New generator interconnection studies will take 1-2 years, not 6 years.
A renewable project that enters the queue in 2026, is most likely going to see a signed interconnection agreement in 2027-28, not 2032.
New resource interconnections are taking 6 years is the common concern I have seen expressed recently in a couple of state proceedings. In the first instance, the transmission utility said it took PJM 6 years to evaluate a battery. In the second instance, a California state agency staff said it took 6 years for new resources to come online.
They are both wrong.
Renewable advocates must watch for this 6-year estimate narrative because study backlogs in interconnection queues are not expected to last longer, interconnection timelines do not include the time it takes for a resource to go online, and recent FERC Order 2023 with its proposed fines on grid operators will reduce the interconnection timeline to 1-2 years. If a renewable project enters the queue in 20261, it is most likely going to see a signed interconnection agreement in 2027-2028, not 2032.
Yes, study backlogs are a drag on new interconnection studies, but they are not expected to last long.
In the first instance, in a PJM state, the transmission utility said it took 6 years for a new Battery Energy Storage System (BESS) to interconnect to PJM’s transmission system compared to the 2 years it took for the utility to rebuild the 138-kV transmission line. But when I pointed out PJM’s FERC-approved queue reform process that shows 2 years for new interconnections, the utility agreed with my 2-year estimate but pointed out the PJM backlogs that need to be cleared first before realizing the efficiencies with the new serial study process.
The utility is right that the past studies backlog must be cleared first in PJM’s process. However, PJM stopped working on studies in each cycle as part of its transition process. Whereas in MISO2, which is similar to PJM3 in queue size, MISO did not stop processing new queue applications until 2023.
So, the 6-year estimate of clearing past studies backlog is valid concept-wise but not accurate timeline-wise because according to MISO’s data, if a project was submitted in 2019, it is estimated to take 5 years (2019-2024) for Generator Interconnection Agreement (GIA) execution because MISO is juggling 4 cycles (2019 DPP, 2020 DPP, 2021 DPP and 2022 DPP).
Source - MISO.
However, PJM is not working on multiple queue cycles. It has taken the approach of transitioning past projects submitted in earlier cycles to a new serial-based cluster study process, similar to MISO’s. PJM also has put a hold on processing new interconnection applications. That’s why this 6-year timeline for new resource interconnection studies is not valid4.
To illustrate the point about serious projects entering the queue in the future, not speculative projects, the data from MISO’s 2019 DPP cycle for the West region shows 58 projects with a total capacity of 8,793 MW started in 2019, which has now dwindled to 24 projects with a total capacity of 4,314 MW.
This data means a 60% reduction in the number of projects and a 50% reduction in the overall capacity. With recent queue reforms implemented in MISO, hypothetically, 24 projects will enter the queue, not 58, because new interconnection queues will be much more focused.
Hence, a project that enters the queue in 2026 is most likely going to be part of a much smaller cohort and reach the GIA execution stage in 2027-2028, not 2032.
The interconnection timeline starts when the request is received and stops when the GIA is executed, not when the project goes online.
In the second instance, in California, where the grid operator is the California Independent System Operator (CAISO), the California Energy Commission (CEC) staff issued a draft report recently that estimates it takes on average 6 years for new renewable interconnections to come online, hence there is a need to extend a nuclear plant.
The report references CAISO’s Resource Interconnection Management System (RIMS) data to support the 6-year estimate, which it defines as from the time the new resource enters the queue until the new resource is online, which is typically referred to as the In-Service Date (ISD).
The draft CEC staff report assumes it takes 6 years because it includes the time for a solar project to come online after the GIA is executed. But, since interconnection queues are operated under the FERC tariff, the timeline should end when the GIA is executed, not when the ISD is reached. If the rest of the grid operators followed the CEC staff lead, then most renewable projects would show up as delayed.
Source - Unsplash.
Take Clearway Energy Group’s Daggett solar+storage project, for example, which went online in October 2023. Clearway’s Daggett consists of 482 MW solar and 280 MW energy storage. The three Daggett Solar projects entered the CAISO queue in April 2016. It appears that the GIAs were executed for all 3 projects sometime before August 2020, after CAISO studies were completed. So, it took 3 to 4 years to sign GIAs for the Daggett solar projects.
But since the Daggett projects are built in phases, the first phase went commercial in October 2023, and the final phase is slated to be online in 2025. If we followed the draft CEC staff report lead, it took nearly 9 years (2016 – 2025) for the Daggett to interconnect, which is not true since the CAISO interconnection process ended in 4 years (2020), not 9 years.
FERC Order 2023 speeds up the generator interconnection process.
CAISO and PJM fall under FERC regulation. Multiple ISOs have GWs (1,000 MW) of renewable projects in their interconnection queues waiting to be studied. FERC, as their regulator, is aware of this problem. Hence, on July 28, 2023, FERC issued Order 2023 to speed up the generator interconnection process.
FERC had issued 3 sets of reforms, with one set specifically targeting the interconnection queue timelines. In Order 2023, FERC has proposed a $1,000 per day fine for delays in interconnection studies and a $2,000 per day fine for delays in restudies, studies done after initial studies are done if an interconnection customer leaves the queue.
Imposing fines on ISOs if they delay interconnection studies is new in Order 2023. Currently, there are no fines for ISOs; hence, they routinely experience delays in interconnection studies due to delays on the interconnection customer end (if a customer leaves the queue, restudies are triggered), the transmission owner end (the transmission owner is typically responsible for conducting the studies, and if they are delayed due to model building delays, then, the entire ISO queue is delayed), and the ISO delay (with a large volume of projects seeking interconnection, sometimes there is a delay in processing the received applications). FERC aims to reduce these delays with the imposition of fines.
So far, only renewable developers have paid the financial consequences of queue delays. Now, with Order 2023, the grid operators are also penalized. That’s another reason why new resource interconnections will take 1-2 years, not 6 years because grid operators will have skin in the game.
Each of the ISOs must file compliance plans with FERC on how they intend to comply with Order 2023. FERC had recently given ISOs an extension to submit these compliance plans by April 2024 instead of December 2023. Once FERC approves these compliance plans, Order 2023 becomes effective. The bottom line is that FERC regulations govern the ISO resource interconnection process for the bulk electric system, not the state processes.
Why 2026? Why not 2024? I struggled with this quite a bit. I ended up with 2026, not 2024 because a) FERC Order 2023 is not effective yet, 2) MISO queue reforms indicate MISO needs time to get rid of its queue backlog too like PJM. CAISO will be in the same boat. MISO didn’t quite stop processing new queues until PJM came out with that idea in 2022. So, in 2023, MISO didn’t open the window to collect new projects, and finally, 3) NRDC report shows PJM won’t be done with queue backlogs until 2026, which was confirmed by PJM’s Vice President of Planning interview, “The transition period to clear the existing backlog is expected to take until 2026,” https://www.nrdc.org/sites/default/files/2023-05/pjm-interconnection-queue-renewable-development-report.pdf
MISO has 242 GWs waiting to be studied, https://cdn.misoenergy.org/20230912%20System%20Planning%20Committee%20of%20the%20BOD%20Item%2005%20Long%20Term%20Resource%20Adequacy630148.pdf
PJM has 265 GWs waiting to be studied, https://insidelines.pjm.com/new-interconnection-process-aims-to-ensure-reliability-enable-state-policies/
See “we estimate that there could be about 100,000 MW of projects with signed ISAs by the end of 2025 and as many as 184,000 MW by the end of 2026.” https://insidelines.pjm.com/new-interconnection-process-aims-to-ensure-reliability-enable-state-policies/