PJM’s frequency regulation rule changes causing ‘significant and detrimental harm’
Energy storage companies “have suffered significant and detrimental harm” from changes to rules governing the frequency regulation market in US regional transmission organisation (RTO) PJM Interconnection’s service area, the Energy Storage Association has said.
The trade group has filed an official complaint with the Federal Energy Regulatory Commission (FERC), the powerful body responsible for regulating transmission networks and wholesale markets in the US. According to ESA, PJM, which is responsible for high voltage wires in 11 states, the Commonwealth of Virginia and District of Columbia, has made revisions to its market for grid-balancing frequency regulation services which should have been put before the regulator before implementation. These new rules, ESA argues, have caused substantive damage to the business cases of energy storage asset owners and operators in PJM’s service area.
Until 2016, PJM’s frequency regulation market, which allowed fast-responding resources like energy storage to bid into tenders to provide the ancillary service ahead of existing assets like gas peaker plants, was the biggest front of meter energy storage market in the US, since overtaken by California. Over 265MW of advanced energy storage projects are thought to be in operation in the 65 million-person area covered by PJM, with the market attracting domestic and international players alike.
PJM allows two types of frequency regulation service provision. The first, Regulation A (RegA) refers to traditional generators, which have limited ramp rates, while the second, Regulation D (RegD), refers to resources such as batteries, that have fast ramp rates, but are limited in the amount of energy they can provide. The signal for RegD resources to be deployed is meant to be energy neutral, meaning that a resource’s increased output in response to a so-called automatic generator control (AGC) signal would match the amount of energy the resource drew from the system in responding to that signal.
During 2015, PJM highlighted operational concerns with the management of system control when large numbers of RegD resources were providing regulation services. In evening and morning ramp periods, as the RTO was experiencing deviations (Area Control Errors) in its balance of load and generation, larger sized units were coming on and offline to keep up.