Evaluating the Role of Pre-Application Reports in Improving Distributed Generation Interconnection Processes

Several tools have emerged in recent years to increase data exchange and transparency in the distributed generation interconnection process with the goal of reducing interconnection costs. One example is pre-application reports. These reports are generated by a utility at the request of prospective interconnection applicants to provide technical information about a specific point of interconnection. Formal pre-application report processes have been established in 12 states at the distribution system level as well as at the transmission level by the Federal Energy Regulatory Commission. These reports are a relatively low-cost method of informing applicants of grid conditions and potential interconnection limitations early in the interconnection process. Thus, this information may encourage interconnection in locations with little to no detrimental impact to the grid and low interconnection costs. Increasing transparency of these grid conditions may also enable applicants to better plan for interconnection costs and requirements, such as system modifications and complex engineering studies. By providing these benefits, pre-application reports are expected to reduce the number of canceled interconnection applications. This report evaluates this hypothesis by quantifying the impact pre-application report processes have on application approval rate. To evaluate this hypothesis this analysis uses utility-reported distributed generation interconnection data from four utilities in Massachusetts. The analysis considers a four-year time period before and a five-year period after pre-application report process were implemented. The results indicate that once pre-application reports were required for projects 500 kilowatts and larger the approval rate of applications increased by 24%. This suggests that pre-application reports may decrease the percentage of canceled projects. However, due to data and other limitations, these results do not necessarily connote causation. This analysis is an important first step and a prerequisite for future analyses regarding the impact of pre-application reports. Other potential impacts also recognized during this analysis included reducing sunk costs and reducing the number of projects requiring a complex review. Collection of additional data would allow for forming more robust conclusions about these impacts in the future. Such data include circuit-level data, interconnection cost data, policy and regulatory background, national-level data, and utility and developer attributes. These data provide necessary context to account for interrelated factors while evaluating pre-application reports. Filling such knowledge gaps ultimately aids regulators in applying best practices within the industry. As more and more distributed energy resources are interconnected, these best practices will become an integral aspect of efficiently transitioning to an electric grid capable of meeting the needs of the 21st century.