Even as it works to implement Order 2023, FERC is considering additional changes to its rules on generator interconnections, with a technical conference set for Sept. 10-11 that saw pre-conference comments filed this week (AD24-9).

Commenters argued for a more proactive transmission planning process that takes into account the future generation mix. Others argued for greater automation and certainty around planning.

Some pushed for a special “fast track” for shovel-ready generation that is needed as the grid continually sees generators retire that need to be replaced. The bulk of the new generation in queues is made up of renewable energy; National Grid said that has helped to overwhelm processes originally designed for a more limited volume of fossil fuel-fired plants.

“Unfortunately, the measures that have been relied on historically — e.g., increased deposits and fees, penalties, and prioritizing first-ready projects — have proven insufficient to address the challenges of a rapidly changing grid driven by unprecedented levels of investment in the energy transition,” National Grid said.

Fixing the situation will require new methods, such as a competitive, priority queue for projects that can readily address reliability needs and better coordination between long-term transmission planning and the generator interconnection process, the company said.

“While a capped queue provides an effective means of getting the GI queues under control and more aligned with realistic and effective grid administration, we cannot lose the value that competition in the generation sector has provided for system reliability and consumer costs,” National Grid said. “Accordingly, to populate the capped priority queue, our proposal would establish a competitive process based on identified needs to select the projects that would form the relevant queue.”

Constellation Energy also supported an expedited queue, noting that ISOs and RTOs have increasingly warned that the trends of accelerating retirements and clogged queues could lead to reliability issues if not addressed in the coming years. Its comments argued for an “Expedited Reliability Process” for reliable, deployment-ready projects, such as uprates to its nuclear plants.

“Constellation has announced approximately 135 MW of planned uprates at our Braidwood and Byron generating stations in Illinois, the equivalent of adding 216 variable-output wind turbines to the grid,” the company said. “In total, nuclear operators across the nation are considering or preparing uprates with a cumulative capacity increase of approximately 2 GW.”

Such uprates and other shovel-ready projects can plug the reliability gap, but they have to sit in queues that have been gummed up with projects that often contribute far less to resource adequacy, Constellation said. Under its proposal, RTOs would be able to set up an expedited queue when they determine some projects would more effectively and quickly address identified reliability needs.

“RTOs concerned that reliability and/or resource adequacy is becoming an issue could, in these narrow circumstances, seek commission approval of an expedited interconnection study process that would prioritize the processing of interconnection requests likely to be responsive to the RTO’s reliability and/or resource adequacy need, and that can demonstrate a high degree of readiness,” Constellation said. “This subset of interconnection requests would be moved through the interconnection study process on an expedited basis so they can be put in place quickly in response to the RTO’s demonstrated reliability and/or resource adequacy need.”

Storage developer Gridstor cautioned FERC against doing damage to the concept of open access in attempting to speed up queues.

“The commission should look to solutions that least compromise open access and make prioritization criteria based as much as possible on the actions and decisions under the control of interconnection customers,” Gridstor said.

Rationing interconnection quests to determine advancement introduces a zero-sum process because only some projects would get into the priority queues. It could even lead to discrimination among similar projects, the company said.

In the past, FERC has limited exceptions to open access to new generators using retired units’ interconnection facilities and to surplus capacity available to existing generators that want to expand. Gridstor argued the main issue leading to the long queues is a lack of adequate transmission, so any expedited, special processing should be time limited.

“It is imperative that the commission should seek a limiting principle — that is, the smallest compromise to open-access principles needed to achieve the goal of rationing interconnection requests,” Gridstor said. “Reforms that go beyond what is strictly necessary to address the current supply-demand imbalance should be rejected, given the more fundamental responsibility of the commission to uphold open access principles.”

Marrying Interconnection and Transmission Planning

The technical conference will also consider arguments around proactively expanding the grid, which would spread the costs of connecting new resources more broadly than they are now.

“Closer integration of generator interconnection and transmission planning processes will result in a more efficient buildout of the electricity grid,” Brattle Group Principal John Michael Hagerty said. “The vast majority of transmission upgrades today are identified through siloed processes, based on grid reliability studies (with limited consideration of future resource needs) and generation interconnection studies. Proactive transmission planning processes that holistically account for both future projected demand and changes in the future generation resource mix and consider a comprehensive set of transmission benefits will identify the upgrades that reduce total customer costs and allow new resources to efficiently enter the system through the generator interconnection process.”

Hagerty’s comments drew from a report he co-authored with Grid Strategies for Advanced Energy United and the Solar and Storage Industries Institute on potential changes. It argued that proactive planning will avoid unneeded upgrades identified through siloed reliability studies and result in more cost-effective upgrades that provide access to more new resources.

Such plans need to be based on multiple scenarios to deal with the uncertainty around the future. Hagerty said a reasonable cost-allocation method would also help.

“Proactive planning does not require a specific approach to cost allocation for the new transmission upgrades,” Hagerty said. “Identifying a reasonable cost allocation approach that aligns costs with beneficiaries will be an important step in implementing an integrated planning and interconnection process.”

Regions could continue to assign upgrade costs to generators, but they would fund a smaller percentage of a larger suite of transmission upgrades developed for their use, he added.

The R Street Institute also argued for proactive planning and broader cost allocation, as it had earlier in FERC’s transmission planning rulemaking. Those would lead to lower costs overall, meaning lower bills for consumers.

“This improved efficiency translates into major cost reductions for network upgrades, which consumers ultimately pay for, either directly or indirectly,” R Street said. “Because transmission costs are so heavily incurred by consumers, large savings from more efficient network upgrades reduces costs to consumers irrespective of cost allocation method.”

R Street cited ERCOT’s “connect and manage” system, in which transmission network upgrades are entirely determined in planning, and generator interconnection does not include deliverability requirements, leading to much lower barriers to entry than the “invest and connect” approach used in other markets.

“Transmission costs are borne by consumers, either directly or indirectly,” R Street said. “Therefore, it is in consumers’ best interests that transmission expansion efforts be most efficient. Separating network upgrades from the generation interconnection process is one way to improve efficiency.”