Impacts of FERC Order 2222 on Asset Health

Landmark FERC Order 2222 opens doors to a new era of energy participation where distributed energy resources (DERs) take a center stage in regional wholesale markets.

Members of Utility Analytics Institute (UAI), a utility-led membership organization supporting utility analytics professionals and utilities of all shapes and sizes, are sharing knowledge and exchanging ideas around utility analytics in community conversations and presentations. In this month’s Asset Health Community Conversation, Joe Nyangon, Ph.D., Senior Power and Utilities Consultant at SAS, delves into the impact of FERC Order No. 2222 on the U.S. energy market, its underlying motivations, and potential challenges ahead.

FERC Order 2222 has transformed the energy landscape by mandating regional grid operators to integrate distributed energy resources (DERs) into their wholesale markets. These DERs include solar photovoltaics (PVs), electric vehicles, energy storage, front-of-the-meter auxiliary load control resources, residential demand response devices like smart thermostats and water heaters, etc. However, implementing Order 2222 presents challenges and changes in responsibilities for RTOs/ISOs, transmission utilities, and distribution utilities. These challenges encompass market readiness, reliability certifications, communication, data sharing, ensuring a clear division of roles between distribution and transmission market operators, and managing scheduled outages, among other important considerations. Key considerations involve transparency, accountability, and the role of analytics in supporting DER aggregation and distribution networks to enhance market efficiency. Read more.