[Federal Register: December 19, 2005 (Volume 70, Number 242)]
[Rules and Regulations]
[Page 75005-75016]
[DOCID:fr19de05-7]

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 35

[Docket No. RM05-4-001; Order No. 661-A]

Interconnection for Wind Energy

Issued December 12, 2005.

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Order on rehearing and clarification.

-----------------------------------------------------------------------

SUMMARY: The Federal Energy Regulatory Commission is granting in part
and denying in part the requests for rehearing and clarification of its
Final Rule on Interconnection for Wind Energy, Order No. 661. Order No.
661 requires public utilities that own, control, or operate facilities
for transmitting electric energy in interstate commerce to append to
their standard large generator interconnection procedures and large
generator interconnection agreements in their open access transmission
tariffs standard procedures and technical requirements for the
interconnection of large wind generation.

DATES: Effective Date: Changes made to Order No. 661 in this order on
rehearing and clarification will become effective on January 18, 2006.

FOR FURTHER INFORMATION CONTACT:

Bruce A. Poole (Technical Information), Office of Markets, Tariffs and
Rates, Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426.<PHONE_NUMBER>.
G. Patrick Rooney (Technical Information), Office of Markets, Tariffs
and Rates, Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426.<PHONE_NUMBER>.
P. Kumar Agarwal (Technical Information), Office of Markets, Tariffs
and Rates, Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426.<PHONE_NUMBER>.
LaChelle Brooks (Technical Information), Office of Markets, Tariffs and
Rates, Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426.<PHONE_NUMBER>.
Jeffery S. Dennis (Legal Information), Office of the General Counsel,
Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426.<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Order No. 661-A; Order on Rehearing and Clarification

    1. On June 2, 2005, the Commission issued Order No. 661, the Final
Rule on Interconnection for Wind Energy (Final Rule).\1\ Several
entities have filed timely requests for rehearing and clarification of
the Final Rule.\2\ In this order, the Commission grants in part and
denies in part the requests for rehearing and clarification.
---------------------------------------------------------------------------

    \1\ Interconnection for Wind Energy, Order No. 661, 70 FR 34993
(June 16, 2005), FERC Stats. & Regs. ] 31,186 (2005) (Final Rule);
see also Order Granting Extension of Effective Date and Extending
Compliance Date, 70 FR 47093 (Aug. 12, 2005), 112 FERC ] 61,173
(2005).
    \2\ Those entities requesting rehearing and/or clarification,
and the acronyms used to refer to them in this order, are listed in
Appendix A to this order.
---------------------------------------------------------------------------

I. Background

    2. In Order No. 2003,\3\ the Commission adopted standard procedures
and a standard agreement for the interconnection of large generation
facilities. The Commission required public utilities that own, control,
or operate facilities for transmitting electric energy in interstate
commerce to file revised Open Access Transmission Tariffs (OATTs)
containing these standard provisions, and use them to provide
interconnection service to generating facilities having a capacity of
more than 20 megawatts.
---------------------------------------------------------------------------

    \3\ Standardization of Generator Interconnection Agreements and
Procedures, Order No. 2003, 68 FR 49845 (Aug. 19, 2003), FERC Stats.
& Regs., Regulations Preambles ] 31,146 (2003) (Order No. 2003),
order on reh'g, 69 FR 15,932 (Mar. 24, 2004), FERC Stats & Regs.,
Regulations Preambles ] 31,160 (2004) (Order No. 2003-A), order on
reh'g, 70 FR. 265 (January 4, 2005), FERC Stats & Regs., Regulations
Preambles ] 31,171 (2004) (Order No. 2003-B), order on reh'g, 70 FR
37661 (June 30, 2005), FERC Stats. & Regs. ] 31,190 (2005) (Order
No. 2003-C); see also Notice Clarifying Compliance Procedures, 106
FERC ] 61,009 (2004).
---------------------------------------------------------------------------

    3. In Order No. 2003-A, on rehearing, the Commission noted that the
standard interconnection procedures and agreement were based on the
needs of traditional generation facilities and that a different
approach might be more appropriate for generators relying on other
technologies, such as wind plants.\4\ Accordingly, the Commission
granted certain clarifications, and also added a blank Appendix G to
the standard Large Generation Interconnection Agreement (LGIA) for
future adoption of requirements specific to other technologies.\5\
---------------------------------------------------------------------------

    \4\ Order No. 2003-A at P 407, n.85.
    \5\ Id.
---------------------------------------------------------------------------

    4. The Commission issued a Notice of Proposed Rulemaking (NOPR)
that proposed technical standards applicable to the interconnection of
large wind generating plants \6\ to be included in Appendix G of the
LGIA.\7\ We proposed the standards in light of our findings in Order
No. 2003-A noted above and in response to a petition submitted by the
American Wind Energy Association (AWEA).\8\ Specifically, the
Commission proposed to establish uniform standards in Appendix G that
would require large wind plants seeking to interconnect to the grid to:
(1) Demonstrate low voltage ride-through capability; in other words,
show that the plant can remain on line during voltage disturbances up
to specified time periods and associated voltage levels; (2) have
supervisory control and data acquisition (SCADA) capability to transmit
data and receive instructions from the Transmission Provider; and (3)
maintain a power factor within the range of 0.95 leading

to 0.95 lagging, measured at the high voltage side of the substation
transformers. The Commission proposed to permit the Transmission
Provider to waive the low voltage ride-through requirement on a
comparable and not unduly discriminatory basis. We proposed to permit
the Transmission Provider to waive or defer compliance with the power
factor requirement where it is not necessary. The Commission did not
propose to adopt a proposal by AWEA to allow a wind generator to
``enter the interconnection queue and conduct its own Feasibility
Study, having obtained the information necessary to do so upon paying
the initial deposit and submitting its interconnection application''
(referred to as ``self-study'' provisions).\9\ The Commission did,
however, ask for comments on how to balance the need of wind generators
to obtain certain data from the Transmission Provider before completing
their Interconnection Requests with the need to protect critical energy
infrastructure information and commercially sensitive data against
unwarranted disclosure.
---------------------------------------------------------------------------

    \6\ Large wind generating plants are those with an output rated
at more than 20 MW at the point of interconnection. The
interconnection requirements for small generators rated at 20 MW or
less are set forth in Standardization of Small Generator
Interconnection Agreements and Procedures, Order No. 2006, 70 FR
34190 (June 13, 2005), FERC Stats. & Regs. ] 31,180 (2005), reh'g
pending.
    \7\ See Interconnection for Wind Energy and Other Alternative
Technologies, Notice of Proposed Rulemaking, 70 FR 4791 (Jan. 31,
2005), 110 FERC ] 61,036 (2005) (NOPR).
    \8\ See Petition for Rulemaking or, in the Alternative, Request
for Clarification of Order No. 2003-A, and Request for Technical
Conference of the American Wind Energy Association (May 20, 2004),
filed in Docket Nos. RM02-1-005 and PL04-15-000 (AWEA Petition).
    \9\ See AWEA Petition at 13.
---------------------------------------------------------------------------

    5. In the Final Rule, the Commission adopted final standard
procedures and technical requirements for the interconnection of large
wind plants in Appendix G, and required all public utilities that own,
control, or operate facilities for transmitting electric energy in
interstate commerce to append Appendix G to the Large Generator
Interconnection Procedures (LGIPs) and LGIAs in their OATTs. As
described in more detail below, the Commission adopted provisions
establishing standards for low voltage ride-through and power factor
design criteria, and requiring that wind plants meet those standards if
the Transmission Provider shows, in the System Impact Study, that they
are needed to ensure the safety or reliability of the transmission
system. Additionally, the Appendix G adopted by the Commission included
a SCADA requirement applicable to all wind plants. Finally, as
described in more detail below, the Commission adopted in Appendix G to
the LGIP limited special interconnection procedures applicable to wind
plants.

II. Requests for Rehearing and Clarification and Commission Conclusions

A. Low Voltage Ride-Through Provisions

    6. In the Final Rule, the Commission adopted a low voltage ride-
through standard, but provided that a wind plant is required to meet
the standard only if the Transmission Provider shows, in the System
Impact Study, that low voltage ride-through capability is needed to
ensure safety or reliability. The standard (adopted in Figure 1 of
Appendix G to the LGIA), if applicable, requires the wind plant to stay
online for specified time periods and at associated voltage levels
where there is a disturbance on the transmission system. The Final Rule
requires that the required voltage levels be measured at the Point of
Interconnection.
    7. Several entities requested rehearing of various aspects of the
low voltage ride-through requirement and standard included in the Final
Rule, including: (1) Provisions that require low voltage ride-though
only when the System Impact Study shows that such capability is
necessary for safety or reliability; (2) the specific low voltage ride-
through standard adopted in the Final Rule; (3) the point of
measurement for the standard; and (4) arguments that Transmission
Providers should be permitted to adopt other provisions of the German
low voltage ride-through standard (which the Commission referenced in
the Final Rule).
    8. However, as described in more detail below, NERC and AWEA
jointly requested that the Commission delay the effective date of the
Final Rule to give them time to resolve concerns expressed by NERC
regarding the low voltage ride-through provisions. The Commission
granted this extension, and on September 19, 2005, NERC and AWEA
submitted a joint report with recommended revisions.
1. Case-by-Case Application/Burden of Proof for Applying the Low
Voltage Ride-Through Standard
    9. Prior to the NERC/AWEA joint report, several entities objected
on rehearing to the Final Rule's adoption of a low voltage ride-through
requirement on a case-by-case basis, placing the burden of proof on the
Transmission Provider to show that low voltage ride-through capability
is needed. ATC, EEI, NERC, NRECA/APPA, and SCE, among others, urged the
Commission to return to the approach in the NOPR, which would have
required low voltage ride-through for all wind plants unless waived by
the Transmission Provider on a not unduly discriminatory basis. ATC
noted that interconnection studies only consider a snapshot of the
transmission system, and do not take into account changes in the future
that may cause a need for low voltage ride-through capability to ensure
reliability. ATC, as well as EEI and SCE, argued that under the case-
by-case approach adopted in the Final Rule, Transmission Providers will
need to perform additional analyses to determine if a reliability need
will exist over the life of the wind plant. SCE, for example, noted
that while a particular System Impact Study may not conclusively
demonstrate that low voltage ride-through is needed at that time, if
other generation projects are built, the first wind plant may come to
need low voltage ride-through. According to various entities, the
additional analyses needed to take these scenarios into account will
increase the time, cost and complexity of wind plant interconnections
and could be a barrier to their development.\10\
---------------------------------------------------------------------------

    \10\ New York ISO asserts that the case-by-case approach could
lead to acute problems in New York, where it has received
interconnection applications from wind plants totaling over 5000 MW
of generation. According to New York ISO, conducting case-by-case
reviews for each of these projects could greatly complicate the
study process and result in substantial delays.
---------------------------------------------------------------------------

    10. Furthermore, ATC asserted that the case-by-case approach
imposes the responsibility for resolving reliability concerns that
arise in the future on the Transmission Provider because wind
generating plants cannot be retrofitted with low voltage ride-through
capability. Similarly, NRECA/APPA argued that this approach unduly
discriminates in favor of wind plants in that low voltage ride-through
capability may not be ``necessary'' (and therefore required) for a
specific plant because other generators or Transmission Providers can
``make up the difference.'' \11\ ATC also contended that the case-by-
case approach may require the Transmission Provider to incur capital
costs that should have been incurred by the wind plant.
---------------------------------------------------------------------------

    \11\ Request for Rehearing of NRECA/APPA at 6.
---------------------------------------------------------------------------

    11. EEI and NU argued that the case-by-case approach adopted by the
Commission in the Final Rule ``lowers the bar for reliability.'' \12\
NERC similarly asserted that requiring Transmission Providers to
justify common elements of good utility practice on a case-by-case
basis is unwise and may deter Transmission Providers from implementing
and following good utility practice.\13\ Southern Company states that
the Transmission Provider, as the entity responsible for maintaining
reliability, should not bear the burden of proof to establish what is
required to maintain system reliability. Southern Company states that
it supports the Commission's statement that Transmission Providers
should not be permitted to require wind plants to install costly
equipment that is not needed for reliability, but argues

that the burden of proof should be shifted, and the System Impact Study
should establish that such equipment is not required. Also, NRECA/APPA
argued that the case-by-case approach imposes unreasonable reliability
risks, and effectively voids the requirement that wind plants have low
voltage ride-through capability ``in a broad range of circumstances.''
\14\
---------------------------------------------------------------------------

    \12\ Request for Rehearing of EEI at 8.
    \13\ New York ISO states that it adopts NERC's position on this
issue.
    \14\ Request for Rehearing of NRECA/APPA at 6.
---------------------------------------------------------------------------

    12. Those requesting rehearing raised several other arguments
regarding the case-by-case approach and burden of proof for applying
the low voltage ride-through standard. NERC believed that the case-by-
case approach could unintentionally create a ``patchwork'' of varying
requirements. EEI and NU also suggested that requiring a showing of
need may introduce prolonged uncertainties into the interconnection
process if parties disagree as to the study assumptions. SCE asserted
that rather than limiting opportunities for undue discrimination, the
requirement of a showing of need could result in discriminatory
treatment in areas with large amounts of wind generation because
projects lower in the queue may be responsible for additional costs
since the need for low voltage ride-through could not be demonstrated
for earlier projects. EEI contended that Order No. 2003 already
contains provisions allowing the parties to an interconnection to
exercise their discretion in complying with system reliability
obligations, and that there is no evidence of problems with these
procedures that justifies such a significant departure from them in the
Final Rule. Further, EEI argued that the Final Rule was a significant
departure from the NOPR and that the Commission should not adopt it
without providing an opportunity for comments on it. Finally, NRECA/
APPA argued that the Commission has not explained how this approach is
consistent with NERC and WECC standards.
2. Specific Low Voltage Ride-Through Standard
    13. Certain requests for rehearing and clarification also addressed
the specific low voltage ride-through standard adopted by the
Commission in the Final Rule. In its request for rehearing, NERC
asserted that the standard in Figure 1 of the Final Rule is not
appropriate. More specifically, NERC contended that Figure 1, by
allowing a wind plant to disconnect from the transmission system when
the voltage drops below 15 percent of the nominal voltage, could result
in violation of NERC Reliability Standard TPL-002-0. This standard
requires transmission planners to ensure that the system will remain
stable and within applicable thermal and voltage ratings, with no loss
of demand or curtailment of firm transfers, where there is a normally
cleared fault on a single element, which is typically four to eight
cycles or 0.067 to 0.133 seconds (67 to 133 milliseconds). According to
NERC, a fault occurring on a transmission line near a wind plant could
cause the voltage at that point to drop to zero for this clearing time.
NERC stated that because Figure 1 would allow the wind plant to
disconnect when the voltage drops below 15 percent of the nominal
voltage, the loss of the single grid element (the transmission line)
would be compounded by the loss of the real power (and any reactive
power) produced by the wind plant. This ``double contingency event''
(loss of both the transmission line and wind plant) violates
Reliability Standard TPL-002-0, NERC asserted.
    14. To remedy this problem, NERC requested that the Commission
simply require wind plants to meet NERC and regional reliability
council requirements.\15\ Alternatively, NERC argued that the rule
should be modified to require wind plants to remain connected through a
normally cleared single line to ground or three phase fault.
Specifically, NERC asserted that Figure 1 should be altered to require
a wind plant to remain online for 0.167 seconds (167 milliseconds), or
ten cycles, if voltage at the high side of the wind plant step-up
transformer is reduced to zero. After 0.167 seconds (167 milliseconds),
but before 0.625 seconds (625 milliseconds), NERC argued that Figure 1
should require the wind plant to stay connected as long at the voltage
is at or above 15 percent of the nominal voltage. NERC contended that
these modifications would reduce the risk to the reliability of the
electric system to an acceptable level.\16\
---------------------------------------------------------------------------

    \15\ ISO-NE argued that the Commission should have required wind
plants to be subject to the same system performance standards that
are applied to other generating technologies.
    \16\ ISO-NE also suggested that, if the Commission adopted a low
voltage ride-through standard, it be modified to require the wind
plant to be connected at zero voltage for ``a time period associated
with the typical clearing time of a normal design contingency
fault.'' Request for Rehearing of ISO-NE at 4.
---------------------------------------------------------------------------

    15. Similarly, NU asserted that wind plants should be required to
``remain on-line for all faults cleared by normal operation of all
protective equipment unless clearing the fault * * * isolates the plant
from the rest of the grid.'' \17\ According to NU, this change would
require generators to have low voltage ride-through capability down to
zero percent of the nominal voltage at the Point of Interconnection.
CenterPoint also contend that wind plants should be required to
maintain low voltage ride-through capability down to zero percent of
the rated line voltage 150 milliseconds (.150 seconds) (the time
generally needed for the transmission system protective equipment to
clear the fault). NU and CenterPoint argued that this change would
reduce the likelihood that a low voltage event would escalate to a
cascading outage or voltage collapse. NU also asserted that this
requirement is similar to those applicable to other generators, and
could be achieved by wind turbines that are currently available. NU
stated that the standard adopted in the Final Rule would threaten
reliability by allowing a wind plant to reduce output, or trip offline,
simply due to a typical system fault.
---------------------------------------------------------------------------

    \17\ Request for Rehearing of NU at 5.
---------------------------------------------------------------------------

    16. NRECA/APPA also objected to the low voltage ride-through
standard adopted in the Final Rule. Specifically, they contended that
the Final Rule should not have established the low voltage ride-through
curve as an absolute standard, and instead should have permitted
Transmission Providers to adopt an alternative curve (subject to review
by the Commission if there is a dispute) when the System Impact Study
shows that it is necessary. ISO-NE, going further, requested that if
the Commission adopted a low voltage ride-through standard, it should
be only a guideline for wind turbine manufacturers. NRECA/APPA asserted
that the Final Rule did not conclude that the low voltage ride-through
standard will protect reliability or address the technical concerns
raised by comments, and, by stating that the Commission might consider
an alternative low voltage ride-through standard, recognizes that it
may not be adequate to preserve reliability in all circumstances.
Alternatively, NRECA/APPA asked that the Commission clarify that
Transmission Providers may support variations from the low voltage
ride-through curve in the Final Rule, based on local and subregional
reliability conditions, under the three variation standards adopted in
the Final Rule.
    17. EEI asserted that the technical challenges presented by wind
generation are being considered by the industry worldwide, and that
many international standards differ from the Commission's Final Rule.
Both EEI and SCE objected to the specific low voltage ride-through
standard through comparison to the German

interconnection guidelines. Particularly, EEI noted that the German
grid code requires wind plants to remain connected to the grid
following a fault that results in the voltage at the Point of
Interconnection dropping to 15 percent of the nominal voltage for as
long as 0.15 seconds. According to EEI, revisions to the German grid
code are nearing completion that will require wind plants to remain
connected to the transmission system following a fault that drops the
voltage at the Point of Interconnection to zero percent of the nominal
voltage for as long at 0.15 seconds. Further, EEI reported that the
Hydro-Qu[eacute]bec requirements for wind farm interconnection are
stricter than the Commission's Final Rule; they require wind plants to
ride through a fault resulting in a voltage drop to zero percent of
nominal voltage for as long as 0.15 seconds. Finally, EEI noted that
Ireland requires wind plants to stay online after a fault that drops
the voltage to 15 percent of nominal voltage for as long as 0.15
seconds. SCE additionally asserted that the requirement that low
voltage ride-through be shown to be necessary in the System Impact
Study conflicts with the German wind interconnection guidelines because
those guidelines assume that all generation will meet the low voltage
ride-through standard. SCE stated that the Final Rule should adopt low
voltage ride-through capability as a governing standard, with
exceptions approved by the governing technical body (NERC or the
Western Electricity Coordinating Council (WECC), a regional reliability
council), as in the German standard.
    18. In the Final Rule, the Commission stated that ``the low voltage
ride-through requirement, and the time periods and associated voltage
levels set forth in Appendix G, Figure 1, apply to three-phase
faults.'' ATC sought clarification as to whether the low voltage ride-
through requirement applied only to three-phase faults. Assuming that
is the case, ATC asked whether there was a requirement for single-phase
and double-phase faults.
3. Point of Measurement for the Low Voltage Ride-Through Standard
    19. NERC argued on rehearing that because the Point of
Interconnection may be some distance from a wind plant, the plant might
actually disconnect at voltages higher than 15 percent of the nominal
voltage at the high side of the wind plant step-up transformer.
According to NERC, this could create a further risk of a double
contingency event.\18\ To avoid this risk, NERC contended that low
voltage ride-through capability should be measured at the high voltage
terminal of the wind plant step-up transformer. Southern Company stated
that a revision to section A.i.2 of the LGIA Appendix G was necessary
to reflect the Commission's decision in the Final Rule to adopt the
Point of Interconnection as the measurement point.
---------------------------------------------------------------------------

    \18\ See supra, P 13.
---------------------------------------------------------------------------

4. Adoption of Other Provisions From the German Standards
    20. SCE noted that while the Final Rule adopted a low voltage ride-
through standard based on the German wind interconnection guidelines,
the Commission did not adopt the related requirements in the German
guidelines. It noted several provisions of the German guidelines that
it stated go hand-in-hand with the low voltage ride-through
standard.\19\ SCE asked the Commission to clarify that Transmission
Providers may implement these other guidelines in the German standard.
---------------------------------------------------------------------------

    \19\ See Request for Rehearing and Clarification of SCE at 9-10.
---------------------------------------------------------------------------

5. NERC/AWEA Recommended Revisions to Low Voltage Ride-Through
Provisions
    21. As noted above, NERC filed a request for rehearing of the Final
Rule contending, in part, that the specific low voltage ride-through
standard adopted by the Commission would permit violations of a NERC
system performance standard.\20\ On August 4, 2005, NERC and AWEA filed
a request to extend the effective date of the Final Rule to allow for
discussions to resolve the reliability concerns expressed by NERC. They
committed to submitting to the Commission a joint final report on their
discussions. On August 5, 2005, the Commission issued an order granting
this request.\21\
---------------------------------------------------------------------------

    \20\ See supra, P 13.
    \21\ Interconnection for Wind Energy, 70 FR 47093 (Aug. 12,
2005), 112 FERC ] 61,173 (2005).
---------------------------------------------------------------------------

    22. On September 19, 2005, NERC and AWEA submitted their joint
final report, which recommended revisions to the low voltage ride-
through provisions of the Final Rule. They state that the recommended
revisions are supported by the NERC Planning Committee and AWEA
members. NERC states that the concerns expressed in its request for
rehearing will be resolved if the Commission adopts the recommended
revisions.
    23. Specifically, NERC and AWEA recommend a different low voltage
ride-through section to be inserted in Appendix G. The recommended
provisions include a transition period standard, which would apply to
wind plants that either: (a) Have interconnection agreements signed and
filed with the Commission, filed with the Commission in unexecuted
form, or filed with the Commission as non-conforming agreements between
January 1, 2006 and December 31, 2006, with a scheduled in-service date
no later than December 31, 2007; or (b) involve wind turbines subject
to a procurement contract executed before December 31, 2005 for
delivery through 2007. During this transition period, wind plants would
be required to ride through low voltage events down to 0.15 per unit
for normal clearing times up to a maximum of nine cycles.
    24. Following this transition period, the NERC/AWEA proposal would
require wind plants to ride through low voltage events down to a zero
voltage level for ``location-specific'' clearing times up to a maximum
of nine cycles. If the fault on the transmission system remained after
this clearing time, the joint recommendation would permit the wind
plant to disconnect from the system.
    25. Under the joint recommendation of NERC and AWEA, during both
the transition period and after, low voltage ride-through capability
would be required for all new wind plant interconnections, instead of
only when the System Impact Study shows that such capability is needed
for safety or reliability, as in the Final Rule. Additionally, in both
cases the point of measurement for the requirement would be at the high
side of the wind plant step-up transformer, instead of at the Point of
Interconnection, as in the Final Rule. NERC and AWEA also recommend
eliminating Figure 1 during both the transition period and after the
transition period because the low voltage ride-through standard
described in their Joint Report replaces the voltage trace represented
by Figure 1.
    26. Finally, NERC and AWEA recommend limiting the variations to the
low voltage ride-through provisions that were permitted by the Final
Rule. The Final Rule permits Transmission Providers to justify
variations between their pro forma tariff and the Final Rule Appendix G
based on the regional reliability, the ``consistent with or superior
to,'' or the independent entity variation standards in Order No.
2003.\22\ NERC and AWEA recommend that variations to their proposed low
voltage ride-through provisions be permitted on an interconnection-wide
basis only, reasoning that such a limitation is appropriate because the
provisions are intended to satisfy a NERC reliability

standard, and because wind generators could incur significant
additional costs if they had to meet many different standards. NERC and
AWEA note that limiting variations would not restrict the ability to
request a deviation in a specific non-conforming agreement filed with
the Commission (as opposed to a variation built into a pro forma
tariff).
---------------------------------------------------------------------------

    \22\ Final Rule at P 107, 109.
---------------------------------------------------------------------------

    27. The Commission issued notice of the NERC/AWEA joint report on
September 21, 2005, and provided interested parties with the
opportunity to submit comments on or before October 3, 2005. FPL
Energy, National Grid, New York ISO and PJM all filed comments
supporting the technical recommendations in the joint report.
    28. National Grid also asks that the Commission make two
clarifications. First, it asks the Commission to clarify that while the
point of measurement for compliance with the low voltage ride-through
standard would be at the high side of the step-up transformer, the
point of measurement for reactive power would remain at the Point of
Interconnection. Second, National Grid requests that the nine cycle
maximum clearing time in the low voltage ride-through provision applies
only to three-phase faults. It says that single line-to-ground faults
are typically much longer than nine cycles, so a general, non-specified
standard is more appropriate for such faults.
    29. New York ISO, while strongly supporting the technical aspects
of the NERC/AWEA joint recommendations, urges the Commission to reject
the proposal that variations to the low voltage ride-through provision
be permitted only on an interconnection-wide basis or through
individually-filed interconnection agreements. It argues that this
could hamper efforts to preserve reliability in individual regions, and
asserts that satisfying NERC planning standards is not sufficient to
preserve reliability because New York State, as well as other regions,
sometimes need more stringent reliability requirements than those of
NERC. New York ISO says that the Commission has viewed NERC's criteria
as being minimum reliability requirements, which individual regions may
exceed if necessary. Therefore, New York ISO argues that at a minimum,
the Commission should permit independent entities to seek variations
from the low voltage ride-through standards recommended by NERC and
AWEA.
    30. Finally, New York ISO asks the Commission to clarify that,
assuming the NERC/AWEA recommendations are adopted, the ``filing date''
for purposes of the proposed transition period includes the date that
conforming interconnection agreements are fully and finally executed.
New York ISO notes that executed conforming agreements need not be
filed with the Commission. Therefore, it contends that the transition
period should apply to agreements executed within its timeframe but not
filed with the Commission.
Commission Conclusion on Low Voltage Ride-Through Provisions
    31. The Commission grants rehearing with regard to the low voltage
ride-through provisions, and adopts the joint recommendation of NERC
and AWEA without modification. This provides a standard that will
ensure that wind plants are interconnected to the grid in a manner that
will not degrade system reliability. Furthermore, this standard
satisfies the reliability concerns expressed by NERC, and either
satisfies or renders moot many of the rehearing requests described
above, including those related to the case-by-case application of the
low voltage ride-through standard and point of measurement for the low
voltage ride-through standard. Additionally, the joint recommendation
also responds to the arguments on rehearing of EEI and SCE regarding
comparison to the German interconnection guidelines.
    32. We are eliminating Figure 1 from Appendix G because the
standard we are adopting in Appendix G replaces that figure.
Accordingly, all references to Figure 1 in the preamble to the Final
Rule should be read to apply to the standard now described in Appendix
G.
    33. We also adopt the NERC/AWEA proposal to permit variations to
the low voltage ride-through provisions of Appendix G only on an
interconnection-wide basis. The low voltage ride-through provisions we
adopt in this order on rehearing were crafted specifically, after
negotiation among the wind industry and NERC, to ensure that NERC
Reliability Standard TPL-002-0 is met in all regions. While other
interconnection standards may be more susceptible to variation among
Transmission Providers or independent entities, the close connection of
this standard to an industry-wide reliability standard persuades us
that limiting variations to those made on an interconnection-wide basis
will best ensure that reliability is protected. Accordingly, we reject
SCE's request that we clarify that Transmission Providers may implement
other guidelines from the German interconnection standard. Adoption of
other guidelines from the German standard on a Transmission Provider-
specific basis could result in varying requirements that may not meet
established reliability standards. For the same reasons, we also reject
New York ISO's assertion that the Commission should continue to permit
variations to the low voltage ride-through provisions under the three
variation standards in the Final Rule, and particularly the independent
entity variation. We note, however, that under section 1211 of the
Energy Policy Act of 2005, the State of New York ``may establish rules
that result in greater reliability within that State, as long as such
action does not result in lesser reliability outside the State than
that provided by the reliability standards.'' \23\ Therefore, the
Commission will consider proposed variations from the State of New York
under this statutory provision.
---------------------------------------------------------------------------

    \23\ Energy Policy Act of 2005, Pub. L. 109-58, Sec.  1211, 119
Stat. 594, 945 (2005).
---------------------------------------------------------------------------

    34. In response to the arguments of NRECA/APPA that the Final Rule
should have permitted Transmission Providers to adopt alternative low
voltage ride-through standards, and ISO-NE's contention that the
standard in the Final Rule should be only a guideline, we find that the
definitive standard we adopt here will provide certainty to wind
developers and manufacturers and ensure that reliability is maintained
and NERC planning standards are met. If another standard is necessary
for a specific wind plant interconnection to maintain reliability, a
non-conforming agreement may be filed with the Commission.
    35. In response to ATC and National Grid, we clarify that the low
voltage ride-through provisions we are adopting apply to all types of
faults, not just to three-phase faults. The standard refers to three-
phase faults with normal clearing as well as single line to ground
faults with delayed clearing. In response to National Grid's specific
concern, we clarify that the nine cycle maximum clearing time expressed
in the low voltage ride-through provisions applies only to three-phase
faults. Single line to ground faults have typically much longer
clearing times, as National Grid notes, and the low voltage ride-
through provisions adopted here recognize this difference by
specifically referring to ``single line to ground faults with delayed
clearing.'' This non-specified standard is appropriate for those types
of faults.

B. Power Factor (Reactive Power) Provisions

    36. In the Final Rule, the Commission adopted in Appendix G to the
LGIA a power factor standard applicable to

wind plants. The Final Rule provides that wind plants are required to
meet this standard only if the Transmission Provider shows, in the
System Impact Study, that reactive power capability is necessary to
ensure the safety or reliability of the transmission system. The
specific power factor standard in Appendix G to the LGIA, if
applicable, requires a wind plant to maintain a power factor within the
range of 0.95 leading to 0.95 lagging (hereinafter +/-0.95), to be
measured at the Point of Interconnection.
    37. Requests for rehearing and/or clarification of these provisions
concern whether wind plants should have to maintain a required power
factor only where the System Impact Study shows that it is required for
reliability or safety, and whether the power factor standard and point
of measurement adopted by the Commission in the Final Rule are
appropriate.
1. Case-by-Case Application/Burden of Proof for Applying the Power
Factor Standard
    38. Several entities object to the provisions in the Final Rule
that require wind plants to maintain the required power factor only
when the Transmission Provider, in the System Impact Study, shows that
it is necessary to ensure safety or reliability. NERC objects to this
approach because it may deter Transmission Providers from implementing
and following good utility practice and could create a ``patchwork'' of
varying requirements. NU argues that this approach ``lowers the bar for
reliability,'' and will add complexity, cost and delay to the generator
interconnection process because Transmission Providers will be required
to perform more studies to determine whether reactive power capability
is necessary for reliability or safety. Southern Company states that
the Transmission Provider, as the entity responsible for maintaining
reliability, should not bear the burden of proof to establish what is
required to maintain system reliability. It supports the Commission's
statement that Transmission Providers should not be permitted to
require wind plants to install costly equipment that is not needed for
reliability, but argues that the burden of proof should be shifted to
the generator.
    39. NRECA/APPA notes that traditional generators are required to
meet the power factor standard not because reactive power is needed in
every case to preserve reliability, but instead because the
transmission system is dynamic and requires flexibility over time to
maintain reliability. They state that the need for reactive power in
the future under a variety of operating conditions cannot be determined
with perfect certainty in the System Impact Study. The case-by-case
approach, they contend, grants an undue preference to wind plants,
imposes risks to system reliability, and shifts costs to consumers and
other generating plants. The risk to system reliability is that the
Final Rule may only require a wind plant to provide reactive power
after other wind plants have been installed without such capability,
and that at that point the resources from that single plant may not be
enough to protect the transmission system. NRECA/APPA also asserts that
the case-by-case approach increases uncertainty, contrary to the
Commission's conclusion in the Final Rule, because each wind plant will
face different requirements based on the outcome of the System Impact
Study. Additionally, it contends that this approach creates more
opportunities for discrimination because it would permit wind plants to
be treated differently.
    40. ATC contends that the Commission has offered no guidance as to
what power factor range would be acceptable if a reliability need is
not identified (and thus reactive power is not required), and whether
wind plants in this instance must operate within any particular
reactive power operating band. Similarly, NU expresses concern that
wind plants could operate at any power factor in the absence of a
showing of need in the System Impact Study, and thus avoid a physical
requirement for delivering power onto the transmission system.
According to ATC, the rule could be interpreted to permit wind plants
to operate at any power factor they choose. It claims that reactive
power is needed for each generator, and that each generator should be
obligated to operate within a range of power factors, regardless of
whether the transmission system as a whole needs additional reactive
power capability. ATC recommends that at a minimum, the Commission
require all wind plants to meet a power factor range of 0.95 leading to
1.0 (unity), and allow the Transmission Provider to require a range of
1.0 (unity) to 0.95 lagging if the System Impact Study shows that there
is a reliability need.
Commission Conclusion
    41. The Commission will not modify the Final Rule to require wind
plants to meet the power factor standard without a showing by the
Transmission Provider, through the System Impact Study, that it is
needed for safety or reliability. The case-by-case approach to a
reliability needs assessment adopted in the Final Rule will not
threaten reliability, as several of those seeking rehearing argue. As
we noted in the Final Rule, if reactive power is necessary to maintain
the safety or reliability of the transmission system, the System Impact
Study performed by the Transmission Provider will establish that
need.\24\ We stated in the Final Rule, and reiterate here, that the
System Impact Study is the appropriate study for determining whether
reactive power capability is needed.\25\ Furthermore, we reasoned in
the Final Rule that requiring wind plants to maintain the power factor
standard only if the System Impact Study shows it to be necessary will
not only ensure that increased reliance on wind power will not degrade
system safety or reliability, but also will limit opportunities for
undue discrimination by ensuring that Transmission Providers do not
require costly equipment that is not necessary for reliability.\26\
---------------------------------------------------------------------------

    \24\ Final Rule at P 51.
    \25\ Id.
    \26\ Id.
---------------------------------------------------------------------------

    42. NERC states that the decision in Order No. 661 to use a case-
by-case approach may deter Transmission Providers from following Good
Utility Practice, and may have the unintended consequence of spawning a
patchwork of varying requirements. We agree with NERC that Transmission
Providers must follow Good Utility Practice when interconnecting all
generating plants, including wind plants, and that not following Good
Utility Practice when performing System Impact Studies could lead to
problems. However, the Commission points out that every Transmission
Provider is required under Order No. 2003 to follow Good Utility
Practice. Transmission Providers are required to complete a detailed
System Impact Study, and are required to ensure that NERC reliability
standards are met in all instances. This includes performing studies to
determine what is necessary to ensure that the interconnection of a
wind generating facility does not degrade grid reliability. The
Commission recognizes that the industry (and particularly NERC) is
continuing to address technical issues involved in the interconnection
of wind plants. If NERC through its stakeholders and Board approval
process develops a new standard, the Commission will entertain such a
standard. Finally, we disagree with NRECA/APPA's suggestion that the
Final Rule threatens the reliability of the transmission system because
it may require only wind plants later in the queue to provide reactive
power, which may not

be sufficient to protect the grid. The System Impact Study will take
into account the system's need for reactive power, both as it exists
today and under reasonable anticipated assumptions. NRECA/APPA has not
explained how assessing the need for reactive power through the System
Impact Study process will result in too little reactive power being
available in the future. Whenever a new generator is added to its
system, the Transmission Provider must complete a new System Impact
Study to ensure that reliability requirements are met; this may require
a new wind generator later in the queue to meet the reactive power
requirement.
    43. We also reject arguments that the case-by-case approach is
inappropriate because of the dynamic nature of the transmission system.
The fact that the transmission system is constantly changing is not new
or unique to the study of wind plant interconnections. The studies that
are part of the interconnection process should take into account likely
circumstances that could occur on the Transmission Provider's system,
whether the studies are conducted in connection with a proposed wind
plant or another type of generating facility.
    44. Furthermore, we are not persuaded that the approach adopted in
the Final Rule will result in additional studies, increased costs and
delays, and cost shifts. First, as noted previously, the System Impact
Study, as well as the other interconnection studies, should take into
account a variety of assumptions concerning anticipated transmission
system conditions. If additional or expanded studies are needed to
determine whether the power factor standard is necessary, the
Commission does not believe that the additional burden will outweigh
the cost considerations underlying the case-by-case approach. Finally,
although the case-by-case approach may result in some delay, we remind
the parties to a wind plant interconnection, like other
interconnections, that they are still required to meet the milestones
set forth in the LGIP. Any increased costs from completing expanded or
additional studies within the timeframe required by this rule will be
borne by the wind plant Interconnection Customer, as provided in Order
No. 2003, which will leave other generators and the Transmission
Provider unharmed.
    45. The Commission also rejects arguments that the case-by-case
approach provides more opportunities for discrimination. As we noted in
the Final Rule Appendix G was adopted to take into account the
technical differences between wind plants and traditional generating
plants. One of these differences is that for wind plants, reactive
power capability is a significant added cost, while it is not a
significant additional cost for traditional generators. Given these
technical differences, treating wind plants differently with regard to
reactive power requirements is not unduly discriminatory or
preferential. Additionally, we note that the outcome of the System
Impact Study, which determines whether reactive power will be required,
can be challenged, which will serve to minimize the opportunities for
discrimination by the Transmission Provider. Also, the wind plant
Interconnection Customer will have recourse to the Commission if it
believes the Transmission Provider has acted in a discriminatory
manner.
    46. The Commission declines to adopt ATC's request that all wind
plants, at a minimum, operate within a power factor range of 0.95
leading to 1.0 (unity). This requirement would essentially require
reactive power in every case, which we have already rejected. If
reactive power capability is needed, including a power factor range of
0.95 leading to 1.0 (unity), the System Impact Study will demonstrate
this need.
2. Specific Power Factor Standard
    47. NRECA/APPA argues that the Commission should clarify that wind
generators must meet the same reactive power requirements as other
generators, provided the requirements are imposed in a
nondiscriminatory manner. It notes that some Transmission Providers
impose a power factor range wider that +/-0.95 on all new generation,
and argues that in such cases, the same range should be applied to wind
plants. It argues that not imposing the same range threatens
reliability and shifts the costs of preserving reliability to customers
or competing generators.
    48. EEI and NU assert that wind plants should regulate voltage to a
set point established by the Transmission Provider, as do synchronous
generators. EEI contends that the language it offered in its initial
comments would provide this necessary clarity, while also maintaining
the flexibility provided in Order No. 2003 so that individual, site-
specific conditions may be addressed.\27\ NU states that wind turbines
have this capability, either inherently (doubly fed induction
generators) or through external equipment.
---------------------------------------------------------------------------

    \27\ EEI's March 2, 2005 comments in this proceeding suggest
that we require the wind plant to maintain a power factor within the
range specified by the Transmission Provider ``from time to time,''
but would not require that it operate outside of the 0.95 leading to
0.95 lagging range. See Comments of EEI (March 2, 2005) at 5-6.
---------------------------------------------------------------------------

    49. NRECA/APPA also expresses concern that the phrase ``taking into
account any limitations due to voltage level, real power output, etc.''
in the power factor requirements section of Appendix G could create
operational problems for Transmission Providers with wind plants on
their systems. Specifically, it is concerned that this language could
exempt wind plants from their reactive power requirements during
startup and low output periods, which could degrade reliability during
a system contingency.
Commission Conclusion
    50. With regard to NRECA/APPA's request for clarification that wind
generators must meet a wider power factor range because some
Transmission Providers impose a power factor range wider that +/-0.95
on all new generation, we note that if we were to allow the
Transmission Provider to impose a wider power factor range as a matter
of routine, that would defeat the purpose of adopting a reactive power
standard for wind generators. However, we note that if the System
Impact Study shows the need for a power factor range wider than +/-0.95
for safety or reliability, the Transmission Provider must file a non-
conforming agreement, as Order No. 2003 permits. The Commission will
consider these non-conforming agreements on a case by case basis. If a
Transmission Provider has a different power factor range in its LGIA
and wishes to apply that same range in Appendix G, it may seek a
variation from the Commission under the variation standards approved in
the Final Rule.\28\ We remind Transmission Providers, however, that the
Commission has adopted a specific power factor standard for wind plants
because of their technical differences. Any proposed variations will be
viewed in light of these technical differences.
---------------------------------------------------------------------------

    \28\ Final Rule at P 109.
---------------------------------------------------------------------------

    51. In response to the assertion of EEI and NU that wind plants
should regulate voltage to a set point established by the Transmission
Provider, we note that in the Final Rule we concluded that article
9.6.2 of the LGIA (which applies to all plants, including wind plants)
already requires that the ``Interconnection Customer * * * operate the
Large Generating Facility to maintain the specified output voltage or
power factor at the Point of Interconnection.'' \29\
---------------------------------------------------------------------------

    \29\ Id. at P 55.
---------------------------------------------------------------------------

    52. Finally, the Commission addressed in the Final Rule the

concerns raised by NRECA/APPA regarding the phrase ``taking into
account any limitations due to voltage level, real power output, etc.''
We stated that this language was necessary due to the technical
limitations of wind generating technology.\30\ We noted that all wind
generating equipment vendors cannot meet the required power factor
range at all levels of output. We reiterate that these technical
differences make the disputed language necessary. Furthermore, without
this language, a Transmission Provider could discriminate against a
wind plant by requiring that it operate at the stated power factor at
voltages where it is technically infeasible to do so.
---------------------------------------------------------------------------

    \30\ Id. at P 56.
---------------------------------------------------------------------------

3. Point of Measurement of Power Factor
    53. National Grid asks that if the Commission adopts the
recommended revisions to the low voltage ride-through provisions filed
jointly by AWEA and NERC, it clarify that while the point of
measurement for compliance with the low voltage ride-through standard
would be at the high-side of the step-up transformer, the point of
measurement for reactive power is at the Point of Interconnection.
Commission Conclusion
    54. We clarify that the point of measurement for the reactive power
standard is at the Point of Interconnection.

C. Self-Study of Interconnection Feasibility

    55. In the Final Rule, the Commission adopted special
interconnection procedures that allow the wind plant Interconnection
Customer, when completing the Interconnection Request form required by
section 3.3 of the LGIP, to provide the Transmission Provider with a
simplified set of preliminary data depicting the wind plant as a single
equivalent generator.\31\ Once the wind generator has provided this
data and satisfied all other applicable Interconnection Request
conditions, the special procedures permit the wind plant to enter the
queue and receive the base case data as provided for in the LGIP.
Finally, the special procedures adopted in the Final Rule require the
wind plant Interconnection Customer to submit, within six months of
submitting the Interconnection Request, completed detailed electrical
design specifications and other data (including collector system layout
data) needed by the Transmission Provider to complete the System Impact
Study.
---------------------------------------------------------------------------

    \31\ ``Single equivalent generator'' information is design data
that represents the aggregate electrical characteristics of the
individual wind generators as a single generator.
---------------------------------------------------------------------------

    56. Southern Company argues on rehearing that these provisions give
wind developers a special preference that unfairly disfavors other
generating technologies.
    57. EEI, NU and Southern Company contend that the ``self-study''
provisions of the Final Rule will add further complexity and
uncertainty to the queue process and make queue management and
assignment of cost responsibilities more difficult for Transmission
Providers with large wind-powered generation projects in their queue.
Southern Company adds that the self-study provisions could increase
costs to market participants because the Transmission Provider will
have to run multiple studies. EEI argues that until the industry can
fully address the issues raised by these provisions in a technical
forum, the Commission should remove the provisions from Appendix G. EEI
and NU assert that the provisions do not protect against a wind plant
Interconnection Customer making significant revisions to its project
proposal. If the Commission does not remove the provisions entirely,
EEI and NU suggest that the Commission allow the Transmission Provider
to determine whether the detailed electrical design specifications
later submitted by the wind plant Interconnection Customer are a
material modification to the initial proposal, which would result in
the initial Interconnection Application being withdrawn.
    58. Midwest ISO agrees with the Commission that a wind plant should
be able to enter the queue and receive base case data based on
preliminary design specifications. However, it seeks rehearing of the
provision that permits a wind plant to wait up to six months before
submitting final design specifications. It argues that this procedure
promotes inefficiency because the Transmission Provider may be able to
evaluate the proposed interconnection, but cannot do so because it
lacks necessary data. Midwest ISO requests that the Commission revise
the Appendix G self-study provisions to permit the Transmission
Provider to notify the wind plant Interconnection Customer of its
intent to start the System Impact Study. Once this notice is given, the
wind plant developer would have five business days to ``submit either
actual design specifications or generic specifications based on typical
equipment used in the industry.'' \32\ Further, Midwest ISO proposes
that if the wind plant Interconnection Customer submits generic
specifications, it should have to accept cost uncertainty, because
additional facilities may be required when the actual design
specifications are taken into account. Midwest ISO asserts that this
would limit delays in the study process and would allow the
Transmission Provider to identify potential problems or eliminate
tenuous or technically deficient projects earlier and to better use its
resources to study proposed interconnections.
---------------------------------------------------------------------------

    \32\ Request for Rehearing of Midwest ISO at 4.
---------------------------------------------------------------------------

Commission Conclusion
    59. The Commission will deny these requests for rehearing. We will
make one minor revision to label these special interconnection
procedures for wind plants as ``Appendix 7'' to the LGIP, as discussed
in more detail below.
    60. In response to arguments that the self-study procedures for
wind plants give these plants a preference, we reiterate that these
procedures were developed to recognize the technical differences of
wind plants. Unlike conventional generators, wind plant design
specifications and configurations can change significantly based on
their placement on the transmission system.\33\ For example, the
placement of wind turbines, voltage support devices, transformers, and
other equipment (including the layout of the medium voltage collector
system) depend on the location of the wind plant, the location of other
generators on the transmission system, and other information included
in the base case data.\34\ To accommodate these differences, the Final
Rule permits wind plants to enter the interconnection queue with a set
of preliminary electrical design specifications depicting the wind
plant as a single generator, instead of providing detailed design
specifications as required by Order No. 2003. Treating wind plants
differently in this regard is not unduly discriminatory or
preferential, but as noted elsewhere, simply recognizes that wind
plants have different technical characteristics than the more
traditional forms of generation that the LGIP and LGIA were designed to
accommodate. We continue to believe that without this reasonable
accommodation, Transmission Providers could frustrate the
interconnection of wind plants by requiring them to submit detailed
design data, which they cannot do until later in the interconnection
process.
---------------------------------------------------------------------------

    \33\ Final Rule at P 97.
    \34\ Id.
---------------------------------------------------------------------------

    61. We are not persuaded that the reasonable self-study provision
we adopted will make the interconnection

queue process significantly more difficult or complex. Wind plant
Interconnection Customers who provide the preliminary single generator
equivalent data are required to provide final detailed electrical
design specifications no later than six months after submitting the
initial Interconnection Request. This six-month time period takes into
account the procedures needed before the start of the System Impact
Study, including the Feasibility Study and negotiation of study
agreements. Therefore, the Transmission Provider will receive from the
wind plant the detailed design information needed to conduct the System
Impact Study. For this reason, we also deny Midwest ISO's request to
modify the six-month deadline. If we adopted Midwest ISO's proposed
modifications, the Transmission Provider could request that the wind
plant provide detailed design specifications at any time it believes it
is ready to begin the System Impact Study, even a day after the initial
Interconnection Request is submitted. As a result, this modification
would defeat the purpose of permitting wind plants to submit
preliminary design specifications, and could allow Transmission
Providers to frustrate the interconnection of wind plants.
    62. With respect to the alternative suggestion by EEI and NU that
the Transmission Provider be permitted to determine that a detailed
design specification later submitted by the wind plant Interconnection
Customer is a material modification of the Interconnection Request, we
note that section 4.4 of the LGIP already addresses modifications and
will apply to wind plants as well as other generating technologies.
When applying this section to wind plant Interconnection Requests that
first submit preliminary design specifications, Transmission Providers
are not to consider the detailed design data provided later by the wind
plant Interconnection Customer to be a material modification unless it
significantly departs from the preliminary specifications provided. In
other words, the detailed design provided later should be substantially
the same as the initial single-generator equivalent design in terms of
its costs and effect on the transmission system.
    63. Finally, to avoid confusion, the Commission will rename the
Appendix G to the LGIP it adopted in the Final Rule as ``Appendix 7,
Interconnection Procedures for a Wind Generating Plant.'' Accordingly,
when complying with the Final Rule and this order on rehearing, public
utilities must adopt the special interconnection procedures applicable
to wind plants as Appendix 7 to their LGIPs. The low voltage ride-
through, power factor design criteria and SCADA provisions should
continue to be labeled ``Appendix G'' to the LGIA.

D. Adoption of Appendix G on an Interim Basis Only

    64. EEI and NU each generally argue that the Commission should
apply Appendix G only on an interim basis, and should defer to NERC and
Institute of Electrical and Electronics Engineers (IEEE) processes to
develop formal technical standards. Southern Company argues that the
Commission should defer to NERC, regional reliability councils, and
other technical organizations to develop technical requirements for
wind plants, and should suspend application of the Final Rule and
formally request that these entities develop technical standards.
Southern Company argues that this would avoid the problems that result
from having the Commission review each variation to Appendix G as the
technical standards are developed and revised. It also asserts that the
Commission should not be the arbiter of technical disputes, such as the
outcome of the System Impact Study or specific SCADA requirements, as
the Final Rule provides.
    65. As noted above, NERC similarly argues that the Commission
should only require wind plants to meet NERC and regional reliability
council requirements, noting that Figure 1 is likely to remain static
over time, which could hamper the development of wind generator
technology. EEI notes that NERC has established a Wind Generator Task
Force that is examining existing standards and will make proposals
later this year. It states that the industry worldwide is addressing
technical challenges presented by wind generation. Significant
modifications are being developed for the German grid code, and Hydro-
Quebec is considering several reliability issues regarding wind
generator interconnection. NERC further notes that Hydro-Quebec
requires the same dynamic performance of wind plants that it requires
of other generating facilities, and that major wind turbine
manufacturers have shown that they can meet this requirement. EEI
proposes that the industry conduct a technical forum to resolve issues
related to wind plant interconnection, concluding with formal
recommendations to the Commission that could be used in a new NOPR, or
to develop formal proposals for NERC or IEEE standards.
Commission Conclusion
    66. The Commission denies these requests for rehearing, and others
noted earlier, that ask us to adopt Appendix G only on an interim
basis. Standards are needed today because no nationwide standard is
currently in place and it is uncertain when such a standard will be
finalized. Without a firm standard in place, the current ad hoc
practices for wind interconnection requirements may frustrate the
interconnection of wind plants. As we noted in the Final Rule, Appendix
G is necessary to recognize the technical differences between wind
plants and traditional plants to ensure that the entry of wind
generation into markets is not unnecessarily inhibited.
    67. We recognize, however, that the industry continues to study and
address issues raised by the interconnection and operation of wind
plants. For that reason, the Commission stated in the Final Rule that
if another entity develops an alternate standard, a Transmission
Provider may seek to justify adopting it as a variation from Appendix
G.\35\ We also stated that we would consider a future industry petition
to revise Appendix G to conform to a NERC-developed standard.\36\ We
reiterate both of those statements here, and also note that under the
Energy Policy Act of 2005, the Commission will be addressing mandatory
reliability standards.\37\
---------------------------------------------------------------------------

    \35\ Id. at P 34. We note that in this order on rehearing,
variations to the low voltage ride-through standard will only be
permitted on an interconnection-wide basis. As we note above,
however, non-conforming agreements may be submitted to the
Commission. See P 33-34, supra.
    \36\ Id.
    \37\ See Energy Policy Act of 2005, Pub. L. 109-58, Sec.  1211,
119 Stat. 594, 941 (2005).
---------------------------------------------------------------------------

E. Transition Period

    68. In the Final Rule, the Commission adopted a transition period
that applies to the low voltage ride-through, power factor design
criteria and SCADA requirements. These technical requirements in the
Final Rule Appendix G, if applicable, apply only to LGIAs signed, filed
with the Commission in unexecuted form, or filed as non-conforming
agreements, on or after January 1, 2006, or the date six months after
publication of the Final Rule in the Federal Register, whichever is
later.\38\ The Commission adopted this transition period to allow wind

equipment currently in the process of being manufactured to be
completed without delay or added expense, and to ensure that the Final
Rule did not interrupt the supply of wind turbines.
---------------------------------------------------------------------------

    \38\ The Final Rule was published in the Federal Register on
June 16, 2005. Thus, the low voltage ride-through, power factor
design criteria and reactive power provisions in the Final Rule, as
revised herein, will apply to LGIAs signed, filed with the
Commission in unexecuted form, or filed as non-conforming
agreements, on or after January 1, 2006.
---------------------------------------------------------------------------

    69. NRECA/APPA argues that the transition period is arbitrary,
capricious, and unduly discriminatory. NRECA/APPA asserts that the
Commission adopted the transition period with no technical
justification and no explanation of how the transition period will
maintain the reliability of the transmission system. They contend that
the transition period requires transmission customers and competing
generators to bear the reliability effects of wind plants
interconnected during the transition period. While NRECA/APPA state
that there are ``valid commercial considerations'' that should be taken
into account for the existing inventory of wind equipment, they contend
that such determinations should be made on a case-by-case basis.
Commission Conclusion
    70. The Commission declines to remove the transition period as
NRECA/APPA request. We adopted this reasonable transition mechanism to
allow wind turbines in the process of being manufactured to be
completed without delay or additional expense.\39\ The transition
period ensures that the supply of wind turbines is not unfairly or
unreasonably interrupted.\40\ Furthermore, contrary to NRECA/APPA's
contention, the Commission considered the possible reliability effects
of the transition period, and concluded that the remaining provisions
of Order No. 2003 will adequately protect reliability.\41\ The
remaining provisions of Order No. 2003 will also ensure that other
generators or the Transmission Provider will not bear the reliability
effects of a wind plant because that rule, and the LGIA and LGIP
contained in it, ensure that generating facilities are not
interconnected in a manner that degrades reliability.
---------------------------------------------------------------------------

    \39\ Final Rule at P 115.
    \40\ Id.
    \41\ Id.
---------------------------------------------------------------------------

III. Document Availability

    71. In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
Internet through FERC's Home Page (http://www.ferc.gov) and in FERC's

Public Reference Room during normal business hours (8:30 a.m. to 5 p.m.
Eastern time) at 888 First Street, NE., Room 2A, Washington, DC 20426.
    72. From the Commission's Home Page on the Internet, this
information is available in the Commission's document management
system, eLibrary. The full text of this document is available on
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or
downloading. To access this document in eLibrary, type the docket
number excluding the last three digits of this document in the docket
number field.
    73. User assistance is available for eLibrary and the Commission's
Web site during normal business hours. For assistance, please contact
FERC Online Support at 1-866-208-3676 (toll free) or<PHONE_NUMBER> (e-
mail at FERCOnlineSupport@FERC.gov), or the Public Reference Room at
202-502-8371, TTY<PHONE_NUMBER> (e-mail at
public.referenceroom@ferc.gov).

IV. Effective Date

    74. As noted above, on August 5, 2005, the Commission issued an
order extending the effective date of the Final Rule to October 14,
2005.\42\ Those provisions of the Final Rule not revised in this order
on rehearing and clarification are effective as of that date. Changes
made to the Final Rule in this order on rehearing and compliance will
become effective on January 18, 2006.
---------------------------------------------------------------------------

    \42\ Order Granting Extension of Effective Date and Extending
Compliance Date, 70 FR 47093 (Aug. 12, 2005), 112 FERC ] 61,173
(2005).
---------------------------------------------------------------------------

V. Compliance With the Final Rule and Order on Rehearing and
Clarification

    75. In the Commission's August 5, 2005 order extending the
effective date of the Final Rule, the Commission also extended to
November 14, 2005, the date by which all public utilities that own,
control, or operate transmission facilities in interstate commerce are
to adopt, in their OATTS, the Final Rule Appendix 7 (as described
above) \43\ as an amendment to the LGIP, and Final Rule Appendix G as
an amendment to the LGIA. By further notice issued October 28, 2005,
the Commission extended this date further, to December 30, 2005. Public
utilities who have already filed a Final Rule Appendix G as amendments
to the LGIPs and LGIAs in their OATTs must file, by December 30, 2005,
the revisions to the Final Rule Appendix G to the LGIA made in this
order on rehearing.
---------------------------------------------------------------------------

    \43\ See supra, P 60.
---------------------------------------------------------------------------

List of Subjects in 18 CFR Part 35

    Electric power rates; Electric utilities.

    By the Commission. Chairman Kelliher dissenting in part with a
separate statement attached.
Magalie R. Salas,
Secretary.

0
In consideration of the foregoing, the Commission revises part 35,
Chapter I, Title 18 of the Code of Federal Regulations as follows.

PART 35--FILING OF RATE SCHEDULES

0
1. The authority citation for part 35 continues to read as follows:

    Authority: 16 U.S.C. 791a-825r, 2601-2645; 31 U.S.C. 9701; 42
U.S.C. 7101-7352.

0
2. In Sec.  35.28, revise paragraph (f)(1) to read as follows:

Sec.  35.28  Non-discriminatory open access transmission tariff.

* * * * *
    (f) Standard generator interconnection procedures and agreements.
(1) Every public utility that is required to have on file a non-
discriminatory open access transmission tariff under this section must
amend such tariff by adding the standard interconnection procedures and
agreement contained in Order No. 2003, FERC Stats. & Regs. & 31,146
(Final Rule on Generator Interconnection), as amended by the Commission
in Order No. 661, FERC Stats. & Regs. ] 31,186 (Final Rule on
Interconnection for Wind Energy), and the standard small generator
interconnection procedures and agreement contained in Order No. 2006,
FERC Stats. & Regs. ] 31,180 (Final Rule on Small Generator
Interconnection), or such other interconnection procedures and
agreements as may be approved by the Commission consistent with Order
No. 2003, FERC Stats. & Regs. & 31,146 (Final Rule on Generator
Interconnection) and Order No. 2006, FERC Stats. & Regs. ] 31,180
(Final Rule on Small Generator Interconnection).
    (i) The amendment to implement the Final Rule on Generator
Interconnection required by the preceding subsection must be filed no
later than January 20, 2004.
    (ii) The amendment to implement the Final Rule on Small Generator
Interconnection required by the preceding subsection must be filed no
later than August 12, 2005.
    (iii) The amendment to implement the Final Rule on Interconnection
for Wind Energy required by the preceding subsection must be filed no
later than December 30, 2005.
    (iv) Any public utility that seeks a deviation from the standard
interconnection procedures and

agreement contained in Order No. 2003, FERC Stats. & Regs. & 31,146
(Final Rule on Generator Interconnection), as amended by the Commission
in Order No. 661, FERC Stats. & Regs. ] 31,186 (Final Rule on
Interconnection for Wind Energy), or the standard small generator
interconnection procedures and agreement contained in Order No. 2006,
FERC Stats. & Regs. ] 31,180 (Final Rule on Small Generator
Interconnection), must demonstrate that the deviation is consistent
with the principles of either Order No. 2003, FERC Stats. & Regs. &
31,146 (Final Rule on Generator Interconnection) or Order No. 2006,
FERC Stats. & Regs. ] 31,180 (Final Rule on Small Generator
Interconnection).

    [Note: The Appendices will not be published in the Code of
Federal Regulations]

Appendix A--List of Entities Requesting Rehearing and/or Clarification
or Submitting Comments and Acronyms

ATC--American Transmission Company LLC.
CenterPoint--CenterPoint Energy Houston Electric, LLC.
EEI--Edison Electric Institute.
FPL Energy--FPL Energy, LLC.
ISO-NE--ISO New England, Inc.
Midwest ISO--Midwest Independent Transmission System Operator, Inc.
National Grid--National Grid USA.
NERC--North American Electric Reliability Council.
New York ISO--New York Independent System Operator, Inc.
NRECA/APPA--National Rural Electric Cooperative Association and
American Public Power Association.
NU--Northeast Utilities.
PJM--PJM Interconnection, L.L.C.
SCE--Southern California Edison Company.
Southern Company--Southern Company Services, Inc.

Appendix B

    [Note: These Provisions to be Adopted as Appendix G to the
LGIA.]

Appendix G--Interconnection Requirements for a Wind Generating Plant

    Appendix G sets forth requirements and provisions specific to a
wind generating plant. All other requirements of this LGIA continue
to apply to wind generating plant interconnections.

A. Technical Standards Applicable to a Wind Generating Plant

i. Low Voltage Ride-Through (LVRT) Capability

    A wind generating plant shall be able to remain online during
voltage disturbances up to the time periods and associated voltage
levels set forth in the standard below. The LVRT standard provides
for a transition period standard and a post-transition period
standard.

Transition Period LVRT Standard

    The transition period standard applies to wind generating plants
subject to FERC Order 661 that have either: (i) Interconnection
agreements signed and filed with the Commission, filed with the
Commission in unexecuted form, or filed with the Commission as non-
conforming agreements between January 1, 2006 and December 31, 2006,
with a scheduled in-service date no later than December 31, 2007, or
(ii) wind generating turbines subject to a wind turbine procurement
contract executed prior to December 31, 2005, for delivery through
2007.
    1. Wind generating plants are required to remain in-service
during three-phase faults with normal clearing (which is a time
period of approximately 4-9 cycles) and single line to ground faults
with delayed clearing, and subsequent post-fault voltage recovery to
prefault voltage unless clearing the fault effectively disconnects
the generator from the system. The clearing time requirement for a
three-phase fault will be specific to the wind generating plant
substation location, as determined by and documented by the
transmission provider. The maximum clearing time the wind generating
plant shall be required to withstand for a three-phase fault shall
be 9 cycles at a voltage as low as 0.15 p.u., as measured at the
high side of the wind generating plant step-up transformer (i.e. the
transformer that steps the voltage up to the transmission
interconnection voltage or ``GSU''), after which, if the fault
remains following the location-specific normal clearing time for
three-phase faults, the wind generating plant may disconnect from
the transmission system.
    2. This requirement does not apply to faults that would occur
between the wind generator terminals and the high side of the GSU or
to faults that would result in a voltage lower than 0.15 per unit on
the high side of the GSU serving the facility.
    3. Wind generating plants may be tripped after the fault period
if this action is intended as part of a special protection system.
    4. Wind generating plants may meet the LVRT requirements of this
standard by the performance of the generators or by installing
additional equipment (e.g., Static VAr Compensator, etc.) within the
wind generating plant or by a combination of generator performance
and additional equipment.
    5. Existing individual generator units that are, or have been,
interconnected to the network at the same location at the effective
date of the Appendix G LVRT Standard are exempt from meeting the
Appendix G LVRT Standard for the remaining life of the existing
generation equipment. Existing individual generator units that are
replaced are required to meet the Appendix G LVRT Standard.

Post-Transition Period LVRT Standard

    All wind generating plants subject to FERC Order No. 661 and not
covered by the transition period described above must meet the
following requirements:
    1. Wind generating plants are required to remain in-service
during three-phase faults with normal clearing (which is a time
period of approximately 4-9 cycles) and single line to ground faults
with delayed clearing, and subsequent post-fault voltage recovery to
prefault voltage unless clearing the fault effectively disconnects
the generator from the system. The clearing time requirement for a
three-phase fault will be specific to the wind generating plant
substation location, as determined by and documented by the
transmission provider. The maximum clearing time the wind generating
plant shall be required to withstand for a three-phase fault shall
be 9 cycles after which, if the fault remains following the
location-specific normal clearing time for three-phase faults, the
wind generating plant may disconnect from the transmission system. A
wind generating plant shall remain interconnected during such a
fault on the transmission system for a voltage level as low as zero
volts, as measured at the high voltage side of the wind GSU.
    2. This requirement does not apply to faults that would occur
between the wind generator terminals and the high side of the GSU.
    3. Wind generating plants may be tripped after the fault period
if this action is intended as part of a special protection system.
    4. Wind generating plants may meet the LVRT requirements of this
standard by the performance of the generators or by installing
additional equipment (e.g., Static VAr Compensator) within the wind
generating plant or by a combination of generator performance and
additional equipment.
    5. Existing individual generator units that are, or have been,
interconnected to the network at the same location at the effective
date of the Appendix G LVRT Standard are exempt from meeting the
Appendix G LVRT Standard for the remaining life of the existing
generation equipment. Existing individual generator units that are
replaced are required to meet the Appendix G LVRT Standard.

ii. Power Factor Design Criteria (Reactive Power)

    A wind generating plant shall maintain a power factor within the
range of 0.95 leading to 0.95 lagging, measured at the Point of
Interconnection as defined in this LGIA, if the Transmission
Provider's System Impact Study shows that such a requirement is
necessary to ensure safety or reliability. The power factor range
standard can be met by using, for example, power electronics
designed to supply this level of reactive capability 606 (taking
into account any limitations due to voltage level, real power
output, etc.) or fixed and switched capacitors if agreed to by the
Transmission Provider, or a combination of the two. The
Interconnection Customer shall not disable power factor equipment
while the wind plant is in operation. Wind plants shall also be able
to provide sufficient dynamic voltage support in lieu of the power
system stabilizer and automatic voltage regulation at the generator
excitation system if the System Impact Study shows this to be
required for system safety or reliability.

iii. Supervisory Control and Data Acquisition (SCADA) Capability

    The wind plant shall provide SCADA capability to transmit data
and receive instructions from the Transmission Provider

to protect system reliability. The Transmission Provider and the
wind plant Interconnection Customer shall determine what SCADA
information is essential for the proposed wind plant, taking into
account the size of the plant and its characteristics, location, and
importance in maintaining generation resource adequacy and
transmission system reliability in its area.

Appendix C

    [Note: These provisions to be adopted as APPENDIX 7 to the LGIP]

Appendix 7 --Interconnection Procedures for a Wind Generating Plant

    Appendix 7 sets forth procedures specific to a wind generating
plant. All other requirements of this LGIP continue to apply to wind
generating plant interconnections.

A. Special Procedures Applicable to Wind Generators

    The wind plant Interconnection Customer, in completing the
Interconnection Request required by section 3.3 of this LGIP, may
provide to the Transmission Provider a set of preliminary electrical
design specifications depicting the wind plant as a single
equivalent generator. Upon satisfying these and other applicable
Interconnection Request conditions, the wind plant may enter the
queue and receive the base case data as provided for in this LGIP.
    No later than six months after submitting an Interconnection
Request completed in this manner, the wind plant Interconnection
Customer must submit completed detailed electrical design
specifications and other data (including collector system layout
data) needed to allow the Transmission Provider to complete the
System Impact Study.

    Joseph T. Kelliher, Chairman, dissenting in part:

    I vote for this order because it constitutes an improvement over
the final rule. I agree with the Commission's decision to grant
rehearing with respect to the low voltage ride-through (LVRT)
provisions and to adopt the joint recommendation of NERC and AWEA.
As the order points out, by adopting a definitive, uniform, LVRT
standard, the Commission ``provide[s] certainty'' to the industry
and ``ensure[s] that reliability is maintained and NERC planning
standards are met.'' \1\
---------------------------------------------------------------------------

    \1\ Order at P34.
---------------------------------------------------------------------------

    Unfortunately, the Commission's decision on LVRT contrasts with
its decision to exempt wind generators from compliance with the same
power factor standard as all other generators. The Commission
requires all non-wind generators to maintain a power factor within
the range of 0.95 leading to 0.95 lagging, which NERC has determined
to be ``within a range required by Good Utility Practice.'' \2\
Order No. 661, however, singles out wind generators for special
treatment by exempting them from meeting the standard power factor
requirement unless the Transmission Provider demonstrates in the
System Impact Study that reactive power capability is necessary to
ensure the safety or reliability of the transmission system. In my
view, exempting only wind generators from the power factor standard
does not provide certainty to the industry, results in an undue
preference for wind generators and does not adequately ensure that
reliability of the transmission system is maintained.
---------------------------------------------------------------------------

    \2\ Order No. 2003 at P541.
---------------------------------------------------------------------------

    Section 205 of the Federal Power Act broadly precludes public
utilities, in any transmission or sale subject to the Commission's
jurisdiction, from ``mak[ing] or grant[ing] any undue preference or
advantage to any person or subject[ing] any person to any undue
prejudice or disadvantage. * * *'' \3\ In my view, Order No. 661
gives preferential treatment to wind generators, since it exempts
wind generators from meeting the same power factor requirement as
all other non-wind generators. The issue is whether the preferential
treatment afforded to wind generators is undue.
---------------------------------------------------------------------------

    \3\ 16 U.S.C. 824d(b).
---------------------------------------------------------------------------

    I do not believe that either the record or the explanation
offered in this order provides a basis for giving preferential
treatment to wind generators when it comes to meeting the power
factor requirement. The order's attempt to justify discriminating in
favor of wind generators as an accommodation for ``technical
differences'' \4\ is not convincing. The only ``technical''
difference identified is the assertion that compliance with reactive
power capability is more expensive for wind generators than for
other generator resources.\5\ While one can understand why wind
generators would like to be relieved of the added cost of complying
with the same power factor standard as all other non-wind
generators, I fail to see how the desire to avoid incurring the
costs of complying with the Commission's standardized power factor
requirement constitutes a technological difference warranting
discriminatory treatment.
---------------------------------------------------------------------------

    \4\ Order at P45.
    \5\ Id. (``One of these [technical] differences is that for wind
plants, reactive power capability is a significant added cost, while
it is not a significant additional cost for traditional
generators.'').
---------------------------------------------------------------------------

    Equally troubling, I disagree with the Commission's decision to
brush aside the concerns raised by NERC and other protesters that
the Commission has ``lowered the bar'' for reliability by shifting
the burden to the Transmission Provider to justify the need for wind
generators to comply with the same power factor requirement as non-
wind generators. I find little comfort in the Commission's view that
any reliability concerns can be addressed in the System Impact Study
if the Transmission Provider proves that a wind generator's
compliance with the reactive power factor standard is necessary. In
my view, shifting the burden to Transmission Providers to make such
a showing simply cannot be reconciled with the approach taken by the
Commission in Order No. 2003 which presumes the need for all
generators to comply with power factor requirement under ``Good
Utility Practice.'' \6\
---------------------------------------------------------------------------

    \6\ Order No. 2003 at PP541-42.
---------------------------------------------------------------------------

    As a result, I would have granted rehearing and returned to the
approach proposed by the Commission in the NOPR of requiring all
generators to meet the same power factor standard absent a waiver by
the Transmission Provider. Accordingly, I dissent in part from the
order.

Joseph T. Kelliher.
[FR Doc. 05-24173 Filed 12-16-05; 8:45 am]

BILLING CODE 6717-01-P