Distributed Generation Interconnection in Illinois

Transcription

1 Distributed Generation Interconnection in Illinois David Rearden January 31, a

2 In the beginning Electricity system was vertically integrated: the utility generated the electricity, transmitted to the towns and distributed it to homes and businesses. The system was not designed to allow unaffiliated entities to interconnect with it. A vertically integrated utility could take advantage of economies of scale in generation. 2

3 What changed? Technology: machines were developed that could produce power at economic costs at lower scale than previously. Recently, small-scale photovoltaic and wind generators have become more competitive. Law: PURPA (Public Utility Regulatory Policies Act, 1978) forced utilities to interconnect with and buy wholesale power from independent power producers. EPAct 2005 also promoted interconnection. EPAct 2005 catalyzed Illinois rulemaking. Policy: In some states, including Illinois, utilities were disintegrated utilities split distribution and transmission from generation. At the same time, interest in retail competition increased. 3

4 Distributed generation for Illinois Interconnection to the transmission network is not under ICC s jurisdiction. Attaching a generator to transmission lines is conducted according to FERC rules. These are generally larger generators. ICC interconnection rules only govern generators that interconnect with the distribution system. These are generally relatively smaller. 4

5 Why is it important to have detailed rules? Safety, safety, safety: the distribution system is owned and managed by the EDC (Electric Distribution Company). Their workers maintain and repair it. The EDC must know and approve what is installed on the system to protect the safety of workers and customers. When developing the rules, this was always the first consideration. (Islanding means that a generator could keep a portion of the EDC s distribution system energized it.) EDC can require the generator to automatically disconnect from the distribution system, and it can require a witness test to be sure the generator will operate as advertised. As noted above, the system was not designed and built to accommodate generators at multiple points on the system. It is imperative to have detailed rules that balance the EDC s need to protect its workers and the distribution system with generators ability to economically install generators. 5

6 Part 466 Introduction Two issues governed the development of Illinois rule titled Electric interconnection of distributed generation facilities. IEEE developed Standard 1547, which is a uniform standard for interconnection of distributed resources with electric power systems. It provides requirements relevant to the performance, operation, testing, safety considerations, and maintenance of the interconnection. I.e., the machine performs as it s supposed to. Note: Standard 1547 only established standards for machines up to 10 MVA (MW). Part 467 governs interconnection for machines with capacity greater than 10 MVA. The distributed generation facility cannot be subject to federal jurisdiction. Most distributed resources will be renewable (wind and solar). But the rule applies to other types of generators besides renewables. 6

7 Part 466 Structure The other salient feature that affected the rule (and interconnection rules in general) was the difference between the impact that smaller machines have on the distribution system and the impact of bigger machines. In America, household demand is about 2 kw or so. If a household installs 2 kw of photovoltaic cells, that represents a much smaller risk to the system than a several MW windmill or solar cell. 7

8 Part 466 Tiers 1 and 2 Tier 1: the Standard 1547 generation facility capacity is 10 kva or less and is inverter-based (generates DC power that is changed to AC power). Solar cells and some windmills are inverter-based. The EDC does not need to construct any facilities. Tier 2: the Standard 1547 generation facility capacity is 2 MVA or less and the EDC need not construct any facilities. 8

9 Part 466--Tier 3 Tier 3: this tier is for businesses that want to self-generate power to shave peak demands. The distinction for this tier is that the customer must install equipment called reverse power relays to prevent power that it generates from leaking back onto the grid. Also, the EDC cannot need to construct any facilities. The requirements for this tier depend on the design of the system that the customer is on. Load side of an area network: 50 kva or less with reverse power relays and Standard 1547 equipment. Limit on total generation on area network. Radial distribution network: 10 MVA or less with reverse power relays and no shared transformers. 9

10 Tiers 1, 2 and 3 Tiers 1, 2 and 3 receive expedited review. When the installation complies with the rules, then the EDC only conducts a relatively short investigation. And the EDC can be sure that the installation will not interfere with the reliability and safety of its system. If the installation does not pass the screens for Tiers 1 through 3, then it cannot receive expedited review. In that case, we have 10

11 Tier 4 Tier 4 is for installations that have 10 MVA capacity or less and don t need to be compliant with Standard If a customer applies to install a machine under the first three tiers, but it does not pass the screens, then the customer must apply under Tier 4. This might happen because the EDC needs to install facilities to accommodate the installation. Tier 4 does NOT have expedited review, as we shall see. 11

12 Application and review: Tiers 1 and 2 After filing an application under Tier 1 or 2, the project must pass various screens in order to receive interconnection in that tier. The screens are designed to protect the distribution system and prevent harm to other customers. They limit the size of the project relative to the load on the system, depending on the system. If the project passes the screens, the customer can sign an interconnection agreement with the EDC and install the generator. If the project does not pass the screens, then the customer must reapply under Tier 4. Tier 1: 7 business days to indicate whether application is complete 15 business days to determine whether passes screens 30 business days to sign interconnection agreement Tier 2: 10 business days to indicate whether application is complete 20 business days to determine whether passes screens- 30 business days to sign interconnection agreement 12

13 Tier 3 Application and review If the project is non-exporting, i.e., it does not inject power into the distribution system, then it is evaluated according to Tier 2 screens. If it passes the screens, then an interconnection agreement can be signed and the project installed. If it does not pass the screens, then the customer must reapply under Tier 4. Tier 3: 10 business days to indicate whether application is complete 25 business days to determine whether passes screens 30 business days to sign interconnection agreement 13

14 Tier 4 processes Tier 4 applications are the most complicated, because a Tier 4 project requires the EDC to install facilities. In order to determine which facilities need to be constructed, engineering studies need to be conducted. Amongst the steps could be a scoping meeting to agree to what needs to be studied, an interconnection feasibility study, an interconnection impact study and an interconnection facilities study. The result of the these studies is a cost estimate for what the customer needs to pay, upfront, before construction begins. 10 business days to indicate whether application is complete for the studies,10 business days to provide a study agreement, with customer having 15 days to sign it 10 business days to conduct the study 30 business days to sign interconnection agreement 14

15 Queues Interconnection requires EDCs to potentially engage in extensive activities by high-skill employees (i.e., engineers). Applications need to be vetted, screens tested,operational tests witnessed and, in the case of Tier 4, new facilities need to be designed and constructed. EDCs expressed a concern that their resources were insufficient to install the all the capacity that customers applied for in a timely way. Especially if some customers file applications for speculative projects: projects that a customer might want to do, but it might not have financing lined up. A queue is a way to prioritize projects. As projects successfully complete the application, pass the screens and sign the interconnection agreements, they are placed into the queue. The queue is first come, first served. 15

16 Application and interconnection agreement forms The application forms and interconnection agreement forms are attached to the rule. Those forms must be used unless agreed to by the customer. Customers must inform the EDC of the exact make and model of the machine and provide electric diagrams of the generator. The EDC must know who is installing the machine and how. The interconnection agreement forms are an expansive agreement that cover almost any contingency. E.g., it spells out how much insurance the customer must have. 16

17 Miscellaneous provisions EDCs must report activity annually and retain records for three years. Also, EDCs need to retain copies of Tier 4 interconnection studies and provide them to applicants upon request. There is a provision for dispute resolution before the parties enter into a formal proceeding before the ICC. 17