By J. Daniel Skees, Partner, Morgan Lewis; Robert P. Goldfin, Associate, Morgan Lewis
In 2022, FERC began issuing directives aimed at ensuring that the reliability of the bulk-power system is protected from potential risks posed by the growing number of inverter-based resources (IBRs) connected to the electric grid. As we previously reported, FERC issued three orders in December 2022 focused on increasing regulations for IBRs through the North American Electric Reliability Corporation (NERC), an independent electric reliability organization that develops and enforces mandatory reliability standards. In continuance of this goal, this fall, FERC took the step of directing NERC to develop or modify reliability standards specifically to address reliability concerns attributable to IBRs (Order No. 901).
NERC has raised concerns about IBRs for years and found that IBRS were a primary cause for a number of reliability disturbances when a significant number of IBRs tripped offline nearly simultaneously. The reliability risk posed by IBRs is expected to increase as NERC estimates approximately 860 GW of IBRs will be added to the grid over the next decade.
However, despite their increasing frequency on the grid, most IBRs are not currently required to register with NERC and are therefore not obligated to follow the reliability standards. As a result of FERC’s 2022 orders, NERC is currently revising its rules of procedure to require most IBRs to register with NERC by 2026, and through Order No. 901, FERC seeks to close the regulatory gap for IBRs to promote the safe and reliable operation of the bulk-power system.
What are IBRs?
IBRs are solar photovoltaic, wind, fuel cell, and battery storage resources that use power electronic devices to convert direct current power to alternating current power to be transmitted on the bulk-power system.
Unique technical characteristics of IBRs compared to fossil fuel generators pose reliability risks that FERC determined will need further investigation and regulation. For example, because no turbine is involved in an IBR’s conversion process, unlike steam-based traditional generation, the inverters can produce energy at any frequency. Consistency and predictability are required to make IBRs compatible with the bulk-power system, which is maintained within a controlled frequency range.
In addition, synchronous generators like natural gas-fired power plants can “ride through” disturbances on the grid, but IBRs cannot unless they are programmed to do so.
Order No. 901 directs NERC to develop new or modified reliability standards that comprehensively address the reliability risks presented by IBRs. FERC directed NERC to address four specific issues for IBRs: (1) data sharing; (2) model validation; (3) planning and operational studies; and (4) performance requirements.
First, the reliability standards must require that generators, transmission providers, and distribution providers provide data that represents the behavior of both registered and unregistered IBRs individually and in the aggregate to bulk-power system planners and operators. FERC stated this data must be of a sufficient level of detail so that the planners can accurately plan for, operate during, and analyze disturbances on the bulk-power system. FERC directed NERC to (1) include in the new or modified reliability standards technical criteria to require registered IBR generator owners to install disturbance-monitoring equipment at their buses and elements; (2) require registered IBR generator owners to provide disturbance-monitoring data to bulk-power system planners and operators for analyzing disturbances on the Bulk-Power System, and (3) require bulk-power system planners and operators to validate registered IBR models using disturbance monitoring data from installed registered IBR generator owners’ disturbance monitoring equipment.
Second, with respect to model validation, FERC stated that the current reliability standards are inadequate because they do not ensure that bulk-power system planners and operators have accurate models to lead to reliable operation of the system. Therefore, FERC directed that the new reliability standards must require the use of approved industry generic library IBR models that accurately reflect the behavior of IBRs during steady state, short-circuit, and dynamic conditions when developing planning, operations, and interconnection-wide models.
To fulfill this directive, FERC suggested that the reliability standards could reference a NERC-approved component model list that defines the models that may be used, and those models that may not be used, for specific types of studies. FERC also directed NERC to determine through its standards development process which nationwide approved component models are needed to build IBR plant models, although NERC may allow the submission of user-defined models alongside the approved industry generic models.
Third, regarding planning and operational studies, FERC directed that the new reliability standards require planning coordinators and transmission planners to include in their planning assessments the study and evaluation of performance and behavior of registered and unregistered IBRs individually and in the aggregate, as well as IBR-distributed energy resources in the aggregate. The reliability standards must require that planning and operational studies assess the impacts of all IBRs within and across planning and operational boundaries for normal operations and contingency event conditions.
Fourth, FERC directed that the new reliability standards must include performance requirements for IBRs. IBRs must provide frequency and voltage support during frequency and voltage excursions in a manner necessary to contribute toward the overall system needs for essential reliability services.
Further, the reliability standards must establish clear and reliable technical limits and capabilities for registered IBRs to ensure that all registered IBRs are operated in a predictable and reliable manner during normal operations and contingency event conditions. FERC stated that a goal of the reliability standards is to require that the operational aspects of registered IBRs contribute toward meeting the overall system needs for essential reliability services.
Finally, the reliability standards must include post-disturbance ramp rates and phase lock loop synchronization requirements for registered IBRs to allow for a quick and stable return to pre-disturbance output while allowing for technical differences between IBR technologies.
Standards Development Timeline
NERC must file new or revised standards in tranches, with each tranche due no later than November 4 of each of the next three years. NERC must also submit, by January 17, 2024, an informational filing that includes a detailed, comprehensive standards development and implementation plan that explains how NERC will prioritize the development of new or modified reliability standards.
The new or modified IBR-related reliability standards will have broad effects on renewable power generator owners and operators as well as those registered entities that interact with renewable power generation for planning and operational purposes. While some IBRs are large enough that they are already registered entities subject to the NERC reliability standards, which generally capture solar and wind facilities of 75 MVA and above, most IBRs will be registered for the first time in the next few years pursuant to FERC’s 2022 orders. These IBRs will become subject to the reliability standards.
In addition to complying with the existing requirements of the reliability standards, under FERC’s latest directive, IBRs should anticipate IBR-specific requirements that will be rolled out by NERC over the next few years. The result will be increased regulatory costs and complexity for IBRs and enhanced protection of the bulk-power system.
Originally published on morganlewis.com. Republished with permission.
Copyright 2023. Morgan, Lewis & Bockius LLP. All Rights Reserved. This article is provided as a general informational service and it should not be construed as imparting legal advice on any specific matter.