The IPWG Members request that the Commission modify the “New York State Standardized Interconnection Requirements and Application Process For New Distributed Generators and Energy Storage Systems 5 MW or Less Connected in Parallel with Utility Distribution Systems” (the SIR), by replacing the current “first-mover” cost-sharing mechanism with the proposed “pro rata” cost sharing mechanism (the Cost-Sharing Proposal). The IPWG Members explain that the Cost-Sharing Proposal would equitably allocate the cost of distribution system upgrades by the utility assigning each interconnecting project a specific distribution hosting capacity fee when an upgrade is needed. The IPWG Members further explain that the Cost-Sharing Proposal applies to two categories of distribution upgrades: 1) “utility-initiated distributed generation (DG) or energy storage system (ESS) upgrades;” and, 2) “market-initiated DG/ESS upgrades.”

The proposed utility-initiated DG/ESS upgrade process would apply to each utility’s Capital Investment Plan (CIP), and will consider options to upgrade the equipment to provide for greater hosting capacity rather than a replacement-in-kind. This process would be initiated by each of the Joint Utilities posting a list of substations with major upgrade plans, or “multi-value distribution (MVD) plans,” on their respective system data portals and an estimate of funding needed to create additional hosting capacity to allow DG/ESS interconnections at that substation. This list will include an estimate of the financial obligation of a first-mover interconnection project and projects that may interconnect after the first project.

The proposed market-initiated DG/ESS upgrades process would occur when a hosting capacity upgrade is needed, there are at least two projects requesting interconnection at this site, and the CIP does not contemplate upgrading or replacing that equipment. Each utility would determine the interconnection fee in dollars per kilowatt (kW) by dividing the sum of the total costs of the “qualifying upgrade” at each designated location by a factor representing the sum of the total hosting capacity in kW of that designated location. The IPWG Members propose that costs of these qualifying upgrades not recovered by additional interconnecting projects sharing in the cost would be deferred until the utility’s next rate plan period for rate base recovery. To limit these potential unrecovered costs, the IPWG Members propose a cap of no more than two percent of a utility’s distribution/sub-transmission electric capital investment budget per fiscal year. The cap would be updated annually and calculated as a rolling five-year average of each utility’s forecasted distribution/sub-transmission electric capital investment for the impacted year and the next four years according to each utility’s current CIP. If this two percent cap is reached, the interconnecting projects would be required to fully fund any qualifying upgrades.

The IPWG Members propose that when a utility is planning a capital upgrade, the utility would create a “Capital Project Queue” at the substation or feeder level for those DG/ESS applications unable to interconnect due to the pending upgrade and update the hosting capacity map to reflect zero hosting capacity for that location. Projects already in the interconnection queue at that location may consent to join the Capital Project Queue or the utility will withdraw their interconnection application from the interconnection queue. SIR timelines would be suspended for projects in the Capital Project Queue until the upgrade is within 18 months of the expected completion date, at which time the projects would advance through the remaining SIR steps.

The IPWG Members propose that, if the Commission adopts this Cost-Sharing Proposal, interconnection applications in the queue should be treated in the following ways: (1) for interconnection applications that have not yet advanced to the Coordinated Electric System Interconnection Review (CESIR) process, the Cost-Sharing Proposal would apply; (2) for interconnection applications in the CESIR process, the Cost-Sharing Proposal would apply; (3) for interconnection applications that have completed the CESIR process, regardless of whether the initial 25 percent payment has been made or not, the interconnecting customer can request an evaluation of the completed CESIR to determine the applicability of the Cost-Sharing Proposal mechanism,; and (4) for interconnection applications that have made full payment, the interconnecting customer would not be eligible for the Cost-Sharing Proposal.

The full text of the petition and the full record of the proceeding may be reviewed online at the Department of Public Service web page: www.dps.ny.gov. The Commission may adopt, reject or modify, in whole or in part, the action proposed and may resolve related matters.

Statements and analyses are not submitted with this notice because the proposed rule is within the definition contained in section 102(2)(a)(ii) of the State Administrative Procedure Act.

(20-E-0543SP1)