In 2020, the Federal Energy Regulatory Commission (FERC) issued Order 2222 with the intent of opening regional transmission group (RTO)/unbiased system operator (ISO) wholesale markets to aggregations of distributed vitality and demand response assets (DER). Doing so would vastly develop the instruments system operators can use to stability the transmission grid. Order 2222 additionally meant correctly valuing vitality storage and DER, which might incentivize extra techniques to be put in.
We reported in Demand and Response in our Q3 difficulty that the implementation of FERC 2222 shouldn’t be precisely going easily.
“We don’t assume FERC 2222 compliance filings have met the spirit of the 2222 order, nor do we predict they’ve met the letter of it both,” [Chris] Rauscher [with Sunrun] says. “We’ll see what FERC does within the remaining determination however 2222 was meant to open up these markets for DER aggregations of every kind and these filings don’t try this.
A brand new report from Guidehouse Insights supplies a complete evaluation of FERC Order 2222 implementation plans. One huge impediment famous within the report is the flexibility for states to opt-out from demand response wholesale market aggregations, one thing FERC licensed in Order 716.
FERC is contemplating whether or not to rescind this opt-out authority because it turns into increasingly more obvious that it might undermine efforts to create a extra revolutionary bulk energy market.
Guidehouse Insights says stakeholders ought to discover methods to harmonize RTO/ISO compliance plans and scale back regional disparities in distributed vitality assets (DER) deployment and integration, together with adopting standardized wholesale market participation fashions developed by the North American Power Requirements Board (NAESB).
“These implementation gaps current severe challenges for the stakeholders probably to profit from the order’s blurring of the excellence between retail and wholesale markets,” says Christopher Cooper, senior analysis analyst with Guidehouse Insights. “However in addition they reveal some fascinating enterprise fashions and stunning progress alternatives for market gamers ready to outwit the regulatory complexity.”
Evaluation of those filings reveals broad disparities within the scope and velocity these RTOs/ISOs intend to undertake the market reforms Order 2222 directed. Coupled with market incentives preserving distributed technology (DG) in retail energy markets, these disparities might stunt the effectiveness of Order 2222 at integrating distributed vitality assets into wholesale markets, in response to the report.
The report, FERC Order 2222: RTO Compliance Plans Reveal Regional Disparities in Distributed Power Integration, summarizes each RTO/ISO Order 2222 compliance submitting and FERC’s responses, up to now. It analyzes excellent points that might affect how Order 2222 is applied and whether or not the order successfully integrates distributed vitality assets into wholesale energy markets; it additionally assesses the danger and penalties of specific outcomes.
Guidehouse Insights supplies analysis, knowledge, and benchmarking providers for right this moment’s quickly altering and extremely regulated industries. The workforce’s analysis methodology combines supply-side business evaluation, end-user major analysis, and demand evaluation, paired with a deep examination of expertise traits, to supply a complete view of rising resilient infrastructure techniques.
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