Regional Grid Operator to Speed Approvals for New Projects

PJM Interconnection has unveiled a new method for approving new electricity projects to speed up the often lengthy process.

The new approval system, which went into effect recently, will allow PJM to bring new, mostly renewable, energy projects online faster, and will “set the stage for more than 260,000 megawatts (MW) of mostly renewable projects to be studied over the next three years.”

PJM is the regional transmission organization (RTO) that manages the movement of wholesale electricity over the 13-state Mid-Atlantic region, including Pennsylvania. “Over the past few years, thousands of new projects totaling 259 gigawatts (GW) of energy capacity have submitted interconnection requests in the region. Nearly all of those projects are wind, solar, and battery capacity,” according to a report from the American Council on Renewable Energy (ACORE), which found that the old approval policy led to average seven-year wait.

The previous PJM policy looked at projects on a first-come, first-served basis, which led to numerous studies, long wait times, and ultimately to withdrawal of three-quarters of the renewable energy applications submitted between 2011 and 2016 because of the uncertainty, ACORE found.

The new process will expedite approvals by evaluating projects in groups on a “first-ready, first-served” basis, looking at their readiness to connect to the grid.

“In collaboration with stakeholders, PJM has made landmark reforms to its interconnection process. We recognized how critical it was to improve the process to move new projects through the planning queue, and those reforms are about to begin,” said Ken Seiler, PJM Vice President of Planning in a statement.

The new process includes various decision points at which the developers must submit readiness deposits and demonstrate they have an approved site, or withdraw their projects. That is expected to weed out the large number of speculative projects that have contributed to existing backlogs.

A 60-day window is now open for developers in transition to post the readiness requirements and in September, PJM will specify the qualifying generators and begin processing projects using a “fast-lane” process.

The new process should add enough capacity to make up for retiring electric generators, including a number of coal-fired power plants, to meet anticipated demand, but concerns remain about projects that have completed the study process, but not moved to construction due to financing, siting, or other issues. In 2023, less than 2,200 MW of projects have come online; in 2022, that number was 2,000 MW, PJM said.

However, by the end of 2024, PJM expects to have cleared about 62,000 MW for connection, another 100,000 MW by the end of 2025, and an additional 100,000 MW by the end of 2026, the company said.

“If PJM’s reforms enable the renewable energy projects in he transition cycle to achieve commercial generation at a rate consistent with averages from less than a decade ago, Mid-Atlantic states could see the creation of approximately 199,000 job-years (the equivalent of one job for one year) and $17 billion in additional capital investment over the next four years,” the ACORE report indicates.