- Summary of Expert Recommendations for Supporting DER Aggregator Participation in Wholesale Markets and Operations in Line with FERC Order 2222
The Federal Energy Regulatory Commission (FERC) passed Order 2222 in September 2020, allowing Distributed Energy Resources (DER) to compete alongside traditional generation resources in wholesale electricity markets through participation via DER Aggregators (DERAs). Order 2222 adds complexity to a system already in the midst of unparalleled change with current and anticipated growth of DER deployment. State and federal policy makers and regulators are evaluating and determining whether and where to establish new rules and requirements as well as enabling policies to bring both DERs and their aggregations onto the electricity system safely, fairly, and reliably. This document was prepared to provide state energy decision makers such as Public Utility Commissions and State Energy Offices with a summary of state actions, considerations, and enabling policies related to Order 2222 implementation.
- Overview of RTO/ISO Filing Status in Response to FERC Order 2222
RTOs/ISOs are primarily responsible for complying with Order 2222 directives, while resulting market changes may need to be addressed and implemented by other entities (e.g., distribution utilities, DERAs, and relevant electric retail regulatory authorities (RERRAs)). This document was prepared to provide Public Utility Commissions and State Energy Offices with a summary of each RTO/ISO filing status at FERC as each market area works to comply with Order 2222. The table and the information included in this document will be updated as new developments are announced. In May 2023 the following updates were added:
1. On April 25, 2023, the NEPOOL Markets Committee voted in support of ISO New England’s proposed response to FERC’s March 1, 2023, order requiring modifications for DER aggregations and participation in their markets.
2. On April 20, 2023, FERC partially accepted the second compliance filing by New York ISO (NYISO). Furthermore, FERC issues a second order directing NYISO to submit a filing within 30 days to address inconsistencies in recent tariff revisions to allow DER aggregations to fully participate in its markets. FERC also directed NYISO to submit filings every six months until December 31, 2024, with information on its stakeholder process in developing updates to their ancillary service market rules related to the participation of DER aggregations. After the end of these biannual filings, FERC will require NYISO to submit a formal compliance filing with their final proposal for compliance. FERC granted NYISO and extension until Q4, 2026 to fully comply with Order 2222.
- DER Integration & Compensation Initiative Project Overview
This project overview summarizes the project description, premise, approach, and objectives of the DER Integration and Compensation Initiative.
- Order 2222, September 2020
Order 2222 amends Federal Energy Regulatory Commission (FERC) regulations to remove barriers to the participation of distributed energy resource aggregations in the capacity, energy, and ancillary service markets operated by Regional Transmission Organizations and Independent System Operators (RTOs/ISOS).
NASEO-NARUC Webinar: Grid Investments for FERC Order 2222, January 27, 2023
To implement FERC Order 2222, state and federal policy makers and regulators are evaluating and determining whether and where to establish new rules and requirements as well as enabling policies to bring both distributed energy resources (DERs) and their aggregations onto the electricity system safely, fairly, and reliably. Underpinning these decisions are the technological requirements for enabling DER aggregation. As part of the NASEO-NARUC Distributed Energy Resources Integration and Compensation Initiative, this webinar highlighted a new report on this topic being developed by the GridWise Alliance. Modeled after their recently released Technology Portfolio Report, the report will be a resource for stakeholders interested in understanding what specific types of grid technologies and investments are needed for the implementation of FERC Order 2222.
NARUC-NASEO Distributed Energy Resource Integration and Compensation Workshop, September 20-21, 2022
State Utility Commissions and State Energy Offices are increasingly faced with novel technical issues and policy decisions related to the integration of distribution-connected energy resources. Almost every aspect of the electric utility can be affected by distributed energy resource (DER) growth, while retail and wholesale rules will also become more intertwined. Policy makers will need to consider many technical and economic issues to prepare for a variety of future paths that are changing rapidly. Ultimately, state energy decision makers individually and collectively want to ensure that these resources are connected and operated in a way that is safe, fair, and supports state goals.
This workshop convenes NARUC and NASEO state members to further prepare for decision making related to the connection, operation, and compensation of distributed energy resources (DERs)---within the distribution grid, bulk power system, and wholesale energy markets. Workshop attendees will be NARUC and NASEO members. Sessions include panel discussions, templates and time for action planning by states, and opportunities to provide input to the U.S Department of Energy and National Laboratories on efforts to support DER integration.
View Presentations for September 20: DER-Bulk Power System Coordination.
View Presentations for September 21: DER Integration through Advancing Interconnection
Interconnection Standards Technical Assistance Workshop, July 17, 2022
In the context of FERC order 2222, distributed energy resource (DER) growth, electric vehicle charging investments, and digitization trends in the evolving electricity sector, many state commissions have identified the need for near-term actions to update their state’s interconnection standards. NARUC members and DOE, NREL, and NIST technical experts joined together for an interactive workshop to learn about resources, lessons learned, and support opportunities for updating DER interconnection standards. Experts will demystify IEEE 1547-2018, assist in prioritizing action steps and processes, and provide an engaging forum for members to make connections to colleagues in other states who share similar challenges and timelines.
DER Aggregation Participation in Electricity Markets: NASEO and NARUC Webinar on EPRI Collaborative Forum Final Report and FERC Order 2222 Roadmap Confirmation, June 2, 2022
Over 2021 and the early part of 2022, the Electric Power Research Institute (EPRI) facilitated a collaborative forum with U.S. and Canadian ISOs/RTOs, distribution and transmission utilities, DER aggregators, and relevant retail regulatory authorities to discuss the challenges and opportunities associated with FERC’s Order 2222 to enable participation of DER aggregations in wholesale electricity markets. Over 45 webcasts were held across the project with relevant topics, educational sessions, and panels involving important stakeholders. In March, EPRI released the final report of the project, in the form of a roadmap that summarized key findings and potential actions across six important areas. In this NASEO-NARUC webinar, EPRI will provide a summary of the report, its key findings, and further activities planned for the future.
Speakers: Erik Ela, EPRI; Nick Heine, EPRI; Jens Boemer, EPRI; Ben Ealey, EPRI; Angela Chuang, EPRI; Ajit Renjit, EPRI
DERs in Wholesale Markets and on the Distribution Network: What Needs to Happen, Advanced Energy Economy (AEE), March 8, 2022
FERC Order 2222 directed regional grid operators to open their wholesale markets to distributed energy resources (DERs) but that will take more than action by RTOs/ISOs. Distribution utilities and their state regulators also have big roles to play in realizing all the benefits of distributed resources for customers and the power grid. In this webinar, which drew on FERC Order No 2222 Implementation: Preparing the Distribution System for DER Participation in Wholesale Markets, a report from AEE and GridLab, utility executives and DER companies explored what needs to happen locally to unlock the value of DERs at the grid edge.
Speakers: Ric O’Connell, GridLab; Susan Mora, Exelon; Tamara Dzubay, Ecobee; Adam Stern, Enel X; Yujia Zhou, DTE Energy; Nate Bennett, DTE Energy; Terri Eaton, Xcel Energy; Peter Dotson-Westphalen, CPower Energy Management; Lisa Frantzis, AEE; Jeff Dennis, AEE
Distributed Energy Resource (DER) Integration into Wholesale Markets and Operations: Overview and Current News, March 2022
The Energy Systems Integration Group has released a new report, DER Integration into Wholesale Markets and Operations, examining the changes in regulation, market rules, planning, and operating practices needed to better integrate distributed energy resources into U.S. wholesale markets and operations. The report covers the nearer-term implementation of FERC Order 2222, the order’s implications for electricity distribution systems, and broader gaps related to DER integration in wholesale markets and distribution systems.
Speakers:Matt McDonnell, Strategen, Lorenzo Kristov, Electric System Policy, Structure, Market Design
- NARUC and NASEO are grateful to the U.S. Department of Energy, Office of Electricity and Grid Deployment Office and the Office of Energy Efficiency and Renewable Energy for funding the DER Integration and Compensation Project which enables the resources and activities described on this webpage.
Advisory Group Members:
- Chair Kent Chandler, Kentucky Public Service Commission
- Alexandra Fisher, District of Columbia Public Service Commission
- Chair Marissa Gillett, Connecticut Public Utilities Regulatory Authority
- Robert Jackson, Michigan Department of Environment, Great Lakes, and Energy
- Commissioner Will McAdams, Public Utility Commission of Texas
- Joanna Troy, Massachusetts Department of Energy Resources
- John Williams, New York State Energy Research and Development Authority (NYSERDA)
- Chair Carrie Zalewski, Illinois Commerce Commission
NARUC and NASEO staff experts who support these activities include:
Kirsten Verclas, NASEO
Tanya Paslawski, NARUC
Sarah Fitzpatrick, NARUC