Chapter II Key Takeaways

The Toolkit begins with Chapter II: Updating Interconnection Procedures to Be Inclusive of Storage, which lays the foundation for integrating storage in interconnection procedures. This chapter identifies the fundamental elements required for ESS integration into interconnection procedures. This includes a discussion of how to include storage in the terms used to describe the types of projects that will be reviewed, and recommended definitions for the concepts that are necessary to ensuring adequate review of ESS, which are further discussed in later chapters.

Recommendations for Updating Interconnection Procedures to Be Inclusive of Storage:
1. Interconnection procedures should define the term ESS and clearly state that the procedures apply to the interconnection of new standalone ESS, and ESS paired with other generators, such as solar.  

2. Interconnection procedures should define and describe the requirements and use of Power Control Systems (PCS), which are essential to capturing the advanced capabilities of storage.  

3. Because DERs paired with ESS often limit their output using a PCS or other means, interconnection procedures should include defined terms that describe the maximum amount of output that takes into account acceptable export control methods (“Export Capacity”), which can be contrasted with the DER’s maximum rated power output (“Nameplate Rating”).  

4. Interconnection procedures should include definitions of the terms “operating schedule” (reflecting the fact that DERs with energy storage can control their import and export according to a fixed schedule), and “operating profile” (describing the maximum output possible in a particular hour based on the DER’s operating schedule or resource characteristics).  

5. In addition to integrating storage into the interconnection procedures, states should also require utilities within their jurisdiction to update related interconnection documents, including application forms, study agreements, and interconnection agreements.

A. Introduction and Problem Statement

Two of the most elementary barriers to energy storage system interconnection are the lack of inclusion of storage in interconnection rules,[1]Jurisdictions use a wide variety of terms to describe the basic rules that govern the interconnection process. They can be called interconnection procedures, standards, rules, tariffs, regulations, … Continue reading and the lack of clarity as to whether and how existing interconnection rules (and related documents, such as application forms and agreements) apply to storage systems. In many jurisdictions, energy storage systems are not explicitly included under the definition of eligible facilities. For example, the interconnection rules in Florida, New Hampshire, Ohio, and Washington do not currently include ESS in the definition of eligible facilities.[2]FL Admin. Code r. 25-6.065; NH Admin. R. PUC 900; OH Admin. Code 4901:1-22; WA Admin. Code 480-108. In addition, applicable interconnection rules do not always adequately reflect the operating capabilities of ESS, which may limit the beneficial and flexible services that storage can provide to the grid. These factors can pose a barrier to timely and cost-efficient interconnection and project financing.

Regulatory certainty is critical in the interconnection process. When customers or developers submit interconnection applications, they have likely already expended significant time and resources on project development, including site and customer acquisition. Uncertainty and lack of clarity can lead to greater perceived or actual risk, which can impact a project’s ability to secure financing and may lead to more speculative projects that never reach interconnection. Conversely, greater clarity on how interconnection rules apply to storage systems—including the processes, time requirements, and costs involved—can allow developers to build those elements into their project design. This can reduce the additional delays of restudies or disputes in the interconnection process and benefit both utilities and interconnection customers.

While ESS can be, and is, interconnected in jurisdictions that do not explicitly include storage in their interconnection procedures, the lack of storage-specific rules can cause delays or increased expenses throughout the interconnection process, which can increase project soft costs. The lack of storage-specific rules can also reduce the ability of grid operators and storage developers to take advantage of the grid support functionalities inherent to storage. As described above, incorporating storage into interconnection rules provides greater clarity and certainty for customers and developers, utilities, and regulators. Such certainty will help facilitate the financing of projects that include ESS and can enable more cost-effective and efficient operation of ESS and the distribution grid. This is especially true when relevant provisions for import/export controls and other operating capabilities are also included in the interconnection rules.

Download the chapter file below to read more. Or download the full Toolkit and Guidance for the Interconnection of Energy Storage and Solar-Plus-Storage for all chapters and recommendations.

References

References
1 Jurisdictions use a wide variety of terms to describe the basic rules that govern the interconnection process. They can be called interconnection procedures, standards, rules, tariffs, regulations, or other terms. This document will typically use the terms “interconnection rules” or “procedures” to refer to the documents typically adopted by jurisdictions, similar to the FERC SGIP or California’s Rule 21. The term “interconnection standard” will refer to formal standards adopted by bodies such as the Institute of Electrical and Electronics Engineers (IEEE).
2 FL Admin. Code r. 25-6.065; NH Admin. R. PUC 900; OH Admin. Code 4901:1-22; WA Admin. Code 480-108.

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