Electric Rule 21: Generating Facility Interconnections

Electric Rule 21 (Rule 21) is a tariff that describes the interconnection, operating and metering requirements for generation facilities to be connected to an investor-owned utility’s (IOUs) distribution system and transmission system over which the California Public Utilities Commission (Commission) has jurisdiction.  Rule 21 provides a generating facility (i.e., customers wishing to install generating or storage facilties on their premises) with access to the electric grid while protecting the safety and reliability of the distribution and transmission systems.

The IOUs under Commission jurisdiction include the Large IOUs—Pacific Gas and Electric Company’s (PG&E), Southern California Edison’s (SCE), and San Diego Gas & Electric’s (SDG&E)—and the three small and multi-jurisdictional utilities (SMJUs)—Bear Valley Electric Service (Bear Valley), Liberty Utilities (CalPeco Electric) LLC (Liberty), and PacifiCorp, d.b.a Pacific Power (PacifiCorp).

Each investor-owned utility is responsible for administration of Rule 21 in its service territory and maintains its own version of the rule:

The Commission has not required PacifiCorp to implement its own version of Rule 21 but accepts PacifiCorp’s existing interconnection processes for the interconnection of smaller facilities. PacifiCorp uses interconnection processes under its Open Access Transmission Tariff (OATT), consistent with Federal Energy Regulatory Commission (FERC) requirements.  In Decision (D.) 07-07-027, the Commission required that PacifiCorp “follow the same principles of timely review and disposition of interconnection requests as in Rule 21 for other utilities without requiring that [it] file [its] own version of Rule 21, amend then current rules, or file another interconnection protocol.” 

Generating Facility interconnections to the IOUs’ distribution system that are subject to FERC jurisdiction do not apply for interconnection through Rule 21, but instead apply under the IOUs’ Wholesale Distribution Access Tariff (WDT) whether they interconnect to IOUs’ distribution or transmission system.

Table of Contents: 

• Interconnection Rulemaking (R.17-07-007)
• Interconnection Discussion Forum
• Dispute Resolution
• Smart Inverters
• Interconnection Data Reporting
• D.16-06-052 Implementation
• Rule 21 Applicability, Provisions, and History
• Contact

Current Interconnection Rulemaking: R.17-07-007

The Commission initiated Rulemaking (R.) 17-07-007 on July 13, 2017 to consider refinements and, if necessary, revise the rules and regulations governing the interconnection of generation, distributed energy resources (DERs) and storage facilities to the electric distribution systems of the Large IOUs.  The proceeding is divided into three phases.

• Phase 1:  Covered quickly resolved issues aimed at streamlining interconnection such as planning, construction, billing and incorporating the Integration Capacity Analysis (ICA), which is designed to help contractors and developers identify project sites where existing grid infrastructure has capacity available to interconnect new DERs, into Rule 21.  As part of Phase 1, the Large IOUs and other stakeholders participated in four working groups, resulting in three decisions:
  • D.19-03-013, issued on April 5, 2029, adopted proposals from the Working Group One Final Report dated March 15, 2018.  D.20-07-040, issued on July 23, 2020, corrected errors in the prior decision. Among the proposals adopted were: expanding the existing Screen Q exemption for net energy metering (NEM) facilities with net export less than or equal to 500 kilowatts (kW); allowing the Large IOUs to require well-defined technical specifications for telemetry for systems between 250 kW and 99 megawatts (MW) when utility -related telemetry cots are estimated to be less than $20,000, if deemed necessary but if not, maintaining the threshold for requiring telemetry at 1 MW; and allowing customers to replace existing inverters with inverters of equal or greater ability, pursuant to D.14-12-035 and encouraging, but not requiring, customers to replace existing inverters with smart inverter at end of life.  Please see the decisions for a complete list of the proposals adopted. 
  • D.20-09-035, issued on September 24, 2020, adopted proposals from the Working Group Two Final Report dated October 31, 2018, the Working Group Three Final Report dated June 14, 2019, and the Vehicle-to-Grid (V2G) Alternating Current (AC) Interconnection Technical Sub-Group Report dated December 11, 2019.D.21-01-027, issued on January 21, 2021, and D.22-04-001, issued on April 8, 2022, corrected errors in the prior decision. Among the proposals adopted were: incorporating the results of the ICA into Rule 21 to streamline the Fast Track process; allowing Distributed Energy Resources to perform within existing hosting capacity constraints while avoiding grid upgrades through the use of Limited Generation Profiles; clarifies the rules applicable to the interconnection of Direct Current (DC) and Alternate Current (AC) Electric Vehicle Supply Equipment (EVSE); and provides the option of less costly Power Control System (PCS) instead of relays. Please see the decisions for a complete list of the proposals adopted.
  • D.21-06-002, issued on June 4, 2021, adopted proposals from the Working Group Four Final Report dated August 12, 2020.  Among the proposals adopted were:  a modified, notification-only approach for certain projects; a study on costs shifts resulting from a prior distribution upgrade exemption; an option for independent unintentional islanding studies; establishment of a working group to look at distribution-level solutions to anti-islanding; and a future pilot to test operational alternatives to address operational flexibility constraints.  Please see the decision for a complete list of the proposals adopted. 

• Phase 2:Expected to begin in mid-2024, this phase will cover rate setting issues, including distribution upgrade cost sharing and rate setting issues resulting from the implementation of Phase 1.Phase 2 may also include other topics needing that are yet to be determined. 

• Phase 3:D.22-04-003, issued on April 7, 2022, adopted recommendations from the California Association of Mall and Multi-Jurisdictional Utilities (CASMU) Working Group Eight Final Report dated October 4, 2021.D.22-04-003 adopted to not make any changes to the interconnection processes for SMJUs, with three minor modifications involving cost itemization, itemized billing processes, and participation in the Unintentional Islanding Working Group.  The decision concluded that given the SMJUs’ small customer base size and their low distributed energy resources interconnection rates, as compared to the larger investor-owned utilities, it is reasonable to not require changes to their interconnection processes.  

Ongoing Meetings

Interconnection Discussion Forum

The Interconnection Discussion Forum (IDF) provides an informal venue for utilities, developers, and other stakeholders to explore a wide variety of issues related to interconnection practices and policies.  The forum meets at least twice a year in person and/or through online conferencing.  Visit the Energy Division's IDF page for more information, including how to join the mailing list and to view previous presentations.  For questions related to the IDF e-mail IxForum@cpuc.ca.gov. 

 

Dispute Resolution

Section K of Rule 21 describes existing procedures for resolution of interconnection disputes. For disputes regarding missed timelines, please contact the relevant utility’s Rule 21 ombudsman:

For all other disputes, please use the procedures outlined in Section K of Rule 21. For CPUC assistance in reviewing or resolving a dispute, please contact Rule21.Disputes@cpuc.ca.gov.

Expedited Interconnection Dispute Resolution Process 

On October 12, 2017, the Commission approved Resolution ALJ-347 establishing an Expedited Interconnection Dispute Resolution Process as authorized by Assembly Bill 2861 (Ting, 2016). The expedited dispute resolution process will issue binding determinations to electric distribution grid interconnection disputes based on the recommendations of a technical panel within 60 days of the Commission receiving the Application regarding a particular dispute. For a detailed description of the adopted process, please see Exhibit A of Resolution ALJ-347.

AB 2821 is intended to address the inadequacy of the existing interconnection dispute resolution process described in utility tariffs in Section K of Rule 21, which relies on protracted mediation and does not benefit from readily-leveraged technical expertise to review the engineering determinations and upgrade cost allocations that often lead to disputes.

To apply for the Expedited Interconnection Dispute Resolution process, click here.

For questions about the expedited process, please contact Rule21.Disputes@cpuc.ca.gov.

Smart Inverter Working Groups

The Smart Inverter Working Group (SIWG) meets on a regular basis to discuss topics relevant to smart inverter functionalities and other topics.  For more information on smart inverter deadlines and working group activities, please see Energy Division’s Smart Inverter Working Group page, or contact SIWG@cpuc.ca.gov.

Schedule: Meetings take place between 1:00 and 2:30 PM PST on alternating Thursdays.  For schedule information, please follow the directions below to join the distribution list.

Distribution List: Energy Division maintains a distribution list for those interested in attending the SIWG. To request to be added to the list, please email SIWG@cpuc.ca.gov with the subject line “Addition to IDF.”  To be removed from the list, email us with the subject line “Removal from SIWG.”  Please include your first and last name, e-mail address (for Removals, as it appears in the IDF invites), organization, role, and phone number

Interconnection Data Reporting

Pursuant to Decision (D.) 14-04-003, the three California IOUs submit interconnection data reports to the CPUC Energy Division on a quarterly basis. Public versions of the reports are made available on our Utility Interconnection Data Reports page.

Rule 21 Interconnection Timeline Reporting

On September 30, 2020, in the R.17-07-007 proceeding, the Commission issued Decision D.20-09-035 “Decision Adopting Recommendations from Working Groups Two, Three and Subgroup” in Phase I of the R.17-07-007 Proceeding, which is quasi legislative (definition at 2). The Decision addressed Working Group Issue 12: Improving Timeline Certainty. The Decision states (at 82-83) “The purpose of Issue 12 is to improve certainty regarding timelines for distribution upgrade planning, cost estimation, and construction. In the Working Group Three Report (at 11), parties claim timelines for these three elements of interconnection are not being set, communicated, and/or adhered to in a predictable and consistent manner. These same parties contend that as a result, developers cannot give reliable estimates to customers; customers may be required to carry their own facilities’ loan or leasing costs for longer than reasonable or expected; and Utilities [i.e., PG&E, SCE and SDG&E] are not being held accountable. Working group participants all agree that in order to improve accountability, transparency, communication, and consistency around these times, additional data is needed along with better data collection.”

To address party concerns and improve timeline tracking, D.20-09-035 ordering paragraph 4 ordered the utilities to track “the actual costs associated with the processing of interconnection applications”. D.20-09-035 ordering paragraphs 22-30 address Rule 21 project timeline tracking issues by mandating regular reporting and specifying areas of additional or improved timeline tracking. It is important to note that D.20-09-035 did not mandate reporting for net energy metering (NEM) systems smaller than 30 kVA (i.e., ~30 kW) installed capacity, which, per the March 2021 Rule 21 Interconnection Program Evaluation (overview below on this webpage), represent the majority of the Rule 21 Interconnections in California.

Since in December 2020, CPUC Energy Division Interconnection staff has worked with the Utilities to construct spreadsheets that track Utility interconnection timeline performance for Rule 21 systems as well as interconnection application processing costs. The Utilities serve these spreadsheets to the R.17-07-007 service list quarterly.

Click the link below to download the aggregated version of the latest, cumulative submission:

All IOUs - R21 Timelines Report

Columns in the cover page tab of this cumulative submission include information on system location (ZIP), system type (e.g., net energy metering, non-export, etc.), system technology (e.g., solar photovoltaic (PV), battery storage, solar PV paired with battery storage, etc.), and the timeline steps required (D.20-09-035 ordering paragraph and Rule 21 tariff references included for ease of reference). Additional tabs in this spreadsheet capture the actual costs associated with the processing of interconnection applications.

Each Utility also submits its own, more detailed quarterly timeline tracking sheet that accompanies its quarterly submission displayed in the cumulative submission. These more detailed quarterly timeline tracking sheets include dates for each system captured in the all-IOU aggregated coversheet. Click the links below to download the latest versions of the Utility submissions:

• PG&E  R21 Timelines Report
• SCE R21 Timelines Report
• SDG&E R21 Timelines Report

If you have additional questions regarding this information, please email IxDE@cpuc.ca.gov.

Rule 21 Interconnection Program Evaluation

Assembly Bill 2861 (Ting, 2016) authorized CPUC to evaluate adherence to Rule 21 interconnection timelines. Guidehouse (consultant) carried out the evaluation from May 2019 through July 2020. Stakeholders at CPUC-hosted workshops vetted questionnaires and data requests sent to the utilities and weighed in on report findings.  In many cases, utility data was incomplete or unavailable, so Guidehouse used population sampling to evaluate performance. Guidehouse also interviewed utilities and developers, aiming to identify opportunities for programmatic changes to improve adherence to Rule 21, transparency and CPUC / utility feedback mechanisms.

Proposals adopted from Issue 12 in the WG 2/3/V2G AC Decision (D.20-09-035) largely address recommendations 7.1-7.3 from the Report. Ordering Paragraph 22 requires IOUs to track and report 19 interconnection timelines similar to those studied in the report. Ordering Paragraphs 23 and 24 establish standard interconnection construction and metering equipment installation timelines, and Ordering Paragraph 25 requires utilities to notify interconnection customers when they will fail (or will likely fail) to meet specified timeline requirements. Ordering Paragraphs 26-29 hold utilities accountable for tracking and adhering to timelines.

The Report was distributed to the R.17-07-007 and Interconnection Discussion Forum service lists in March 2021 and is available for download here.

Decision 16-06-052 Implementation

Decision 16-06-052 (R.11-09-011), adopted by the Commission on June 23, 2016, institutes a 25% Cost Envelope for interconnection costs; grants Joint Motions pertaining to Cost Certainty and Non-Exporting, Behind-the-Meter Energy Storage; and requires Rule 21 revisions to incorporate the technical requirements for Phase 2 smart inverter communications and Phase 3 advanced inverter functions as recommended by the Smart Inverter Working Group.

For more information about the provisions of D.16-06-052, please visit the D.16-06-052 webpage.

General Information about Rule 21

Applicability 

Rule 21 governs CPUC-jurisdictional interconnections, which include the interconnection of all net energy metering (NEM) facilities, "Non-Export" facilities, and qualifying facilities intending to sell power at avoided cost to the host utility. Rule 21 does not apply to the interconnection of generating or storage facilities intending to participate in wholesale markets overseen by the Federal Energy Regulatory Commission (FERC). These facilities must typically apply for interconnection under the FERC-jurisdictional "Wholesale Distribution Access Tariff" (when connecting to the distribution system) or "CAISO Tariff" (when connecting to the transmission system).

Overview of Tariff Provisions 

Rule 21 contains provisions governing many aspects of interconnection, including:

• Procedures and timeframes for reviewing applications
• Fee schedules to process applications and perform impact studies
• Pro forma application and agreement forms
• Allocation of interconnection costs
• Provisions specific to net energy metered facilities
• Technical operating parameters
• Certification and testing criteria
• Technical requirements for inverters
• Metering and monitoring requirements
• Procedures for dispute resolution

Regulatory History 

The Commission's first iteration of Rule 21 was adopted in 1982.  As initially adopted, Rule 21 was designed to meet the needs of small, non-utility-owned generating facilities, namely qualifying facilities, which included renewable, non-renewable, and cogeneration plants as defined by the Public Utility Regulatory Policies Act.

The Commission revisited Rule 21 in 1999.  Working collaboratively with the California Energy Commission, the Commission undertook a redesign of Rule 21 to establish a more standardized and transparent engineering analysis for the interconnection of distributed generation, especially generation that offsets on-site load.  Rule 21 adopted an "Initial Review" screening process designed to permit the utility engineer to quickly identify, among other factors, whether a generating facility is configured to remain within certain technical limits, and thus unlikely to cause electrical disruptions on the grid.

The modified Rule 21 successfully facilitated the interconnection of tens of thousands of net energy metered and non-exporting generation facilities between 1999 and 2011.  However, generators seeking to export a portion or all of their generation to the utility's distribution system lacked a straightforward means of interconnecting under Rule 21.  Gaps in the tariff also existed for the interconnection of new technologies, such as energy storage.

On September 22, 2011, the Commission opened Rulemaking (R.) 11-09-011 to "address the key policy and technical issues essential to timely, non-discriminatory, cost-effective and transparent interconnection." During the course of that proceeding, the Commission adopted three substantive decisions: Decision (D.) 12-09-018, D.14-12-035 and D.16-06-052. 

On September 20, 2012, the Commission issued D.12-09-018, which adopted a settlement agreement focused on the interconnection study process.  The settlement agreement required that each utility revise its Rule 21 to assign all interconnection requests to either the "Fast Track" - a screen-based, streamlined review process for net energy metering, non-export, and small exporting facilities - or the "Detailed Study" process for more complicated generating facilities.

On December 18, 2014, the Commission issued D.14-12-035, which adopted revisions to Rule 21 to require "smart" inverters for Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE), and San Diego Gas & Electric Company (SDG&E).  D.14-12-035 adopted the revisions recommended by the Smart Inverter Working Group in its January 2014 report "Recommendations for Updating the Technical Requirements for Inverters in Distributed Energy Resources." 

On June 23, 2016, the Commission issued D.16-06-052, which enhanced the Rule 21 Pre-Application Report, created a Unit Cost Guide, enhanced the behind-the-meter storage interconnection process, and established a pilot program to institute a cost certainty envelope for interconnections triggering a distribution upgrade.

Despite the significant progress made in R.11-09-011, additional improvements to Rule 21 are needed. On July 13, 2017, the Commission issued an Order Instituting Rulemaking to Consider Streamlining Interconnection of Distributed Energy Resources and Improvements to Rule 21. Among the principal topics to be considered in the new rulemaking (R.17-07-007) is the incorporation into Rule 21 of the utilities' Integration Capacity Analysis (ICA) tools, currently under development in the Distribution Resources Plan (DRP) proceeding (R.14-08-013).  The ICA tools use power flow analysis to determine the ability of a circuit to host distributed energy resources.  Incorporating the ICA tools into Rule 21 may better inform interconnection siting decisions and further streamline the Fast Track process for certain projects.

Contact Us

For utility-specific interconnection inquiries, please contact the relevant utility using the contact information found on the utility's interconnection website.

For inquiries to the Interconnection & Distribution Engineering staff, contact:

E-Mail	Purpose
IxDE@cpuc.ca.gov	For general inquiries related to interconnection (e.g., tariff inquiries; proceeding inquiries)
IxForum@cpuc.ca.gov	For inquiries related to the Interconnection Discussion Forum (e.g., Distribution List; Agenda Items; General Questions)
SIWG@cpuc.ca.gov	For inquiries related to the Smart Inverter Working Group (e.g., Distribution List; Agenda Items; General Questions), Smart Inverters and Interconnection Standards
Ix_Tx_Dispute@cpuc.ca.gov	For inquires related to Transmission interconnection disputes and Summer Reliability interconnection disputes
Rule21.Disputes@cpuc.ca.gov	For Rule 21 interconnection disputes (e.g., Expedited Interconnection Dispute Resolution Process)

 

For more information on proceedings, decisions, and locating documents, please visit the corresponding CPUC websites:

• Proceedings and Rulemaking: https://www.cpuc.ca.gov/proceedings-and-rulemaking
• Advanced Search: https://www.cpuc.ca.gov/documents

There are two ways to receive information related to proceedings:

1. Become a Party to a Proceeding.  This allows you to receive e-mails and documents sent by the Commission, by other parties participating in the proceeding, and notices of workshops or other events.    
2. Subscribe to a Proceeding.  This allows you to follow subscription documents on the proceeding docket card.  Visit the docket card, search for the proceeding, and open the link, and subscribe.  Visit the docket card:  https://apps.cpuc.ca.gov/apex/f?p=401:1:0