Paper trading is here, introducing an element of speculation in wholesale electric markets.The electric power industry joined the commodity markets on March 29, 1996, when power futures began to...
Federal Interconnection Standards: Putting DG in a Box
"has jurisdiction over generator interconnections when a generator interconnects to a transmission provider's transmission system or makes wholesale sales in interstate commerce at either the transmission or distribution voltage level." Interestingly, the ANOPR is silent about DG interconnections at the distribution level that exclude exports or wholesale sales-potentially, a large segment of the DG market that, by default, would be left to states to handle.
Elements of a Comprehensive Standard
In a typical DG facility operating in parallel with an electric utility grid, the DG output may be fully consumed by the adjacent load (non-export) or injected into the grid if output exceeds load (export). While numerous configurations and DG sizes are possible, comprehensive interconnection standards share the following elements:
- clear and concise application requirements and cost, including filing deadlines;
- processes for evaluating DG grid impacts, including screening criteria for system impact and facilities studies;
- simplified or expedited approval process for low-impact or pre-certified DG;
- minimum technical requirements, including DG performance criteria (e.g., voltage, frequency, power quality);
- safety and reliability requirements, including protective relaying according to DG size and type; and
- a dispute resolution procedure including mediation, arbitration, and commission filing. DG technologies generally fall under two categories: rotating machines such as induction and synchronous generators, and latent devices, such as photovoltaic (PV) systems or fuel cells that involve few moving parts. The latter category typically employs inverter-based technologies to convert direct current output to alternating current to synchronize to the utility grid.
Inverter-based generators tend to have less impact on utility grids because they automatically shut down if the grid experiences an outage or abnormal condition. Smaller DG-10 kW is often a rule of thumb-and those that are inverter-based typically are candidates for simplified interconnection. Most states employ screening criteria based on DG size relative to utility circuit loadings. For example, a DG applicant may pass a screen for expedited processing if DG output is less than 10 percent of the feeder peak.
FERC's ANOPR Quickly Bogs Down
The pitfall of false expectations soon reared its head as the SGC, represented by an impressive array of suppliers and industry experts, fought to a stalemate with utilities and NARUC on specific provisions of proposed small generator interconnection applications and procedures. The consensus agreement submitted by the joint coalition in November 2002 now resembles a patchwork quilt of annotations and exceptions highlighting as many differences as areas of agreement among the SGC, NARUC, and utilities.
Comments submitted to FERC by the SGC portray utilities and NARUC as inhibiting the evolution of a robust DG market, and characterize prior utility interconnection standards as "inconsistent, overly burdensome, unreasonably expensive, and often deliberately obstructive," noting that current "interconnection procedures constitute one of the most significant barriers to the widespread use of small resources in U.S. electricity markets." 2 The SGC points out that the utilities' proposal could lead to unacceptably long application and study timeframes (over one year for complicated applications) as a major deficiency of the consensus agreement.
Perhaps the most fundamental, yet vexing issue in this debate is who bears the burden of proof