JD Supra
Summary
Electric transmission planning processes have not been able to keep pace with demand for interconnection service, leaving over 1,000 gigawatts (GW) of generation and 400 GW of storage stranded in the nation’s interconnection queues. In response to the backlog, PJM Interconnection LLC—the nation’s largest RTO by load served—recently imposed a two-year pause on new interconnection requests and asked the Federal Energy Regulatory Commission (FERC) to consider reforms to its interconnection process. At present, projects seeking interconnection service in the United States are only about 28% likely to finish the process, and face an average interconnection timeline of 3.7 years. This state of affairs has not only undermined investor and developer confidence, but has also led to concern that developers hedge against uncertainty by submitting more requests than needed or by submitting requests in advance of hitting important project milestones.
In public comments submitted to FERC prior to the issuance of the NOPR, groups like the American Clean Power Association (ACPA) and the Solar Energy Industries Association (SEIA) identified a number of interconnection-related problems faced by industry participants. ACPA wrote that generators have “little cost certainty throughout the interconnection process” and that affected system rules, intended to ensure reliability on adjacent systems affected by interconnection upgrades, are “badly broken.” SEIA explained that, because interconnection upgrades have grown “significantly” in cost in recent years, many previously viable projects are now less economic or even non-competitive.
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