Specific Proposal
(1) Metrics
111. While some commenters agree with the Commission's proposed
table of metrics,\320\ multiple commenters suggest additional metrics
that should be posted.\321\ For instance, Public Interest Organizations
request information on the available interconnection capacity
(including, at a minimum, a snapshot of existing available
interconnection capacity and associated tran
[…truncated; see source link]Indexed from Federal Register on September 6, 2023.
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