On February 18, 2016, the Federal Energy Regulatory Commission (FERC) issued a notice of inquiry (NOI) concerning the ability of new types of generation resources to maintain a balance between generation and load. Balance is necessary in order to maintain a scheduled electricity frequency of 60 Hz within the bulk power system. Generators maintain that balance by providing frequency control services, which include inertial response, and primary and secondary frequency response. Conventional, fossil fuel fired generation facilities have been a reliable source of frequency control services. In contrast, variable energy resources (VERs) generally do not offer the capability to provide frequency control services. As VERs make up a greater share of the generation resource mix, frequency control services could diminish, thus leading to reliability challenges within the bulk power system.

The Commission’s overall goal of the NOI is to ensure that frequency response is maintained at reliable levels throughout the bulk power system while seeing increasing levels of participation by VERs. In response to its overall goal, the Commission is inviting comments on the need for changes to its rules and regulations regarding frequency response. More specifically, the Commission seeks comment on: (1) possible changes to generator interconnection agreements that would mandate primary frequency response requirements for new generators; (2) possible regulations requiring primary frequency response capability for existing generation resources; and (3) compensation for generators that provide primary frequency response. Given the early stages of this proceeding, the impact on generators, and VERs in particular, is not clear-cut. Nevertheless, the fact that some balancing authorities are implementing frequency response requirements implies that VERs may need to adapt to a more rigorous set of frequency response requirements, which could mean increased design and construction costs. Comments are due to the Commission within 60 days of publication in the Federal Register. Publication occurred on February 24, 2016, with comments due by April 25, 2016.1  The NOI is available in Docket No. RM16-6-000.