FERC Order 842 requires primary frequency response by generators

U.S. energy regulators have issued an order amending standard interconnection agreements to require new generators to install, maintain and operate a functioning governor or equivalent controls capable of primary frequency response as a precondition of interconnection. The Federal Energy Regulatory Commission's Order No. 842 also amended the pro forma interconnection agreements to include certain operating requirements including maximum droop and deadband parameters, and sustained response provisions.

As described by the Commission, reliable operation of an alternating current grid requires maintaining system frequency within predetermined boundaries above and below 60 Hertz. Frequency response describes an interconnected grid’s ability to arrest and stabilize deviations from this predetermined range of frequencies after a sudden loss of generation or load.

Historically, the U.S. grid's primary frequency response capability came from baseload synchronous generators such as coal-fired power plants. But many such plants have retired in recent years, with further retirements expected. In 2016, the Commission noted that shifts in the portfolio of U.S. electric generators meant fewer resources could likely provide primary frequency response, especially if new variable energy resources such as wind and solar did not provide this service. In response, it opened an inquiry into what primary frequency response reforms it should make.

On February 15, 2018, the Commission issued its Order No. 842 revising its regulations to require newly interconnecting large and small generating facilities, both synchronous and non-synchronous, to install, maintain, and operate equipment capable of providing primary frequency response as a condition of interconnection. The final rule also amends the Commission's pro forma interconnection agreements to include certain operating requirements including maximum droop and deadband parameters, and sustained response provisions. It provides exemptions for nuclear power plants and some combined heat-and-power plants.

These requirements will apply to most newly interconnecting generation facilities that execute, or request the unexecuted filing of, an LGIA or SGIA on or after the rule’s effective date, as well as to existing large and small generating facilities that take any action that requires the submission of a new interconnection request that results in the filing of an executed or unexecuted interconnection agreement on or after the effective date.

In a press release, the Commission said its action was intended to address "the increasing impact of the evolving generation resource mix." Commissioner LaFleur made a separate statement in which she noted that while decreases in the nation's portfolio percentage of synchronous generation have contributed to declining frequency response performance, "recent technological advancements have enabled new non-synchronous generating facilities, such as wind and solar, to cost-effectively include primary frequency response capabilities in their facilities." Improved inverters and battery storage are among these innovations.

The Commission has also recently noted the potential of electric storage resources to provide frequency response and other services. Its Order No. 841 is designed to remove barriers to the participation of electric storage resources in wholesale markets operated by regional transmission organization and independent system operators, including markets for frequency response.

Wind, solar lead new generation in Jan. 2016

Wind and solar projects accounted for all new electric power generation placed in service in the U.S. in January 2016, according to a report by federal energy regulators.

The Federal Energy Regulatory Commission's Office of Energy Projects releases a monthly Energy Infrastructure Update.  These reports provide summary data and narrative highlights of energy infrastructure developments in the past month.  Energy Infrastructure Update reports typically cover natural gas, nonfederal hydropower, electric generation, and electric transmission.

The report for January 2016 shows that all tracked electric generation placed in service that month was powered by either wind or solar.  The report notes 5 wind projects placed in service in January 2016, with a total installed capacity of 468 megawatts. These projects are:

• MidAmerican Energy Co.’s 153.4 MW Adams Wind Project in Adams County, Iowa
• Fowler Ridge IV Wind Farm LLC’s 150 MW Amazon Wind Farm Expansion Project in Benton County, Indiana -- developed by Pattern Energy; power generated is sold to Amazon Web Services under long-term contract
• Los Vientos Windpower IV LLC’s 110 MW Los Vientos Windpower Phase 2 Expansion Project in Starr County, Texas -- power generated is sold to Bryan Texas Utilities, Garland Power and Light, and Greenville Electric Utility System under long-term contract
• Milo Wind Project LLC’s 50 MW Milo Wind Project in Roosevelt County, New Mexico -- power generated is sold to Southwestern Public Service Co. under long-term contract
• Patriot Renewables LLC’s 4.5 MW Beaver Ridge Hill Wind Project in Waldo County, Maine

The report also covers 6 solar projects totaling 145 megawatts of installed capacity placed in service.  Notably, it does not include plants with nameplate capacity less than 1 megawatt, so most rooftop and distributed solar projects were excluded from this data set.

The January 2016 infrastructure update also notes that a battery storage project in Ohio has come online.  Willey Battery Utility LLC’s Willey Battery Storage Project in Hamilton County, Ohio is described as providing supply-demand balancing service for the frequency regulation market in the PJM region.  Under FERC Order No. 755, battery storage and other innovative technologies can be compensated for offering frequency regulation to the grid.

FERC Order 755 promotes energy storage

New technologies have the promise to help electric grid operators perform the challenging task of balancing supply and demand at all times.  This means making sure there the exact amount of electricity is being generated across the region as is demanded by consumers at that very moment.  Line losses and the constraints of each local transmission and distribution system add complication.  If the grid gets out of balance, problems arise with the electricity's frequency and power quality.  In the worst case, failure can lead to cascading blackout, and safety can be at issue.

Historically, the balancing act has involved sending coordinated dispatch instructions to generators and demand response resources.  Rules typically guide the grid operator in telling individual generating units to operate at specific levels. For example, flows through hydroelectric turbines can be varied, or fuel can be added to boilers or combustion turbines at a faster or slower rate.  Through careful management, these conventional generation resources have been used to balance supply and demand, providing services known as frequency response and frequency regulation.

Though it is partly automated and well-practiced, this conventional resource dispatch process does take some time to take effect.  Energy storage technologies such as flywheels, and batteries can not only provide frequency regulation, but can engage and ramp up much faster than conventional resources can.  These faster-ramping resources could provide the grid relief in real time, as opposed to ramping up more slowly like conventional generation.

In most US markets, providers of efficient fast-ramping frequency regulation have been compensated the same as when conventional units provide regulation service, even when using fast-ramping resources is more efficient.  At times this has meant that conventional resources have been dispatched when fast-ramping ones would have been lower-cost (and less polluting).  For these reasons, this October the Federal Energy Regulatory Commission found that the current frequency regulation compensation practices "result in rates that are unjust, unreasonable, and unduly discriminatory or preferential."

In Order No. 755, FERC issued a final rule requiring the grid operators in organized markets to compensate frequency regulation resources based on the actual service they provide.  Under Order 755 (123 page PDF), this must include separate payments for capacity (the marginal unit’s opportunity costs of being available) and for your actual performance.

Winners under Order 755 include providers of fast-ramping frequency response.  These could include developers and operators of flywheel energy storage companies like Beacon Power, battery storage facilities, and compressed air energy storage, and other resources still in the conceptual phase.  Winners also include energy consumers in the markets affected by Order 755, who should benefit from lower costs through improved operational and economic efficiency.

August 9, 2010 - new nuclear, flywheel storage, China energy efficiency crackdown

Nuclear power is a hot topic -- specifically the construction of new nuclear plants, something that most countries in the world have been slow to do in recent years.  Now the United Kingdom says it anticipates building its first new nuclear plant in 2018,  most likely on-site at existing nuclear facilities.

Meanwhile, in midcoast Maine, where the spent fuel from the decommissioned Maine Yankee nuclear plant has been stored on-site in Wiscasset, an editorial in the Brunswick Times Record calls for the nuclear waste to be shipped away.  The editorial notes that citizens were told that waste would be removed by 2010 -- and with Yucca Mountain no longer viable as a storage site, area residents see no prospect of the waste being taken away as promised.

Just as oil and natural gas tank storage capacity can be used to smooth out swings in the availability and market price of fuel, energy storage can play a major role in ensuring power service while dampening price swings.  Frequency regulation -- keeping the alternating current at 60 Hz, which essentially requires smoothing out the gap between supply and demand on an instantaneous basis -- is an important service that all electric grids need.  As more and more intermittent generation resources come online, like wind, grids need more and more frequency regulation.  Massive mechanical flywheels can provide this service. In today's news, Beacon Power Corporation has closed on a $43 million DOE-backstopped loan, completing the financing for the 20 MW flywheel energy storage plant Beacon is building in Stephentown, New York.  The plant, which is under construction and on budget, is projected to cost $69 million, about 80% of which represents direct facility costs.  The Federal Financing Bank, part of the U.S. Treasury, provided the $43 million loan. NYSERDA provided a $2 million grant, with Beacon putting up the remaining $26 million in cash, in-kind assets, and project costs.  Beacon is also planning two more 20 MW flywheel projects: one in Glenville, NY, and one in the PJM Interconnection.

Supporting renewable and energy efficiency projects through grant funding programs is one way to improve a state's energy efficiency and emissions.  In China, the world's largest energy consumer, the government is taking a different approach: ordering 2,087 industrial manufacturers rated as having low energy efficiency to close.  Affected facilities, which produce steel, concrete, paper, coke, and forest products, will lose their emissions licenses next month.  Just to be sure, the government will order utilities and banks to cease dealings with the sanctioned businesses.  The government's stated motivations include slippage on its five-year plan energy efficiency plan, as China's economic recovery and booming construction industry drive energy consumption up.

Maine is moving forward with PACE financing -- but municipalities need to take a bit of action to open the door to residential energy efficiency in their communities.

Two quick links to Lewiston Sun Journal pieces about wind.  First, a story by Naomi Schalit critical of the results of Governor Baldacci's pro-wind efforts.  Second, a letter from my friend and Leadership Maine classmate Paul Williamson providing a counterpoint to last month's Jonathan Carter column critical of Maine mountaintop wind.  More to follow on these stories soon.