By Francis Hodsoll and Jon Hillis
We often receive questions about how the transmission of solar energy works here in Virginia. In addition, we often are asked about the supply of solar and how that matches up with the demand for renewable energy. Read on for some insights into these two questions.
The State of Solar Supply in Virginia (May 15, 2018)
Currently, in Virginia, there are 10 in-service utility-scale solar energy projects totaling 327 MWs that have completed the PJM interconnection process. All ten of these projects have become operational since 2016. We expect, by the end of this year, that three more projects—representing 55 MW.ac of capacity—will become operational.
By comparison, at the end of 2015, Virginia had no operational utility-scale solar facilities—whatsoever!
PJM, the independent system operator that manages the interconnection of generators to the electrical grid, currently includes 127 additional projects in various stages of the interconnection process representing 7,968 MW.ac. SolUnesco has evaluated the viability of these projects, and we believe that approximately 72 projects representing 3,885 MW.ac are likely to become operational over the next three or more years based on the project characteristics and estimated interconnection costs. 
At a recent solar trade conference in Atlanta, Dominion Energy’s head of business development for the regulated entity stated that 10,000 MWs are in the interconnection queue, which may include distribution interconnection requests which are not publicly disclosed or have been withdrawn from the PJM queue.
These numbers are dynamic and will differ as new projects line up to interconnect and some existing projects drop out of the process.
Balancing Supply and Demand
A Solar Energy Industries Association report projects a tripling of the solar capacity in Virginia over the next five years. On the demand side, our peers in the industry tell us that they are responding to multiple RFPs from corporate buyers seeking to buy solar. Dominion Energy, a buyer of solar, anticipates generating 15% of its power in Virginia with renewable resources by 2025. Further, large enterprises such as Walmart, Target, Microsoft, Facebook, Google, Amazon Web Services, Marriott, McDonald’s, and a majority of the Fortune 100 are considering access to renewable energy as part of their investment decisions. The bottom line is that most sources we consider credible see tremendous growth in solarㅡboth in supply and demandㅡhere in Virginia.
The Interconnection Process
There are two separate interconnection processes depending on whether applicant seeks to interconnect to the distribution system or the transmission system:
- The right to interconnect and deliver energy to the wholesale transmission grid that is governed by PJM; and
- The right to interconnect to the distribution grid that is governed by state law and the electric utility rules.
For the transmission interconnection process, PJM governs and manages the process. PJM manages the requests for interconnection service (Applicants) to the electrical transmission system by queueing the requests and then evaluating all interconnection requests in one collective ‘Queue.’ Each year PJM runs two queues with defined dates for opening and closing that queue. All Applicants within a specific queue are evaluated together.
The PJM interconnection process incorporates a Feasibility Study phase, an Impact Study phase, and a Facilities Study phase. Each phase imposes increasingly granular analysis and requires a significantly greater financial commitment from the Applicant.
At the end of each study phase the Applicants are provided the results of the studies and they determine whether they wish to remain in the interconnection process by paying a deposit on the next phase. At the end of the process, PJM provides an Interconnection Agreement that defines the specific costs, in addition to the rights and responsibilities of both the interconnection customer and the utility. When the interconnection customer (IC) executes the interconnection agreement, they have then committed to pay the interconnection costs. Once the interconnection facilities are operational, the IC has the right to deliver energy to the transmission system at the interconnection point.
While PJM governs the process, the utility that owns the transmission infrastructure conducts the specific power flow studies and analyses that 1) determine what Attachment Facilities are required for the Applicant to safely interconnect to the transmission system (e.g., a substation with disconnects, upgraded transmission lines, protection equipment); and 2) identify system overloads and faults caused by the collective impact of all of the Applicants seeking to interconnect within a specific queue. In addition to the collective impact, the studies identify the specific contribution of each Applicant to an overload or fault.
These studies evaluate the impacts under both typical operations with all transmission facilities operating and under N minus 1 scenarios, in which a credible contingency event occurs. These studies determine the costs to construct the Attachment Facilities and the Upgrade costs required to eliminate any identified overload or fault under normal operations or under N-1 conditions.
The state distribution interconnection process—governed by state rules—generally mirrors the PJM distribution process. However, the state process does not require the utilities to adhere to a defined schedule, nor does the state process automatically cancel the Applicants’ Queue position based on the Applicants’ failure to meet certain milestones.
Interested in learning more? Please check out the following resources, courtesy of PJM: