FERC on Thursday announced that it would reconsider Order 2222-A, the latest episode in the commission’s debate on whether it should allow states to prevent demand response resources from participating in RTO/ISO markets (RM18-9-003, RM21-14).

In issuing Order 2222 in September 2020, FERC ordered RTOs and ISOs to open their markets to distributed energy resource aggregations. With March’s Order 2222-A, the commission clarified that a DR resource could participate in an aggregation that included at least one other type of DER, even if the DR resource was in a state that chose to opt out of Order 719. That order, issued in 2008, allowed states to block DR aggregations from participating in wholesale markets. (See FERC Limits State ‘Opt Out’ on DR.)

But at its open meeting Thursday, FERC set aside 2222-A. Chair Richard Glick opened the meeting by saying he was convinced by arguments in rehearing requests and by Commissioner Mark Christie “that we should not be putting the cart before the horse.”

“These issues are best considered holistically and in the context of” its Notice of Inquiry into whether it should rescind Order 719, he said.

Additionally, FERC extended the deadline for comments in the NOI, which irked Commissioner Neil Chatterjee. Though he concurred with Thursday’s order, he urged “the commission to eliminate this outdated and anticompetitive policy, an action I believe is necessary to fully unleash the power of DER and allow consumers to realize all the benefits demand response resources can provide in DER aggregations.”

The order also provided clarification that “payment of full LMP in the energy market to behind-the-meter distributed energy resources participating as demand response resources in distributed energy resource aggregations does not constitute double counting, so long as the requirements of Order No. 745, including the net benefits test, are satisfied.”

Christie concurred in part and dissented in part, saying “I would have voted against Order No. 2222 had I been a member of the commission at that time, and I did vote against Order No. 2222-A.”

In the latter order, Christie said the majority has sided “against the consumers who for years to come will almost surely pay billions of dollars for grid expenditures likely to be rate-based in the name of ‘Order 2222 compliance.’”

“To ameliorate at least some of the damaging effects caused by Order Nos. 2222 and 2222-A, I would authorize states and other RERRAs the right to exercise an opt-out from the requirements of those orders, if not permanently then at least for some period of years to enable them better to prepare for the impacts on retail customers and distribution grids they now face,” Christie added.

Commissioner James Danly issued a separate concurrence to “highlight that even if the commission is correct that it has jurisdiction over distributed energy resource aggregations — including those ‘aggregations’ comprised of a single resource — the commission still should have chosen not to exercise such jurisdiction in Order No. 2222.”