The Federal Energy Regulatory Commission’s failure to act soon on ISO New England’s interconnection reform proposal may prevent up to 3 GW of resources from participating in the grid operator’s next capacity auction, according to Flatiron Energy Development.

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“Failure to act by the commission could result in sharply higher capacity rates and therefore less affordable electricity for the region, while increasing the risk of a resource shortfall,” Flatiron said in a Wednesday filing at FERC. Further delay by FERC “may exacerbate concerns about acute winter resource adequacy challenges,” the utility-scale storage developer said.

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In mid-May, ISO-NE filed proposals to reform its grid interconnection rules in response to FERC’s landmark Order 2023, which set new interconnection requirements — including shifting to a first-ready, first-served cluster study process instead of first-come, first-served reviews of interconnection requests. ISO-NE asked FERC to approve the proposals by Aug. 12, 2024. The proposals were widely supported by ISO-NE stakeholders and the region’s states.

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FERC, however, hasn’t acted on the proposals. The New England States Committee on Electricity, which represents the region’s governors, has urged FERC to make a decision on ISO-NE’s interconnection reform proposal.

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“Near-term action on the widely supported filing is necessary to help alleviate the interconnection queue backlogs and uncertainty that continues to exist in New England,” NESCOE said in a Nov. 25 letter to FERC.

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In response, former FERC Chairman Willie Phillips said Jan. 21 that the agency would act on the proposals “as expeditiously as possible.”

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FERC needs to make a decision by the end of March to allow new resources to participate in ISO-NE’s upcoming auction, which has been delayed to 2028, according to Flatiron.

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A decision is needed so project developers can meet deadlines that would be set under ISO-NE’s proposed transition to a new interconnection review process, the Boulder, Colorado-based company said.

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Given FERC’s delay, ISO-NE has developed a contingency transition plan that would likely give energy storage developers in the transition process time for at least some projects to be online by the start of the 2028/29 capacity commitment period, which begins June 1, 2028, according to Flatiron.

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Flatiron has about 2.1 GW of projects in development in ISO-NE, including 600 MW of projects with completed System Impact Studies and/or executed Interconnection Agreements that have not participated in a Capacity Network Resource Group Study or obtained a capacity obligation to secure Capacity Network Resource Interconnection Service, the company said.

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Hull Street Energy, a private equity firm, owns Flatiron.