The Federal Energy Regulatory Commission on March 1 approved parts of ISO New England’s Order 2222 compliance proposal related to the aggregation of distributed energy resources. It was all about metering in the ISO-NE filing.
FERC was swayed by multiple protestors, including United States senators from New England states, who were unhappy with ISO-NE’s proposal regarding opportunities for behind-the-meter DERs located behind the retail delivery point.
Based on concurrences from Commissioners Allison Clements and James Danly, and Commissioner Mark Christie’s dissent, it remains to be seen how ISO-NE engages its utilities and submits a proposal that reduces the metering barriers for aggregations of DERs in the New England region.
Participation Model – FERC wanted the aggregation of DERs to provide all services they were technically capable of, including capacity, energy, and ancillary services. FERC didn’t require grid operators to propose a new market participation model for DERs. However, ISO-NE added two new models. First, the Demand Response Distributed Energy Resource Aggregation (DRDERA) model allows demand response DER to aggregate with other types of DERs. Second, the Settlement Only Distributed Energy Resource Aggregation (SODERA) model allows DERs to inject, withdraw, and participate in the forward capacity, day-ahead, and real-time energy markets.
In addition to the two new models, ISO-NE proposed additions to five existing models to make them compliant with Order 2222. These 5 existing models are – 1) Generator Asset Model, 2) Continuous Storage Facility (CSF), 3) Binary Storage Facility (BSF) model, 4) Alternative Technology Regulation Resource (ATRR) model, and 5) the Demand Response Resource (DRR) model.
US Senators Whitehouse, Markey, Warren, and Sanders wrote to ISO-NE expressing concern that ISO-NE’s proposal fails to remove barriers for behind-the-meter distributed energy resources. The senators objected to ISO-NE’s proposal to put utilities in the center of submetering (metering DERs individually). FERC found that ISO-NE partially complied with this requirement because “behind-the-meter DERs participating under those participation models may be unable to provide all services that they are technically capable of providing through aggregation, as required by Order No. 2222”.
FERC directed ISO-NE to file within 30 days a compliance filing that addresses how the grid operator’s existing capacity market mitigation rules would apply to Distributed Energy Capacity Resources participating in Forward Capacity Auction FCA 18. ISONE just cleared FCA 17.
FERC also directed ISO-NE to file within 60 days a compliance plan “that (1) identifies the existing rules that require a market participant that provides wholesale energy withdrawal service to be an LSE, and (2) explains whether this requirement is applicable to all resources in ISO-NE in order to provide wholesale energy withdrawal service in the energy market.”
Finally, FERC directed ISO-NE to file within 180 days a plan that addresses how the capacity market mitigation rules for FCA 19 and beyond will apply to Distributed Energy Capacity Resources.
Metering and Telemetry System Requirements – FERC required metering and telemetry requirements to be not burdensome for the Component DERs to participate in an aggregation. There were many protests on ISO-NE’s metering proposal. In response, FERC found that ISO-NE partially complied with this requirement. So, FERC directed ISO-NE to file within 60 days a compliance plan that explains why its proposal is just and reasonable and to also specify that a DER aggregator is responsible for providing metering data to ISO-NE.
Submetering – Protestors were concerned that for behind-the-meter DERs, submetering was not a viable option because DERs are dependent on the host utility. In footnote 352, FERC explained that behind the meter DERs are DERs with a Point Of Interconnection (POI) located behind the Retail Delivery Point. It didn’t help ISO-NE when it acknowledged that the Host Participant Assigned Meter Reader will not be able to accommodate submetering unless software systems can accommodate wholesale and retail settlements, and the timeline to implement those software systems is uncertain.
Metering at the Retail Delivery Point and Parallel Metering – Without submetering as a viable option, protestors felt that metering at the Retail Delivery Point or installing a parallel meter are the only options for Component DERs, but they are not economical. FERC agreed with the protestors that submetering with reconstitution and parallel metering is not viable. Reconstitution is a process by which energy injection/withdrawal measured at a device behind the meter (e.g., a behind-the-meter generator/battery) is subtracted from energy injection/withdrawal measured at the RDP. Because metering at the RDP is outside FERC jurisdiction, FERC dropped several hints for ISO-NE to determine how PJM, NYISO, and CAISO have figured it out.
Alternative Metering Proposals such as Alternatives to Metering at the Retail Delivery Point and Third Party Metering – Some protestors felt that ISO-NE must “add submetering options that do not require baselines measured at the RDP, based on submetering options other RTOs/ISOs offer” as an alternative to metering at the RDP. Others felt that third-party metering is a viable option. FERC suggested ISONE could address whether it explored third-party metering options for behind-the-meter DERs. FERC stated under ISO’s proposal that behind-the-meter DERs may be unable to provide all services they are technically capable of providing through Aggregation.
Double Counting – ISO-NE felt that submetering provides opportunities for double counting because “behind-the-meter DERs should not be permitted to sell energy into wholesale markets and at the same time consume that energy and avoid being charged for it”. Protestors argued that there is no provision for double counting of reserves or regulation provided by behind-the-meter DERs because retail customers do not consume reserves or regulation and are allocated a portion of the costs necessary to meet their reserves and regulation requirements.
Effective Date – FERC didn’t require an effective date and allowed ISONE to propose a reasonable implementation date. ISO-NE had proposed November 1, 2026, for all the tariff provisions but November 1, 2022, for Distributed Energy Capacity Resource participation in the Forward Capacity Market and other minor changes. FERC found ISO-NE fully compliant with this requirement because ISO-NE proposed a reasonable implementation date. But FERC asked ISO-NE to file within 30 days an implementation timeline milestone to meet before the next capacity market auction starts.
FERC Commissioner Concurrences and Dissent – If Commissioner Christie concurred on PJM’s 2222 proposal due to lack of objection from PJM States, here in ISO-NE filing, he dissented, citing metering costs imposed by 2222 requirements on consumers. But both Commissioner Clements and Danly concurred, avoiding a 2-2 vote. Commissioner Clements’s concurrence encouraged ISONE to “roll up its sleeves” and integrate DERs as other grid operators have done.