FERC’s surprising response to PJM’s Order 2222 proposal is good for solar, DER

Federal Energy Regulatory Commission

On March 1, the Federal Energy Regulatory Commission approved PJM’s Order 2222 compliance proposal related to the aggregation of Distributed Energy Resources. This approval surprised FERC watchers who thought FERC orders would be stalled with commissioners tied 2-2 along party lines. But that was not the case, and distributed energy resources, specifically net energy metered solar, were a big winner in FERC’s ruling on PJM’s compliance filing. One of the key takeaways in FERC’s approval of PJM’s filing is the mention of device-level meter data, which will help NEM solar and other distributed energy resources.

There is a lot to chew on in the FERC order but here are some of the key takeaways of interest to the distributed solar and storage providers.

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Interconnection – Because Component DERs (individual DERs that make up an aggregation) are on the distribution system, which is state jurisdiction, in Order 2222, FERC did not mandate DER interconnections go through the FERC jurisdictional generator interconnection queue. FERC found PJM fully complied with this requirement because PJM’s proposal stated the DER Capacity Aggregation Model, which is new, does not have to secure Capacity Interconnection Rights, unlike the Generation Capacity Resources. This approval is good news for NEM solar.

Participation Model – FERC wanted the aggregation of DERs to provide all services they were technically capable of, including capacity, energy, and ancillary services. On the capacity market, FERC found PJM partially complied with this requirement because PJM’s proposed rules for Component DERs in an aggregation co-located with a retail end-use load are exempt from capacity market rules such as Minimum Offer Price Rule (MOPR) and Market Seller Offer Cap (MSOC).

FERC didn’t agree with PJM on this capacity market mitigation for Component DERs. As a result, FERC directed PJM to file a compliance plan within 30 days “that removes its proposed tariff language that exempts DER Capacity Aggregation Resources containing Component DER directly connected to distribution facilities co-located with retail end-use load from capacity market power mitigation rules.”

Double counting of services – FERC mandated that dual registration – registering a retail program in the wholesale market – should be allowed, and any restriction on retail programs must be narrowed according to the services they wish to provide. This double-counting is a big issue for NEM solar, and the A

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