By Rich Heidorn Jr.

New generators seeking interconnections must be equipped to provide primary frequency response, FERC ruled Thursday (Order 842, RM16-6).

The commission said the requirement that generators have governors or other equipment to respond automatically to frequency disturbances must be included in the pro forma generator interconnection agreements (GIAs) for both large (20 MW+) and small generators.

The rules will apply to new generation and existing generators that seek a new interconnection agreement because of “material modifications” to their facilities. The commission declined to order existing generators to retrofit their facilities to provide the service, saying it would be “prohibitively expensive” for some.

The final rule makes only small changes from the commission’s November 2016 Notice of Proposed Rulemaking, which cited concerns by NERC and others that frequency response has declined with the loss of traditional synchronous generation and the increase in asynchronous renewables. (See FERC: Renewables Must Provide Frequency Response.)

The commission cited a 2010 NERC survey that found only 30% of generators in the Eastern Interconnection provided primary frequency response and that only 10% provided “sustained” response. The commission said the existing pro forma large GIA — which required primary frequency response from only synchronous generating facilities — does not reflect technological advances allowing nonsynchronous generation to provide the service.

The commission set operating requirements of a maximum droop setting of 5% and a deadband setting of ±0.036 Hz.

“We find that the establishment of minimum uniform operating requirements for all newly interconnecting generating facilities is preferable to the fragmented and inconsistent primary frequency response settings currently in place throughout the Eastern and Western Interconnections,” FERC said. ERCOT already has minimum frequency response requirements, FERC noted.

FERC agreed with recommendations by the Edison Electric Institute and the Western Interconnection Regional Advisory Body that it modify the rule to explicitly prohibit interconnection customers from blocking their governors’ ability to respond to frequency deviations.

“One of the commission’s concerns with the current lack of clear, uniform primary frequency response requirements is NERC’s finding indicating that a number of generator owners/operators have implemented operating settings that have effectively removed the availability of their generating facilities from providing timely and sustained primary frequency response (e.g., wide deadband settings, uncoordinated plant-level controls). The reforms adopted in this final rule, to be applied uniformly to new generating facilities, are intended to eliminate these practices.”

The commission disagreed with the National Rural Electric Cooperative Association’s (NRECA) contention that the rule is premature, saying “adopting these requirements now is more prudent than waiting until the lack of primary frequency response undermines grid reliability, a point acknowledged by NERC’s Essential Reliability Services Task Force.”

Headroom, Compensation

The commission rejected EEI’s proposal that generators be required to maintain headroom — allowing them to increase output in response to low frequency — and receive compensation for doing so. “If future conditions necessitate a headroom requirement, we will then consider any appropriate compensation,” it said.

FERC also said it would consider on a case-by-case basis requests from transmission providers seeking to impose a headroom requirement “in a particular factual circumstance” that includes a compensation mechanism.

The commission said compensation is not necessary because “the cost of installing, maintaining and operating a governor or equivalent controls is minimal.” FERC estimated the cost of adding governors to new wind and solar generators would average $3,300/MW, about 0.2% of total capital costs for wind and solar.

FERC also rejected requests that it order compensation for traditional generators that provide inertial response. “No commenter asserts that inertial response trends on the Eastern and Western Interconnections are approaching levels that could threaten reliability. In addition, because inertial response is provided automatically by the rotating mass of synchronous machines as system frequency deviates and is not controllable, synchronous generating facilities do not incur additional incremental costs to provide inertial response,” the commission said.

Exceptions and Accommodations

The commission exempted or offered accommodations to some classes of resources:

• Combined heat and power (CHP) generators that are sized to serve onsite load and have no ability to export power to the grid will be exempt from the operating requirements but must install a governor “in the event that there is an increased need in the future for primary frequency response capability.”
• Energy storage will only be required to provide frequency response within specified operating ranges representing minimum and maximum states of charge. The commission said the accommodation would prevent the premature degradation of storage resources.
• Distributed energy resources will be required to provide frequency response only when they are allowed to ride through disturbances, the commission said in response to Xcel Energy’s concern that dynamic frequency response at the distribution level can interfere with anti-islanding protections. The rule does “not supersede a generating facility’s ride-through settings or require an interconnection customer to override anti-islanding protection or any protective relaying that has been set to disconnect the generating facility during certain abnormal system conditions,” the commission said.
• Nuclear generators are exempt from the rule because their licenses with the Nuclear Regulatory Commission often restrict providing frequency response.

No Exemption for Wind, Small Generators

Wind generation must comply with the requirement, the commission said, rejecting an exemption request by Sunflower Electric Power and Mid-Kansas Electric.

“Unlike certain CHP or nuclear generating facilities, the record does not indicate that there is an economic, technical or regulatory basis for a generic exemption for newly interconnecting wind generating facilities,” FERC said. “In particular, we are persuaded by [the American Wind Energy Association’s] assertion that the proposed primary frequency response capability requirements can be met at low cost for new wind projects, and that newly interconnecting wind facilities should not have difficulty complying.”

Small generators also will not be exempt. The commission said the rule will not result in “unduly burdensome” costs or create a barrier to entry, noting that PJM has not seen a decrease in small generator interconnections since it required nonsynchronous generation to install enhanced inverters with frequency response capability. “We are persuaded by commenter assertions that that small generating facilities are making up a growing percentage of the generation resource mix, and that as the market penetration of small generating facilities increases, there will be a growing need for primary frequency response from these generating facilities,” FERC said.

The commission rejected NRECA’s request that individual balancing authorities be permitted to seek waivers from the rule but agreed that “unique circumstances or needs of some individual regions or areas may warrant different operating requirements.” FERC said it would consider variations based on Regional Entity reliability requirements; variations that are “consistent with or superior to” the final rule; and “independent entity variations” filed by RTOs and ISOs.

The revised GIAs are due 70 days after publication of the rule in the Federal Register.