FERC proposal could improve conditions for U.S. pumped-storage development

A Notice of Proposed Rulemaking issued by the Federal Energy Regulatory Commission earlier this month could help increase the role of pumped-storage within the United States.

While independent system operators (ISOs) and regional transmission organizations (RTOs) have previously developed individual plans for integrating storage resources into their portfolios, the U.S. has lacked a common framework for the utilization of storage and other aggregated distributed energy resources (DERs).

The proposal would require “each RTO and ISO to revise its tariff to establish a participation model consisting of market rules that, recognizing the physical and operational characteristics of electric storage resources, accommodates their participation in the organized wholesale electric markets.”

Further, the notice would “define distributed energy resource aggregators as a type of market participant that can participate in the organized wholesale electric markets under the participation model that best accommodates the physical and operational characteristics of its distributed energy resource aggregation.”

The second distinct portion of the FERC proposal would require each RTO and ISO to revise its tariff to allow distributed energy resource aggregators, including storage resources, to participate directly in the organized wholesale electric markets.

Specifically, each would be required to “establish distributed energy resource aggregators as a type of market participant and allow the distributed energy resource aggregators to register aggregations under the participation model in the RTO/ISO tariff that best accommodates the physical and operational characteristics of the distributed energy resource aggregation.”

This would address a problem in the current model, under which operators have often been forced to register storage resources as other types of resources, potentially limiting compensation for all the services they can offer their respective markets.

The document was prepared following a 2010 request for information, after which FERC said it has an “ongoing interest in removing barriers to resources that are technically capable of participating in the organized wholesale electric markets”.

Now, however, the commission said it must “ensure that the rates, terms and conditions of jurisdictional services under the Federal Power Act are just and reasonable and not unduly discriminatory or preferential.”

FERC is now soliciting comments on the Notice of Proposed Rulemaking, after which it will require RTOs and ISOs to submit a compliance filing six months after its effective date of a final rule. The new tariff requirements would then become fully effective 12 months after the compliance filing date.

The document is available for viewing in full in the Federal Register.

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Michael Harris formerly was Editor for HydroWorld.com.

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