SOM - State of Michigan



Interconnection RulesInitial Reply Comments: Sections 2, 3, 4May 1, 2019The Michigan Energy Innovation Business Council (Michigan EIBC) appreciates the opportunity to submit initial reply comments to those submitted by other parties on Sections 1-1.4, 2, 3, and 4 of the MN DIP. These initial comments to not necessarily represent the totality of Michigan EIBC’s positions on these issues. In addition to the reply comments, in a separate document please find initial comments on Sections 1.5-1.8.Sections 1-1.4:Section 1.1.1As noted in Michigan EIBC’s original comments, if there is a simplified process included in Michigan’s interconnection rules, we agree with Vote Solar and ELPC that the process should include projects up to at least 50 kW and not be limited only to 20 kW projects.Section 1.1.2In some aspects of the interconnection studies, it is not necessary to use full aggregate nameplate rating. For example, as described by Cypress Creek Renewables, “certain aspects of the facility output (i.e. short circuit) may need to be studied based on the full aggregate nameplate output of the facility. However, the output power under normal operating conditions should be allowed to be specified by the interconnection customer, provided that an adequate method of limiting power output is provided. For customers that provide a recloser or circuit breaker at the POI, the output power limit can be enforced in that device. It is common industry practice to allow power-limiting in the software controls of an individual inverter as well.” Michigan EIBC encourages the Commission to consider these operational differences when revising the definitions section of the interconnection rules. If the proper “fail safe” features are included, a developer should have the ability to over install. This is often important for energy storage. For example, if a 5 MW battery is going to be interconnected, but it is only going to charge at 2 MW, it should not be studied for interconnection at 5 MW. It is important to balance accurate operating conditions with the need to protect grid operations.It is also important to consider in the category size restrictions and definitions whether the measurements utilize AC or DC power. The National Electrical Code (NEC) defines a generator’s output as the maximum potential?AC output of the generator.?To define maximum output using DC output instead would mean that the output will depend strongly on the configuration of the DER system. For example, rooftop solar panels on east and west facing roofs would generate significantly less actual energy than what southern facing panels would generate if the size limitations are based on DC output. Section 1.4: Pre-application reportsPre-application reports are essential to Michigan’s revised interconnection rules. FERC Orders 792 (2013) and 792-A (2014) included a process to allow customers to request pre-application reports and several Midwest states have recently added pre-application processes to their updated interconnection rules (including Ohio, Iowa, Illinois, and Minnesota).It is critical that these pre-application reports include sufficient information and granularity to allow interconnection customers to determine whether or not to submit a full application. Without pre-application reports, potential interconnection customers do not always have complete, current knowledge about the state of the grid in areas where they would like to interconnect. This means that potential customers often invest time and money investigating opportunities to interconnect in areas that are not ultimately economical. Consumers and DTE argue in their comments that $300 may not be the appropriate cost for a pre-application report and that these reports will increase personnel and administrative costs. It is critical to interconnection customers that the fee for pre-application reports is reasonable and consistent. It defeats the purpose of a low-cost, limited-information report prior to a more in-depth application if the pre-application costs are not clearly defined and an established, reasonable amount. It is also important to recognize that a significant portion of the current projects in the interconnection queues may be speculative in nature given that developers do not have sufficient information to determine which locations will be viable points of interconnection. This information could be easily gained through a pre-application report, avoiding the need for those projects to enter the full interconnection queue, and thereby saving significant time and cost (to both developers and utilities).It is important, additionally, that the pre-application process is distinct from the interconnection queue. A developer should submit only limited, basic information to request a pre-application – these pre-applications are most valuable for projects that have not undergone significant development and are helpful to determine which projects are viable for further investment. As indicated by Cypress Creek, “there should be no deadline to act on pre-application data. The official queue spot should be assigned when the project is submitted by an interconnection customer and the interconnection timelines should dictate how applications are progressed.”Consumers and DTE also argue in their comments that many of the items included in the Minnesota pre-application reports are not currently easily available for the utilities to provide to potential interconnection customers. If the pre-application reports were to only include the information proposed by DTE Energy, the reports would not be granular enough or contain enough information for customers/developers to determine whether or not a proposed point of interconnection is viable. Similar elements to those listed in the MN DIP are required in pre-application reports for other Midwest states. Unless there are specific items that cannot be included because of a unique situation in Michigan, Michigan’s pre-application reports should include the same items as those in the MN DIP. At a minimum, all information that is currently available should be shared with developers and the utilities should be required to continue to update their database through studies to make more information available over time. Hosting capacity analysesMichigan EIBC suggests that creation of dynamic, publicly available hosting capacity maps would greatly assist with the pre-application process and would likely decrease the number of pre-application reports and/or speculative interconnection applications. The Commission could begin this process with an RFI to companies who have the capability to work with utilities to create these maps. Several regulated utilities across the country including those in New York and Illinois have created these maps recently within a relatively short time period (e.g., 12 – 24 months). Section 3:Fast Track ProcessIn general, Consumers and DTE argue that projects above 550 kW and 25kV or above 150 kW, respectively, should not qualify for a fast track screening process and must always undergo a full engineering and distribution study process. The utilities argue that the process established in Minnesota does not apply to the conditions in Michigan. However, FERC Orders 792 (from 2013) and 792-A (from 2014) established a fast track process based on technical screening criteria for projects up to 4 MW that should be applicable across the country. It does not follow that FERC and the other midwestern states who have all recently adopted a similar fast track process to that contained in the MN DIP have established procedures that would not work in Michigan. FERC issued Orders 792 and 792-A, which served as revisions to Order 2006, expanded and revised the technical screening process adopted in Order 2006. Specifically, Orders 792 and 792-A changed the fast track process to include differentiation by voltage and interconnection location and increased the maximum project size for the fast track process to 4 MW. This technical screening process creates an efficient, expedited, and yet technically sound, method to process applications without subjecting projects that do not significantly impact the grid to unnecessary review. Especially with increased demand for interconnection, it is critical to institute policies that avoid costly, time consuming reviews for projects that do not require such reviews.Sections 3.2.4 and 3.4.7 (clause as added by Consumers Energy)The addition of the proposed clause would largely defeat the purposes of the fast track technical screening process. The purpose of that process is to determine if a DER may be interconnected safely and reliably without further study and the fast track screens in the MN DIP are the same as those determined by FERC. If a DER passes all of the screens, the utility should be able to determine that the DER may be interconnected safely and reliably. If there are specific concerns with certain screens, those should be discussed and improved. However, it is unreasonable to allow the utility to determine, at their own discretion, to disregard the fast track screens and require a DER that passes all of the screens to enter the full study process.Section 3.4:It is important that the costs for each step of the interconnection process are predictable and aligned with original estimates. Michigan EIBC agrees with Cypress Creek Renewables that if there are unexpected cost overruns (e.g., above 120% of the original estimate) for the supplemental review process, the interconnection applicant must be contacted for approval. It is unreasonable to expect a customer to pay costs far beyond the original estimate without additional approval. In addition, because it is often difficult for developers to anticipate changes in cost, Michigan EIBC encourages the Commission to consider requiring regular reporting of updated cost estimates by the utility to customers (e.g., monthly reports). Finally, it would not be unreasonable for the Commission to establish a maximum cost for each type of required study.Section 4:Batched process:Consumers Energy proposed a batch study process for projects that require full studies at the same time. Studies would be batched together based on application time (not based on location). During the March 19, 2019 meeting, a representative from Consumers Energy stated that this process would not save time in the review process. According to the presentation from Consumers Energy, it appears that they are not proposing timelines for the milestones that need to be met during the batch study process. This is concerning, especially for applicants who apply near the start of a batch and then have to wait longer in the queue before their project is studied.It does seem that the utility intends to use the “interconnection commitment” requirement to ensure that all of the studied projects actually move forward and are, thereby, included in the subsequent study. However, if the applications are processed sequentially, it is also likely that this inclusion would occur. The utility states that there would be cost sharing among applicants, but it is important that those savings be described in detail. For example, it is important to understand whether only projects located in proximity to each other would achieve cost savings.Michigan EIBC is open to considering this process in more detail if there are clearly defined benefits to applicants, but there is additional clarity needed around both how the process would work and how the benefits would accrue.Section 4.2:Michigan EIBC disagrees with Consumers Energy that the scoping meeting should not be mandatory and should not be completed within a certain timeline. Such a meeting will allow mutual agreement and understanding of the necessary study and will allow the applicant to better understand and assess the best estimate of costs.Sections 4.3 and 4.4.2:In a similar manner to the above argument, Michigan EIBC agrees with Cypress Creek Renewables that if the costs for the system impact study or facilities study are unexpectedly higher than the non-binding good faith estimate, the interconnection applicant must be contacted for approval.Affected System Impact Studies:Sections 4.3.6, 4.3.7 and 4.3.8 and 5.13 deal with Affected System Impact studies in case there are Transmission System adverse system impacts. This was discussed during one of the stakeholder meetings and it appears that the process in Michigan is distinct from the process in Minnesota. It will be important for the Commission to clarify these sections to ensure that the process followed in Michigan is clear, transparent, and established. Section 4.5 (as added by DTE Energy):Michigan EIBC disagrees with the suggestion by DTE Energy that the timelines in the interconnection rules should be waived if the number of applications exceeds the amount expected by the utility in a given calendar year. It is likely that such a process would result in an exceedance of the expected number of applications every year. If the interconnection rules create a functional pre-application process and fast track process, there should be many fewer projects needing to undergo a complete study. This will save significant time and money for the utility and for applicants, mitigating the long interconnection queue and the need to waive timelines in the rules. ................
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