by Elle Nicholson
TXSES is working on a new regulatory development that should improve the solar installation process for homeowners and smaller companies in Texas, if implemented. As distributed energy has increased in popularity throughout the state, the Public Utility Commission of Texas’ (PUC) rules for connecting distributed energy resources (DER)—small-scale energy sources like solar panels and battery storage—to the grid have not kept up. Current regulations were created years ago and meant mostly for large-scale solar installations. Their requirements often hinder the interconnection process for smaller-scale solar and make interconnection needlessly difficult, holding small- and large-scale DER to the same regulatory requirements despite operating at very different levels. TXSES is working to develop language for the PUC for two new rulings intended to streamline the interconnection process for small-scale solar by distinguishing them from large-scale systems.
The new rules, intended to be implemented in 2025, are designed to save customers time and money. One will specifically address installations of 50kW and smaller (residential) and the other will target installations 50kW-2500kW (small to mid-size commercial). These should simplify the process for homeowners and small to mid-size businesses. The rulings will also cover community solar projects of these sizes and include residential-scale battery storage for the first time. By omitting unnecessary requirements and speeding up interconnection of small-scale DER, the rulings are expected to save customers money and allow them to begin reaping the benefits of distributed energy sooner.
Examination of the existing regulation, substantive rules 25.211 and 25.212, reveals why such a solution is beneficial. The rules apply broadly to any installation under 10MW connecting to the distribution grid. As of now, if application of a specific requirement seems inappropriate for a proposed DER system, customers only have two options. They or their installer can either agree with their utility on different requirements or petition the PUC for a good cause exception. Both options are complicated and time-consuming, meaning smaller customers often end up complying with unnecessary measures.
Examples of such measures include pre-interconnection studies, required communications, protective equipment, and approval timelines. In the status quo, utilities can mandate pre-interconnection studies for all customers – fees are prohibited for small-scale DER, but the study itself is not. The study can take up to four weeks, slowing down proceedings and costing utilities and customers alike more money. Additionally, customers must provide the utility with “detailed information” concerning proposed systems. Rule 25.211 specifies such communications are subject to PUC rules 25.84, 25.272, and 25.273, none of which directly correlate to DER. This muddles communications and further convolutes the interconnection process.
Furthermore, rule 25.212 requires all DER to include protective equipment to prevent tripping of utility system breakers. Small-scale distributed resources produce too low wattage to trip high-voltage utility breakers, so this measure is excessive and adds unneeded costs. Finally, the stipulated timeframe for interconnection is four to six weeks from a utility’s receipt of a completed application and two weeks’ notice for startup testing. Enforcing the same timeline for a simple residential system as a large commercial system is illogical. These examples demonstrate why holding small DER to the same requirements as large DER creates unnecessary hurdles which lengthen and complicate the interconnection process. TXSES anticipates that its collaboration with the PUC to create separate rulings will correct these problems, thereby making interconnection faster and cheaper for small-scale DER customers.