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October 22, 2024


Contributed by Sid Sung, Bitech Technologies Chief Innovation Officer

The power grid interconnections related to renewable energy can be divided into two primary categories: Transmission Interconnection (TI) and Distributed Energy Resources Interconnection (DERI). This blog from Bitech Technologies will focus on the DERI category.

In today’s market, the deployment of Distributed Energy Resources, particularly distributed photovoltaics (DPV), has experienced substantial growth in recent years and is expected to keep rising in the future. This increase has been especially notable in specific systems.

DER Market overview

Distributed energy resources (DER) are increasingly recognized as a pivotal component of modern energy infrastructures in the 21st century. According to a recent forecast by Wood Mackenzie Power & Renewable, it is anticipated that investments in DER within the United States will surpass $110 billion from 2020 to 2025. This substantial financial influx is expected to drive total DER capacity to an impressive 387 gigawatts by the middle of this decade. Key factors fueling this growth include the rise of solar installations, which harness renewable energy directly from sunlight, and the expansion of electric vehicle infrastructure, which supports the electrification of transportation. As these technologies continue to evolve and proliferate, they not only promise enhanced energy security and resilience but also contribute significantly to reducing greenhouse gas emissions, positioning DER as a cornerstone for sustainable energy solutions moving forward.

Although incorporating non-emitting distributed energy resources (DER) can assist utilities in reaching ambitious decarbonization targets, it may also escalate grid congestion and create additional challenges for grid reliability, including the necessity for costly infrastructure enhancements.

What is DER Interconnection? The interconnection of Distributed Energy Resources (DER) to the grid involves processes that can be optimized to facilitate quicker and more cost-effective integration of DER into grid operations and planning, all while ensuring reliability and maintaining power quality.

Typical DER interconnections encompass various considerations, practices, and emerging solutions across a wide range of related topics. This focus is particularly relevant for investor-owned utilities (IOUs), municipal utilities (Munis), and cooperatives (Co-ops). This blog will concentrate on the deployment of DER Interconnection in IOUs and Munis.

As the deployment of distributed energy resources (DER) expands, it becomes essential for utilities and regulators to grasp the intricacies involved in interconnecting these assets to their systems. They must also explore various solutions that align with the levels of DER penetration, unique system characteristics, operational capabilities, and organizational frameworks.

While some aspects of interconnection have well-established standards, many remain in an early stage with no universally accepted best practices. Moreover, the most appropriate approach for any specific situation will differ based on the degree of DER penetration.

DERs encompass resources linked to the distribution network near the load, including distributed photovoltaic (DPV), wind power, combined heat and power systems, microgrids, energy storage solutions, microturbines, and diesel generators. Energy efficiency initiatives, demand response programs, and electric vehicles are also frequently regarded as DERs.

These resources may be deployed individually, co-located, or aggregated and in some cases jointly controlled. These resources can either reduce Demand (such as energy efficiency) or provide supply to satisfy the energy, capacity, or ancillary services need for the distribution grid.

DPV, wind and Energy storage may be behind-the-meter (BTM) or in front-of-the-meter (FTM) and utility, customer and third-party owned. Although very little BTM wind and energy storage capacity is installed today.

Some states, liked Hawaii, have been dominated by deployment of small residential and commercial rooftop DPV systems (typically maximum of 200 kW in size), others like North Carolina have been larger, ground-mounted DPV systems ranging in size from several hundred kw to several MW that are not primarily sited to serve a given load or co-located with a load.

DER Interconnection Process

The following summarized the typical interconnection process for DERs.

  1. Interconnection Application (IA) is submitted to IOUs or Munis

  2. Fast-track Screens for Technical screens and studies:

    If the project is below a specified size threshold, the utility then conducts a series of technical screens to evaluate the potential impact of the PV on its system.

    The number and type of screens a given project undergoes depend on the characteristics of the project.

  3. Supplemental Review Screens:

    If any negative system impacts - for example on voltage, power quality, or protection—are identified during the screening process, strategies for mitigating those impacts are identified by the utility.

    Other emerging DER Interconnection screen focus including Flexible Inter-connection (FI), Hosting Capacity Analysis (HCA), forecasting DER deployments. These topics are not quite put into every IOU or Munis DER interconnection processes yet, but start to review and discussed between IOU, Munis and DoE.

  4. Model & Mitigation:

    There is a variety of options for mitigating these impacts, including, but not limited to, downsizing the PV system, using advanced inverter functions (for inverter-based DERs), or upgrading the distribution network.

    Different distribution system upgrades with advanced inverters are one of the possible scenarios need to deploy. The “traditional cost-allocation approaches” can be problematic and can be replaced by “emerging cost-allocation” schemes.

    Once all the studies are completed and approved then submit Model for final review.

Transmission vs DER Interconnection

The processing concepts in Transmission Interconnection (TI) and Distributed Energy Resource Interconnection (DERI) share similarities. The studies conducted for TI correspond to the screens utilized in DERI. However, the TI analysis is considerably more complex, as it encompasses transmission networks that may involve both deployment ISOs and interconnected ISOs. Factors such as capacity, safety, and other considerations make TI more intricate than DERI interconnections. Additionally, the scale of interconnections in TI is significantly larger than that in DERI, often involving larger transformers and breakers compared to those used in DER interconnections.

The impact of the TI study may extend across both ISO and IOU/Munis, although DERI evaluations are primarily confined to individual IOU/Munis, which allows for a more expedited processing time. Given the current structure of the North American Region (NAR) power network, the TI market presents a significantly larger opportunity than DERI. For Municipalities, if key readiness factors are established, there will be a shift towards next-generation hybrid power infrastructures. This transition will not only enhance profitability for municipal power providers but also empower municipal governments to implement various practical Smart City infrastructures. Bitech Technologies plans to introduce a Smart Power application tailored for Smart Cities in the near future.

Moving forward, once the regulatory framework and technology costs for deployment are established, the DERI will be implemented more extensively in regions significantly affected by extreme weather, such as Florida and Texas.

The Department of Energy (DoE) is currently working on both TI and DERI processes. As these efforts reach maturity, it’s anticipated that the two processes—which share about 85% of their methodologies—may converge into a unified standard. The subsequent diagrams illustrate the transition of the DERI processes for Investor-Owned Utilities (IOUs) and Municipalities (Munis) from 2019 to 2024.

2019-04 Typical utility interconnection process; systems above a certain size may skip the Fast Track Screening Process and go straight to more detailed impact studies
2024-08-14 DoE i2X DER Interconnection Process

Market Major Efforts for the DER Interconnection

These DERI major efforts in the industry include a) Flexible interconnection (FI), b) Hosting Capacity Analysis (HCA), c) Thermal Impacts on service transformers, d) other topics are gathering by DoE & participated IOUs & Munis. This blog will focus on Flexible interconnection (FI) and other DERI focuses will review in future Bitech Technologies’ blogs.

Flexible Interconnection (FI)

What is FI? FI utilizes existing physical infrastructure to expand grid capacity for interconnection by sizing capacity to maximum possible generation parameters of interconnecting project plus a buffer margin.

Historically, DERI use FI agreements between DER owners and utilities. These require the grid always to absorb the total DER output exported, regardless of grid conditions. The downside to this approach is that as DER penetrations rise, their output could exceed a feeder’s hosting capacity, potentially leading to adverse grid impacts such as poor power quality, voltage fluctuations, and thermal overloads.

As a result, distribution grid operators conservatively consider DER interconnection requests by assuming worst-case grid conditions. The number of interconnections may be limited (or grid upgrades may be requested) to stay well below hosting capacity thresholds; this is sometimes referred to as maintaining ample headroom. While this approach supports grid reliability, it can also reduce the amount of DER connected to the grid, which can lower customer satisfaction and slow progress toward renewable energy targets.

FI is a good strategy for connecting DERs to the grid that allows for real-time control of DERs. It's an alternative to fixed capacity agreements, which require the grid to absorb the total DER output regardless of grid conditions. FI offers diverse options and innovative approaches for integrating DER into the grid. By enhancing the controllability of DER, it helps lower the cost of interconnection without requiring major infrastructure upgrades.

This FI approach also shortens construction timelines, making the integration process more efficient. With FI, DER systems can dynamically adjust their output in response to real-time grid conditions, including controlling or limiting generation when necessary. This not only benefits DER operators by reducing upfront infrastructure costs but also supports the grid by enabling more distributed and renewable energy to connect seamlessly. Ultimately, FI promotes a more resilient, sustainable energy system by facilitating the growth of renewable generation.

FI Program Consideration

To conduct a comprehensive examination and analysis of screens and studies, it is essential to consider contracting and long-term operations. The following outline summarizes the efforts of Xcel and ComEd in relation to the FI Program:

  • GOAL: Deliver considerations and best practices for an end-to-end FIX process framed by stages, such as; analysis, application, contracting, and long-term operations.

    Project is set to complete by early summer 2024

    Technical studies and long-term planning elements are secondary, stretch topics, but are being discussed.

  • CONTEXT: Xcel and ComEd are in different stages of piloting a FI program that aims to open up capacity for renewables within constrained locations on the grid.

    ComEd pilot is not public but is showing promising results for future publication.

    Xcel has requested a focus on community solar projects waiting for upgrades to be completed, but our results will also be useful for long-term endeavors that may help avoid upgrades.

  • TOOLS EMPLOYED: DoE Pacific Northwest National Laboratory (PNNL) is using flow charts and decision trees to map process steps and dependencies, while also moderating technical side discussions.

  • MITIGATING FACTORS by PNNL, Xcel and ComEd are

    focused on upfront details and analysis shared between utilities and applicants that could help a FIX program operate efficiency.

    also thinking about how to communicate FIX programs in order to achieve trust and participation.

  • LESSONS LEARNED: With only a few pilots in the U.S. most of our understanding is coming from the U.K.

    FI program limits have been set around 5-10% in the UK but actual curtailment has been much less. Communicating this is the hard part.

    Determining the exact parameters and rules to guide such a program requires direction from a regulator.

The following diagram outlines the Firm Capacity, FI and upgrade approached for DER Interconnection; it provides a great overview of the three approaches for DERI. In the real world, it makes sense for IOUs and Munis to deploy with the combination and depends on the capacitor and overall factors review.

DoE has outlined the following summary collected from IOUs and Munis, for near and long terms challenges for FI. Here are the summary of the challenges and long term implementation consideration for the FI.

Near-Term Challenges to Implementing FI

  • Process

    FI is an evolving strategy and continues to mature

    Complexity to develop new and repeatable process for how to study, implement, and operate it

    Timeline vs. Risk: Making timely progress while balancing technical risks

  • Technical

    Identify the constraints that can be addressed by FI and which FI solution/ technology

    Understand the extent that FI can address multiple DERs and multiple system constraints

    Identify conditions where FI could contribute to reaching another hosting capacity limit

  • Experience

    Understand how to create positive customer and utility experience to participate in FI

    Define the long-term requirements and financial impacts to all customers

    Maintaining fairness for all customers and DER owners

Long Term Considerations to Implementing FI

  • Developing a sustainable, scalable, and robust FI solution that works for customers and the utilities

  • Integrating with other grid systems, like Distribution Management Systems, Advanced Metering Infrastructure, and Distributed Energy Resources Management System

  • Avoid isolated deployments and stranded costs

  • Ensure reliability and safety is maintained at all times

From the above summary, it is evident that while the trend of flexible interconnections (FI) is progressing, there remains significant ground to cover. The growing deployment of distributed energy resources (DER) coupled with the challenges posed by extreme weather events underscores the importance of integrating FI into DER systems. This integration holds promise as a pivotal strategy for enhancing power reliability and expediting recovery during shortages.

In this context, a deeper exploration of how FI can facilitate DER interconnection will be elaborated upon in Bitech Technologies' upcoming blog entries. Readers can look forward to more insights in this third episode of our interconnection series, where we will delve into innovative approaches and best practices associated with this crucial topic.

Access on: 2024-11-09 12:30:14 (New York)