New Mexico has the nation’s best DER interconnection policy: report – Utility Dive

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The state received high marks for its robust energy storage interconnection framework, frequent public reports on its queue and incorporating IEEE’s technical standard for DER interconnections.
Vote Solar and IREC are among the energy nonprofits pushing for more distributed capacity on the grid to boost reliability and resilience, and to accommodate rising demand from new loads. Advocates argue distributed clean energy and renewables generally are faster and cheaper to deploy than gas-fired generation, which some utilities and hyperscalers are procuring to serve data centers.
“This report, and its state-specific policy recommendations, is particularly timely given the current pressure on regulators to rein in electric rate hikes and deliver more energy to meet growing demand,” IREC CEO Chris Nichols said in a statement.
The report comes at a challenging time for distributed solar and storage, following the rollback of tax incentives and other supportive policy at a federal level. Some states are also scaling back their clean energy goals amid concerns about affordability and timelines. 
But aside from incentives or mandates, “Freeing the Grid” highlights that state-level interconnection bureaucracy has an important role to play in helping or hindering the deployment of distributed energy resources. It examines statewide interconnection policies using more than 50 criteria across 10 categories covering general interconnection rules, review processes, timelines, costs, energy export provisions, data sharing and dispute resolution.
The “rule applicability” category, for example, awards more points to states whose distributed energy resource interconnection rules apply broadly to generators and energy storage systems up to 20 MW. Arizona, California, Illinois and New Jersey were among the states that scored well in this category.
The “streamlined review” category favors states that expedite interconnection request reviews for inverter-based systems up to 5 MW, with additional points for those gated by export capacity rather than nameplate capacity and those that include a cluster study option. Massachusetts, Michigan, Oregon and Rhode Island received good grades in this category.
Of all the states and territories examined, Oregon and New Jersey improved the most. Both rose from “D” to “B” grades. But both have room for improvement, IREC and Vote Solar said. New Jersey, for example, could improve public interconnection queue tracking and its equipment screening processes.
Even New Mexico, the only state to earn an “A” grade, has room for improvement. IREC and Vote Solar recommend that it align the voltage and power quality screens in its supplemental review process with IEEE Standard 1547-2018, require utilities to share more interconnection queue data and allow an “ombudsman” or third-party mediator to handle interconnection disputes.
IREC and Vote Solar found that although eight states meaningfully improved their interconnection rules since the 2023 assessment, most states and territories still have inefficient or inadequate DER interconnection policies. More than 80% scored “C” or worse on an “A” to “F” scale, and about 25% lack broadly applicable interconnection rules at all, the groups said.
Sachu Constantine, Vote Solar executive director, said in a statement that the group was pleased to see states “making meaningful progress” to improve the speed and transparency for DER interconnections.
But “many states still have substantial work ahead to ensure community power resources like solar can connect to the grid efficiently and fairly,” Constantine added.
The states that received “F” grades lack jurisdiction-wide interconnection rules. Those include a mix of relatively populous states like Georgia, Tennessee and Missouri, plus smaller states like Wyoming, North Dakota and Alaska. IREC and Vote Solar recommend they adopt statewide rules before doing anything else.
States with “D” grades scored poorly across most or all categories. Texas, for example, should assess energy storage systems based on export rather than nameplate capacity and adopt a simplified review process for inverter-based resources with export capacity greater than 25 kW, IREC and Vote Solar said.
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Active managed charging can delay costly system upgrades while saving individual customers money on their bills, utilities, automakers and aggregators say, but a lack of standardized data-sharing is slowing adoption.
The utility will supply a 1.4-GW Oracle data center under construction now, and it has submitted contracts to regulators for a 1-GW Google project also in the works.
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CEO Robert Blue said the 2.6-GW Coastal Virginia Offshore Wind farm, which began producing some electricity in March, should be fully operational by 2027 and generate approximately $5 billion in fuel savings over 10 years. The utility’s fuel and other energy-related costs jumped 67% in Q1.
NextEra Energy Resources signed contracts for 1.3 GW of battery storage in the first quarter and expects to build 43 GW of battery storage by the end of 2032.
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