On October 3, 2016, FERC clarified that Order No. 827’s reactive power requirements for newly interconnecting non-synchronous generators do not apply to all existing non-synchronous generators making upgrades that require interconnection requests. FERC further clarified that, instead, transmission providers may propose changes to their tariffs to define “newly interconnecting non-synchronous generators” to include repowering an existing generator.
In Order No. 827, FERC required all newly interconnecting non-synchronous generators, including wind generators, to design their facilities to be capable of providing reactive power (see June 20, 2016 edition of the WER). FERC did not apply Order No. 827’s requirements to existing generators making upgrades that require new interconnection requests because, according to FERC, the generators may not be installing equipment capable of providing reactive power, and requiring those generators to make further upgrades to be capable of providing reactive power could impose substantial costs on those generators. FERC reasoned that most upgrades that require new interconnection requests are software upgrades that do not involve fundamental changes to the hardware of the facilities.
In response, the California Independent System Operator Corporation (“CAISO”) requested clarification, or in the alternative, rehearing of Order No. 827, arguing that repowering of an existing generator that requires new inverters and an interconnection study should be considered a “newly interconnecting non-synchronous generator” for purposes of Order No. 827’s reactive power requirements. In particular, CAISO contended that installing new inverters is a more significant upgrade than software upgrades and requires a new interconnection study, and thus should constitute a “newly interconnecting non-synchronous generator.” In support of its argument, CAISO reasoned that by treating the repowering of existing generators as newly interconnecting generators for purposes of Order No. 827, FERC would: (1) promote voltage stability; (2) reduce the likelihood that the System Impact Study would not identify a reactive power need; (3) incentivize repowering generators to install inverters that can provide reliability services; (4) promote more effective and efficient system operations and planning; and (5) treat all projects using modern inverters equally.
In its order, FERC granted in part, and denied in part, CAISO’s request. In doing so, FERC continued to find that Order No. 827 should not apply to all existing non-synchronous generators making upgrades that require new interconnection requests. However, FERC recognized that the repowering of some generators may involve substantial changes to the physical facilities of the generators. Thus, FERC clarified that transmission providers, in their tariff revisions as part of their compliance filing for Order No. 827, are not precluded from defining a “newly interconnecting non-synchronous generator” to include repowering of existing generators. Any tariff revisions necessary to comply with Order No. 827 are due October 14, 2016.
A copy of the order is available here.