With FERC's Order 2222 requiring RTOs to allow distributed energy resource aggregation in wholesale markets, I'm curious if anyone's seeing movement from their local utilities yet. Here in Tennessee, TVA has been pretty quiet about implementation timelines. The order technically gives them until December 2022 but some utilities are getting ahead of it. Anyone hearing concrete plans from their utilities?
FERC Order 2222 implementation - any utilities moving yet?
Andre, we're seeing some early movement from Consumers Energy here in Michigan. They filed a preliminary compliance plan with MPSC last month outlining how they plan to handle DER aggregation. The big question is how this affects net metering customers who want to participate in wholesale markets. My commercial clients with solar are very interested but the regulatory framework is still murky.
Here in New Jersey, PSE&G has been more proactive than expected. They're working with PJM on a pilot program for commercial battery storage aggregation. One of my Newark clients with a 500kW battery system is participating in the pilot. Early results show potential revenue of $15-20K annually just from wholesale market participation, separate from their demand charge savings.
Tony that's impressive revenue potential. Down here in Mississippi, Entergy has been dragging their feet on any DER programs. They're claiming technical concerns about grid stability but I think they're just trying to delay as long as possible. MISO is supposed to be developing the market rules but utilities have significant input on implementation timelines.
Entergy Louisiana is taking a different approach than Mississippi - they actually seem interested in DER aggregation as a way to defer transmission upgrades. New Orleans has some aging infrastructure and distributed resources could help with reliability during peak summer demand. They're proposing a tariff modification that would allow wholesale market participation while maintaining retail rate protections.
Pennsylvania is going to be interesting to watch since we're fully deregulated retail but still have utility distribution companies. Duquesne Light is working on interconnection standards for aggregated DER, but the market structure is complicated with competitive suppliers involved. My Pittsburgh clients are asking about battery storage + wholesale market participation but the rules aren't clear yet.
Out here in Utah, Rocky Mountain Power filed their compliance plan last week. They're proposing a phased approach starting with large commercial customers who have existing distributed generation. The interesting part is they want to use existing Schedule 136 net metering customers as the initial pilot group. Could be a model for other western utilities.
CPS Energy here in San Antonio is taking a wait-and-see approach. Since we're municipal utility not subject to FERC jurisdiction directly, but ERCOT is working on market rules that will affect us. The Texas market structure is unique anyway with its energy-only design. Municipal utilities have more flexibility but also less regulatory pressure to move quickly.
Angela that's a good point about municipal utilities having different pressures. TVA is in a similar boat as a federal utility - FERC jurisdiction but different regulatory dynamics. I'm hearing they're going to wait until late 2022 to file their compliance plan and focus on large industrial customers first. The distributed solar market in Tennessee is still relatively small compared to other regions.
Update on the PSE&G pilot I mentioned - preliminary results show the battery aggregation generated $22,000 in wholesale market revenue over 6 months for a 500kW system. That's on top of $18,000 in demand charge savings. The business case for commercial battery storage is becoming compelling even without subsidies. Other New Jersey utilities are paying attention.
Great thread everyone. I've been tracking Order 2222 implementation across different regions and the variation in utility approaches is fascinating. The economics Tony shared from New Jersey are similar to what we're seeing in other PJM territories. The key is going to be how quickly utilities can develop the interconnection and operational procedures. Some are clearly more motivated than others to make this work.