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Maine PUC Amends Small Generator Interconnection Procedures Rules (Chapter 324)

On November 3, 2023, the Maine Public Utilities Commission (the “Commission”) issued an Order adopting amendments to its Small Generator Interconnection Procedures Rule (Chapter 324).

Background. Chapter 324 was last amended on December 21, 2021. See Maine Public Utilities Commission, Amendments to Small Generator Interconnection Procedures Rules (Chapter 324), Docket No. 2021-00167 Order (Dec. 21, 2021). In 2022, the Legislature enacted LD 1100, An Act to Support the Continued Access to Solar Energy and Battery Storage by Maine Homes and Businesses. P.L. 2021 Ch. 264. Among other things, LD 1100 required that the Commission contract with an expert to evaluate Maine’s interconnection procedures and practices to ensure: (1) neither the timelines nor other requirements unduly limit the ability of residential and non-residential customers to install on-site solar facilities or battery storage systems to offset a customer’s electrical consumption; (2) transparency of interconnection screens and upgrades required for customer-sited generation; (3) the dispute resolution processes for residential and nonresidential interconnection customers are fair and efficient and do not place a disproportionate burden of technical expertise and cost on these customers; (4) cost allocation methods for interconnection studies and upgrades for on-site solar energy generators are not prohibitive; and (5) reflect nationally-recognized best practices.

Pursuant to LD 1100, in February 2022, the Commission engaged the Interstate Renewable Energy Council (IREC) to evaluate Maine’s procedures and practices to ensure solar and storage projects that serve a customer’s own electricity needs are interconnected efficiently and without bearing costs for distribution grid upgrades. IREC issued a report detailing its evaluation and recommendations. See IREC, Interconnection Standards, Practices, and Procedures to Support Access to Solar Energy and Battery Storage for Maine Homes and Businesses (2022) (“IREC Report”). On December 5, 2022, the Commission initiated an Inquiry into Chapter 324 to gather input from interested parties on potential changes to Chapter 324 based on the IREC Report. The Notice of Inquiry (NOI) included a draft of the proposed amendments to Chapter 324. See Maine Public Utilities Commission, Inquiry into Proposed Changes to Small Generator Interconnection Procedures (Chapter 324), Docket No. 2022-00345, Notice of Inquiry (Dec. 5, 2022). Comments were filed by the Office of the Public Advocate (OPA), Central Maine Power Company (CMP), Versant Power (Versant), Efficiency Maine Trust (EMT), Natural Resources Council of Maine (NRCM), A Climate to Thrive (ACTT), ReVision Energy, the Governor’s Energy Office (GEO), the Maine Renewable Energy Association (MREA), and the Coalition for Community Solar Access (CCSA), among other parties.

Current rulemaking. On May 23, 2023, the Commission issued a Notice of Rulemaking (NOR) and proposed amendments to Chapter 324. Several interested parties provided comments on the proposed amendments to the rule, including the GEO, Competitive Energy Services, LLC, Newtility, LLC, CMP, EMT, Versant, CCSA, MREA, ReVision Energy, and the OPA, among other parties. The Commission adopted the following amendments to the rule:

  • Cost allocation. The amended rule defines “On-Site Load” and “On-Site-Load ICGF” as projects larger than Level 1 (which Level 1 projects must be <25 kW) that serve on-site load. Specifically, the amended rule provides that an “On-Site Load-ICGF” is a Level 2 project above 25 kW and up to 250 kW that only serves to offset on-site load. This definition includes projects that export generation through the Net Energy Billing (NEB) kWh Credit program but does not include projects that export generation under the NEB Tariff Rate. The Commission amended the rule to provide that T&D utilities should not charge Level 1 customers for new single-phase service transformers. The amended rule provides that all Level 1 projects shall pay a flat fee of $150 and gives the Commission the opportunity to adjust the flat fee to ensure that the fee reflects actual costs experienced by Level 1 interconnection customers. Additionally, like Level 1 projects, On-Site Load ICGFs will not pay for new single-phase service transformers. However, unlike Level 1 customers, the amended rule provides that On-Site Load ICGFs will pay a fee of $25 per-kW of a project’s nameplate capacity. The per-kW fees from On-Site Load ICGFs will be used to cover all non-single-phase service transformer distribution upgrade costs, including travel and labor. However, if the combined costs for the non-single-phase service transformer distribution upgrades, labor and travel for an individual On-Site ICGF exceeds $10,000, the participating customer shall pay any amount above $10,000. When setting the $25 per kW fee and $10,000 cap on upgrade costs that are not the responsibility of these projects, the Commission relied on data submitted by the T&D utilities. The amended rule requires T&D Utilities to use the pooled per kW fees to pay for distribution upgrades for qualifying ICGFs, up to the $10,000 cap. Finally, the definition of “Distribution Upgrades” has been amended to make clear that distribution upgrades are those additions, modifications, and upgrades to the interconnecting T&D system at or beyond the utility-owned infrastructure side of the point of common coupling to accommodate interconnection of the ICGF.
  • Aggregated generation. The Commission amended the definition of “Aggregated Generation” to include all existing generation, the generation from the proposed ICGF, and projects with a fully executed interconnection agreement (IA), regardless of whether they have paid for their distribution upgrades. The Commission reasoned that IA execution is a reasonable test of project maturity and commitment, as projects that have executed their IA have paid their application fee and incurred system impact study (SIS) costs. The Commission Order emphasizes that the amended definition will only work if the T&D Utilities strictly follow and enforce the queue management requirements and timeframes already outlined in the rule. Importantly, the amended definition does not guarantee that a Level 4 project will not require restudy prior to its execution of an IA. A project will be susceptible to leapfrogging while it is still undergoing an SIS. Even after completing the SIS but prior to execution of the IA, a Level 4 project could be responsible for additional upgrades if a new SIS is needed due to a Level 2 project applying prior to execution of the Level 4 IA. In the Commission’s opinion, such risk is reasonable for the Level 4 project, and the IA execution date is the appropriate date at which a project should no longer be at risk of being leapfrogged by a Level 2 project.
  • Minor system modifications. The amended rule revised the definition of “Minor System Modifications” to clarify that such modifications refer specifically to distribution upgrades.
  • Automatic sectionalizing device. The amended rule updated the definition of “Automatic Sectionalizing Device” to clarify that it means interrupting devices that can automatically re-energize a line, like line reclosers. However, a “fuse” is not included in the amended definition as the Commission found that nationwide best practices do not require T&D Utilities to include “fuse” in the amended definition.
  • Energy storage. CMP and Versant suggested that the Commission develop a form that requests information about interconnecting energy storage system (ESS). The amended rule adopted the suggestions of CMP and Versant and directs the Commission to develop an ESS Application Information Form as one of the standard forms described in Ch. 324, Section 4. Both EMT and the GEO suggested the rule explicitly account for operating profiles for the proposed ESS. However, the Commission relied on current nationwide best practices and refrained from requiring operating profiles for ESS as part of the ESS Application Form. Further, CES suggested revising the proposed definition of ESS for clarity; however, the Commission opted not to change the definition of ESS because it maintains consistency of definitions across statutes and Commission rules.
  • New Screen 7(J). The amended version of the rule creates a new Screen 7(J) that directs T&D Utilities to screen an ICGF that can introduce inadvertent export when the ICGF’s nameplate rating minus its export capacity exceeds 250kW. Screen 7(J) introduces a threshold and formula to determine if a proposed ICGF requires further power flow analysis.
  • Informal dispute resolution. Since this rulemaking process has begun, the Commission has created a website that interconnection customers may use to initiate good faith negotiations with T&D Utilities. Interconnection customers are directed to the website by the Commission’s Consumer Assistance and Safety Division for guidance on initiating the “good faith” negotiations required by the rule. The Commission noted that this approach seems to be helping interconnection customers initiate good faith negotiations, and as such, the amended rule did not change the process for initiating good faith negotiations. Instead, the Commission will continue to evaluate the effectiveness of the website for promoting the resolution of interconnection disputes.
  • Transparency. The amended rule adopts the changes related to transparency made in the proposed rule. Specifically, the amended rule requires T&D Utilities to make available information about minimum load and minimum daytime load that the T&D Utility used to conduct screens for Level 1 and Level 2 projects.
  • Level 3 interconnection. Chapter 324 defines Level 3 projects as non-exporting ICGFs that are not larger than 10 MW. The Commission proposed adding export controls to the rule, which provides the Commission with the opportunity to further clarify which screens apply to the interconnection of non-exporting ICGFs. As in the proposed rule, the amended rule now requires T&D Utilities to seek a waiver from the Commission if the T&D Utility prevents a non-exporting ICGF from interconnecting due to a reduction in load.
  • New Screen 7(I). In response to the Procedural Order dated March 17, 2023, the T&D Utilities observed that when they evaluate interconnection issues for ICGFs, they regularly employ an additional test related to the quality of service and voltage. The amended rule formalized this requirement into a new “Screen 7(I),” which already exists in Chapter 320 of the Commission’s rules. The amended rule also extends the deadline for performing all the screens for Level 1, Level 2, and Level 3 customers.

A copy of the Commission’s revised Chapter 324 rules – effective on November 3, 2023 – can be found here.