Summary Overview: MADRI Model Small Generator Interconnection Procedures Prepared by Brad Johnson* June 15, 2006 ACN Energy Ventures *National Renewable Energy Laboratory Subcontractor MIDWEST INTERCONNECTION WORKSHOP

2 What is the Mid-Atlantic Distributed Resources Initiative (MADRI)? Five PJM jurisdictions Regional approach to DR, DG, & Efficiency Facilitated stakeholder process with open mtgs Support from US DOE –also EPA, FERC, PJM MADRI ‘working group’ meets every 6-8 weeks

3 MADRI Initiatives Include:  Advanced metering infrastructure  ‘AMI Toolkit’ for state regulators  PUC briefings  Model regulatory structures to promote distributed energy resources (DER)  Model dynamic pricing tariff (in progress)  Model revenue stability mechanism (in progress)  Effort to enhance DER business case  Mitigation of wholesale market price spikes  Distribution system value of DER  Model Interconnection Procedures For more info:

4 MADRI Interconnection Goals Develop standardized set of procedures for states to consider - not intended to be prescriptive Ensure consistency with IEEE 1547 technical standards Ensure participation from major stakeholders: –PJM, state PUCs, state energy offices, NREL, DG providers & associations, utilities, NEMA were all active –Others participated occasionally, e.g. Chesapeake Bay Commission, Drexel University

5 MADRI Model Procedures Based on FERC and NJ Rules NJ Interconnection Rules (October ’04) –Paved new ground for expedited review procedures –Introduced timelines for utility reviews –Integrated testing & certification requirements FERC Small Gen Rules (May ’05) –Culmination of multi-year national stakeholder process –Included a number of key aspects of the NJ rules –In spite of limited jurisdiction, rule represents broad consensus and is good blueprint for states

6 MADRI Procedures Overview Four Categories of Review –Level 1 <10kVA Inverter Based/Certified –Level 2 <2 MVA Inverter Based/Certified –Level 3A – DG Does Not Export Power –Level 3 – Up to 10 MVA Reference to PJM Small Generator Technical Requirements (IEEE 1547 Based) Procedures to Connect to Area Networks Criteria for Testing & Certification Two Standard Interconnection Agreements –10 KVA and Less –> 10 KVA to 10 MVA Expedited

7 MADRI Summary General Interconnection Provisions… Applicability – 10MVA or less operating in parallel Fees – “nominal” fee for <10kVA, cost based for rest Technical Standard – “PJM Small Generator Technical Requirements” (essentially IEEE 1547) Isolation Device – must be readily accessible lockable, visible-break (or customer provides lockbox for utility access) Multiple DG Units – interconnection request evaluated based on total aggregate capacity Increase in Capacity for Existing System – new agreement based on total aggregate capacity

8 MADRI Summary Level 1 Procedures (What qualifies) <10kVA Inverter-based Certified interconnection equipment Does not connect to Area Network

9 MADRI Summary Level 1 Procedures (Technical Screens)

10 MADRI Summary Level 1 Procedures (Timeline)

11 MADRI Summary Level 2 Procedures (What qualifies?) <2 MVA Projects that fail Level 1 review Inverter-based Certified interconnection equipment Does not connect to Area Network

12 MADRI Summary Level 2 Procedures (Technical Screens)

13 MADRI Summary Level 2 Procedures (Timeline)

14 <50kVA Certified inverter Reverse power relays < 5% of max load on circuit or 50 kVA No new facilities < 10 MVA All generation on circuit < 10 MVA Reverse power relays Dedicated transformer No new facilities MADRI Summary Level 3A Procedures (What qualifies?) Area NetworkRadial Feeder

15 MADRI Summary Level 3A Procedures (Technical Screens) <10kVA to Area Network  Same as Level 1 10kVA – 50 kVA to Area Network  Same as Level 2 Connects to radial feeder  Same as Level 2

16 MADRI Summary Level 3A Procedures (Timelines) <10kVA to Area Network  Same as Level 1 except EDC has an additional 20 days to conduct Area Network impact study 10kVA – 50 kVA to Area Network  Same as Level 2 except EDC has an additional 25 days to conduct Area Network impact study Connects to radial feeder  Not specified – most of assessment expected to be related to looking at potential fault currents

17 MADRI Summary Level 3 Procedures (What qualifies?) Projects from 2 –10 MVA Projects less than 2MVA that:  Are not Certified  Are non-inverter based Projects not approved under Level 1, Level 2 or Level 3A reviews

18 MADRI Summary Level 3 Procedures (Elements of review process) Scoping Meeting to review interconnection request and existing studies Feasibility Study to review short circuit capability limits; identify thermal or voltage limits; grounding requirements; non-binding estimate of facilities cost System Impact Study to evaluate the safety and reliability impacts Facilities Study to estimate cost of equipment, engineering, procurement and construction work

19 MADRI Summary Level 3 Procedures (Timeline Elements) Interconnection Request – EDC sends notice on status of completeness 10 days after receiving request, if deficient, customer has 10 days to complete Scoping Meeting held within 10 days of receiving notification of completed interconnection request Feasibility Study agreement provided within 5 days of determination that it is necessary System Impact Study agreement provided within 5 days of determination that it is necessary Facilities Study agreement provided within 5 days of determination that it is necessary

20 Presumption is That it Should be Safe to Connect to Area Network if: –No Export of Power –DG<5% of Peak Load on Network Up to 50 KW Burden is on Utility to Conduct Study Showing That DG is Not Safe Study is at Utility Expense MADRI Summary Connecting To Area Networks

21 MADRI Made Significant Progress in Integrating 1547 Technical Requirements with Testing Requirements and Clearly Defines Certification Requirements to Qualify for Expedited Reviews This Integration is Key to Successful Implementation of Screens and Will Help Ensure Greater Standardization Among State Interconnection Procedures MADRI Insight Testing & Certification

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COMPARISON OF KEY DIFFERENCES BETWEEN MADRI & FERC INTERCONNECTION REQUIREMENTS PREPARED BY BRAD JOHNSON 6/08/05

24 Comparison of MADRI and FERC Interconnection Technical Requirements 1.Isolation Device – Required. Must be accessible, lockable visible break type device; alternatives for customer to use lockbox to provide access 2.Generation may not cause protective equipment to exceed 90% of short circuit rating 1.Isolation device not specifically required 2.Generation may not cause protective equipment to exceed 87.5% of short circuit rating MADRI < 10 MVAFERC < 20 MVA References PJM Small Generator Minimum Technical Requirements – Based on IEEE 1547 With Clarification Notes References IEEE 1547

25 Comparison of MADRI and FERC Interconnection Processes Level 1 (<10kVA) & Level 2 (<2 MVA) interconnections require inverters & Certified interconnection equipment No impact assessments by EDC for Level 1 & 2. Limited impact assessment for 3A Level 1& 2 & 3A must satisfy impact technical screens Level 3A ( <10 MVA) Provisions for Area Networks & non-exporting systems Level 3 – study process for all other systems < 10 MVA (virtually identical to FERC/PJM) Streamlined application for <10kVA requires Certified inverter based equipment Super-expedited for Certified interconnection equipment < 2 MW (does not have to be inverter based) Study process for all other systems < 20 MVA (virtually identical to MADRI/PJM) No impact assessments for 1 & 2 above but must satisfy impact technical screens No provisions comparable to MADRI Level 3A MADRI (<10 MVA)FERC (<20 MVA)

26 MADRI Comparison Level 1 Timelines

27 MADRI Comparison Level 2 Timelines

28 Comparison of MADRI & FERC Interconnection Fees FERC Interconnection FeesMADRI Interconnection Fees 1.Level 1 Interconnection Request  Nominal fee (<$100) 2.Level 2, 3A, 3 Interconnection Request  Cost based fee  To be established by appropriate state regulatory body 3.Level 3 Studies  Interconnection customer responsible for all costs incurred for any interconnection studies 1.Level 1 Interconnection Request  $100 processing fee 2.Fast Track Process (Comparable to MADRI Level 2)  $500 processing fee 3.Level 3 Studies  Lesser of $1,000 deposit or 50% of estimated cost of feasibility study at time of interconnection request  Interconnection customer responsible for all costs incurred for any required interconnection studies