The glowing reviews and legal and trade press headlines would have one believe that distributed energy resource (DER) aggregation under Order 2222 will soon transform the electric industry, as DERs that are too small to participate directly in regional transmission organisation or independent system operator markets will flock to third-party DER aggregators which will sell wholesale services to organised markets. Will DER owners leap at the chance to participate in wholesale markets?
Order 2222 goes to great length explaining why distributed energy resource (DER) aggregators selling power are public utilities making Federal Energy Regulatory Commission (FERC)-jurisdictional sales under Section 205 of the Federal Power Act. This holding is no surprise. The FERC has said for decades that sales by DERs at wholesale are FERC-jurisdictional.
One would think that the issue of jurisdiction over interconnections to distribution facilities of resources selling wholesale power could not get more complex. Order 2222 proves that it could. Specifically, qualifying facility interconnections to distribution, an area where jurisdiction was previously relatively clear, has been muddled a bit.
In the long-awaited Broadview order, the Federal Energy Regulatory Commission reinforced the Public Utility Regulatory Policies Act's statutory limit for small power production qualifying facilities (SPP QFs) to a power production capacity of no more than 80MW. SPP QFs cannot evade this statutory limit by restraining the ability of much larger facilities to actually 'send out' more than 80MW through the use of limited inverters.
The DC Circuit has issued its opinion on various petitioners' appeals of Order No 841, denying the claim that the Federal Energy Regulatory Commission lacks the authority to prohibit states from barring electric storage resources located on utility distribution systems from participating in wholesale power markets. The most direct ramification of the opinion is that it largely eradicates any meaningful chance of successfully challenging on jurisdictional grounds a distributed energy resource aggregation final rule.