FERC Proposes New Interconnection Policies

On January 17, 2013, the Federal Energy Regulatory Commission (FERC) issued a Notice of Public Rulemaking focused on reducing barriers to processing small generator interconnection requests. The proposed rule outlines changes to FERC's Small Generator Interconnection Procedures (SGIP) and Small Generator Interconnection Agreement. Together, these policies dictate the treatment of interconnecting facilities that are 20 megawatts or smaller. This rule is particularly relevant to new renewable generation facilities like solar and wind.

There has been an increased focus on grid reliability in recent years as strict regulations on utility emissions have resulted in fuel shifting and the retirement of older facilities. In addition, policies focused on spurring new investments in renewable energy generation, including renewable energy portfolio standards at the state level, have resulted in a re-examination on the procedures in place to enable their connection to the grid. The proposed rule further addresses these issues.

The proposed rule recommends four changes to:

• Allow requests for pre-application reports for potential interconnection customers
• Amend the current 2 MW threshold as it relates to the Fast Track Process
• Amend customer options for projects failing the Fast Track screens
• Revise pro-forma SGIP Facilities Study Agreement to enable written comments on necessary upgrades for interconnectedness

The proposed rule will be published in the Federal Register in the coming days, at which point a 120-day comment period will commence.