155 FERC ¶ 61,277

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

18 CFR Part 35

[Docket No. RM16-1-000; Order No. 827]

Reactive Power Requirements for Non-Synchronous Generation

(Issued June 16, 2016)

AGENCY: Federal Energy Regulatory Commission.

ACTION: Final rule.

SUMMARY: The Federal Energy Regulatory Commission (Commission) is eliminating

the exemptions for wind generators from the requirement to provide reactive power by 

revising the pro forma Large Generator Interconnection Agreement (LGIA), Appendix G 

to the pro forma LGIA, and the pro forma Small Generator Interconnection Agreement 

(SGIA). As a result, all newly interconnecting non-synchronous generators will be 

required to provide reactive power at the high-side of the generator substation as a 

condition of interconnection as set forth in their LGIA or SGIA as of the effective date of 

this Final Rule.

EFFECTIVE DATE: This Final Rule will become effective [Insert date 90 days after 

publication in the FEDERAL REGISTER].

FOR FURTHER INFORMATION CONTACT:

Brian Bak (Technical Information)

Office of Energy Policy and Innovation

Federal Energy Regulatory Commission
Docket No. RM16

-1-000- 2 -

888 First Street, NE

Washington, DC 20426

(202) 502-6574

brian.bak@ferc.gov

Gretchen Kershaw (Legal Information)

Office of the General Counsel

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

(202) 502-8213

gretchen.kershaw@ferc.gov

SUPPLEMENTARY INFORMATION:
155 FERC ¶ 61,277

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Reactive Power Requirements for Non-Synchronous 

Generation

Docket No. RM16-1-000

ORDER NO. 827

TABLE OF CONTENTS

Paragraph Numbers

I. Background.............................................................................................................. 6.

II. Need for Reform.................................................................................................... 11.

III. Discussion.............................................................................................................. 13.

A. Reactive Power Requirement for Non-Synchronous Generators............... 16.

1. NOPR Proposal ............................................................................... 16.

2. Comments........................................................................................ 17.

3. Commission Determination ............................................................ 21.

B. Power Factor Range, Point of Measurement, and Dynamic 

Reactive Power Capability Requirements.................................................. 26.

1. NOPR Proposal ............................................................................... 26.

2. Comments........................................................................................ 27.

3. Commission Determination ............................................................ 34.

C. Real Power Output Level ........................................................................... 41.

1. NOPR Proposal ............................................................................... 41.

2. Comments........................................................................................ 42.

3. Commission Determination ............................................................ 47.

D. Compensation............................................................................................. 50.

1. NOPR Proposal ............................................................................... 50.

2. Comments........................................................................................ 51.

3. Commission Determination ............................................................ 52.

E. Application of the Final Rule ..................................................................... 53.

1. NOPR Proposal ............................................................................... 53.

2. Comments........................................................................................ 54.

3. Commission Determination ............................................................ 59.

a. Newly Interconnecting Non-Synchronous Generators........ 60.

b. Upgrades to Existing Non-Synchronous Generators........... 64.

F. Regional Flexibility.................................................................................... 68.

G. Miscellaneous Comments........................................................................... 70.

IV. Compliance and Implementation........................................................................... 74.
Docket No. RM16-1-000 - 2 -

V. Information Collection Statement ......................................................................... 78.

VI. Regulatory Flexibility Act Certification................................................................ 83.

VII. Environmental Analysis ........................................................................................ 86.

VIII. Document Availability .......................................................................................... 87.

IX. Effective Date and Congressional Notification..................................................... 90.
155 FERC ¶ 61,277

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Reactive Power Requirements for Non-Synchronous 

Generation

Docket No. RM16-1-000

ORDER NO. 827

FINAL RULE

(Issued June 16, 2016)

1. The Federal Energy Regulatory Commission (Commission) is eliminating the

exemptions for wind generators from the requirement to provide reactive power by 

revising the pro forma Large Generator Interconnection Agreement (LGIA), Appendix G 

to the pro forma LGIA, and the pro forma Small Generator Interconnection Agreement 

(SGIA). Under this Final Rule, newly interconnecting non-synchronous generators that 

have not yet executed a Facilities Study Agreement as of the effective date of this Final 

Rule will be required to provide dynamic reactive power within the range of 0.95 leading 

to 0.95 lagging at the high-side of the generator substation. This Final Rule revises the 

pro forma LGIA and pro forma SGIA to establish reactive power requirements for nonsynchronous generation. Specifically, the pro forma LGIA will include the following 

(the pro forma SGIA will include similar language):1

Non-Synchronous Generation. Interconnection Customer 

shall design the Large Generating Facility to maintain a 

 1 See Section IV of this Final Rule, Compliance and Implementation, for the 

specific changes to the pro forma LGIA and pro forma SGIA.
Docket No. RM16-1-000 - 2 -

composite power delivery at continuous rated power output at 

the high-side of the generator substation at a power factor 

within the range of 0.95 leading to 0.95 lagging, unless the 

Transmission Provider has established a different power 

factor range that applies to all non-synchronous generators in 

the Control Area on a comparable basis. This power factor 

range standard shall be dynamic and can be met using, for 

example, power electronics designed to supply this level of 

reactive capability (taking into account any limitations due to 

voltage level, real power output, etc.) or fixed and switched 

capacitors, or a combination of the two. This requirement 

shall only apply to newly interconnecting non-synchronous 

generators that have not yet executed a Facilities Study 

Agreement as of the effective date of the Final Rule 

establishing this requirement (Order No. 827).

2. Section 35.28(f)(1) of the Commission’s regulations requires every public utility 

with an open access transmission tariff (OATT) on file to also have on file the pro forma 

LGIA and pro forma SGIA “required by Commission rulemaking proceedings 

promulgating and amending such interconnection procedures and agreements.”2 As a 

result of this Final Rule, all newly interconnecting non-synchronous generators will be 

required to provide reactive power as a condition of interconnection pursuant to the 

pro forma LGIA and pro forma SGIA. These reactive power requirements will apply to 

any new non-synchronous generator seeking to interconnect to the transmission system 

that has not yet executed a Facilities Study Agreement as of the effective date of this 

Final Rule.

 2 18 C.F.R. § 35.28(f)(1) (2015).
Docket No. RM16-1-000 - 3 -

3. The existing pro forma LGIA and pro forma SGIA both require, as a condition of 

interconnection, an interconnecting generator to design its Generating Facility3 “to 

maintain a composite power delivery at continuous rated power output at the Point of 

Interconnection at a power factor4 within the range of 0.95 leading to 0.95 lagging”5 (the 

reactive power requirement).

 3 The pro forma LGIA defines “Generating Facility” as an “Interconnection 

Customer’s device for the production of electricity identified in the Interconnection 

Request,” excluding the Interconnection Customer’s Interconnection Facilities. The 

pro forma LGIA further defines “Large Generating Facility” as a “Generating Facility 

having a Generating Facility Capacity of more than 20 MW.” The pro forma SGIA 

defines “Small Generating Facility” as an “Interconnection Customer’s device for the 

production and/or storage for later injection of electricity identified in the Interconnection 

Request,” excluding the Interconnection Customer’s Interconnection Facilities. For 

purposes of this Final Rule, unless otherwise noted, “Generating Facility” refers to both a 

Large Generating Facility and a Small Generating Facility.

4 The power factor of an alternating current transmission system is the ratio of real 

power to apparent power. Reliable operation of a transmission system requires system 

operators to maintain a tight control of voltages (at all points) on the transmission system. 

The ability to vary the ratio of real power to apparent power (i.e., adjust the power factor) 

allows system operators to maintain scheduled voltages within allowed for tolerances on 

the transmission system and maintain the reliability of the transmission system. The 

Commission established a required power factor range in Order No. 2003 of 0.95 leading 

to 0.95 lagging, but allowed transmission providers to establish different requirements to 

be applied on a comparable basis. See Standardization of Generator Interconnection 

Agreements and Procedures, Order No. 2003, FERC Stats. & Regs. ¶ 31,146, at P 542

(2003), order on reh’g, Order No. 2003-A, FERC Stats. & Regs. ¶ 31,160, order on 

reh’g, Order No. 2003-B, FERC Stats. & Regs. ¶ 31,171 (2004), order on reh’g, Order 

No. 2003-C, FERC Stats. & Regs. ¶ 31,190 (2005), aff'd sub nom. Nat’l Ass’n of 

Regulatory Util. Comm’rs v. FERC, 475 F.3d 1277 (D.C. Cir. 2007), cert. denied, 

552 U.S. 1230 (2008).

5 Section 9.6.1 of the pro forma LGIA and section 1.8.1 of the pro forma SGIA.
Docket No. RM16-1-000 - 4 -

4. As discussed below, however, wind generators have been exempt from the general 

requirement to provide reactive power absent a study finding that the provision of 

reactive power is necessary to ensure safety or reliability. The Commission exempted 

wind generators from the uniform reactive power requirement because, historically, the 

costs to design and build a wind generator that could provide reactive power were high 

and could have created an obstacle to the development of wind generation.6

 Due to 

technological advancements, the cost of providing reactive power no longer presents an 

obstacle to the development of wind generation.7

 The resulting decline in the cost to 

wind generators of providing reactive power renders the current absolute exemptions 

unjust, unreasonable, and unduly discriminatory and preferential. Further, the growing 

penetration of wind generators on some systems increases the potential for a deficiency in 

reactive power.8

 6 Interconnection for Wind Energy, Order No. 661, FERC Stats. & Regs. ¶ 31,186,

at P 51, order on reh’g, Order No. 661-A, FERC Stats. & Regs. ¶ 31,198 (2005).

7 See, e.g., Payment for Reactive Power, Commission Staff Report, Docket 

No. AD14-7, app. 2, at 1-3 (Apr. 22, 2014).

8 See, e.g., PJM Interconnection, L.L.C., 151 FERC ¶ 61,097, at P 7 (2015); 

CAISO Comments at 2-3 (explaining that, in 2014, CAISO had over 11,000 MW of 

interconnected variable energy resources, the majority of which are non-synchronous 

generators, but expects to have over 20,000 MW of such resources interconnected by 

2024).
Docket No. RM16-1-000 - 5 -

5. Given these changes, the Commission finds under section 206 of the Federal 

Power Act (FPA)9 that wind generators should not have an exemption from the reactive 

power requirement which is unavailable to other generators. While we find that requiring 

non-synchronous generators to provide dynamic reactive power is now reasonable, we 

recognize that distinctions between non-synchronous and synchronous generators still 

exist and that these differences justify requiring non-synchronous generators to provide 

dynamic reactive power at a different location than synchronous generators: nonsynchronous generators will be required to provide dynamic reactive power at the highside of the generator substation, as opposed to the Point of Interconnection. The reactive 

power requirements we adopt here for newly interconnecting non-synchronous generators 

provide just and reasonable terms, which recognize the technical differences of nonsynchronous generators from synchronous generators. These requirements also benefit 

customers by ensuring that reliability is protected without adding unnecessary obstacles 

to further development of non-synchronous generators.

I. Background

6. Transmission providers require reactive power to control system voltage for 

efficient and reliable operation of an alternating current transmission system. At times, 

transmission providers need generators to either supply or consume reactive power. 

 9 16 U.S.C. § 824d-e (2012).
Docket No. RM16-1-000 - 6 -

Starting with Order No. 888,10 which included provisions regarding reactive power from 

generators as an ancillary service in Schedule 2 of the pro forma OATT, the Commission 

issued a series of orders intended to ensure that sufficient reactive power is available to 

maintain the reliability of the bulk power system.

7. Starting with Order No. 2003, the Commission adopted standard procedures and a 

standard agreement for the interconnection of Large Generating Facilities (the pro forma 

LGIA), which included the reactive power requirement.11 Under this requirement, large 

generators must design their Large Generating Facilities to provide 0.95 leading to 

0.95 lagging reactive power at the Point of Interconnection. Synchronous generators 

have met this requirement by providing dynamic reactive power at the Point of 

Interconnection, utilizing the inherent dynamic reactive power capability of synchronous 

generators. The Commission recognized in Order No. 2003-A that the pro forma LGIA 

was “designed around the needs of large synchronous generators and that generators 

relying on newer technologies may find that either a specific requirement is inapplicable 

or that it calls for a slightly different approach” because such generators “may have 

 10 Promoting Wholesale Competition Through Open Access Non-Discriminatory 

Transmission Services by Public Utilities; Recovery of Stranded Costs by Public Utilities 

and Transmitting Utilities, Order No. 888, FERC Stats. & Regs. ¶ 31,036 (1996), order 

on reh’g, Order No. 888-A, FERC Stats. & Regs. ¶ 31,048, order on reh’g, Order 

No. 888-B, 81 FERC ¶ 61,248 (1997), order on reh’g, Order No. 888-C, 82 FERC 

¶ 61,046 (1998), aff’d in relevant part sub nom. Transmission Access Policy Study Group 

v. FERC, 225 F.3d 667 (D.C. Cir. 2000), aff’d sub nom. New York v. FERC, 535 U.S. 1 

(2002).

11 Order No. 2003, FERC Stats. & Regs. ¶ 31,146 at PP 1, 542.
Docket No. RM16-1-000 - 7 -

unique electrical characteristics.”12 Therefore, the Commission exempted wind 

generators from this reactive power requirement.13

8. In June 2005, the Commission issued Order No. 661,14 establishing 

interconnection requirements in Appendix G to the pro forma LGIA for large wind 

generators.15 Recognizing that, unlike traditional synchronous generators, wind 

generators had to “install costly equipment” to maintain reactive power capability, the 

Commission in Order No. 661 preserved the exemption for large wind generators from 

the reactive power requirement unless the transmission provider shows, through a System 

Impact Study, that reactive power capability is required to ensure safety or reliability.16 

The Commission explained that this qualified exemption from the reactive power 

 12 Order No. 2003-A, FERC Stats. & Regs. ¶ 31,160 at P 407 & n.85.

13 Id. Article 9.6.1 of the pro forma LGIA provides: “Interconnection Customer 

shall design the Large Generating Facility to maintain a composite power delivery at 

continuous rated power output at the Point of Interconnection at a power factor within the 

range of 0.95 leading to 0.95 lagging, unless Transmission Provider has established 

different requirements that apply to all generators in the Control Area on a comparable 

basis. The requirements of this paragraph shall not apply to wind generators.”

14 Interconnection for Wind Energy, Order No. 661, FERC Stats. & Regs. 

¶ 31,186, Appendix B (Appendix G – Interconnection Requirements for a Wind 

Generating Plant), order on reh’g, Order No. 661-A, FERC Stats. & Regs. ¶ 31,198 

(2005).

15 Id. P 1.

16 Id. PP 50-51. Appendix G states: “A wind generating plant shall maintain a 

power factor within the range of 0.95 leading to 0.95 lagging, measured at the Point of 

Interconnection as defined in this LGIA, if the Transmission Provider’s System Impact 

Study shows that such a requirement is necessary to ensure safety or reliability.”
Docket No. RM16-1-000 - 8 -

requirement for large wind generators would provide certainty to the industry and 

“remove unnecessary obstacles to the increased growth of wind generation.”17

9. In May 2005, the Commission issued Order No. 2006,18 in which it adopted 

standard procedures and a standard agreement for the interconnection of Small 

Generating Facilities (pro forma SGIA).19 In Order No. 2006, the Commission 

completely exempted small wind generators from the reactive power requirement.20 The 

Commission reasoned that, similar to large wind generators, small wind generators would 

face increased costs to provide reactive power that could create an obstacle to the 

development of small wind generators. Additionally, the Commission reasoned that 

small wind generators would “have minimal impact on the Transmission Provider’s 

 17 Id. P 50.

18 Standardization of Small Generator Interconnection Agreements and 

Procedures, Order No. 2006, FERC Stats. & Regs. ¶ 31,180, Attachment F (Small 

Generator Interconnection Agreement), order on reh’g, Order No. 2006-A, FERC 

Stats. & Regs. ¶ 31,196 (2005), order granting clarification, Order No. 2006-B, FERC 

Stats. & Regs. ¶ 31,221 (2006).

19 Id. P 1.

20 Id. P 387. Section 1.8.1 of the pro forma SGIA states: “The Interconnection 

Customer shall design its Small Generating Facility to maintain a composite power 

delivery at continuous rated power output at the Point of Interconnection at a power 

factor within the range of 0.95 leading to 0.95 lagging, unless the Transmission Provider 

has established different requirements that apply to all similarly situated generators in the 

control area on a comparable basis. The requirements of this paragraph shall not apply to 

wind generators.”
Docket No. RM16-1-000 - 9 -

electric system” and therefore the reliability requirements for large wind generators that 

were eventually imposed in Order No. 661 were not needed for small wind generators.21

10. Since the Commission provided these exemptions from the reactive power 

requirement for wind generators, the equipment needed for a wind generator to provide 

reactive power has become more commercially available and less costly, such that the 

cost of installing equipment that is capable of providing reactive power is comparable to 

the costs of a traditional generator.

22 Recognizing these factors, the Commission recently 

accepted a proposal by PJM Interconnection, L.L.C. (PJM), effectively removing the 

wind generator exemptions from the PJM tariff.

23 Specifically, the Commission granted 

PJM an “independent entity variation” from Order No. 661 in accepting PJM’s proposal 

to require interconnection customers seeking to interconnect non-synchronous 

generators,24 including wind generators, to use “enhanced inverters” with the capability 

to provide reactive power.25 The Commission observed that, “[a]lthough there are still 

 21 Id. P 24.

22 See, e.g., Payment for Reactive Power, Commission Staff Report, Docket 

No. AD14-7, app. 1, at 6, app. 2, at 4-5 (Apr. 22, 2014).

23 PJM Interconnection, L.L.C., 151 FERC ¶ 61,097 at P 28.

24 Non-synchronous generators are “connected to the bulk power system through 

power electronics, but do not produce power at system frequency (60 Hz).” They “do not 

operate in the same way as traditional generators and respond differently to network 

disturbances.” Id. P 1 n.3 (citing Order No. 661, FERC Stats. & Regs. ¶ 31,198 at P 3 

n.4). Wind and solar photovoltaic generators are two examples of non-synchronous 

generators.

25 Id. PP 1, 6.
Docket No. RM16-1-000 - 10 -

technical differences between non-synchronous generators [such as wind generators] and 

traditional generators, with regard to the provision of reactive power, those differences 

have significantly diminished since the Commission issued Order No. 661.”26 The 

Commission agreed with PJM “that the technology has changed both in availability and 

in cost since the Commission rejected [the California Independent System Operator’s] 

proposal in 2010,” such that “PJM’s proposal will not present a barrier to nonsynchronous resources.”27

II. Need for Reform

11. Based upon this information, on November 19, 2016, the Commission issued a 

Proposal to Revise Standard Generator Interconnection Agreements (NOPR) that 

proposed to eliminate the exemptions for wind generators from the requirement to 

provide reactive power as contained in the pro forma LGIA, Appendix G to the 

pro forma LGIA, and the pro forma SGIA.28 In the NOPR, the Commission sought 

comment on: whether to remove the exemptions for wind generators from the reactive

power requirement; whether the current power factor range of 0.95 leading to 

0.95 lagging, as set forth in the existing pro forma LGIA and pro forma SGIA, is

reasonable given the technology used by non-synchronous generators; whether newly

 26 Id. P 28.

27 Id.

28 Reactive Power Requirements for Non-Synchronous Generation, Notice of 

Proposed Rulemaking, 80 Fed Reg. 73,683 (Nov. 25, 2015), FERC Stats. & Regs. 

¶ 32,712 (2015).
Docket No. RM16-1-000 - 11 -

interconnecting non-synchronous generators should only be required to produce reactive

power when the generator’s real power output is greater than 10 percent of nameplate

capacity; and whether the existing methods used to determine reactive power

compensation are appropriate for wind generators and, if not, what alternatives would be

appropriate.29

12. In response to the NOPR, 24 entities submitted comments,30 most of which

generally support the proposed elimination of the exemptions. However, some

commenters seek clarification of various issues that fall into six broad categories: 

(1) comments regarding where the reactive power requirement should be measured (the

Point of Interconnection, the generator terminals, or elsewhere); (2) comments contesting

the proposal to require fully dynamic reactive power capability; (3) comments contesting

the proposal to require non-synchronous generators to maintain the required power factor

range only when the generator’s real power output exceeds 10 percent of its nameplate

capacity; (4) comments on compensation methods for reactive power; (5) comments

seeking clarification as to which non-synchronous resources the Final Rule will apply;

and (6) comments on the need for regional flexibility.

 29 Id. P 18.

30 See Appendix A for a list of entities that submitted comments and the shortened 

names used throughout this Final Rule to describe those entities.
Docket No. RM16-1-000 - 12 -

III. Discussion

13. The Commission finds that, given the changes to the cost of providing reactive

power by non-synchronous generators, as well as the growing penetration of such

generators, the reactive power requirements in the pro forma LGIA and pro forma SGIA

are no longer just and reasonable and are unduly discriminatory and preferential and,

thus, need to be revised. We have determined in this Final Rule to apply comparable

reactive power requirements to non-synchronous generators and synchronous generators. 

We recognize technological differences between non-synchronous and synchronous

generators still remain. Because of the configuration and means of producing power of

synchronous generators, these generators provide dynamic reactive power at the Point of

Interconnection. Many commenters point out, however, that the advancements in

technology do not permit some non-synchronous generators to provide dynamic reactive

power at reasonable cost at the Point of Interconnection. Recognizing the differences

between the two categories of generation, we have determined to require nonsynchronous generators to provide dynamic reactive power at the high-side of the

generator substation.31

 31 This measurement point is different from Order No. 2003 requirement, which 

measures the power factor at the Point of Interconnection. As an example, the generator 

substation would be the substation for a wind generator that separates the low-voltage 

collector system from the higher voltage elements of the Interconnection Customer 

Interconnection Facilities that bring the generator’s energy to the Point of 

Interconnection. Both the pro forma Large Generator Interconnection Procedures and the 

pro forma Small Generator Interconnection Procedures require interconnecting 

(continued ...)
Docket No. RM16-1-000 - 13 -

14. The requirements adopted by this Final Rule are intended to ensure that all 

generators, both synchronous and non-synchronous, are treated in a not unduly 

discriminatory or preferential manner, as required by sections 205 and 206 of the FPA,

and to ensure sufficient reactive power is available on the bulk power system as more 

non-synchronous generators seek to interconnect and more synchronous generators retire.

15. We discuss below the issues raised in the comments.

A. Reactive Power Requirement for Non-Synchronous Generators

1. NOPR Proposal

16. In the NOPR, the Commission proposed to eliminate the exemptions for wind 

generators from the reactive power requirement, and thereby to require that all newly

interconnecting non-synchronous generators provide reactive power as a condition of

interconnection.32

2. Comments

17. Most commenters agree that the current exemptions for wind generators from the 

reactive power requirement are unjust, unreasonable, and unduly discriminatory and 

preferential due to increases in the number and size of non-synchronous generators, and 

 

generators to provide a simplified one-line diagram of the plant and station facilities, 

which will be appended to the interconnection agreement.

32 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 12.
Docket No. RM16-1-000 - 14 -

advances in non-synchronous generator technology.

33 Commenters contend that 

operation and planning of the bulk power system requires adequate levels of voltage 

support, and that exempting wind generators from the reactive power requirement may 

inhibit the proper operation of the bulk power system.

34 Specifically, commenters assert

that non-synchronous generators are increasingly replacing synchronous generators, 

which is resulting in a decrease in the amount of dynamic reactive power available to the 

transmission system.35 Commenters also contend that the inverters used by most nonsynchronous generators today are manufactured with the inherent capability to produce 

reactive power.36 Therefore, commenters generally support the Commission’s proposal 

to create comparable reactive power requirements for non-synchronous and synchronous 

generators.37 While the Public Interest Organizations support the removal of the 

 33 EEI Comments at 5; Indicated NYTOs Comments at 2-3; ISO/RTO Council 

Comments at 4; ISO-NE Comments at 9-10; MISO Comments at 2.

34 CAISO Comments at 2-5; ISO/RTO Council Comments at 5; ISO-NE 

Comments at 9; NERC Comments at 5-6; Six Cities Comments at 3-4.

35 CAISO Comments at 2-3; EEI Comments at 4-5; ITC Comments at 1-2; SCE 

Comments at 2; SDG&E Comments at 2.

36 CAISO Comments at 3; ISO/RTO Council Comments at 5; MISO Comments at 

2-3; NaturEner Comments at 2; NERC Comments at 9; SCE Comments at 2.

37 CAISO Comments at 3; EEI Comments at 6-7; EPSA Comments at 3; Idaho 

Power Comments at 1; Indicated NYTOs Comments at 2; ISO/RTO Council Comments 

at 4; ISO-NE Comments at 7-8; ITC Comments at 1; Lincoln Comments at 1-2; MISO 

Comments at 1-2; NEPOOL Initial Comments at 6; SCE Comments at 2; SDG&E 

Comments at 3.
Docket No. RM16-1-000 - 15 -

exemptions for wind generators from the reactive power requirement, they ask that the 

Commission not impose unduly burdensome requirements on non-synchronous 

generators.38

18. Commenters argue that it is more effective to have a standard reactive power 

requirement for wind generators than requiring transmission providers to show through a 

System Impact Study the need for reactive power from an interconnecting wind generator 

on a case-by-case basis because a System Impact Study may not reflect the future needs 

of the transmission system.39 CAISO explains that deficiencies in reactive power support 

may only become apparent when there are high levels of variable energy resources and 

low demand, or when certain transmission infrastructure or synchronous generators are 

out of service.40 Because System Impact Studies do not study all conditions, CAISO 

contends they may not capture these deficiencies before a wind generator interconnects to 

the transmission system.41 Therefore, CAISO, as well as the ISO/RTO Council, assert 

that transmission providers may need to remedy deficiencies in reactive power support 

 38 Public Interest Organizations Comments at 1.

39 CAISO Comments at 4-5; EEI Comments at 5-6; ISO/RTO Council Comments 

at 5; ISO-NE Comments at 2.

40 CAISO Comments at 4.

41 Id.
Docket No. RM16-1-000 - 16 -

that were not identified through a System Impact Study through authorization and 

development of transmission infrastructure upgrades.42

19. Commenters argue that relying on transmission system upgrades after a wind 

generator interconnects, or relying on more recently interconnected generation resources,

to meet reactive power deficiencies may shift the cost of providing reactive power from 

one interconnection customer to another. Specifically, if a System Impact Study does not 

show that an earlier interconnecting wind generator needs to provide reactive power, but, 

as a result of the combination of existing and new wind generators, a System Impact 

Study for a later interconnecting wind generator does make that showing, the newer 

interconnecting wind generator would have the entire burden of supplying reactive power 

instead of sharing equally with the other wind generators creating the need for reactive 

power.

43 Further, commenters assert that requiring transmission providers to show 

through a System Impact Study the need for reactive power from interconnecting wind 

generators leads to delays and increased costs in processing interconnection requests.44 

Commenters argue that a uniform reactive power requirement for non-synchronous 

generators may result in reduced costs for wind development by allowing standardization 

 42 CAISO Comments at 4; ISO/RTO Council Comments at 5.

43 ISO/RTO Council Comments at 5; Union of Concerned Scientists Comments at 

4-5.

44 ISO-NE Comments at 2, 4, 10; NEPOOL Initial Comments at 5.
Docket No. RM16-1-000 - 17 -

of components and equipment.45 Additionally, ISO-NE argues that the difficulty in 

demonstrating a need for reactive power through a System Impact Study has resulted in 

some wind generators not being required to install reactive power equipment and, 

consequently, not being able to deliver real power during certain system conditions as a 

result of insufficient reactive power capability.46 According to ISO-NE, this situation has 

resulted in transmission system operators needing to curtail wind generators as a result of 

unstudied real-time system characteristics.47

20. Several independent system operators (ISOs) and regional transmission 

organizations (RTOs) have been developing new reactive power requirements and 

procedures to address deficiencies in the current method of requiring transmission 

providers to show through a System Impact Study that reactive power from an 

interconnecting wind generator is necessary to ensure safety or reliability.48

3. Commission Determination

21. Based on the comments filed in response to the NOPR, and the record in the PJM 

and ISO-NE proceedings accepting PJM’s and ISO-NE’s reactive power requirements for 

 45 Indicated NYTOs Comments at 2; Joint NYTOs Comments at 2.

46 ISO-NE Comments at 5.

47 Id. at 6.

48 CAISO Comments at 1-2; ISO-NE Comments at 6; NEPOOL Initial Comments 

at 4.
Docket No. RM16-1-000 - 18 -

non-synchronous generators,49 the Commission adopts in this Final Rule reactive power 

requirements for newly interconnecting non-synchronous generators, as discussed in 

greater detail below. We find the continued exemptions from the reactive power 

requirement in the pro forma LGIA and the pro forma SGIA for newly interconnecting 

wind generators to be unjust, unreasonable, and unduly discriminatory and preferential.

22. Non-synchronous generators other than wind generators currently are not exempt 

from the reactive power requirement in the pro forma LGIA and pro forma SGIA,

50

although the Commission has treated other types of non-synchronous generators in the 

same manner as wind generators on a case-by-case basis.51 We proposed in the NOPR52

 49 On April 15, 2016, after issuing the NOPR and receiving comments, the 

Commission approved ISO-NE’s proposal to eliminate the exemptions for wind 

generators from the reactive power requirement. ISO New England Inc., 155 FERC 

¶ 61,031 (2016). The Commission previously accepted PJM’s similar proposal. See 

PJM Interconnection, L.L.C., 151 FERC ¶ 61,097 (2015).

50 Order Nos. 2003, 661, and 2006 explicitly exempted only wind generators from 

the reactive power requirement. See Order No. 661, FERC Stats. & Regs. ¶ 31,186 at 

P 106 (“While we are not applying the Final Rule Appendix G to non-wind technologies, 

we may do this in the future, or take other generic or case-specific actions, if another 

technology emerges for which a different set of interconnection requirements is 

necessary.”).

51 See Nevada Power Co., 130 FERC ¶ 61,147, at P 27 (2010) (“[C]onsistent with 

our requirements for all wind facilities in Order No. 661, the Commission will require 

based on the facts of this case, that, before Nevada Power may require El Dorado’s solar 

facility to be capable of providing reactive power, Nevada Power must show, through a 

system impact study, that such a requirement is necessary to ensure the safety or 

reliability of the grid.”); id. P 24 (“We agree . . . that this is not the appropriate 

proceeding in which to make a generic determination on whether to extend to solar 

generators wind power’s exemption from the requirement to provide reactive power 

support.”).
Docket No. RM16-1-000 - 19 -

to apply the Final Rule to all non-synchronous generators, and received no adverse 

comments. This Final Rule will apply to all newly interconnecting non-synchronous 

generators that have not yet executed a Facilities Study Agreement as of the effective 

date of this Final Rule.

23. Older wind turbine generators consumed reactive power, but, because they did not 

use inverters like other non-synchronous generators, they lacked the capability to produce 

and control reactive power without the use of costly equipment.

53 Based on 

technological improvements since the Commission created the exemptions for wind 

generators, requiring newly interconnecting wind generators to provide reactive power is 

not the obstacle to the development of wind generation that it was when the Commission 

issued Order Nos. 2003, 661, and 2006.54 In particular, the wind turbines being installed 

today are generally Type III and Type IV inverter-based turbines,55 which are capable of 

producing and controlling dynamic reactive power, which was not the case in 2005 when 

 52 E.g., NOPR, FERC Stats. & Regs. ¶ 32,712 at P 17.

53 Order No. 661, FERC Stats. & Regs. ¶ 31,186 at PP 50-51.

54 As discussed above, in exempting wind generators from the reactive power 

requirement, the Commission sought to avoid creating an obstacle to the development of 

wind generation. For example, in Order No. 661, the Commission was concerned with 

“remov[ing] unnecessary obstacles to the increased growth of wind generation.” Id. P 50.

55 A Type III wind turbine is a non-synchronous wound-rotor generator that has a 

three phase AC field applied to the rotor from a partially-rated power-electronics 

converter. A Type IV wind turbine is an AC generator in which the stator windings are 

connected to the power system through a fully-rated power-electronics converter. Both 

Type III and Type IV wind turbines have inherent reactive power capabilities.
Docket No. RM16-1-000 - 20 -

the Commission exempted wind generators from the reactive power requirement in Order 

No. 661.56

24. We therefore conclude that improvements in technology, and the corresponding 

declining costs for newly interconnecting wind generators to provide reactive power,

make it unjust, unreasonable, and unduly discriminatory and preferential to exempt such 

non-synchronous generators from the reactive power requirement when other types of 

generators are not exempt. Further, requiring all newly interconnecting non-synchronous 

generators to design their Generating Facilities to maintain the required power factor 

range ensures they are subject to comparable requirements as other generators.

57

25. The Commission also is concerned that, as the penetration of non-synchronous 

generators continues to grow, exempting a class of generators from providing reactive 

power could create reliability concerns, especially if those generators represent a 

substantial amount of total generation in a particular region, or if many of the resources 

that currently provide reactive power are retired from operation. In addition, as noted 

above, maintaining the exemptions for wind generators places an undue burden on 

synchronous generators to supply reactive power without a reasonable technological or 

 56 Id. PP 50-51.

57 See, e.g., Sw. Power Pool, Inc., 119 FERC ¶ 61,199, at P 29 (“Providing 

reactive power within the [standard power factor range] is an obligation of a generator, 

and is as much an obligation of a generator as, for example, operating in accordance with 

Good Utility Practice.”), order on reh’g, 121 FERC ¶ 61,196 (2007).
Docket No. RM16-1-000 - 21 -

cost-based distinction between synchronous and non-synchronous generators.58 

Therefore, the Commission concludes that the continued exemptions from the reactive 

power requirement for newly interconnecting wind generators are unjust, unreasonable,

and unduly discriminatory and preferential. For these reasons, the Commission revises 

the pro forma LGIA, Appendix G to the pro forma LGIA, and the pro forma SGIA to 

eliminate the exemptions for wind generators from the reactive power requirement.59

 58 See PJM Interconnection, L.L.C., 151 FERC ¶ 61,097 at P 7; Payment for 

Reactive Power, Commission Staff Report, Docket No. AD14-7, app. 1 (Apr. 22, 2014).

59 The Final Rule does not revise any regulatory text. The Final Rule revises the 

pro forma LGIA and pro forma SGIA in accordance with section 35.28(f)(1) of the 

Commission’s regulations, which provides: “Every public utility that is required to have 

on file a non-discriminatory open access transmission tariff under this section must 

amend such tariff by adding the standard interconnection procedures and agreement and 

the standard small generator interconnection procedures and agreement required by 

Commission rulemaking proceedings promulgating and amending such interconnection 

procedures and agreements, or such other interconnection procedures and agreements as 

may be required by Commission rulemaking proceedings promulgating and amending the 

standard interconnection procedures and agreement and the standard small generator 

interconnection procedures and agreement.” 18 C.F.R. § 35.28(f)(1) (2015). See 

Integration of Variable Energy Resources, Order No. 764, FERC Stats. & Regs. 

¶ 31,331, at PP 343-345 (adopting this regulatory text effective September 11, 2012), 

order on reh’g and clarification, Order No. 764-A, 141 FERC ¶ 61,232 (2012), order on 

clarification and reh’g, Order No. 764-B, 144 FERC ¶ 61,222 (2013). While not revising 

regulatory text, the Commission is using the process provided for rulemaking 

proceedings, as defined in 5 U.S.C. § 551(4)-(5) (2012).
Docket No. RM16-1-000 - 22 -

B. Power Factor Range, Point of Measurement, and Dynamic Reactive 

Power Capability Requirements

1. NOPR Proposal

26. The Commission proposed in the NOPR as part of the reactive power 

requirements for non-synchronous generators to require all newly interconnecting nonsynchronous generators to design their Generating Facilities to maintain a composite 

power delivery at continuous rated power output at the Point of Interconnection at a 

power factor within the range of 0.95 leading to 0.95 lagging.

60 Further, the Commission 

proposed to require that the reactive power capability installed by non-synchronous 

generators be dynamic.61

2. Comments

27. Several commenters support the Commission’s proposal to measure the reactive 

power requirement at the Point of Interconnection.62 Commenters note that measuring 

the reactive power requirement at the Point of Interconnection is consistent with the 

current requirement in the pro forma LGIA for measuring the reactive power requirement 

where a transmission provider’s System Impact Study shows the need for reactive power 

from an interconnecting wind generator.63 Midwest Energy argues that transmission 

 60 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 16.

61 Id. P 14.

62 CAISO Comments at 6; EEI Comments at 8; Indicated NYTOs Comments at 4; 

Midwest Energy Comments at 9; NERC Comments at 9.

63 CAISO Comments at 6; EEI Comments at 7.
Docket No. RM16-1-000 - 23 -

providers are only concerned with power factor and voltage at the Point of 

Interconnection.64 CAISO asserts that measuring the reactive power requirement at the 

Point of Interconnection gives interconnection customers flexibility in how they design 

their generator projects to meet the reactive power requirement.65 CAISO states that 

inverter manufacturers informed CAISO that current inverters used by most nonsynchronous generators are capable of producing 0.95 leading and 0.95 lagging reactive 

power at full real power output at the generator’s Point of Interconnection.66 NextEra 

acknowledges that the common approach within ISOs/RTOs is to measure reactive power 

at the Point of Interconnection, but suggests that if reactive power is measured at the 

Point of Interconnection, then the Commission should maintain the flexibility for nonsynchronous generators to meet that requirement using static reactive power devices if 

agreed to by the transmission provider, as provided for in Appendix G to the pro forma

LGIA.67 NaturEner asserts that, depending on the length of the collector system, 

transformer substation characteristics, and the length of the Interconnection Customer 

Interconnection Facilities from the generator terminals to the Point of Interconnection, it 

may not be possible for non-synchronous generators to meet the 0.95 leading to 

 64 Midwest Energy Comments at 9.

65 CAISO Comments at 6.

66 Id. at 3.

67 NextEra Comments at 10-11.
Docket No. RM16-1-000 - 24 -

0.95 lagging reactive power requirement at the Point of Interconnection without installing 

additional equipment.68

28. On the other hand, some commenters disagree with the NOPR proposal and argue 

that the reactive power requirement should be measured at the generator terminals rather 

than at the Point of Interconnection for non-synchronous generators. They assert that 

measuring at the Point of Interconnection would result in significantly higher costs for 

non-synchronous generators than measuring at the generator terminals. They also argue 

that, because of the often significant distance between non-synchronous generator

terminals and the Point of Interconnection, measuring the reactive power requirement for 

non-synchronous generators at the generator terminals would result in a reactive power 

requirement that is comparable to measuring at the Point of Interconnection for 

synchronous generators.69 AWEA and LSA contend that synchronous and nonsynchronous generators are not similarly situated due to the fact that non-synchronous 

generators are typically located geographically and electrically farther from the Point of 

Interconnection than synchronous generators.70 Therefore, AWEA and LSA request that 

non-synchronous generators have the option to meet the reactive power requirement at 

the generator terminals, even if the requirement at that point is more stringent 

 68 NaturEner Comments at 3.

69 AWEA and LSA Comments at 12; Joint NYTOs Comments at 3-4; Public 

Interest Organizations Comments at 2; Union of Concerned Scientists Comments at 3.

70 AWEA and LSA Comments at 12.
Docket No. RM16-1-000 - 25 -

(e.g., 0.95 leading to 0.90 lagging) than at the Point of Interconnection.71 AWEA and 

LSA note that they supported the independent entity variation from Order No. 661 in 

PJM in part because the reactive power requirement is measured at the generator 

terminals.72

29. Some commenters argue that, due to the configuration of typical non-synchronous 

generators, additional investment is required to supplement the inherent dynamic reactive 

power capability of the generators to meet the reactive power requirement at the Point of 

Interconnection; therefore, they assert that requiring measurement at the Point of 

Interconnection would reset the costs for non-synchronous generators to a level higher 

than that which the Commission considered in approving PJM’s independent entity 

variation.73 In addition to equipment investment, AWEA and LSA contend that, in many 

situations, providing excess reactive power at the generator terminals to meet the reactive 

power requirement at the Point of Interconnection would result in a large decrease in real 

power output, and accompanying lost opportunity costs and lost zero-emission, zero-fuel 

cost energy.74 Similarly, NaturEner argues that the proposed power factor range of 0.95 

leading to 0.95 lagging is only reasonable if the reactive power requirement is measured 

 71 Id. at 10, 12-13.

72 Id. at 10-11.

73 AWEA and LSA Comments at 10-12; NextEra Comments at 9; Union of 

Concerned Scientists Comments at 3-4.

74 AWEA and LSA Comments at 11.
Docket No. RM16-1-000 - 26 -

at the generator terminals.75 NaturEner contends that measuring the reactive power 

requirement at the generator terminals will result in sufficient voltage control at the Point 

of Interconnection.76 Alternatively, NaturEner also suggests that it would be reasonable 

to require a power factor range of 0.95 leading to 0.95 lagging at the generator 

substation.77 Finally, NaturEner argues that any additional reactive power needs could be 

determined in a System Impact Study.78

30. While CAISO allows synchronous generators to provide reactive power at the 

generator terminals, CAISO does not support providing this option to non-synchronous 

generators. CAISO argues that measuring the reactive power requirement at the 

generator terminals is inappropriate for non-synchronous generators because nonsynchronous generators often use multiple transformers, collection circuits, and 

substations to transmit real power across lengthy Interconnection Customer 

Interconnection Facilities from the generator terminal to the Point of Interconnection, 

reducing the amount of reactive power that reaches the transmission system. In contrast, 

CAISO explains that the configuration of synchronous generators typically involves a 

single transformer and short Interconnection Customer Interconnection Facilities from 

 75 NaturEner Comments at 3.

76 Id. at 3-4.

77 Id. at 3.

78 Id. at 4; see also Midwest Energy Comments at 10.
Docket No. RM16-1-000 - 27 -

the generator terminal to the Point of Interconnection, making measuring the reactive 

power requirement at the generator terminals for synchronous generators appropriate for 

ensuring that sufficient reactive power is provided to the transmission system.79

31. As to the Commission’s proposal to require fully dynamic reactive power 

capability, commenters in support argue that requiring dynamic reactive power capability 

allows generators to operate across a broader range of operating conditions than allowing 

static reactive power devices.80 ISO-NE asserts that requiring fully dynamic reactive 

power capability is consistent with the historic requirement that synchronous generators 

provide dynamic reactive power.81 ISO-NE contends that generators are more effective 

at providing dynamic reactive power compared to transmission infrastructure.82

32. Conversely, other commenters disagree with the proposal to require fully dynamic 

reactive power capability. SDG&E contends that such a requirement is not necessary and

that allowing non-synchronous generators to use static reactive power devices to meet the 

reactive power requirement will provide flexibility to generator developers and keep 

costs at a reasonable level.83 SDG&E suggests that the dynamic reactive power 

 79 CAISO Comments at 6-7.

80 EEI Comments at 8; ISO-NE Comments at 8.

81 ISO-NE Comments at 8.

82 Id. at 9.

83 SDG&E Comments at 3-4.
Docket No. RM16-1-000 - 28 -

capability requirement only be for 0.985 leading to 0.985 lagging reactive power 

capability.84 Other commenters assert that the existing pro forma LGIA and pro forma 

SGIA neither define “dynamic” reactive power capability, nor specify a mix of static 

versus dynamic reactive power capability that a generator must maintain, and that the 

Commission should not specify such a mix in this proceeding.85 Rather, AWEA and 

LSA argue that it would be discriminatory to require non-synchronous generators to 

maintain fully dynamic reactive power capability because their configuration results in 

significant loss of dynamic reactive power from the generator terminal to the Point of 

Interconnection. Instead, AWEA and LSA argue that static reactive power devices are 

necessary and effective to supplement the dynamic reactive power capability of the 

generator to provide reactive power at the Point of Interconnection.

86

33. NextEra argues that if the proposed reactive power requirement is for fully 

dynamic reactive power capability, then measuring the requirement at the generator 

terminals for non-synchronous generators is required to ensure comparable treatment to 

synchronous generators.87 NextEra contends that the cost of providing reactive power is 

manageable at the Point of Interconnection if the flexibility provided in section 9.6.1 of 

 84 Id. at 4.

85 AWEA and LSA Comments at 8; EEI Comments at 8; Midwest Energy 

Comments at 5; NextEra Comments at 6.

86 AWEA and LSA Comments at 9; see also Midwest Energy Comments at 6.

87 NextEra Comments at 9-10.
Docket No. RM16-1-000 - 29 -

the pro forma LGIA is maintained and the reactive power requirement can be met with 

static reactive power devices, but that the requirement could be cost-prohibitive if nonsynchronous generators are required to install dynamic reactive power devices.88 

Commenters request that the Commission clarify that it did not intend to specify that a 

non-synchronous generator must meet the reactive power requirement with only dynamic 

reactive power capability.89 Specifically, NextEra argues that the Commission should not 

remove paragraph A.ii of Appendix G to the pro forma LGIA because it provides 

important provisions regarding the types of devices that can be used to meet the reactive 

power requirement.90

3. Commission Determination

34. We will require the reactive power requirements in the pro forma LGIA and 

pro forma SGIA for non-synchronous generators to be measured at the high-side of the 

generator substation. Newly interconnecting non-synchronous generators will be 

required to design their Generating Facilities to maintain a composite power delivery at 

continuous rated power output at the high-side of the generator substation. At that point, 

the non-synchronous generator must provide dynamic reactive power within the power 

factor range of 0.95 leading to 0.95 lagging, unless the transmission provider has 

 88 Id. at 9; NextEra Supplemental Comments at 4.

89 AWEA and LSA Comments at 9; Midwest Energy Comments at 6; NextEra 

Comments at 7.

90 NextEra Comments at 8.
Docket No. RM16-1-000 - 30 -

established a different power factor range that applies to all non-synchronous generators 

in the transmission provider’s control area on a comparable basis.91 To ensure there is no 

undue discrimination, we clarify that the ability of a transmission provider to establish 

different requirements is limited to establishing a different power factor range, and not to 

the other reactive power requirements.

35. Non-synchronous generators may meet the dynamic reactive power requirement 

by utilizing a combination of the inherent dynamic reactive power capability of the 

inverter, dynamic reactive power devices (e.g., Static VAR Compensators), and static 

reactive power devices (e.g., capacitors) to make up for losses. In developing this 

reactive power requirement for non-synchronous generators, the Commission is 

balancing the costs to newly-interconnecting non-synchronous generators of providing 

reactive power with the benefits to the transmission system of having another source of 

reactive power.

36. Although the Commission in the NOPR considered measuring the reactive power 

requirements for non-synchronous generators at the Point of Interconnection, we are 

persuaded by commenters’ arguments that requiring fully dynamic reactive power 

 91 Under these provisions, transmission providers may establish a different power 

factor range for synchronous or non-synchronous generators as long as the requirement 

applies to all generators in each class on a comparable basis. See Order No. 2003, FERC 

Stats. & Regs. ¶ 31,146 at P 542 (“We adopt the power factor requirement of 0.95 leading 

to 0.95 lagging because it is a common practice in some NERC regions. If a 

Transmission Provider wants to adopt a different power factor requirement, Final Rule 

LGIA Article 9.6.1 permits it to do so as long as the power factor requirement applies to 

all generators on a comparable basis.”).
Docket No. RM16-1-000 - 31 -

capability at the Point of Interconnection may result in significantly increased costs for 

non-synchronous generators in meeting the reactive power requirements.92 These added 

costs will ultimately be borne by customers, whether through reactive power payments in 

regions that compensate for reactive power capability, or through elevated prices for 

capacity or energy in regions that do not compensate for reactive power capability. In 

contrast, measuring the reactive power requirements at the high-side of the generator 

substation, rather than at the Point of Interconnection, will be less expensive for nonsynchronous generators because a greater amount of the inherent dynamic reactive power 

capability of the inverters associated with non-synchronous generators will be available 

at the high-side of the generator substation than at the Point of Interconnection.

37. In adopting the Point of Interconnection as the point of measurement for large 

wind plants in Order No. 661, the Commission balanced the case-by-case reactive power 

requirement with the needs of the transmission system.93 Here, we remove the case-bycase approach, and require that all newly interconnecting non-synchronous generators 

provide reactive power as a condition of interconnection. By requiring all newly 

interconnecting non-synchronous generators to provide reactive power, we are increasing 

the amount of reactive power available to meet transmission system needs, and, at the 

 92 See, e.g., NaturEner Comments at 3 (“Based on the above technological and 

cost-based reasons, NaturEner believes the +/- 0.95 requirement is reasonable if the 

Proposed Rule is refined to measure the requirement at the wind turbine terminals (or as 

an alternative at the wind farm substation), and not at the Point of Interconnection.”).

93 Order No. 661, FERC Stats. & Regs. ¶ 31,186 at P 59.
Docket No. RM16-1-000 - 32 -

same time, balancing the costs to non-synchronous generators of providing that reactive 

power by measuring the requirements at the high-side of the generator substation.

38. Similarly, in Order No. 661, the Commission was not convinced that dynamic 

reactive power capability was needed from every wind generator, and so adopted the 

case-by-case approach.94 However, with the increasing penetration of wind generation 

and retirement of traditional synchronous generators, which provided dynamic reactive 

power capability to the transmission system, we now find it is necessary to require 

dynamic reactive power capability from all new generators. The dynamic reactive power 

capability may be achieved at the high-side of the generator substation at lower cost 

compared to dynamic reactive power at the Point of Interconnection by systems using a 

combination of dynamic capability from the inverters plus static reactive power devices 

to make up for losses. Therefore, this Final Rule gives non-synchronous generators the 

flexibility to use static reactive power devices to make up for losses that occur between 

the inverters and the high-side of the generator substation, so long as the generators 

maintain 0.95 leading to 0.95 lagging dynamic reactive power capability at the high-side 

of the generator substation.

39. While measuring the reactive power requirements at the Point of Interconnection 

would provide the greatest amount of reactive power to the transmission system, the costs 

associated with providing that level of reactive power do not justify the added benefit to 

 94 Id. P 66.
Docket No. RM16-1-000 - 33 -

the transmission system.95 In fact, one of the reasons for undertaking this rulemaking 

proceeding was the Commission recognized that the cost of providing reactive power 

may no longer present an obstacle to the development of wind generation. On the other 

hand, measuring the reactive power requirements at the Generating Facilities would 

likely result in very little reactive power being provided to the transmission system but 

would be relatively inexpensive to implement for the non-synchronous generator. The 

high-side of the generator substation represents a middle ground. It is located beyond the 

low voltage collector systems where significant reactive power losses occur, resulting in 

more reactive power provided to the transmission system than a requirement at the 

Generating Facilities, while being less expensive to implement than a requirement at the 

Point of Interconnection. We find that measuring the reactive power requirements at the 

high-side of the generator substation reasonably balances the need for reactive power for 

the transmission system with the costs to non-synchronous generators of providing 

reactive power.

 95 See ISO New England Inc., Tariff Filing, Transmittal Letter, Docket No. ER16-

946-000, at 17 (filed Feb. 16, 2016) (“[T]he proposed requirements provide for the 

reactive capability to be measured at the high-side of the station transformer rather than at 

the Point of Interconnection to account for the long generator leads through which many 

wind generators are interconnecting to the New England system – as long as 

approximately 50-80 miles between the generator collector transformer and the Point of 

Interconnection. There is no benefit to the generator, and little benefit to the system, to 

force the generator to provide voltage support all the way to a Point of Interconnection 

that is very remote, and it is not necessarily even achievable to effectively transfer such 

quantities of reactive power over such distances.”); see also NextEra Supplemental 

Comments at 3-4.
Docket No. RM16-1-000 - 34 -

40. We find establishing dynamic reactive power requirements at the high-side of the 

generator substation preferable to the suggestion in the comments that, at relative equal 

cost, reactive power could be provided at the Point of Interconnection as long as the 

inherent dynamic reactive power produced by the generator can be enhanced with static 

reactive power capability. By establishing dynamic reactive power requirements at the 

high-side of the generator substation, non-synchronous generators will be able to provide 

faster responding and more continuously variable reactive power capability than if they 

provide static reactive power capability at the Point of Interconnection. In addition,

requiring dynamic reactive power capability allows generators to operate across a broader 

range of operating conditions than allowing static reactive power enhancements.

96

C. Real Power Output Level

1. NOPR Proposal

41. The NOPR proposed to require newly interconnecting non-synchronous generators

to design their Generating Facilities to maintain the required power factor range only 

when the generator’s real power output exceeds 10 percent of its nameplate capacity.97 

 96 EEI Comments at 8; ISO-NE Comments at 8; see also ISO New England Inc., 

Tariff Filing, Transmittal Letter, Docket No. ER16-946-000, at 19 (filed Feb. 16, 2016) 

(“[I]n New England’s experience, the implementation of the reactive power exemption 

has disadvantaged wind generators seeking to interconnect, putting burdens on the study 

process not experienced for conventional generators and compromising their ability to 

operate through various system conditions once interconnected, a situation that leads 

system operators to curtail wind farm output for system reliability reasons.”).

97 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 15 (citing Order No. 661, FERC 

Stats. & Regs. ¶ 31,186 at P 46).
Docket No. RM16-1-000 - 35 -

The proposed pro forma LGIA would state: “Non-synchronous generators shall only be 

required to maintain the above power factor when their output is above 10 percent of the 

Generating Facility Capacity.”98 The Commission stated its understanding that the 

inverters used by non-synchronous generators were not capable of producing reactive 

power when operating below 10 percent of nameplate capacity.99

2. Comments

42. Several commenters support the 10 percent exemption given current inverter 

technology.100 EEI notes that the Commission uses both “generator nameplate capacity” 

and “Generator Facility Capacity” in reference to the 10 percent exemption, and requests 

that the Commission clarify that the correct term is “Generator Facility Capacity.”101 The 

ISO/RTO Council states that its ISO/RTO members do not uniformly agree that the 

10 percent exemption is appropriate and want to be able to establish rules based on their 

individual situations.

102 Similarly, the Indicated NYTOs support the Commission 

allowing regional variation on the 10 percent exemption within a reasonable range based 

 98 Id. P 16. The Commission proposed similar revisions to the pro forma SGIA: 

“Non-synchronous generators shall only be required to maintain the above power factor 

when their output is above 10 percent of the generator nameplate capacity.” Id.

99 Id. P 15 (citing Order No. 661, FERC Stats. & Regs. ¶ 31,186 at P 46).

100 EEI Comments at 9; NaturEner Comments at 4; NERC Comments at 10; SCE 

Comments at 3; NextEra Comments at 11.

101 EEI Comments at 9-10.

102 ISO/RTO Council Comments at 3.
Docket No. RM16-1-000 - 36 -

on existing regional requirements (up to an exemption for below 25 percent real power 

output).103

43. AWEA and LSA and the Joint NYTOs argue that the 10 percent exemption should 

be increased to 25 percent, consistent with what the Commission approved in PJM.104

AWEA and LSA assert that the ability of non-synchronous generators to provide reactive 

power can be reduced when individual generators within the plant are not producing real 

power, such that the 10 percent operating threshold is insufficient.105

44. Other commenters oppose the 10 percent exemption, arguing that it is not 

necessary given the technology available to non-synchronous generators.106 These 

commenters contend that some inverters can produce reactive power at zero real power 

output.107 Additionally, ISO-NE argues that requiring non-synchronous generators to be 

capable of providing reactive power at all output levels will further technological 

development and advancement.108 ISO-NE asserts that if the Commission adopts the 

10 percent exemption, it should limit the exemption to only wind generators because non-

 103 Indicated NYTOs Comments at 4.

104 AWEA and LSA Comments at 13; Joint NYTOs Comments at 3.

105 AWEA and LSA Comments at 13.

106 ISO-NE Comments at 13; Midwest Energy Comments at 9; MISO Comments 

at 3.

107 ISO-NE Comments at 14; NaturEner Comments at 4.

108 ISO-NE Comments at 14.
Docket No. RM16-1-000 - 37 -

synchronous generators other than wind generators have not had an exemption from the 

reactive power requirement and it is inappropriate to create a new exemption for these 

generators.109

45. MISO requests that non-synchronous generators be required to produce reactive 

power at low and zero-voltage conditions to ensure the robustness of the transmission 

system.110 Similarly, Midwest Energy argues that the Commission has not fully 

considered the high levels of reactive power generated by lightly loaded interconnection 

facilities associated with non-synchronous generators.

111 Midwest Energy explains that 

its largest events of excess reactive power production have occurred when nonsynchronous generators are producing less than 10 percent of their nameplate capacity. 

Midwest Energy asserts that it may be necessary for non-synchronous generators to 

install static inductors to absorb reactive power in these situations. Therefore, according 

to Midwest Energy, requiring non-synchronous generators to provide reactive power at 

all levels of real power output would prevent potential high voltage reliability 

concerns.112

 109 Id. at 14-15.

110 MISO Comments at 3.

111 Midwest Energy Comments at 2-3.

112 Id. at 8.
Docket No. RM16-1-000 - 38 -

46. AWEA and LSA request clarification regarding the proposal in the NOPR that 

non-synchronous generators be required to maintain a “composite power delivery at 

continuous rated power output at the Point of Interconnection at a power factor within the 

range of 0.95 leading to 0.95 lagging.”113 AWEA and LSA argue that this language can 

be interpreted as either requiring non-synchronous generators to provide reactive power 

proportionate to the actual output of the generator, or to provide reactive power within 

the full power factor range based on the maximum output of the generator no matter the 

actual output of the generator.114 AWEA and LSA contend that the first interpretation—a 

reactive power requirement proportionate to actual output—is the most reasonable 

interpretation.115 NERC asserts that the second interpretation is correct.

116

3. Commission Determination

47. We will not adopt the 10 percent exemption proposed in the NOPR in this Final 

Rule and will instead require all newly interconnecting non-synchronous generators to 

design their Generating Facilities to meet the reactive power requirements at all levels of 

 113 AWEA and LSA Comments at 5; NOPR, FERC Stats. & Regs. ¶ 32,712 at 

P 16.

114 AWEA and LSA Comments at 5-7 (explaining that the first interpretation will 

result in a triangular PQ curve, while the latter will result in a rectangular PQ curve); 

see also NERC Comments at 9.

115 AWEA and LSA Comments at 6.

116 NERC Comments at 9.
Docket No. RM16-1-000 - 39 -

real power output, as is already required of synchronous generators.117 Although several 

commenters support the 10 percent exemption,118 and some commenters support 

increasing that threshold to 25 percent,119 we find, on balance, that requiring nonsynchronous generators to provide reactive power at all levels of real power output 

appropriately recognizes the capabilities of existing non-synchronous generation 

technologies and creates requirements that are comparable to the existing requirement for 

synchronous generators. Additionally, by maintaining the reactive power requirement at 

all output levels, non-synchronous generators will mitigate potential over-voltage 

concerns on lightly loaded Interconnection Customer Interconnection Facilities of a nonsynchronous generator when operating at low real power output.

48. While some commenters argue that technical limitations exist that prevent nonsynchronous generators from providing adequate reactive power at lower levels of real 

power output, and note that the Commission approved a 25 percent exemption in PJM, 

several commenters indicate that non-synchronous generators are capable of providing 

reactive power at all levels of real power output.120 Although the Commission approved 

 117 Section 9.6.1 of the pro forma LGIA and section 1.8.1 of the pro forma SGIA.

118 EEI Comments at 9; NaturEner Comments at 4; NERC Comments at 10; SCE 

Comments at 3; NextEra Comments at 11.

119 AWEA and LSA Comments at 13; Joint NYTOs Comments at 3.

120 ISO-NE Comments at 13; Midwest Energy Comments at 9; MISO Comments 

at 3.
Docket No. RM16-1-000 - 40 -

a 25 percent exemption in PJM, that was pursuant to a section 205 filing with broad 

stakeholder support. We now act on a more comprehensive record and take action 

generically to apply to all transmission providers.121 Moreover, while not all nonsynchronous generators are currently designed to maintain reactive power capability at all 

levels of real power output, modern inverters can be designed to provide this capability. 

We agree with ISO-NE’s comments that imposing this requirement will help encourage 

further technological development, such that the bulk power system will ultimately 

receive higher quality and more reliable reactive power service from all generators.

49. As for AWEA and LSA’s and NERC’s requested clarifications, we clarify that the 

amount of reactive power required from non-synchronous generators should be 

proportionate to the actual output of the generator, such that a 100 MW generator would 

be required to provide approximately 33 MVAR of reactive power when operating at 

maximum output (100 MW), and approximately 3.3 MVAR when operating at 10 MW, 

and so on. This addresses some commenters’ concerns that sometimes not all nonsynchronous generators at a particular location are operating at a given time (e.g., only 

50 of 100 wind turbines are actually spinning or 1/3 of solar panels are covered by 

clouds), without creating an unnecessary exemption for non-synchronous generators.

 121 As discussed below, to the extent an ISO or RTO seeks to maintain an existing 

exemption, it can include such a request in its compliance filing as an independent entity 

variation and the Commission will consider the request at that time based on the 

arguments provided.
Docket No. RM16-1-000 - 41 -

D. Compensation

1. NOPR Proposal

50. The Commission stated in the NOPR that non-synchronous generators are eligible 

for the same payments for reactive power as all other generators, consistent with the

compensation provisions of the pro forma LGIA and pro forma SGIA.

122 The 

Commission proposed that any compensation for such non-synchronous generators 

would be based on the cost of providing reactive power, but noted that the cost to a wind 

generator of providing reactive power may not be easily estimated using existing methods 

that are applied to synchronous generators.123 Therefore, the Commission sought

comment on whether these existing methods are appropriate for wind generators and, if

not, what alternatives would be appropriate.

124

2. Comments

51. Several commenters support the Commission’s proposal to require transmission 

providers to compensate non-synchronous generators for reactive power on a comparable 

basis as synchronous generators, provided that non-synchronous generators provide 

 122 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 12 (citing Order No. 2003-A, FERC 

Stats. & Regs. ¶ 31,160 at P 416); see also sections 9.6.3 and 11.6 of the pro forma LGIA 

and sections 1.8.2 and 1.8.3 of the pro forma SGIA.

123 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 12 (citing Payment for Reactive 

Power, Commission Staff Report, Docket No. AD14-7, app. 2 (Apr. 22, 2014)).

124 Id. P 18 (citation omitted).
Docket No. RM16-1-000 - 42 -

comparable reactive power service.125 Other commenters seek clarification, or ask that 

the Commission outline principles for compensation.126 Other commenters argue that the 

Commission should not mandate a uniform approach to reactive power compensation.127 

Finally, while some commenters ask that the Commission address the issue of reactive 

power compensation, they assert that addressing reactive power compensation in this 

rulemaking is outside the scope of the proceeding.128

3. Commission Determination

52. We will not change the Commission’s existing policies on compensation for 

reactive power. Sections 9.6.3 and 11.6 of the currently-effective pro forma LGIA and 

sections 1.8.2 and 1.8.3 of the currently-effective pro forma SGIA provide that the 

transmission provider must compensate the interconnecting generator for reactive power 

service when the transmission provider requests that the interconnecting generator

operate outside of the specified reactive power range. These sections also provide that if 

the transmission provider compensates its own or affiliated generators for reactive power 

 125 CAISO Comments at 9; EEI Comments at 10; ISO/RTO Council Comments 

at 7; MISO Comments at 3-4.

126 ISO/RTO Council Comments at 7; SDG&E Comments at 4-5; AWEA and 

LSA Comments at 2-5; Public Interest Organizations Comments at 2-3; NextEra 

Comments at 14.

127 Indicated NYTOs Comments at 4; ISO/RTO Council Comments at 7; SDG&E 

Comments at 4; CAISO Comments at 8-9; Joint NYTOs Comments at 4; SCE Comments 

at 3; Six Cities Comments at 2, 5-6.

128 EPSA Comments at 6; NextEra Comments at 14.
Docket No. RM16-1-000 - 43 -

service within the specified reactive power range, it must compensate all generators for 

this service, and at what rate such compensation should be provided. While the 

Commission asked for comments on principles for compensating non-synchronous 

generators for reactive power, the comments, aside from noting that the current AEP

methodology129 does not translate to non-synchronous generation, did not provide a 

sufficient record for determining a new method. Therefore, any non-synchronous 

generator seeking reactive power compensation would need to propose a method for 

calculating that compensation as part of its filing. We note, however, that Commission 

staff is convening a workshop to explore reactive power compensation issues in the 

markets operated by ISOs/RTOs on June 30, 2016.130

E. Application of the Final Rule

1. NOPR Proposal

53. As a transition mechanism, the Commission proposed in the NOPR to apply the

reactive power requirements in this Final Rule to all newly interconnecting nonsynchronous generators that, as of the effective date of this Final Rule, either: (1) have

not executed an interconnection agreement; or (2) requested that an interconnection

agreement be filed unexecuted that is still pending before the Commission. The

 129 See Am. Elec. Power Serv. Corp., Opinion No. 440, 88 FERC ¶ 61,141, at 

61,456-57 (1999).

130 See Reactive Supply Compensation in Markets Operated by Regional 

Transmission Organizations and Independent System Operators, Notice of Workshop, 

Docket No. AD16-17-000 (issued Mar. 17, 2016).
Docket No. RM16-1-000 - 44 -

Commission also proposed to apply the reactive power requirements to all existing nonsynchronous generators making upgrades that require new interconnection requests after

the effective date of the Final Rule. The Commission stated that it did not believe it 

would be reasonable or necessary to require all existing wind generators to provide 

reactive power because not all such generators are capable of providing reactive power 

without incurring substantial costs to install new equipment. However, the Commission 

proposed to require existing wind generators that make upgrades that require new 

interconnection requests to conform to the new reactive power requirements.131

2. Comments

54. CAISO and MISO support the Commission’s proposed application of the new 

reactive power requirements to new and existing non-synchronous generators.132 CAISO 

contends that interconnection customers should be required to adhere to the conditions of 

interconnection at the time they execute an interconnection agreement. CAISO states 

that, in its own reactive power stakeholder initiative, it proposed to apply a new reactive 

power requirement to its April 2016 interconnection queue cluster and to all future 

clusters. CAISO explains that, depending on the timing of the Final Rule, the new 

reactive power requirements would apply to this same group of interconnecting 

generators because they will not execute their interconnection agreements for at least one 

 131 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 17.

132 CAISO Comments at 5-6; MISO Comments at 5-6.
Docket No. RM16-1-000 - 45 -

year after the study process begins. CAISO states that applying reactive power 

requirements to these interconnecting generators would ensure these generators do not 

lean on existing generators to provide reactive power.133

55. In contrast, some commenters argue that the Commission should not apply the 

new reactive power requirements to generators that have begun or have already received 

their System Impact Study, depending on the requirements of the Final Rule.134 AWEA 

and LSA contend that applying the proposed reactive power requirements to nonsynchronous generators that have begun their System Impact Study, or that have been in 

the interconnection queue for some period of time without starting their System Impact 

Study, may result in sizable costs and fundamental unfairness. AWEA and LSA argue 

that such non-synchronous generators may not have been designed to meet the new 

reactive power requirements and, therefore, may incur substantial equipment costs to 

meet those requirements.

135

56. NextEra argues that the proposed application of the Final Rule to non-synchronous 

generators that have not yet executed an interconnection agreement is unreasonable if the 

Commission requires fully dynamic reactive power capability measured at the Point of 

 133 CAISO Comments at 5-6.

134 AWEA and LSA Comments at 14; NextEra Comments at 13.

135 AWEA and LSA Comments at 14-15.
Docket No. RM16-1-000 - 46 -

Interconnection.136 NextEra asserts that requiring fully dynamic reactive power 

capability at the Point of Interconnection would be a significant change to the status quo 

and would render some investments made by non-synchronous generators that have 

already received the results of their System Impact Study, but have not yet executed an 

interconnection agreement, useless. According to NextEra, such a major shift could also 

impose delays and additional costs related to the redesign, purchase, and installation of 

additional equipment.137 NextEra contends that if the Commission allows for the use of 

static reactive power devices to supplement the dynamic reactive power capability of 

non-synchronous generators at the Point of Interconnection, the Commission would 

merely be formalizing what is already common practice, and, therefore, that the proposed 

application of the Final Rule would be reasonable. However, if the Commission requires 

fully dynamic reactive power capability at the Point of Interconnection, NextEra asks that 

the Final Rule not apply to non-synchronous generators that have received their System 

Impact Study.138

57. Some commenters also oppose the Commission’s proposal to apply the reactive 

power requirements to existing non-synchronous generators making upgrades that require 

 136 NextEra Comments at 11.

137 Id. at 12-13.

138 Id. at 12.
Docket No. RM16-1-000 - 47 -

new interconnection requests.139 AWEA and LSA assert that most upgrades do not 

involve fundamental changes to the original technology, or to the hardware, but instead 

simply involve software upgrades.140 Lincoln argues that applying the new reactive 

power requirements to wind generators making upgrades could result in financial 

detriment to entities that have previously entered into binding contracts to purchase wind 

generation by exposing those entities to unforeseen expenses not contemplated when they 

entered into the contracts.141 AWEA and LSA request that the new reactive power 

requirements only apply to upgrades on a case-by-case basis, depending on the outcome 

of the relevant interconnection study, and only to the incremental capacity requested 

through the upgrade.142 AWEA and LSA also request that the Commission clarify what 

constitutes a “Material change” to a generator that would trigger a new interconnection 

study.143

 139 AWEA and LSA Comments at 14; Lincoln Comments at 2.

140 AWEA and LSA Comments at 14.

141 Lincoln Comments at 2.

142 AWEA and LSA Comments at 14-15.

143 Id. at 15.
Docket No. RM16-1-000 - 48 -

58. SDG&E requests that the Commission clarify that the proposed reactive power 

requirements would apply to all non-synchronous generators and not to just wind 

generators.144

3. Commission Determination

59. We will apply the requirements of this Final Rule to all newly interconnecting 

non-synchronous generators that have not yet executed a Facilities Study Agreement

145 as 

of the effective date of this Final Rule. We will not apply the requirements of this Final 

Rule to existing non-synchronous generators making upgrades to their Generating 

Facilities that require new interconnection requests. However, such a generator may be 

required to provide reactive power if a transmission provider determines through that 

generator’s System Impact Study that a reactive power requirement is necessary to ensure 

safety or reliability. The transition mechanism we establish in this Final Rule allows 

non-synchronous generators currently in the process of interconnecting to complete the 

interconnection process without unreasonable delay or expense.

a. Newly Interconnecting Non-Synchronous Generators

60. While the Commission proposed in the NOPR to apply the requirements of the 

Final Rule to all newly interconnecting non-synchronous generators that have not yet

 144 SDG&E Comments at 1, 3.

145 The pro forma Large Generator Interconnection Procedures contain a standard 

“Interconnection Facilities Study Agreement” as Appendix 4. Similarly, the pro forma 

Small Generator Interconnection Procedures contain a standard “Facilities Study 

Agreement” as Attachment 8.
Docket No. RM16-1-000 - 49 -

executed an interconnection agreement as of the effective date of the Final Rule, or

requested that one be filed unexecuted that is still pending, we agree with AWEA and 

LSA, and NextEra,146 that applying the Final Rule as proposed may unduly burden nonsynchronous generators that have completed their System Impact Study. Such nonsynchronous generators may have already purchased equipment needed to interconnect 

prior to executing an interconnection agreement (or requesting that one be filed 

unexecuted that is still pending).147 We are especially concerned with applying new 

reactive power requirements to non-synchronous generators that have advanced in the 

interconnection process in light of our decision to measure the reactive power 

requirements at the high-side of the generator substation, rather than at the Point of 

Interconnection. Because the Point of Interconnection has been the industry standard 

under Appendix G to the pro forma LGIA, non-synchronous generators that have 

completed their System Impact Study may have relied on that standard in designing their 

Generating Facilities, thereby creating an undue burden on such generators.148

 146 AWEA and LSA Comments at 14; NextEra Comments at 13.

147 AWEA and LSA explain that many non-synchronous generators will have 

already chosen their collector array cable and transformer or inverter before receiving an 

interconnection agreement. Rather than being able to choose equipment that could 

reduce reactive losses, the only compliance option for non-synchronous generators that 

are “significantly advanced” in the interconnection process to meet the requirements of 

the Final Rule would be to install potentially expensive reactive power devices. AWEA 

and LSA Comments at 15.

148 NextEra Comments at 12-13.
Docket No. RM16-1-000 - 50 -

61. To avoid these undue burdens, we will apply the requirements of this Final Rule 

to all newly interconnecting non-synchronous generators that have not yet executed a 

Facilities Study Agreement as of the effective date of this Final Rule. Pursuant to the 

pro forma Large Generator Interconnection Procedures and to the pro forma Small 

Generator Interconnection Procedures, and simultaneous with the delivery of the System 

Impact Study, the transmission provider provides a draft Facilities Study Agreement to an 

interconnecting generator.149 The executing of the Facilities Study Agreement 

immediately follows the completion of the System Impact Study. The execution of the 

Facilities Study Agreement, and the subsequent completion of the Facilities Study, 

represents the time in the interconnection process when the transmission provider and 

generator developer agree to the general technical requirements that will be needed for 

the generator to reliably interconnect to the transmission system.150 This point in the 

 149 Section 8.1 of the pro forma Large Generator Interconnection Procedures state 

that, simultaneous with the delivery of the System Impact Study, the transmission 

provider must provide the interconnection customer with an Interconnection Facilities 

Study Agreement. Likewise, section 3.5 of the pro forma Small Generator 

Interconnection Procedures state that a transmission provider must provide an 

interconnection customer a Facilities Study Agreement along with the completed System 

Impact Study report.

150 Section 7.3 of the pro forma Large Generator Interconnection Procedures 

explains that the System Impact Study will “provide the requirements or potential 

impediments to providing the requested interconnection service, including a preliminary 

indication of the cost and length of time that would be necessary to correct any problems 

identified in those analyses and implement the interconnection,” along with “a list of 

facilities that are required as a result of the Interconnection Request and a non-binding 

good faith estimate of cost responsibility and a non-binding good faith estimated time to 

(continued ...)
Docket No. RM16-1-000 - 51 -

interconnection process is early enough in the development of a generation project such 

that the project developer likely has not purchased equipment to interconnect their project 

because they have not yet reached an agreement with the transmission provider on the 

interconnection requirements of the project, which occurs after the completion of the 

System Impact Study. In choosing to apply the reactive power requirements of this Final 

Rule to projects that have not executed a Facilities Study Agreement, the Commission is 

ensuring that a majority of newly interconnecting non-synchronous generators are subject 

to the requirements of this Final Rule without subjecting projects to additional costs after 

the interconnection requirements of the project have been established.151 Further, as 

discussed in the Commission’s determination in Section III.B, Power Factor Range, 

Point of Measurement, and Dynamic Reactive Power Capability Requirements, the new 

reactive power requirement for non-synchronous generators will be measured at the highside of the generator substation and should not result in the increased costs of providing 

 

construct.” Section 5.0 of the System Impact Study Agreement attached to the pro forma

Small Generator Interconnection Procedures as Attachment 7 provides the same.

151 See, e.g., Neptune Regional Transmission Sys., LLC v. PJM Interconnection, 

L.L.C., 110 FERC ¶ 61,098, at P 23 (“Each customer knows that subsequent cost 

allocations will be determined by circumstances that are known as of the time its System 

Impact Study is conducted. Projects may drop out of the queue and customers may move 

up the queue, but the cost allocation system insulates an interconnection customer from 

costs arising from events occurring after its System Impact Study is completed, other than 

costs arising from changes from higher-queued generators. . . . If an interconnection 

customer were to be held financially responsible for the costs of events occurring after its 

System Impact Study is completed it would be impossible for the customer to make 

reasoned business decisions.”), order on reh’g, 111 FERC ¶ 61,455 (2005), aff’d sub 

nom. Pub. Serv. Elec. and Gas Co. v. FERC, 485 F.3d 1164 (D.C. Cir. 2007).
Docket No. RM16-1-000 - 52 -

dynamic reactive power at the Point of Interconnection that would substantially affect the 

financial viability of a non-synchronous generator in the interconnection queue that 

AWEA and LSA raise in their comments.

62. In addition, using the execution of a Facilities Study Agreement as the point in the 

interconnection process for transitioning to the requirements of this Final Rule represents 

a clearly defined point to avoid confusion in applicability. To further ensure clarity for 

newly interconnecting non-synchronous generators, we include in the revisions to

section 9.6.1 to the pro forma LGIA and section 1.8.1 to pro forma SGIA this transition 

mechanism,152 which we require transmission providers to adopt, as part of their 

compliance with this Final Rule.153

63. We also amend Appendix G to the pro forma LGIA, which public utility

transmission providers are required to adopt, as part of their compliance with this Final 

Rule. Appendix G to the pro forma LGIA applies only to wind generators.154 Those 

newly interconnecting wind generators that have executed a Facilities Study Agreement 

 152 See infra P 74 (providing the amended text of section 9.6.1 to the pro forma

LGIA and section 1.8.1 to the pro forma SGIA).

153 In West Deptford Energy, LLC v. FERC, 766 F.3d 10, 20 (D.C. Cir. 2014), the 

court explained that the tariff provisions in effect at the time an interconnection 

agreement is executed apply to that interconnection customer, “unless the amended tariff 

has a grandfathering provision.”

154 See Order No. 661, FERC Stats. & Regs. ¶ 31,186, Appendix B (Appendix G –

Interconnection Requirements for a Wind Generating Plant).
Docket No. RM16-1-000 - 53 -

as of the effective date of this Final Rule will be subject to the amended Appendix G.155 

If Appendix G is not applicable to any newly interconnecting wind generators, the public 

utility transmission provider or RTO/ISO should remove Appendix G from its LGIA as 

part of its compliance filing. When all newly interconnecting wind generators that have 

executed Facilities Study Agreements as of the effective date of this Final Rule finalize 

their LGIAs and Appendix G is no longer necessary, we encourage the public utility 

transmission providers and RTOs/ISOs to file, or to include as part of, an FPA 

section 205 filing a proposal to remove Appendix G from their LGIA.

b. Upgrades to Existing Non-Synchronous Generators

64. Some commenters raise concerns with applying the requirements of this Final 

Rule to existing non-synchronous generators making upgrades that require new 

interconnection requests.156 Generally, such generators would otherwise be exempt from 

the reactive power requirement. Lincoln argues that the proposed application of the new 

reactive power requirements to existing non-synchronous generators making upgrades 

could expose entities with existing power purchase agreements to unforeseen expenses.157 

As noted by AWEA and LSA, most upgrades that require new interconnection requests 

 155 See infra P 74 (providing the amended text of paragraph A.ii of Appendix G to 

the pro forma LGIA).

156 AWEA and LSA Comments at 14; Lincoln Comments at 2.

157 Lincoln Comments at 2.
Docket No. RM16-1-000 - 54 -

do not involve fundamental changes to the original technology, or to the hardware, but 

instead simply involve software upgrades.158

65. We recognize that there are a variety of triggering points for a new interconnection 

request in the various transmission provider regions, and the fact that an existing nonsynchronous generator making an upgrade may not be installing new equipment. We 

also acknowledge, as the Commission did in the NOPR, that not all existing wind 

generators are capable of providing reactive power without incurring substantial costs to 

install new equipment.

159 Therefore, we will not apply the requirements of this Final 

Rule to existing non-synchronous generators making upgrades that require new 

interconnection requests.160 Rather, we will maintain the existing approach in Appendix 

 158 AWEA and LSA Comments at 14.

159 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 17.

160 Given our determination not to adopt the NOPR proposal, we find moot 

AWEA and LSA’s request that the Commission clarify what constitutes a “Material 

change” to a generator that would trigger a new interconnection study. We note that, on 

May 13, 2016, Commission staff held a technical conference on generator 

interconnection issues, exploring triggers for restudies, among other things. See Review 

of Generator Interconnection Agreements and Procedures, Supplemental Notice of 

Technical Conference, Docket Nos. RM16-12-000, RM15-21-000 (issued May 4, 2016); 

Review of Generator Interconnection Agreements and Procedures, Notice Inviting PostTechnical Conference Comments, Docket Nos. RM16-12-000, RM15-21-000 (issued 

June 3, 2016) (Question 1.10: “Should interconnection procedures be more specific 

about what constitutes a material modification to a generator interconnection request? Is 

it clear to interconnection customers what types of modifications to their interconnection 

requests would and would not affect their place in the queue? Do transmission owners 

and RTO/ISOs exercise any level of discretion in determining whether a customer has 

made a material modification? What is the range and nature of that discretion? Please 

reference provisions in interconnection procedures, as applicable, in your answer.”).
Docket No. RM16-1-000 - 55 -

G to the pro forma LGIA for existing non-synchronous generators making upgrades to 

their Generating Facilities that require new interconnection requests after the effective 

date of this Final Rule, meaning that those upgrades will be exempt from the requirement

to provide reactive power unless the transmission provider’s System Impact Study shows 

that provision of reactive power by that generator is necessary to ensure safety or 

reliability.

66. We decline AWEA and LSA’s request that the reactive power requirement apply 

only to the incremental capacity that results from an upgrade in the event the System 

Impact Study shows the need for reactive power.161 If a transmission provider’s System 

Impact Study shows the need for reactive power as a result of an upgrade, the 

transmission provider should have the flexibility to require reactive power capability 

consistent with the needs identified in the study, including the ability to apply the reactive 

power requirements of this Final Rule to all of the generator’s capacity. Otherwise, 

allowing a transmission provider to apply the reactive power requirements only to the 

incremental capacity that results from an upgrade would undermine the Commission’s 

goal of ensuring adequate reactive power support for the transmission system.162 

Therefore, we will give transmission providers the flexibility to apply the reactive power 

 161 AWEA and LSA Comments at 14-15.

162 NOPR, FERC Stats. & Regs. ¶ 32,712 at P 11 (explaining the Commission’s 

concern that the growing penetration of wind generators increases the potential for a 

deficiency in reactive power, and resulting local reliability issues).
Docket No. RM16-1-000 - 56 -

requirements to all of an existing non-synchronous generator’s capacity when that 

generator makes an upgrade that requires a new interconnection request, and the System 

Impact Study shows the need for reactive power.163

67. We require transmission providers to propose, as part of their compliance with this 

Final Rule, tariff revisions implementing the transition mechanism laid out above for 

existing non-synchronous generators making upgrades to their Generating Facilities that 

require new interconnection requests.

F. Regional Flexibility

68. Multiple commenters request that the Commission recognize independent entity 

variations for ISOs/RTOs and regional differences for transmission providers outside of 

ISOs/RTOs in evaluating compliance with the Final Rule.164

69. We apply here all three of the methods for proposing variations adopted in Order 

No. 2003: (1) variations based on Regional Entity reliability requirements; (2) variations 

that are “consistent with or superior to” the Final Rule; and (3) “independent entity 

 163 As with the existing approach, should an existing non-synchronous generator 

disagree with the transmission provider that the System Impact Study shows a need for 

reactive power as a result of the upgrade, it may challenge the transmission provider’s 

conclusion through dispute resolution or appeal to the Commission. See Order No. 661, 

FERC Stats. & Regs. ¶ 31,186 at P 51.

164 EEI Comments at 11; Indicated NYTOs Comments at 3; ISO-NE Comments at 

11-12; ISO/RTO Council Comments at 3; Joint NYTOs Comments at 3; NEPOOL Initial 

Comments at 6; NEPOOL Supplemental Comments at 3-4.
Docket No. RM16-1-000 - 57 -

variations” from ISOs/RTOs.165 If a transmission provider seeks to justify variations 

from the requirements of this Final Rule, it may do so in its compliance filing. A

transmission provider may propose to include standards developed by NERC or a 

Regional Entity in its own standard interconnection agreement. The Commission is 

mindful of the work being done by these organizations in developing standards for the 

interconnection of non-synchronous generators, and we strongly encourage all interested 

parties to continue to participate in developing these standards.

G. Miscellaneous Comments

70. CAISO argues that the Commission should allow transmission providers to 

propose additional technical requirements for interconnecting non-synchronous 

generators related to voltage support, such as requiring automatic voltage control.166 

Transmission providers may propose additional technical requirements, to the extent they 

believe those are necessary, in a separate filing pursuant to section 205 of the FPA.

71. MATL requests clarification that the Commission will continue to accept tariff 

arrangements that require customers on merchant transmission lines to self-supply 

ancillary services. MATL specifically requests that this clarification be included in the 

final rule compliance obligation, and in similar future proceedings.167 We clarify that 

 165 Order No. 2003, FERC Stats. & Regs. ¶ 31,146 at PP 824-827; see also Order 

No. 661, FERC Stats. & Regs. ¶ 31,186 at P 109.

166 CAISO Comments at 8.

167 MATL Comments at 5.
Docket No. RM16-1-000 - 58 -

merchant transmission lines that have received exemptions from providing ancillary 

services will not be affected by this Final Rule. Therefore, those entities that do not have 

reactive power requirements in their Commission-approved OATTs will not need to 

submit a compliance filing in response to this Final Rule.

72. SCE requests that the Commission expand the scope of the rulemaking proceeding 

to include low voltage ride-through requirements for synchronous and non-synchronous 

Generating Facilities smaller than 20 MW.168 We decline to expand the scope of the 

rulemaking proceeding to include low voltage ride-through requirements for synchronous 

and non-synchronous Generating Facilities smaller than 20 MW. We note that the 

Commission has issued a Notice of Proposed Rulemaking, Requirements for Frequency 

and Voltage Ride Through Capability of Small Generating Facilities, to consider these 

issues.169

73. AWEA and LSA request that the Commission limit the reactive power 

requirements to a specific range of voltage at the Point of Interconnection.170 NERC also 

recommends that the Commission clarify the reactive power requirements by providing a 

 168 SCE Comments at 4.

169 See Requirements for Frequency and Voltage Ride Through Capability of Small 

Generating Facilities, Notice of Proposed Rulemaking, 81 Fed. Reg. 15,481 (Mar. 23, 

2016), 154 FERC ¶ 61,222 (2016).

170 AWEA and LSA Comments at 7 (explaining the range of voltage and providing 

a proposed Q-V curve).
Docket No. RM16-1-000 - 59 -

reactive capability versus voltage characteristic diagram.171 We find the request to 

specify a voltage range for the reactive power requirements to be outside the scope of this 

proceeding. The existing pro forma LGIA and pro forma SGIA do not specify a voltage 

range for the reactive power requirement for synchronous generators, and the 

Commission does not have a sufficient record on which to create such a requirement.

IV. Compliance and Implementation

74. Section 35.28(f)(1) of the Commission’s regulations requires every public utility 

with a non-discriminatory OATT on file to also have on file the pro forma LGIA and 

pro forma SGIA “required by Commission rulemaking proceedings promulgating and 

amending such interconnection procedures and agreements.”172 The Commission hereby 

revises section 9.6.1 of the pro forma LGIA to read:

9.6.1 Power Factor Design Criteria

9.6.1.1 Synchronous Generation. Interconnection Customer shall design 

the Large Generating Facility to maintain a composite power delivery at 

continuous rated power output at the Point of Interconnection at a power 

factor within the range of 0.95 leading to 0.95 lagging, unless the

Transmission Provider has established different requirements that apply to 

all synchronous generators in the Control Area on a comparable basis. The 

requirements of this paragraph shall not apply to wind generators.

9.6.1.2 Non-Synchronous Generation. Interconnection Customer shall 

design the Large Generating Facility to maintain a composite power 

delivery at continuous rated power output at the high-side of the generator

substation at a power factor within the range of 0.95 leading to 0.95 

lagging, unless the Transmission Provider has established a different power 

 171 NERC Comments at 9-10.

172 18 C.F.R. § 35.28(f)(1) (2015).
Docket No. RM16-1-000 - 60 -

factor range that applies to all non-synchronous generators in the Control 

Area on a comparable basis. This power factor range standard shall be 

dynamic and can be met using, for example, power electronics designed to 

supply this level of reactive capability (taking into account any limitations 

due to voltage level, real power output, etc.) or fixed and switched 

capacitors, or a combination of the two. This requirement shall only apply 

to newly interconnecting non-synchronous generators that have not yet 

executed a Facilities Study Agreement as of the effective date of the Final 

Rule establishing this requirement (Order No. 827).

The Commission similarly revises section 1.8.1 of the pro forma SGIA to read:

1.8.1 Power Factor Design Criteria

1.8.1.1 Synchronous Generation. The Interconnection Customer shall 

design its Small Generating Facility to maintain a composite power 

delivery at continuous rated power output at the Point of Interconnection at 

a power factor within the range of 0.95 leading to 0.95 lagging, unless the 

Transmission Provider has established different requirements that apply to 

all similarly situated synchronous generators in the control area on a 

comparable basis. The requirements of this paragraph shall not apply to 

wind generators.

1.8.1.2 Non-Synchronous Generation. The Interconnection Customer shall 

design its Small Generating Facility to maintain a composite power 

delivery at continuous rated power output at the high-side of the generator 

substation at a power factor within the range of 0.95 leading to 0.95 

lagging, unless the Transmission Provider has established a different power 

factor range that applies to all similarly situated non-synchronous 

generators in the control area on a comparable basis. This power factor 

range standard shall be dynamic and can be met using, for example, power 

electronics designed to supply this level of reactive capability (taking into 

account any limitations due to voltage level, real power output, etc.) or 

fixed and switched capacitors, or a combination of the two. This 

requirement shall only apply to newly interconnecting non-synchronous 

generators that have not yet executed a Facilities Study Agreement as of the 

effective date of the Final Rule establishing this requirement (Order 

No. 827).
Docket No. RM16-1-000 - 61 -

In addition, the Commission revises paragraph A.ii of Appendix G to the pro forma 

LGIA, “Technical Standards Applicable to a Wind Generation Plant,” as follows:173

The following reactive power requirements apply only to a newly 

interconnecting wind generating plant that has executed a Facilities Study 

Agreement as of the effective date of the Final Rule establishing the 

reactive power requirements for non-synchronous generators in section 

9.6.1 of this LGIA (Order No. 827). A wind generating plant to which this 

provision applies shall maintain a power factor within the range of 0.95 

leading to 0.95 lagging, measured at the Point of Interconnection as defined 

in this LGIA, if the Transmission Provider’s System Impact Study shows 

that such a requirement is necessary to ensure safety or reliability. The 

power factor range standard can be met by using, for example, power 

electronics designed to supply this level of reactive capability (taking into 

account any limitations due to voltage level, real power output, etc.) or 

fixed and switched capacitors if agreed to by the Transmission Provider, or 

a combination of the two. The Interconnection Customer shall not disable 

power factor equipment while the wind plant is in operation. Wind plants 

shall also be able to provide sufficient dynamic voltage support in lieu of 

the power system stabilizer and automatic voltage regulation at the 

generator excitation system if the System Impact Study shows this to be 

required for system safety or reliability.174

 173 The full text of the pro forma LGIA will be posted on the Commission’s 

internet page at: http://www.ferc.gov/industries/electric/indus-act/gi/stnd-gen.asp. The 

full text of the pro forma SGIA will be posted on the Commission’s internet page at: 

http://www.ferc.gov/industries/electric/indus-act/gi/small-gen.asp.

174 Section A.ii of Appendix G to the pro forma LGIA.
Docket No. RM16-1-000 - 62 -

75. As in Order Nos. 2003175 and 661,176 the Commission is requiring all public 

utility177 transmission providers to adopt the requirements of this Final Rule as revisions 

(as discussed above) to the LGIA and SGIA in their OATTs within 90 days after the 

publication of this Final Rule in the Federal Register.178 Transmission providers that are 

not public utilities also must adopt the requirements of this Final Rule as a condition of 

maintaining the status of their safe harbor tariff or otherwise satisfying the reciprocity 

requirement of Order No. 888.179 As discussed above, we are not requiring changes to 

interconnection agreements already in effect, but are applying the requirements of this 

Final Rule to newly interconnecting non-synchronous generators that have not yet 

executed a Facilities Study Agreement. The requirements of this Final Rule also do not 

 175 Order No. 2003, FERC Stats. & Regs. ¶ 31,146 at P 910.

176 Order No. 661, FERC Stats. & Regs. ¶ 31,186 at P 121.

177 For purposes of this Final Rule, a public utility is a utility that owns, controls, 

or operates facilities used for transmitting electric energy in interstate commerce, as 

defined by the FPA. See 16 U.S.C. § 824(e) (2012). A non-public utility that seeks 

voluntary compliance with the reciprocity condition of an OATT may satisfy that 

condition by filing an OATT, which includes the pro forma LGIA and pro forma SGIA.

178 MISO requests that the Commission extend the requirements of this Final Rule 

to the MISO pro forma Generator Interconnection Agreement and not just to the 

Commission’s pro forma LGIA and pro forma SGIA. MISO Comments at 4-6. As 

stated, each public utility transmission provider subject to this Final Rule is directed to 

adopt the requirements of this Final Rule as revisions to the standard interconnection

agreements in its OATT.

179 Order No. 888, FERC Stats. & Regs. ¶ 31,036 at 31,760-63.
Docket No. RM16-1-000 - 63 -

apply to existing non-synchronous generators making upgrades to their Generating 

Facilities that require new interconnection requests.

76. In some cases, public utility transmission providers may have provisions in the 

currently effective LGIAs and SGIAs in their OATTs related to the provision of reactive 

power by non-synchronous generators that the Commission has deemed to be consistent 

with or superior to the pro forma LGIA and pro forma SGIA. Where the relevant 

provisions of the pro forma LGIA and pro forma SGIA are modified by this Final Rule, 

public utility transmission providers must either comply with this Final Rule or 

demonstrate that their previously-approved LGIA and SGIA variations continue to be 

consistent with or superior to the pro forma LGIA and pro forma SGIA as modified by

this Final Rule.

77. In addition, some ISOs/RTOs may have provisions in the currently effective 

LGIAs and SGIAs in their OATTs related to the provision of reactive power by nonsynchronous generators that the Commission has accepted as an independent entity 

variation to the pro forma LGIA and pro forma SGIA. Where the relevant provisions of 

the pro forma LGIA and pro forma SGIA are modified by this Final Rule, ISOs/RTOs 

must either comply with this Final Rule or demonstrate that their previously-approved 

LGIA and SGIA variations continue to justify an independent entity variation from the 

pro forma LGIA and pro forma SGIA as modified by this Final Rule.

V. Information Collection Statement

78. The following collection of information contained in this Final Rule is subject to 

review by the Office of Management and Budget (OMB) regulations under section 
Docket No. RM16-1-000 - 64 -

3507(d) of the Paperwork Reduction Act of 1995.180 OMB’s regulations require approval 

of certain information collection requirements imposed by agency rules.

181 Upon 

approval of a collection of information, OMB will assign an OMB control number and 

expiration date. Respondents subject to the filing requirements of this Final Rule will not 

be penalized for failing to respond to this collection of information unless the collection 

of information displays a valid OMB control number.

79. The reforms adopted in this Final Rule revise the Commission’s pro forma LGIA 

and pro forma SGIA in accordance with section 35.28(f)(1) of the Commission’s 

regulations.

182 This Final Rule requires each public utility transmission provider to revise

its pro forma LGIA and pro forma SGIA to: (1) eliminate the exemptions for wind 

generators from the requirement to provide reactive power; and (2) require that all newly 

interconnecting non-synchronous generators that have not yet executed a Facilities Study 

Agreement provide reactive power as a condition of interconnection as set forth in their 

LGIA or SGIA as of the effective date of this Final Rule. The reforms adopted in this 

Final Rule require filings of pro forma LGIAs and pro forma SGIAs with the 

Commission. The Commission anticipates the revisions required by this Final Rule, once 

implemented, will not significantly change currently existing burdens on an ongoing 

 180 44 U.S.C. § 3507(d) (2012).

181 5 C.F.R. § 1320.11 (2015).

182 18 C.F.R. § 35.28(f)(1) (2015).
Docket No. RM16-1-000 - 65 -

basis. With regard to those public utility transmission providers that believe that they 

already comply with the revisions adopted in this Final Rule, they can demonstrate their 

compliance in the filing required 90 days after the effective date of this Final Rule. The 

Commission will submit the proposed reporting requirements to OMB for its review and 

approval under section 3507(d) of the Paperwork Reduction Act.183

80. While the Commission expects the revisions adopted in this Final Rule will

provide significant benefits, the Commission understands that implementation can be a 

complex and costly endeavor. The Commission solicited comments on the accuracy of 

provided burden and cost estimates and any suggested methods for minimizing the 

respondents’ burdens. The Commission did not receive any comments concerning its 

burden or cost estimates. Therefore, the Commission retains the estimates proposed in 

the NOPR, with minor changes to reflect updated estimates.

Burden Estimate: The Commission believes that the burden estimates below are 

representative of the average burden on respondents. The estimated burden and cost for 

the requirements adopted in this Final Rule follow.184

 183 44 U.S.C. § 3507(d) (2012).

184 Commission staff estimates that industry is similarly situated in terms of hourly 

cost (wages plus benefits). Based on the Commission’s average cost (wages plus 

benefits) for 2015, $72/hour is used.
Docket No. RM16-1-000 - 66 -

FERC 516B revisions in Final Rule in RM16-1

No. of 

Respondents

185

(1)

Annual No.

of 

Responses 

Per 

Respondent

(2)

Total No.

of 

Responses 

(1)*(2)=(3)

Average 

Burden 

(Hrs.) & 

Cost ($) Per 

Response

(4)

Total 

Annual 

Burden Hrs.

& Total 

Annual Cost

($)

(3)*(4)=(5)

Conforming 

LGIA

changes to 

incorporate 

revisions

132 1 132 7.5

$540

990 hours

$71,280 

Conforming 

SGIA

changes to 

incorporate 

revisions

118 1 118 7.5

$540

885 hours

$63,720

Total 250 15 hours

$1,080

1,875 hours

$135,000

Cost to Comply: The Commission has projected the total cost of compliance as 

follows:186

• Year 1: $135,000 ($1,080/utility)

• Year 2: $0

After implementation in Year 1, the revisions adopted in this Final Rule would be 

complete.

 185 Number of Applicable Registered Entities.

186 The costs for Year 1 consist of filing revisions to the pro forma LGIA and 

pro forma SGIA with the Commission within 90 days of the effective date of this Final 

Rule plus initial implementation. The Commission does not expect any ongoing costs 

beyond the initial compliance in Year 1.
Docket No. RM16-1-000 - 67 -

Title: FERC-516B, Electric Rate Schedules and Tariff Filings.

Action: Revisions to an information collection.

OMB Control No.: TBD

Respondents for this Rulemaking: Businesses or other for profit and/or not-for-profit 

institutions.

Frequency of Information: One-time during Year 1.

Necessity of Information: The Commission adopts revisions in this Final Rule to the 

pro forma LGIA and pro forma SGIA to improve the reliability of the bulk power system

by requiring all newly interconnecting non-synchronous generators to provide reactive 

power as a condition of interconnection, and to ensure that all generators are being 

treated in a not unduly discriminatory or preferential manner.

Internal Review: The Commission has reviewed the requirements in this Final Rule and 

has determined that such revisions are necessary. These requirements conform to the 

Commission’s need for efficient information collection, communication, and 

management within the energy industry. The Commission has assured itself, by means of 

internal review, that there is specific, objective support for the burden estimates 

associated with the information collection requirements.

81. Interested persons may obtain information on the reporting requirements by 

contacting the following: Federal Energy Regulatory Commission, 888 First Street, NE, 

Washington, DC 20426 [Attention: Ellen Brown, Office of the Executive Director],

e-mail: DataClearance@ferc.gov, phone: (202) 502-8663, fax: (202) 273-0873.
Docket No. RM16-1-000 - 68 -

82. Comments on the collection of information and the associated burden estimates in 

this Final Rule should be sent to the Commission in this docket and may also be sent to 

the Office of Information and Regulatory Affairs, Office of Management and Budget, 

725 17th Street, NW, Washington, DC 20503 [Attention: Desk Officer for the Federal 

Energy Regulatory Commission], at the following e-mail address: 

oira_submission@omb.eop.gov. Please reference the docket number of this rulemaking 

in your submission.

VI. Regulatory Flexibility Act Certification

83. The Regulatory Flexibility Act of 1980 (RFA)187 generally requires a description 

and analysis of rules that will have significant economic impact on a substantial number 

of small entities. The RFA does not mandate any particular outcome in a rulemaking. It 

only requires consideration of alternatives that are less burdensome to small entities and 

an agency explanation of why alternatives were rejected.

84. The Small Business Administration (SBA) revised its size standards (effective 

January 22, 2014) for electric utilities from a standard based on megawatt hours to a 

standard based on the number of employees, including affiliates. Under SBA’s 

standards, some transmission owners will fall under the following category and 

 187 5 U.S.C. § 601-12 (2012).
Docket No. RM16-1-000 - 69 -

associated size threshold: electric bulk power transmission and control, at 

500 employees.188

85. The Commission estimates that the total number of public utility transmission 

providers that would have to modify the LGIAs and SGIAs within their currently 

effective OATTs is 132. Of these, the Commission estimates that approximately 

43 percent are small entities (approximately 57 entities). The Commission estimates the 

average total cost to each of these entities will be minimal, requiring on average 15 hours 

or $1,080. According to SBA guidance, the determination of significance of impact 

“should be seen as relative to the size of the business, the size of the competitor’s 

business, and the impact the regulation has on larger competitors.”189 The Commission 

does not consider the estimated burden to be a significant economic impact. As a result, 

the Commission certifies that the revisions adopted in this Final Rule will not have a 

significant economic impact on a substantial number of small entities.

VII. Environmental Analysis

86. The Commission is required to prepare an Environmental Assessment or an 

Environmental Impact Statement for any action that may have a significant adverse effect 

 188 13 C.F.R. § 121.201, Sector 22 (Utilities), NAICS code 221121 (Electric Bulk 

Power Transmission and Control) (2015).

189 U.S. Small Business Administration, A Guide for Government Agencies How to 

Comply with the Regulatory Flexibility Act, at 18 (May 2012), 

https://www.sba.gov/sites/default/files/advocacy/rfaguide_0512_0.pdf.
Docket No. RM16-1-000 - 70 -

on the human environment.190 As we stated in the NOPR, the Commission concludes 

that neither an Environmental Assessment nor an Environmental Impact Statement is 

required for the revisions adopted in this Final Rule under section 380.4(a)(15) of the 

Commission’s regulations, which provides a categorical exemption for approval of 

actions under sections 205 and 206 of the FPA relating to the filing of schedules 

containing all rates and charges for the transmission or sale of electric energy subject to 

the Commission’s jurisdiction, plus the classification, practices, contracts and regulations 

that affect rates, charges, classifications, and services.191 The revisions adopted in this 

Final Rule update and clarify the application of the Commission’s standard 

interconnection requirements to non-synchronous generators. Therefore, this Final Rule 

falls within the categorical exemptions provided in the Commission’s regulations, and as 

a result neither an Environmental Impact Statement nor an Environmental Assessment is 

required.

VIII. Document Availability

87. In addition to publishing the full text of this document in the Federal Register, the 

Commission provides all interested persons an opportunity to view and/or print the 

contents of this document via the Internet through the Commission’s Home Page 

(http://www.ferc.gov) and in the Commission’s Public Reference Room during normal 

 190 Regulations Implementing National Environmental Policy Act of 1969, Order 

No. 486, FERC Stats. & Regs. ¶ 30,783 (1987).

191 18 C.F.R. § 380.4(a)(15) (2015).
Docket No. RM16-1-000 - 71 -

business hours (8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street, NE, Room 2A, 

Washington, DC 20426.

88. From the Commission’s Home Page on the Internet, this information is available 

on eLibrary. The full text of this document is available on eLibrary in PDF and 

Microsoft Word format for viewing, printing, and/or downloading. To access this 

document in eLibrary, type the docket number of this document, excluding the last 

three digits, in the docket number field.

89. User assistance is available for eLibrary and the Commission’s website during 

normal business hours from the Commission’s Online Support at (202) 502-6652 (toll 

free at 1-866-208-3676) or email at ferconlinesupport@ferc.gov, or the Public Reference 

Room at (202) 502-8371, TTY (202) 502-8659. E-mail the Public Reference Room at 

public.referenceroom@ferc.gov.

IX. Effective Date and Congressional Notification

90. The Final Rule is effective [INSERT DATE 90 days from publication in 

FEDERAL REGISTER]. However, as noted above, the requirements of this Final Rule 

will apply only to newly interconnecting non-synchronous generators that have not yet 

executed a Facilities Study Agreement. The Commission has determined, with the 

concurrence of the Administrator of the Office of Information and Regulatory Affairs of 

OMB, that this Final Rule is not a “major rule” as defined in section 351 of the Small 

Business Regulatory Enforcement Fairness Act of 1996. This Final Rule is being 

submitted to the Senate, House, Government Accountability Office, and Small Business 

Administration.
Docket No. RM16-1-000 - 72 -

List of subjects in 18 C.F.R. Part 35

Electric power rates; Electric utilities; Non-discriminatory open access transmission 

tariffs

By the Commission.

( S E A L )

Kimberly D. Bose,

Secretary.
Docket No. RM16-1-000 - 73 -

Appendix A

List of Commenters (RM16-1-000)

AWEA and LSA American Wind Energy Association and Large-scale 

Solar Association

CAISO California Independent System Operator Corporation

EEI Edison Electric Institute

EPSA Electric Power Supply Association

Idaho Power Idaho Power Company

Indicated NYTOs Consolidated Edison Company of New York, Inc.; 

Niagara Mohawk Power Corporation d/b/a National 

Grid; and Orange and Rockland Utilities, Inc.

ISO/RTO Council ISO/RTO Council

ISO-NE ISO New England Inc.

ITC International Transmission Company d/b/a ITC 

Transmission; Michigan Electric Transmission 

Company, LLC; ITC Midwest LLC; and ITC Great 

Plains, LLC

Joint NYTOs New York Power Authority; New York State Electric 

and Gas; Rochester Gas and Electric; and Central 

Hudson Gas and Electric

Lincoln City of Lincoln, Nebraska d/b/a Lincoln Electric 

System

MATL MATL LLP

Midwest Energy Midwest Energy, Inc.

MISO Midcontinent Independent System Operator, Inc.

NaturEner NaturEner USA, LLC and its subsidiaries

NEPOOL New England Power Pool Participants Committee

NERC North American Electric Reliability Corporation

NextEra NextEra Energy, Inc.

PG&E Pacific Gas and Electric Company

Public Interest Organizations Center for Rural Affairs; Clean Wisconsin; Great 

Plains Institute; Natural Resources Defense Council; 

Sierra Club; Sustainable FERC Project; Western Grid 

Group; Wind on the Wires

SCE Southern California Edison Company

SDG&E San Diego Gas and Electric Company

Six Cities Cities of Anaheim, Azusa, Banning, Colton, Pasadena, 

and Riverside, California

Union of Concerned Scientists Union of Concerned Scientists