FERC Order No. 792 (Part 3 of 3): Adoption by States

FERC Order No. 792 is a major update to the standardized generator interconnection rules found in the pro forma Small Generator Interconnection Procedures (SGIP) and Small Generator Interconnection Agreement (SGIA). The SGIP and SGIA, created by FERC in Order No. 2006, have largely standardized the generator interconnection process. The updates to the SGIP and SGIA in Order No. 792 are major benefits to distributed generation, especially small solar and energy storage. This article is the last in a three-part series on Order No. 792. Part 1 described how the order helps new solar PV projects. Part 2 described how energy storage benefits from the order. Part 3 discusses potential state adoption of FERC’s new rules for state-jurisdictional interconnections.

State Adoption of Order No. 792 Interconnection Process

Although Order No. 792 creates many benefits for distributed solar PV and energy storage projects, a large portion of such projects will not be directly affected because their interconnections fall outside the jurisdiction of FERC under Order Nos. 792 and 2006. With some exceptions, interconnections of PURPA qualifying facilities (QFs) and interconnections on local distribution lines are under state jurisdiction and therefore are not governed by FERC’s interconnection rules. That said, many states model their interconnection rules after FERC’s rules as FERC encouraged states to do in Order No. 2006.

To the extent a state actively manages state-jurisdictional interconnections through rulemaking, Order No. 792 is cause to update the state’s rules. “Similar to our approach in Order No. 2006,” wrote FERC, “our hope is that states may find this [Order No. 792] helpful in formulating or updating their own interconnection rules…” FERC recognized California’s ongoing efforts to update California’s Rule 21 on generator interconnections. In connection with California’s effort to increase distributed generation, the state expects significant growth in small-scale generators with state-jurisdictional interconnections. Rule 21 is being updated to adapt to the increased density of distributed interconnections and advances in the technology of inverters. At some level of penetration, distributed generation particularly intermittent generation, will exceed the design capabilities of local circuits.

Luckily, the latest generation of inverters can be programmed to manage power from distributed generation, effectively increasing the ability of a given circuit to accommodate generators. Smart inverters can also be programmed to improve power quality through regulation. By taking advantage of the features of smart inverters in interconnections, California hopes to increase and optimize its use of distributed generation. As states consider updating their interconnection rules to match the changes made by FERC in Order No. 792, they may also want to look to California’s Rule 21 as an ambitious and forward-looking rule update to take advantage of the current capabilities of inverters.

Lovinger Kaufmann LLP assists solar PV developers and utilities in negotiation, dispute resolution, and rulemaking related to generator interconnections. Lovinger Kaufmann LLP participated in the drafting of the current interconnection rules in Oregon and Washington, which are modeled on the SGIP and SGIA from FERC Order No. 2006.

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