Grid operator PJM has presented a proposal to permit “shovel-ready” energy projects an expedited route to interconnection to meet grid reliability needs.
PJM, with a service area including Virginia and Ohio, has indicated it will provide stakeholders with a formal proposal early next month to allow for feedback, before filing it at the Federal Energy Regulatory Commission for approval in early December.
The grid operator is considering three avenues for facilitating new power generation more quickly. They include reforming the process for transferring capacity interconnection rights from deactivating power plants to other resources, altering the process for using surplus interconnection capacity, and the Reliability Resource Initiative (RRI).
This follows PJM's decision to clear out a backlog of interconnection requests that had been put on hold. These requests are being reviewed under a three-track process to transition to a fully reformed interconnection study framework. Under the reformed process, the operator plans to study new interconnection requests by mid-2026.
Meanwhile, PJM is finalizing interconnection agreements for approximately 25GW of projects under its fast-track review and aims to complete the 26GW Transition Cycle 1 by mid-2025. The window for projects to enter the 96GW Transition Cycle 2 (TC2) closes on December 17, covering requests submitted between October 2020 and September 2021.
As part of the RRI, PJM may allow a limited number of projects to enter the TC2 process through an application window that opens in early 2024.
PJM is considering two criteria options when selecting projects. A firm eligibility option based on an effective load-carrying capability of 45 percent or higher, including thermal, storage, offshore wind, and landfill gas projects, or a formulaic approach ranking projects by grid value, capacity size, and other factors.
PJM plans to present its proposal on October 30 and finalize it at a November 6 meeting. However, some stakeholders have raised concerns over the lack of analysis supporting PJM's reliability claims and the potential impact on cost allocation for network upgrades. Critics argue the proposal is not fuel-neutral and could delay projects in TC2, leading to uncertainty for future investments further exacerbating potential capacity shortfalls.
The proposal follows a call of concern from the operator that many renewable energy projects in its US region are not being built despite receiving approval to connect to the grid.
The operator said 450 projects promising 37.2GW in capacity have agreed on interconnection deals but are not yet online.
While many of these are under construction, 12.1GW of the total is considered “suspended,” meaning interconnection work is not underway.
