In the world of renewable energy, the race to connect solar and storage projects to the grid is a complex and often frustrating journey. While grid operators are making strides in interconnection reform, the process remains a major hurdle for developers, particularly in the United States. The recent report by Advanced Energy United sheds light on the progress and challenges, offering a comprehensive look at the state of interconnection for solar and storage projects.
The Interconnection Challenge
The report highlights a stark reality: despite the dominance of solar and storage in planned U.S. capacity additions, the journey to grid connection is fraught with delays, uncertainty, and competition for limited transmission capacity. This is a critical issue, as the U.S. Energy Information Administration predicts a record 86 GW of utility-scale generating capacity additions in 2026, with solar and storage leading the charge. However, the interconnection process is a bottleneck, with thousands of projects waiting to connect, representing a significant barrier to the widespread adoption of clean energy.
Regional Progress and Challenges
Each of the seven regional transmission system operators analyzed in the report has made meaningful progress over the past 18 months. However, the report emphasizes that there is not yet strong evidence of improved interconnection speed. For instance, Southwest Power Pool (SPP) has studied an impressive 340 GW of generation and is moving towards a Consolidated Planning Process, offering a predictable per-MW fee called GRID-C. This could potentially reduce upfront costs and delays, but the affordability of the GRID-C rate for developers remains a key question.
Midcontinent Independent System Operator (MISO) continues to face a large backlog, with delays in cluster studies and a skipped 2024 cluster. MISO is implementing new reforms, including a zonal queue cap and stricter readiness requirements, to address these issues. Meanwhile, PJM is nearing the end of a long queue transition, with 811 requests totaling 220 GW seeking interconnection, including significant amounts of storage and solar.
Solar and Storage: A Mixed Picture
For solar and storage developers, the report paints a mixed picture. Regional grid operators are adopting cluster studies, readiness requirements, automation, and more proactive transmission planning. However, active queue capacity remains high, and recent fast-track policies could direct scarce grid capacity towards more fossil-heavy resources. Solar projects have seen a decline in interconnection queue capacity, while stand-alone storage and hybrid projects have dropped significantly.
The report also highlights the potential of flexible interconnection services for storage, which could take advantage of batteries' ability to operate within defined limits and deploy faster than other resources. As U.S. storage deployment accelerates, this could be a game-changer.
Cost Uncertainty: A Central Barrier
Cost uncertainty remains a significant barrier to interconnection. Network upgrade costs for withdrawn projects averaged 70% of total interconnection costs, according to Berkeley Lab research. Average network upgrade costs ranged from $200/kW for solar projects larger than 400 MW to $300/kW for smaller projects. To address these issues, the report recommends five priority reforms, including entry fees tied to planned transmission capacity and improved reporting after generator interconnection agreements are signed.
The Way Forward
The success of regional operators' next steps will determine whether interconnection reform can move projects from queue positions to commercial operation fast enough to meet rising demand. The report emphasizes the need for continued progress and innovation in interconnection processes to ensure a smooth transition to a clean energy future. Personally, I think that the key to unlocking this potential lies in the hands of grid operators, who must continue to push the boundaries of interconnection reform and embrace innovative solutions to address the challenges faced by solar and storage developers.
In conclusion, the report by Advanced Energy United offers a comprehensive and thought-provoking look at the state of interconnection for solar and storage projects. It highlights the progress made by regional grid operators, while also emphasizing the challenges that remain. As the world shifts towards clean energy, the interconnection process must be streamlined and made more accessible to developers. Only then can we truly unlock the potential of solar and storage to power a sustainable future.
