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DGIC Interconnection Insights

The Distributed Generation Integration Collaborative (DGIC) Insights provide answers to questions posed by DGIC participants, deliver timely updates on pressing interconnection issues, and disseminates analysis findings to inform decision making and planning.

Interconnection Performance Reporting: Massachusetts Leads the Way (for Now)

March 2015 by Emerson Reiter and Kristen Ardani

Distributed Generation Growth and the Importance of Interconnection

Distributed generation (DG) systems are being connected to the U.S. electrical grid at an unprecedented rate. Much of this activity is occurring in the solar sector; GTM Research reports that 49,000 distributed solar installations were completed in Q3 2014 alone, bringing the total number of installations to 577,000 nationwide.1 The most active state in the country in Q3 2014, California, saw an average of 75 new systems interconnected to the grid each day.

A grid connection can help realize the full economic value of a DG system, especially in utility service territories where net energy metering policies are in place, as these programs allow customers to receive bill credits for excess generation exported to the grid. In the absence of storage, a grid connection is also vital for the provision of back-up power when on-site DG is not operating. Despite the importance of this physical link, the process by which it is requested, reviewed, and authorized is one of the least-discussed aspects of distributed generation value and cost. Because every single grid-tied DG system must complete this process before operation, reducing the cost and duration of the interconnection process can have substantial benefits on the deployment of distributed generation nationwide.

Interconnection Standards and Process Timelines

In order to streamline this process across multiple utility territories, many states have implemented interconnection standards. According to the Database of State Incentives for Renewables and Efficiency (DSIRE), 44 states have implemented some version of interconnection standards to date. These standards cover a wide range of topics, including access requirements for utilities, disconnect switches, equipment certifications and standards, and reporting requirements. The standards also outline the various steps which a DG system must complete before it can be authorized to operate by the local utility.

These steps may vary slightly from state to state, but most standards are modeled after the Federal Energy Regulatory Commission's (FERC) Small Generator Interconnection Procedure (SGIP) and include the following major phases:

  • Application development and submission — the party requesting permission to interconnect a DG system to the grid completes an interconnection application and submits it to the local utility
  • Application review — Once the utility receives the interconnection application, utility administrators review it for completeness and evaluate the potential for adverse effects on the electrical grid from the new DG system
  • Construction* — the installation company constructs the DG system
  • Inspection — in many jurisdictions, a building or electrical inspection by a local authority is required before the system can be energized
  • Permission to operate (PTO) — once the utility has received notice of the completed local inspection, it will grant the DG system operator a final notice of permission to operate.

*This step is typically not regulated by interconnection standards, but is included here to illustrate a complete installation sequence. In addition, some jurisdictions allow construction prior to approval by permitting small systems to submit their application and AHJ inspection together prior to PTO. This can streamline the process but means the installer is at risk if the installed system triggers detailed studies or costly system upgrades.

In some states, the interconnection standards specify required timelines for each phase of the process listed above. The time required to complete each step may vary across states and by the size of the system being interconnected. For example, the regulated timelines for application completeness and initial screen review in several states are shown below:

State Timeframe Requirements for Application Review and Approval with Freeing the Grid Score
State Freeing the Grid Timeframe Requirement Score (out of 5) System Size Eligibility Days for Completeness Review Days for Application Review (initial Screens) Total Days for Application Review and Aproval
CA 4 Up tp 2 MW 10 15 25
NY 3 Up to 50 kW 5 10 15
Up to 2 MW 5 15 20
NJ 3 Up to 10 kW 3 10 13
Up to 2 MW 3 15 18
CO 4 Up to 10 kW 10 15 25
Up to 2 MW 10 15 30
AZ N/A. As of the writing of this report, Arizona has no standard timeframe requirements in place.

Source: Ardani et al (, pg 10)

Interconnection Process Performance Reporting: Importance and Current Status in Leading States

Despite the clear definition of these timelines in many states, they are often not being met. According to a recently published NREL report, it shows that a large percentage of interconnection requests are exceeding the regulated timelines for application review and permission to operate. One potential reason for such delays is that interconnection application processing is not being publicly tracked and reported. Without clear and open interconnection process performance reporting, there is no way to assess utility and PV developer timelines and actions.

Standardized, public reporting on interconnection timeline performance can provide a wide array of benefits to many parties. Solar developers may seem the most obvious beneficiaries, as such reporting would allow them to adjust their operations or seek out new markets depending on a local utility's application processing speed. However, customers, regulators, and utilities themselves could see multiple benefits from public interconnection performance reporting as well. For instance, utilities would be able to transparently identify and track sources of delay, distinguishing between customer-and utility-related delays.

Despite these many potential benefits, only four states — Massachusetts, New York, Hawaii and California — have implemented public reporting requirements for interconnection process timelines and performance. A high-level comparison of these requirements revealed wide variation in terms of the data reported, frequency of publication, and ease of retrieval. In this comparison, Massachusetts' interconnection process reporting stands out as the clear leader, because it:

  • Features the most thorough breakdown of the interconnection process, tracking the time required for each application to complete each stage
  • Provides highly granular locational data down to the distribution circuit level, increasing its usefulness to all parties
  • Requires monthly updates and releases data to the public via a standardized downloadable spreadsheet on the Massachusetts Department of Energy Resources (DOER) website.

A New Breed of Interconnection Reporting: Hawaii's Integrated Interconnection Queue

On January 30, 2015, Hawaiian Electric Company, Maui Electric Company, and Hawaii Electric Light Company each launched their own web-based Integrated Interconnection Queue (IIQ) as part of an October 2014 proposal to address the backlog of DG applications awaiting interconnection. The queues show applications from all distributed generation programs, such as net energy metering and feed-in tariff, and include information such as system size, circuit name, review status and date of application receipt. While the California investor-owned utilities have been publishing queue information for distribution-connected wholesale facilities for years, the Hawaii IIQs mark the first public interconnection queues which encompass all classes of DG installations.

Though the IIQs provide clear improvements in transparency, they are primarily forward-looking; project records are eliminated from the publically available report on a monthly basis as projects are completed or withdrawn. By contrast, the other state reports track all applications received, completed, and withdrawn, thus enabling project tracking over time. This type of data reporting is particularly useful for tracking DG penetration levels and trends in utility and customer actions. The lack of data for completed projects does not negate the value of Hawaii's IIQs, but simply reflects a difference in purpose: the Hawaiian utilities developed their IIQs to communicate the order of applications to customers and allow them to track their queue position on their circuit; Massachusetts developed its interconnection data reporting requirements in the context of a "service quality metric" on which it could evaluate utility performance. As more states develop and adopt interconnection data reporting requirements, they have the opportunity to adopt the best features from each type of report.

1U.S. Solar Market Insight Report, Q3 2014; GTM Research; page 47.