FERC Approves Small Generator Interconnection Standard

May 18, 2005

The Federal Energy Regulatory Commission (FERC) issued standard procedures on May 12th for the interconnection of small power generating equipment to power grids. The new procedures are meant to reduce the uncertainty, time, and costs associated with connecting systems to the grid that have generating capacities of 20 megawatts or less. The rule directs public utilities to offer non-discriminatory, standardized interconnection service for small generators and to provide technical procedures for connecting to the grid. Public utilities will also have to provide a Small Generator Interconnection Agreement, which contains the contractual provisions for the interconnection and spells out who pays for improvements to the utility's electric system, if needed to complete the interconnection. The rule allows simpler interconnection for systems of 2 megawatts or less, and even simpler procedures for systems of 10 kilowatts or less that use inverters. The rule applies only to interconnections with facilities already subject to FERC jurisdiction and does not apply to local distribution facilities. See the FERC press release and the final rule (PDF 705 KB). Download Acrobat Reader.

According to the Solar Energy Industries Association (SEIA), interconnection standards can have a significant impact on the number of renewable energy and distributed energy systems installed within a state. In New Jersey, for instance, an easy-to-understand process that allows for expedited processing with fixed fees has caused a solar power boom. For businesses, New Jersey allows interconnection and net metering for facilities as large as two megawatts. SEIA credits the standard with a 550 percent growth in solar capacity within the state over the past three years. See the SEIA press release.