Flexible Interconnection: Clearing Queues, Reducing Costs and Speeding Up Grid Connections.

There is an extensive backlog of Distributed Energy Resource (DER) seeking to interconnect to utility networks in queues across the country. The length and throughput of these interconnection queues have resulted in slowing down the adoption of low-cost renewable energy, the ability of states to meet renewables targets and several other negative impacts.

For reasons of supply security and public good, utilities remain extremely conservative when evaluating the addition of new power plants to the grid. Unfortunately, the pace at which DER can consent and construct is not aligned to the timeline for grid upgrades triggered by the interconnection process. The result is that, largely speaking, the grid has not been able to keep up with DER growth across the country. If the DER projects are still financially viable following the interconnection study, developers and system owners may still have to wait months or years, depending on the upgrade, before their project will be ready to interconnect. These long lead timelines have led to excessive backlogs in construction of the DERs. 

One viable solution is Flexible Interconnections. Flexible Interconnections allow the violations identified in the system impact (screening) studies to be managed in operational timescales using scheduled, modeled, and real-time information and communications technology. Flexible Interconnections work by monitoring the network where the constraints identified in the interconnection studies may occur and curtailing the export of the generator as the constraint is approached. The same would apply for import if the connection were load demand.

Figure 1 shows the difference in operation between a conventional interconnection and a Flexible Interconnection. The conventional interconnection has a fixed limit and takes no account of intra-day or intra-seasonal variations in load or DER import / export. The fixed, deterministic limit is set based on the worst-case system conditions.  By contrast the Flexible Interconnection removes this fixed limit and manages the DER to the real-time hosting capacity of the network. This allows variations in demand and DER export or import, as well as any network redundancy. e.g. reserved capacity for contingencies. to be utilized to release capacity. SGS experience indicates that viable hosting capacity is typically increased by 50-100%.  

 Figure 1: Conventional (Firm) vs Flexible Interconnection- EPRI[1]

The terms under which curtailment will be applied are written into the interconnection agreement with the customer. This allows the customer to understand the risks of lost export, model them and build them into their financial models. The new connecting customer trades the benefits of a lower cost and/or faster connection in exchange for curtailment under specific and well-defined conditions and the associated potential loss of revenues. 

States across the US have set aggressive clean energy targets over the coming decades. To manage the impacts of achieving these targets without curtailment and Flexible Interconnections would require an electricity grid built to manage capacity many times larger than it is today. This puts utilities in a challenging position between their rate base customers and the developers of renewable DER assets. Historically, when a developer applies for interconnection, if an upgrade is necessary then the full cost of that upgrade falls to the project developer. At a certain point, though, the upfront cost to upgrade the infrastructure makes a renewable energy project infeasible. The costs preventing these interconnections will make it hard for states and utilities to reach their renewable targets.

In contrast, the burden of those costs will fall to the rate payer if utilities cover or share some of the cost with developers. As a result, while utilities will meet their renewable target, it will come at a greater cost to the customer and be less desirable to regulators, stakeholders, and customers. 

Flexible Interconnections provide the means to rebalance the costs and risks or DER and system development, providing lower cost and faster connections for project developers, no additional costs to ratepayers and the means of securing the system and enabling the clean energy transition for utilities.

North America’s Utilities and States have already set aggressive renewable targets to help stem the impacts of fossil fueled generation retirement and to help with the call to action against climate change. To achieve these targets, utilities and DER developers need to act quickly to add more renewable energy to the grid. Today, the utility interconnection process is slowing down progress by offering expensive and time-consuming upgrades onto DER developers. Flexible Interconnections are the path utilities can use to rapidly increase hosting capacity and minimize the cost developers pay to help states achieve their carbon-free visions of the future.

Flexible Interconnections are already deployed and operating in numerous locations.  AVANGRID is an exemplar in the US of the international state of the art and growing trend.  By allowing deployment without the burden of system upgrades, time is saved in connecting DER – typically this is months to years of reduced time to connect.  Also, by enabling utilities and project developers to install DER at the targeted sizes, ROI for developers is balanced with utility goals and obligations.