Optimizing Grid Reliability with Distributed Energy Resources

by Brian Lydic, Regulatory Engineer, Interstate Renewable Energy Council 

Two weeks ago at Intersolar in San Francisco, IREC hosted and participated in a panel discussion on the State of Smart Inverters: Adoption and Considerations for Implementation. I had the pleasure of presenting alongside representatives from Xcel Energy (Minnesota), Southern California Edison and GridLab to talk about the implications for states and utilities of the 2018 update to IEEE 1547 standards.

From this discussion and IREC’s work on these standards, I provide an update and overview on the state of the IEEE 1547 standards and recent developments in California, with an eye to considerations other states would benefit from keeping in mind as they look to capitalize on the potential of smart inverters.

What is IEEE 1547-2018 and what does it mean for distributed energy resources?

In April 2018, a major revision of the national standard for interconnection of distributed energy resources (DERs) was published – IEEE Standard 1547-2018, IEEE Standard for Interconnection and Interoperability of Distributed Energy Resources with Associated Electric Power Systems Interfaces. The standards require distributed energy resources to provide specific grid supportive functionalities. These capabilities can then help increase the amount of DER that can be accommodated on the grid, increase power quality for all customers, and ensure that DERs can continue to be a reliable grid resource as penetration increases and the grid transforms. Although all DERs will be required to have these functionalities enabled, inverter-based DERs will utilize “smart inverters” to comply with the new standards.

California and Hawaii have already begun deployment of some smart inverter functionality, although work still remains to be done in those states to fully integrate smart inverter capabilities into these markets. Other states, like Minnesota, Maryland and Illinois are just starting down the path of how best to take advantage of smart inverter technologies.

What are the impacts of the new standards?  

Specifically, the updated standard requires DERs to provide an array of grid supportive functionality, including voltage and frequency ride-through, voltage and frequency regulation, as well as communications and control functionality. In addition to customer and grid benefits, these new requirements will enable DERs to communicate with and receive signals from the grid. Using more sophisticated software infrastructure, these smart inverters can also be controlled and monitored remotely. Among other advantages, these communications and controls will enable DERs to convey performance data with the system owner, the utility and others to more quickly diagnose and address any operational or maintenance issues.

[bctt tweet=”The IEEE 1547-2018 standards have the potential to affect anyone on the DER industry side, from the financier and developer to the installer and customer.” username=”IRECUSA”] Utilities will be learning techniques to leverage and correctly manage the new equipment capabilities. State regulators will play an important role in adopting and implementing the new standards, helping ensure that all interests are balanced, with the overall goal of increasing grid safety and reliability. All parties will need to work together to apply the new concepts for higher DER penetration. Chief among them, the IEEE 1547-2018 standards will have the following impacts, once implemented:

  • The process for customers installing DER to interconnect to the grid will change;
  • DER projects will have the ability to automatically respond to certain grid conditions, which will help avoid potential negative impacts and optimize their grid benefits;
  • More DER will be capable of interconnecting to the grid under higher penetration scenarios, without requiring costly upgrades, assuming their control functions are set up to accommodate grid conditions; and
  • Customers installing DER may see shifts in their distributed generation output under certain scenarios, which might require new consumer protection measures.

In contrast with earlier standards that provided one set of requirements for all DERs, the new IEEE 1547-2018 lays out a set of options for deployment that may be selected based on system considerations and goals. This optionality may be more challenging to apply uniformly across the board, with potential for different implications of certain functions for small versus large DER projects. States and utilities will want to consider how default settings might be applied, or whether and when it’s appropriate to deviate from default settings based on a DER project’s level of interconnection review.

What’s next?

Now that IEEE 1547-2018 standards have been adopted, work is underway to publish revisions to the accompanying IEEE Standard 1547.1, IEEE Standard Conformance Test Procedures for Equipment Interconnecting Distributed Resources with Electric Power Systems, which will help manufacturers as they test and certify their products to the new 1547 standard. For example, solar PV and energy storage inverters are certified and listed to UL 1741, Inverters, Converters, Controllers and Interconnection System Equipment for Use With Distributed Energy Resources, which meets IEEE 1547/1547.1 testing requirements. After IEEE 1547.1 is published, likely in 2019-2020, UL 1741 will be updated to reference the new 1547 and 1547.1 standards. From there, it will take up to 18 months for all products to comply with the updated requirements.

Even though the full implementation of IEEE 1547-2018 will take a few more years, it is not too soon for states to begin adopting the new standard. IEEE 1547-2018 adds new features and requirements, and, as noted, includes much more flexibility and options, rather than a single package of default settings that work in all instances and for all technologies. Utilities and state regulatory commissions will need to consider “performance categories” that can be assigned differently to different DERs. In addition, states and utilities located within a regional transmission organization (RTO) or an independent system operator (ISO) may need to consult and coordinate on reliability and other performance standard settings. Adopting and integrating the new standard sooner rather than later will ensure ample time to navigate some of the more complex issues to integrate and optimize smarter grid technologies.

[bctt tweet=”State regulators will play an important role in adopting and implementing the new standards, helping ensure that all interests are balanced, with the overall goal of increasing grid safety and reliability.” username=”IRECUSA”]

What are some considerations to keep in mind?

According to IEEE 1547-2018 standards, frequency regulation (also referred to as frequency droop or frequency-watt) and improved power quality requirements will be required by default. However, voltage-regulating functions (e.g., reactive power functions, such as power factor, volt-var, watt-var, constant var, and active power function volt-watt) are not required to be turned on by default. To make the most of the standard and prepare for higher DER penetration in the future, state commissions and utilities should consider the widespread use of voltage regulation early (before high penetrations are reached) to enhance the effectiveness of these functions.

As one of the early adopter solar states, Hawaii learned that the grid would have been able to host higher penetrations of DER if they had been able to deploy these functions early on. Reaching high penetration before implementing these functions can limit their effectiveness to increase the grid’s hosting capacity for more DER.

Adopting the regulation functions, however, can reduce a DER system’s energy production at certain locations, which can impact project economics. Care must be taken to ensure customers are not unduly affected by the required settings. Since the performance of voltage-based functions depend on a customer’s location on the grid as well as factors outside of the customer’s control, such as utility voltage regulation practices, introducing these functions can complicate performance modeling and reduce confidence in the return on investment. Explicit consumer protection provisions may be necessary to ensure that customers are aware of this potential loss of energy production over time and/or that a recourse exists if a single customer experiences a disproportionate amount of production loss. Similarly, system designers need to understand and model the effects of the new functions on DER output power to convey accurate information to customers regarding anticipated lifetime energy production.

In addition, the new standards will impact the interconnection review process for all DER, and states should work to ensure as much consistency and harmonization as possible among the different utilities within their jurisdiction. Adopting commission-approved default settings applicable statewide will help ensure greater transparency and clarity for stakeholders navigating the interconnection process, while also ensuring a smoother glidepath to adopt and integrate smart inverters on the grid (which will bring grid benefits). In certain situations, bespoke settings (e.g., for regulation function set points, trip settings, etc.) may be an alternative option for DER customers seeking to interconnect in lieu of an identified upgrade. However, state interconnection standards will need to provide clarity around the circumstances under which this can occur to maintain a fair and equitable process for all DER customers.

The timeline for implementation is another issue that states need to consider, and whether or not their market conditions warrant a more expedited process to adopt new standards, like California and Hawaii have taken. In these cases, consideration will need to be given for how products will be tested and certified, in advance of the official test procedures and certification requirements.

As more states work to adopt and implement the IEEE 1547-2018 standards, additional issues are likely to arise that will need commission focus and stakeholder coordination to resolve.

What is happening in California?

Over several years, California has developed requirements for the regulation functions as well as communications and control. Much of this effort was conducted by the Smart Inverter Working Group (SIWG), a joint effort led by the California Public Utilities Commission and the California Energy Commission, with involvement from numerous stakeholders, including utilities, manufacturers, developers, non-profits and other organizations. The SIWG’s effort also informed development of the national IEEE 1547 standard.

SWIG’s consensus recommendations for updating California’s interconnection tariff (Rule 21) were developed in three phases, with adopted changes incorporated into the utilities’ Advice Letters in the Rule 21 proceeding. Most recently, the utilities submitted revised Advice Letters to incorporate the phase 3 functions, which include the regulation functions, which as mentioned above, have the potential to reduce energy production of DER projects under certain situations. While somewhat contentious, these updates will require the default activation of the frequency-watt and volt-watt functions. IREC, the California Solar and Storage Association and other parties recommended that, at a minimum, utilities adopt reporting mechanisms that could identify when consumers were being unduly impacted by this functionality.

In response to these and other stakeholder concerns, the commission’s resolution E-4898 directed the utilities to work with the SIWG to define appropriate reporting methodologies for voltage issues. These methodologies should be determined by late 2018, and utilities will implement them in quarterly reports to the commission following the mandatory activation of the volt-watt function starting in February 2019. Similarly, utilities will report on their voltage complaint process to ensure that utility voltage issues are being resolved in a timely manner. Estimates of losses due to the frequency-watt function will also be reported. California’s additions to Rule 21 will bring it closer to the newly published 1547 standard; however, further harmonization between California’s standards and IEEE 1547-2018 may be warranted in the future.

Now is the Time: States to Lead on IEEE 1547-2018 Implementation

The rules governing the grid have been evolving for decades and will continue to evolve as more DERs are integrated and optimized as resources. The IEEE 1547-2018 updates and the changes underway in California represent a substantial leap from former practices, and will require more attention from states, utilities and all involved stakeholders. These new requirements have the potential not only to affect DER customers and developers, but project financiers, utilities and regulators. [bctt tweet=”States that work swiftly to address the new standards will be better equipped to integrate new technologies, optimize the benefits of DER, and improve system power quality.” username=”IRECUSA”] Now is the time to commence the process and pave the path for a more distributed and clean energy future.