Section 227.11 authorizes agencies to promulgate administrative rules. Section 196.02(1) authorizes the Commission to do all things necessary and convenient to its jurisdiction. Section 196.02(3) grants the Commission specific authority to promulgate rules. Section 196.03(1) requires public utilities to provide reasonably adequate service and facilities. Section 196.19(2) requires public utilities to file all rules and regulations that in the judgment of the Commission affect service. Section 196.20(1) requires public utilities to include all service rules in their rate schedules, and file changes in rate schedules with the Commission. Section 196.37(2) authorizes the Commission to exercise control over the service rules that a public utility has with its consumers and requires the Commission to make a just or reasonable order if the Commission finds that the service is unjust, insufficient, or unlawful. As described above, Section 196.496(2) directs the Commission to promulgate rules regarding the interconnection of distributed generation facilities to electric distribution facilities. D. Related Statutes or Rules
As noted in B., this rule implements Wisconsin Stat. § 196.496. Existing rule provisions cross-reference electric utility service rules in Wis. Admin. Code ch. PSC 113, and the state electrical code established in ch. PSC 114. Proposed revisions add another connection with ch. PSC 113 by proposing updated dispute resolution language aligned with general dispute resolution procedures established in PSC 113.0407. E. Plain Language Analysis
The proposed rule would update the existing provisions of Wis. Admin. Code ch. PSC 119 (PSC 119), regarding the interconnection of customer-owned distributed generation facilities with the distribution system of electric public utilities. Updates are informed by the recommendations of a rulemaking advisory committee including representatives from utilities, distributed generation installers, customer and renewable energy advocates, and technical experts on distributed generation issues. Updates are intended to account for the significant changes in distributed generation technology and operations since the current rules were promulgated in 2004. Specific updates include referencing new technical standards and codes; adding and refining rule definitions to reference considerations raised by new and updated technologies related to distributed generation that have emerged in recent years; and clarifying language related to testing and communication requirements to reflect present practices and requirements.
Updates are also intended to refine rule provisions related to the application process and information sharing. The volume of interconnection requests has substantially increased since the initial rules were promulgated and may continue to increase in future years. To ensure administrative requirements remain fair and timely, and balance the interests of customers, installers and utilities, in the face of increased application volume, the proposed updates seek to clarify and update application process requirements, including related forms. The proposed rule updates, including the application process, are designed to support more-effective information collection; update timing deadlines and decision criteria for application processing; update application-related fee levels and clarify requirements for fee administration; require utilities to provide more information on application requirements, processing of submitted applications, and grid conditions relevant to interconnections; and establish a more clearly defined dispute resolution process.
F. Summary of, and Comparison with, Existing or Proposed Federal Statutes and Regulations
The Federal Energy Regulatory Commission (FERC) has addressed interconnection issues through multiple orders, including FERC Order No. 841 concerning electric storage resources (issued 2018), FERC Order No. 872 concerning updates to the Public Utility Regulatory Policies Act of 1978 (PURPA) (issued 2020), and FERC Order No. 2222 concerning distributed energy resources more generally (issued 2020).
In those Orders, FERC declined to issue regulations regarding interconnection to the distribution facilities owned by the electric utility serving the customer. Order Nos. 841 and 2222 do address participation in electricity markets operated by regional transmission operations (such as the Midcontinent Independent System Operator, Inc., or MISO, which serves this role in Wisconsin) by interconnection resources. However, both of those Orders explicitly established that nothing in the Orders preempts the right of states to regulate the safety and reliability of their own distribution systems and stated that all resources affected by the Orders must comply with any applicable state rules related to interconnection with the customer’s electric utility.
G. Comparison with Similar Rules in Adjacent States
Minnesota, Iowa, and Illinois have recently promulgated updates to their own interconnection rules, and a rule review process is ongoing in Michigan. All four states—as well as a number of other states around the country—are taking similar approaches to the rule revisions proposed in Wisconsin, by updating technical standards and making changes to interconnection application processes in light of significant growth in distributed generation deployment. For example, the proposals in this rulemaking for providing more information to applicants on grid conditions and application processing were informed by the similar requirements recently enacted in Minnesota. Illinois’ updates, enacted in 2022, include similar technical updates to the definitional changes proposed in Wisconsin, such as by addressing the treatment of “export-limited” projects that use new technologies to limit the amount of energy the customer sends to the utility’s distribution system.
H. Summary of Factual Data and Analytical Methodologies Used and How Any Related Findings Support the Regulatory Approach Chosen
No factual data or methodologies were relied upon.
I. Analysis and Supporting Documents Used to Determine the Effect on Small Business or in Preparation of an Economic Impact Report
The Commission’s fiscal estimate and economic impact analysis determined that the proposed rules will not have an economic effect on small businesses. The Commission sought input from all utilities, Wisconsin Utilities Association, Utility Workers’ Coalition, and the National Federation of Independent Businesses.
J. Effect on Small Business (initial regulatory flexibility analysis)
These rules will not have an economic impact on small businesses. The Wisconsin Stat. § 227.114 (12) definition of “small business” states that to be considered a small business, the business must not be dominant in its field. Since electric utilities are monopolies in their service territories, they are dominant in their field and are not small businesses.
K. Germane Modifications
The Commission resubmitted the proposed rule pursuant to Wis. Stat. § 227.19(2) with germane modifications. While the proposed rule CR 22-077 was under review by the Joint Committee for Review of Administrative Rules (JCRAR), JCRAR raised concerned about language defining “distributed generation” (DG) capacity ranges and “export capacity” of a DG facility. On November 1, 2023, the Commission recalled the proposed rule pursuant to Wis. Stat. 227.19(4)(b)4. to make germane modifications. The Commission approved the proposed rule with germane modifications on November 9, 2023. Description of Modifications
JCRAR raised concerns regarding language in Sections 4 and 9 of the proposed rules. In Section 4, JCRAR expressed concerns regarding the second sentence which would not allow a DG facility with a non-exporting energy storage system of 1 MW or larger to be used in determining the export capacity as part of the category definitions. In Section 9, JCRAR expressed concerns with the second sentence because the use of “or” in the phase, “Export capacity is either the nameplate rating, or a lower amount if limited using any approved means,” is unclear. Language was proposed for the second sentence of Section 9 to make sure it is clear that the lesser of the two capacity values should be used. The Commission modified Sections 4 and 9 with JCRAR’s suggested revisions as follows:
— Section 4—PSC 119.02(7):
— Deleted the second sentence of this section, “The nameplate rating shall be used instead of the export capacity for this definition if the non-exporting energy storage system is larger than 1 MW.”
— Section 9—PSC 119.02(17m):
— Deleted the second sentence of this section, “Export capacity is either the nameplate rating, or a lower amount if limited using any approved means.”
— Replaced with the following language below. The suggested language was slightly revised to comply with LRB formatting guidelines:
— Export capacity is the lesser of the following:
— (1) the nameplate rating.
—(2) if limited using any approved means, that limited amount.
L. Agency Contact Person
M. Place Where Comments are to be Submitted and Deadline for Submission
A hearing notice, announcing a preliminary public hearing on the statement of scope, was published on the Commission’s website on March 4, 2021, and in the Wisconsin Administrative Register on March 8, 2021. An in-person hearing was held on March 19, 2021. The Commission accepted comments by regular mail, online, and at the public hearing. The public comment period for online and mailed comments ended on March 25, 2021. The public had the opportunity make oral comments at the hearing.
A hearing notice, announcing the public hearing and public comment period, was published on the Commission’s website on October 27, 2022, and in the Wisconsin Administrative Register on November 11, 2022. A virtual public hearing was held on November 29, 2022. The Commission accepted comments by mail, online, and at the public hearing. The public comment period ended on December 7, 2022.
Dated at Madison, Wisconsin, the 5th day of March, 2024.
By the Commission:
Cru Stubley
Secretary to the Commission
CS DL:01974190
Appendix A [see formatting in PDF]
TEXT OF PROPOSED RULE
Section 1. PSC 119.02 (4) is amended to read:
PSC 119.02 (4) “Category 1” means a DG facility with an export capacity of 20 kW or less. A DG facility comprised of a resource no larger than 20 kW with a non-exporting energy storage system no larger than 20 kW shall be considered a Category 1 system.
Section 2. PSC 119.02 (5) is amended to read:
