Primer: Impact of FERC Order 845 on Energy Storage

As ISO/RTOs start to get ready to submit initial Order 845 compliance filings at FERC, more questions are coming up about the order, and how it impacts energy storage. Here’s a quick primer.

The primary intent of Order 845, Reform of Generator Interconnection Procedures and Agreements, is to improve the interconnection process for generators over 20 MW by removing uncertainty, promoting more informed interconnection decisions and greater transparency, improving the interconnection process, and modifying the pro forma Large Generation Interconnection Procedures (LGIP) and Large Generation Interconnection Agreement (LGIA). Embedded in the Order are concepts and clarifications that impact energy storage.

·      The definition of Generating Facility was amended to include energy storage.[1]

·      While it isn’t specific to energy storage, facilities can now request interconnection service below the generation facility nameplate capacity (or the aggregate capacity), as long as control system and penalties are in place to ensure the facilities do not inject above requested level. 

·      Enables generation owners to add energy storage to an existing generation facility. If a generation owner has “surplus interconnection”[2] it can request a fast-track interconnection process to utilize the surplus, by adding storage for example, or transfer that surplus to an affiliate. However, the Order falls short of the NOPR, and FERC did not include a concept which they advanced in the NOPR which would have allowed non-affiliated parties to buy and sell surplus interconnection.  

FERC declined to act on a number of requests related to energy storage, specifically:

·      The Commission declined to set standards for modeling energy storage in the interconnection process, either stand alone or co-located, at this time. Therefore, it remains up to each ISO to model energy storage as deemed appropriate.

·      The Commission determined the definition of generation does not need to be amended to specify that an asset can withdraw energy from the grid, as requested by NYISO.

·      The Commission declined to clarify that energy storage being used as a transmission asset does not need to go through the LGIP and execute an LGIA as requested by a few stakeholders. FERC based their decision on the fact that changes made in this order will not affect whether energy storage operates as transmission.  

·      The Commission declined to extend the Order to make similar changes to the Small Generator Interconnection Process (SGIP), citing the processes are significantly different.


[1] New definition: Generating Facility shall mean Interconnection Customer’s device for the production and/or storage for later injection of electricity identified in the Interconnection Request, but shall not include the interconnection customer’s Interconnection Facilities.

[2] Surplus interconnection is the unused portion of interconnection amount requested and reflected in the interconnection service agreement