September 20, 2021
ESA Provides Recommendations to FERC on Improving Hybrid Resource Interconnection & Market Participation
ESA submitted recommendations jointly with ACP, SEIA, and AEE (“the Hybrid Resource Coalition”) in response to FERC staff’s Hybrid Resource White Paper and the reports submitted by the RTOs/ISOs on how hybrid resources are operating in their markets. In our comments, we make recommendations on terminology, interconnection, market participation, and capacity accreditation for co-located hybrid (broadly defined in our comments as two or more resource ID resources sharing a single POI) and integrated hybrid resources (broadly defined as single market ID resources sharing a single POI).
- On terminology, the Coalition recommends that RTOs and ISOs adopt standard terminology that involves using a standard set of criteria for the definition of each type of resource (e.g., single point of interconnection, technology types, number of resource IDs required, etc.).
- On interconnection, the Coalition recommends that RTOs and ISOs establish clear interconnection procedures for new hybrid resources; stand-alone renewable projects that have completed the interconnection process and later seek to add a storage component; and stand-alone projects in the queue that seek to modify their interconnection requests to add a storage component. We also note that that a full re-study not be required in cases where adding storage to an existing or queued project does not change the electrical properties at the POI.
- On market participation, the Coalition recommends that hybrid resources should be able to offer and be compensated for all capacity, energy, and ancillary services they can provide. Additionally, market power mitigation rules should be transparent and predictable for all resources, and they must be updated to accurately reflect the opportunity costs of hybrids.
- On capacity accreditation, the Coalition recommends that RTOs and ISOs employ a “sum-of-parts” approach as a minimum value for capacity accreditation of integrated hybrid resources, but to also consider moving to more sophisticated approaches such as an ELCC methodology, which can capture interactive effects among resource components and result in more accurately calculations of these resources’ contributions to system resource adequacy.
Lastly, we note that while many RTOs and ISOs have positive initiatives underway to further integrate these resources, greater consistency on treatment of these resources requires clear direction from FERC in the form of a Commission rulemaking on integrated hybrid and co-located hybrid resources to standardize their terminology and treatment, and provide a clear timetable for needed changes to interconnection, market participation, and capacity valuation.