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FERC approves PJM queue reform

image credit: Lawrence Berkley National Lab
Sriram Raghavan's picture
Senior Portfolio Analyst The Energy Authority

I am an electrical engineer currently working as a Senior Portfolio Analyst at The Energy Authority. My current job involves running production cost/stochastic risk models to provide economic...

  • Member since 2022
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  • Dec 2, 2022
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 FERC approves PJM queue reform to speeding up grid interconnecting backlogs (2,700 active projects worth 250 GW at various points in study process as of May this year). One of the main issues was dealing with speculative projects entering/staying in the queue.

  • FERC determines and agrees with PJM (original reform) that the RTO must be moving from first-come, first served queue process to first-ready, first-served clustered cycle approach to tackle the massive backlog.
  • PJM also proposed certain other reforms aimed at minimizing the number of speculative and non-ready projects entering the queue, including imposing readiness requirements and providing off-ramps for stalled or delayed projects to withdraw from the queue.
  • FERC also signed off on PJM's proposal for transitioning to the new process, which includes provisions to expedite new projects expected to have minimal impacts on the transmission system.
  • In addition, the agency approved more stringent site control requirements aimed at discouraging or preventing project developers from submitting speculative projects.
  • FERC approved PJM's proposal to eliminate suspension rights, which allow applicants with non-ready projects to suspend the processing of an interconnection request for a limited period of time while they attempt to arrange financing or otherwise determine whether and how to move forward with their projects.
    • Developers instead will be allowed to extend milestones (other than site control) for up to one year.
Discussions
Matt Chester's picture
Matt Chester on Dec 2, 2022

FERC also signed off on PJM's proposal for transitioning to the new process, which includes provisions to expedite new projects expected to have minimal impacts on the transmission system

Do you have examples of what types of projects this will apply to and what level of increase to speed they could see? Or is it somewhat vague in the actual text? 

Sriram Raghavan's picture
Sriram Raghavan on Dec 20, 2022

Matt, the reforms were generalized in terms of how to better handle the queue, rather by fuel type. As things stand, ~80% of the projects are solar, battery and solar + storage, ~10% natural gas, 5% wind in the queue. The majority would be solar and storage that would reap benefits in terms of making the interconnection process first ready-first served. My opinion - with IRA in place and special funding for batteries - we can expect to see more in-house manufacturing which should ease the supply chain in general and hence how these projects go in the queue. 

Henry Craver's picture
Henry Craver on Dec 9, 2022

Definitely moving in the right direction here. It's still discouraging, however, how many projects we see get hung up or scraped altogether because of pseudo community input mechanisms. 

Sriram Raghavan's picture
Sriram Raghavan on Dec 20, 2022

Henry - Agreed, with strong investment opportunities funded by the government and the need to decarbonize, developers swarm to include their projects into the queue without a defined structure, so as to "reserve a spot in line" but that in turn puts PJM/RTO's in a tough spot to clear the queue. Need proper regulations even before getting in the queue. 

Michael Keller's picture
Michael Keller on Dec 20, 2022

Ah yes, the motto of big government: it’s only money and it not even ours.

Sriram Raghavan's picture
Thank Sriram for the Post!
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