Listen to this post

NERC recently filed rule changes with FERC that propose to significantly expand NERC registration and compliance requirements to inverter based resources, such as renewable energy and battery facilities, that historically were too small to be subject to such requirements.  NERC’s proposed rule changes are one of the latest developments in NERC’s multi-year effort to address the “reliability gap” associated with these types of resources.

NERC’s proposal includes revisions to the NERC Rules of Procedure to update the Generator Owner (“GO”) and Generator Operator (“GOP”) registry criteria to include an expanded category of smaller resources, which NERC has labeled Category 2 GOs and Category 2 GOPs.  NERC initially called these entities “GO-IBRs” but stakeholders found that term confusing so NERC changed the term to Category 2 GOs/GOPs. Under NERC’s proposal, Category 2 GOs/GOPs include non-bulk electric system inverter based resources that (i) either have or contribute to an aggregate nameplate capacity of greater than or equal to 20 MVA, (ii) connected through a system designed primarily for delivering such capacity to a common point of connection at a voltage greater than or equal to 60 kV. If an entity meets the criteria for Category 2 GO or Category 2 GOP, once registered, it would be required to comply with associated reliability standards.

To proactively prepare for FERC’s potential acceptance of NERC’s proposal and future compliance obligations, we recommend that renewable energy and battery storage developers, owners, and operators take the following steps:

  • Analyze all currently operating projects that are not registered with NERC as a GO or GOP to determine if any will be required to register with NERC as Category 2 GO or Category 2 GOP;
  • Analyze development-stage projects to determine if any will be required to register with NERC as a Category 2 GO or Category 2 GOP. Prioritize this analysis for development-stage projects that are close to energization or projected to obtain project financing/investment.
  • Contact your NERC compliance consultant or agent and make a plan for potential Category 2 GO/GOP registration and compliance obligations. In Husch Blackwell’s experience, NERC consultants are already preparing for the Category 2 GO/GOP.  Contacting your NERC consultant now will allow you to get ahead of an influx of other projects who will need registration and compliance assistance if the Category 2 GO/GOP goes into effect.

NERC’s proposed rule changes are currently pending in FERC Docket No. RR24-2 (available here). NERC’s Quick Reference Guide provides helpful information and resources. For further information or assistance with the steps recommended above contact Sylvia Bartell or an attorney in Husch Blackwell’s Energy Regulation practice group.