Significant Ease in Incorporating Clean Energy into the U.S. Power Grid

A new rule aims to expedite the connection of renewable energy projects to the grid — a development that has been welcomed by clean energy advocates.

Yesterday, the Federal Energy Regulatory Commission (FERC) made the decision to revamp the approval process for new energy projects, which had been causing significant delays in the growth of renewable energy in the US.

“This is a watershed moment for our nation’s transmission grid,” FERC Chair Willie Phillips said in a press release yesterday.

Currently, it takes an average of five years for a new energy project to connect to the grid. There is a significant backlog of over 2,000 gigawatts of clean energy generation and storage awaiting approval. This backlog represents the same capacity as the nation’s existing power plants have for generating electricity today.

The delays were expected to worsen as renewable energy projects gained momentum with the decreasing costs of wind and solar energy compared to coal or gas power plant construction. FERC’s previous approach was designed for a grid dominated by fossil fuels. In the past, developers typically focused on a few large-scale power plants, but they are now managing numerous smaller solar, wind, and battery projects, as The New York Times reports. Renewable energy sources are distributed more widely across the network.

To address the backlog, the new federal rule mandates that grid managers assess projects as clusters rather than individually. They will also face strict deadlines and penalties for failing to complete interconnection studies on time. The rule prioritizes projects that have made the most progress and introduces new requirements for developers, including financial deposits to dissuade the proposal of non-viable projects.

Currently, renewable energy accounts for just over 20 percent of the US electricity mix. However, a five-year wait time will not suffice if the Biden administration aims to achieve a 100 percent clean power grid by 2035. Additional capacity would also be beneficial during heatwaves, such as those experienced this summer, which resulted in high electricity demand for air conditioning. Two major grid operators recently warned against potential energy shortages due to this reason.

The changes implemented by FERC have been praised by clean energy trade groups and environmental organizations. The American Clean Power Association described FERC’s action as a “much-needed step” that enables the smooth and cost-effective incorporation of new clean energy resources into the electric grid.