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  • Sidley Environmental and Energy Brief June FERC public meeting dominated by proposed regulations for electric transmission

Sidley Environmental and Energy Brief June FERC public meeting dominated by proposed regulations for electric transmission

By on June 24, 2022 0

NOPR to reform Generator interconnection procedures and agreements

On June 16, 2022, the Federal Energy Regulatory Commission (FERC) took another step to facilitate access to the transmission system with a Notice of Proposed Rulemaking (NOPR) on Improvements to Generator Interconnection Procedures and Agreements. The NOPR aims to reform FERC’s current procedures and agreements and, in doing so, (1) address the significant backlog of interconnection backlogs, (2) provide greater certainty, and (3) prevent discrimination against next-generation technologies.

The NOPR outlines three key areas of reform to remove barriers to network access. First, NOPR is proposing to replace the current first-come, first-served serial review process with a first-ready, first-served cluster review process. The new process would allow transmission utility providers to study multiple proposed generation facilities at the same time instead of conducting a study for each generation facility separately. As part of this new process, transmission providers will implement more stringent financial commitments and readiness requirements for interconnect customers. Second, NOPR is proposing to increase the processing speed of the interconnect queue by removing the “reasonable efforts” standard, imposing hard study deadlines, and creating penalties in some cases for carriers who do not meet study deadlines. Carriers would be required to use a standardized and transparent affected system review process and provide an optional resource solicitation review process. Third, NOPR proposes to integrate technological advancements into the technological process. Transport providers would be required to allow multiple resources to co-locate at a shared site behind a single interconnect point and share a single interconnect request. Interconnection customers would be permitted, under certain circumstances, to add a generation facility to their existing interconnection request without losing their position in the queue.

This NOPR is the latest in a series of transmission and interconnection reform efforts that FERC began in 2003 when it issued Order No. 2003 Establishing Standard Procedures and Agreements for Large Facilities production interconnected. FERC issued subsequent rules creating similar requirements for small generating facilities in 2005 with Order No. 2006, then issued its Interconnect Queuing Practices 2008 decree targeting queuing practices at the interconnection of regional transmission operators and independent network operators. In recent years, FERC has sought to improve the generator interconnection process, including issuing Order No. 845 in 2018 and NOPR issued earlier this year to reform regional transmission planning and cost allocation.

The NOPR has not yet been published in the Federal Register. Comments will be due 100 days after its posting date, and comment responses will be due 30 days after that.

Proposed improvements to Ensure network reliability against extreme weather conditions

Also on June 16, 2022, FERC launched two NOPRs aimed at improving the reliability of the bulk power system against extreme weather conditions, Transmission System Planning Performance Requirements for Severe Weather Conditions (NOPR Transportation System Planning) and Ad hoc information reports on extreme weather vulnerability assessments Climate change, extreme weather and power system reliability (NOPR Information Reports). Both NOPRs stem from FERC’s Technical Conference on Climate Change, Severe Weather, and Power System Reliability held in June 2021.

The Transmission System Planning NOPR proposes to direct the North American Electric Reliability Corporation (NERC) to make changes to Reliability Standard TPL-001-5.1 (Transmission System Planning Performance Requirements) that require (1) that NERC develop baseline planning cases using information such as past major extreme weather events and future weather projections, (2) transportation providers should plan for extreme weather events using steady-state and transient stability analyzes covering a range of extreme weather scenarios, and (3) transportation providers must develop corrective action plans for instances in which performance requirements related to extreme weather events are not met.

Briefing Reports NOPR proposes to require transportation providers to submit ad-hoc briefing reports outlining their policies and procedures for conducting extreme weather vulnerability assessments. The information report should include how the transportation provider will (1) develop a scope for its extreme weather vulnerability assessments, (2) develop inputs, (3) identify vulnerabilities and determine exposure to extreme weather events, (4) estimate impact costs and (5) develop extreme weather risk mitigation measures.

Given recent and frequent extreme weather events and their increasing threat to grid reliability, FERC has placed greater emphasis on taking action in this space. For example, after the February 2021 freeze in Texas and the Midwest, FERC, NERC, and regional entities formed a joint investigation team and released a report on network cold weather operations, which included findings and preliminary recommendations. It is likely that FERC will continue to be active in this space.

NOPRs have not yet been published in the Federal Register. Comments will be due 60 days after their respective posting dates.

Ultimately, these NOPRs are an effort by FERC to ensure the grid is resilient to climate change, while also enabling lower-carbon forms of generation to meet customer demand. A more in-depth discussion of these issues can be found in Emily Mallen’s podcast interview with FERC General Counsel Matthew Christiansen, released by the Environmental Law Institute on June 22, 2022.

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