The proposed rule would require an “intermediate agreement” by any large load seeking an ERCOT interconnection as well as new financial assurances.
________________________________________________
Major energy consuming industries — so called “large loads” — will need to jump through a few more hoops if they want to connect to the ERCOT grid, under a new regulatory proposal.
Presented to the Public Utility Commission on March 12, a proposed Rule for Publication would require an “intermediate agreement” by any large load seeking to connect to the grid. It also will require that they post new financial assurances.
Staff presented the proposed rule during the open meeting, and the commissioners approved its publication to allow for further consideration. The deadline for public comment is April 17th .
THE DETAILS
The proposed rule calls for large loads seeking a grid connection to enter an “intermediate agreement.” This agreement would be part of an ERCOT “interconnection study” required for all such large loads. The intermediate agreement is to include various disclosures, demonstrations by the large load of site control, and requirements to post a financial security of $50,000.
Within 30 days of completion of ERCOT’s interconnection study, the requestor must execute an interconnection agreement that includes payment of a nonrefundable interconnection fee of $100,000 per megawatt (this is separate from the $50,000 financial security), the posting of financial security for significant equipment and services, payments of other direct interconnection costs, and the posting of financial security for system upgrades.
PUC staff initially called for an initial financial security of $100,000, but PUC Chair Thomas Gleeson filed a memo in March calling for a reduction of $50,000 per MW. The suggestion and others ended up in the proposed rule that was approved for publication.
Commissioners also called for input from stakeholders. Issues of particular interest include:
- The use of abandoned financial commitments to reduce consumer rates or rate base
- Whether the reduction in financial commitment from $100,000 to $50,000 should apply to both the intermediate agreement and the interconnection fee.
- How financial commitments might be aligned with commercial milestones, and which fees are classified as nonrefundable.
More information about this rulemaking can be found in the PUC website, under Project No. 58481.