FERC Revises Small Generator Rules to Include Energy Storage

A final rule issued by the Federal Energy Regulatory Commission (FERC) on Nov. 22 allowing energy storage projects to connect with the electric grid could boost the energy storage industry’s presence as a backup power source for intermittent energy sources, industry experts say.

FERC Order No. 792 amends Order No. 2006—the pro forma Small Generator Interconnection Procedures (SGIP) and pro forma Small Generator Interconnection Agreement (SGIA)—to include energy storage projects so those projects can receive rates, terms, and conditions for interconnection with public utilities that are “just and reasonable and help remedy undue discrimination.”

SGIP and SGIA govern the interconnection of generating facilities of up to 20 MW with a public utility’s transmission facilities or its FERC-jurisdictional distributional facilities. The SGIP and SGIA also include “fast track” provisions applying to generating facilities of up to 2 MW as well as to inverter-based facilities of up to 10 kW.

FERC pointed to comments from the Community Renewable Energy Association (CREA), which said that expanding the definition of “small generating facility” would incentivize small generators to “keep abreast of future innovations in storage technology.” The California Independent System Operator also reportedly said it “believes the existing definition is sufficiently broad to encompass a storage device and therefore apply the SGIP to such a facility if it is less than
 20 MW.”

As part of the final rule, FERC also requires transmission providers to provide interconnection customers with the opportunity to request preapplication reports so they can make more informed siting decisions. Those reports—prepared at a default fixed preapplication report fee of $300—must be provided within 20 business days of an initial request with data that is “readily available.”

Additionally, FERC adopted a number of reforms to the Fast Track eligibility thresholds. All projects interconnecting to lines greater than 69 kV are now ineligible for the Fast Track Process, though synchronous and induction machines will continue to be subject to the 2-MW Fast Track threshold.

Finally, under the rule, each public utility transmission provider is required to submit a compliance filing within six months of the rule’s effective date.

“These reforms are good news for storage project developers and further facilitate the deployment of storage on the power grid,” said Darrell Hayslip, chair of the Energy Storage Association (ESA). “We commend the FERC Commissioners for acknowledging that energy storage should be able to participate in the small generator interconnection process on our electric grid and that our rules and policies should evolve as well.”

The final FERC rule comes just weeks after the California Public Utilities Commission established an energy storage target of 1,325 MW that California’s largest investor-owned utilities, Pacific Gas and Electric Company, Southern California Edison, and San Diego Gas & Electric, must meet by 2020.

Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)

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