Inverter-Based Resource Frequency and Voltage Protection Standards
Summary
The Federal Energy Regulatory Commission (Commission) approves proposed Reliability Standard PRC-024-4 (Frequency and Voltage Protection Settings for Synchronous Generators, Type 1 and Type 2 Wind Resources, and Synchronous Condensers), Reliability Standard PRC-029-1 (Frequency and Voltage Ride-through Requirements for Inverter-Based Resources), and a definition of "Ride-through," which the North American Electric Reliability Corporation (NERC) submitted in response to a Commission directive. In addition, the Commission directs NERC to clarify documentation requirements for legacy equipment needed to support an exemption request pursuant to Reliability Standard PRC-029- 1; to consider whether, and if so how, to address a total of two exception- and exemption-related issues raised by commenters; and to submit an informational filing that assesses the reliability impact of the exemptions to Reliability Standard PRC-029-1.
Compliance Requirements
- #1
Each generator owner of a NERC-registered IBR must ensure the design and operation is such that each IBR meets or exceeds Ride-through requirements, in accordance with the 'must Ride-through zone' as specified in Attachment 1 of proposed Reliability Standard PRC-029-1; Each generator owner of a NERC-registered IBR must adhere to voltage ride-through performance criteria during system disturbances, unless a documented hardware limitation exists in accordance with Requirement R4; Each generator owner of a NERC-registered IBR must ensure that its IBR adheres to ride-through requirements during frequency excursion events by continuing to exchange current and remain electrically connected in accordance with the 'must ride-through zone' as specified in Attachment 2, and while the absolute rate of change of frequency (RoCoF) magnitude is less than or equal to 5 hertz/second, unless a documented hardware limitation exists in accordance with Requirement R4; Each Generator Owner identifying an IBR that is in-service by the effective date of PRC-029-1, has known hardware limitations that prevent the IBR from meeting Ride-through criteria as detailed in Requirements R1-R3, and requires an exemption from specific Ride-through criteria shall document information supporting the identified hardware limitation; Each generator owner of an IBR must provide the information supporting the identified hardware limitation (unless considered proprietary by the original equipment manufacturer) to each planning coordinator, transmission planner, transmission operator, and reliability coordinator in the footprint in which the legacy IBR is located; Generator owner must submit documentation to the relevant Compliance Enforcement Authority that must accept that all aspects of the documentation specified in proposed Requirement R4 have been provided before an exemption can be granted; NERC must submit a responsive modification to the Reliability Standard within 12 months of the effective date of this final rule to clarify documentation requirements for legacy equipment needed to support an exemption request; NERC must submit to the Commission an informational filing 18 months after the conclusion of the exemption request period in proposed Reliability Standard PRC-029-1, Requirement R4 that assesses the reliability impact of the exemptions to the Standard; NERC must determine whether, and if so how, to account for HVDC-connected IBR exception concerns and long-lead time project exemption concerns through its standard development process and submit its determination within 12 months of the effective date of this final rule
Deadline: 2025-08-28(Effective date of PRC-029-1 (30 days after publication in Federal Register on 07/29/2025))
Market Impacts
Mandatory ride-through performance requirements for all NERC-registered IBRs (solar PV, Type 3/4 wind, BESS, fuel cells) to remain connected during voltage and frequency disturbances; New projects must fully satisfy ride-through performance requirements without exemption provisions that apply to legacy equipment; Enhanced grid reliability through standardized IBR performance requirements creates market opportunities for compliant equipment manufacturers and service providers; Restrictions on legacy IBR operations that cannot meet ride-through requirements without hardware limitations documentation and exemption approval; Mandatory documentation and information sharing requirements for exemption requests and compliance demonstrations
Action Items
Implement IBR ride-through performance capabilities
Design and operate all NERC-registered inverter-based resources to meet or exceed the voltage and frequency ride-through requirements specified in Attachments 1 and 2 of PRC-029-1, ensuring IBRs remain connected and continue operation through system disturbances
Document hardware limitations for legacy IBRs
For existing IBRs in-service by the effective date that cannot meet ride-through requirements, document specific hardware limitations preventing compliance with Requirements R1-R3, including evidence from equipment manufacturers
Submit exemption requests for legacy IBRs
File exemption requests with the relevant Compliance Enforcement Authority (typically Regional Entity) for legacy IBR hardware limitations, providing complete documentation that must be accepted before exemption is granted
Share exemption documentation with grid operators
Provide hardware limitation documentation to each planning coordinator, transmission planner, transmission operator, and reliability coordinator in the footprint where the legacy IBR is located, unless considered proprietary by OEM
Configure IBR protection settings
Ensure IBR protection settings are configured to ride through up to four voltage deviations within any cumulative 10-second measurement window as specified in Attachment 1, Tables 1 and 2
Implement frequency ride-through capabilities
Configure IBRs to remain connected and exchange current during frequency excursion events while absolute rate of change of frequency magnitude is ≤ 5 hertz/second, as specified in Attachment 2
Update synchronous resource standards
For synchronous generators, synchronous condensers, and type 1 and type 2 wind resources, maintain capability-based requirements under PRC-024-4 and remove references to IBR functionality
Establish compliance monitoring procedures
Implement procedures to continuously monitor and verify IBR ride-through performance during system disturbances to ensure ongoing compliance with PRC-029-1 requirements
Estimated Monetary Impact
Basis: The regulation does not specify monetary amounts. Estimates are based on the complexity of requirements described: hardware modifications for legacy IBRs, documentation for exemptions, compliance with ride-through performance criteria (voltage and frequency disturbances), and reporting to multiple entities (planning coordinators, transmission planners, operators, reliability coordinators). Small companies are assumed exempt as typical for NERC standards. Medium and large costs reflect system upgrades, staff training, and ongoing monitoring. Benefits include reduced risk of grid instability and potential efficiency gains from standardized operations. No penalty amounts are specified in the text.Confidence: 40%
Small Companies
< $10M
Costs
Implementation: $0
Ongoing/yr: $0
Penalties: $0
Benefits
Efficiency: $0
New Revenue: $0
Risk Reduction: $0
Net Impact: $0/yr
Medium Companies
$10M - $100M
Costs
Implementation: $50K
Ongoing/yr: $15K
Penalties: $0
Benefits
Efficiency: $10K
New Revenue: $0
Risk Reduction: $5K
Net Impact: $0/yr
Large Companies
> $100M
Costs
Implementation: $200K
Ongoing/yr: $50K
Penalties: $0
Benefits
Efficiency: $30K
New Revenue: $0
Risk Reduction: $15K
Net Impact: $1K/yr
Validated Company Impacts
Clearway Energy, Inc.
Clearway Energy operates renewable energy generation facilities including solar and wind projects, which are inverter-based resources (IBRs) subject to NERC reliability standards. As a generator owner of NERC-registered IBRs, the company would be directly subject to the ride-through performance requirements, documentation obligations, and potential exemption processes outlined in PRC-029-1. The rule focuses specifically on inverter-based resource reliability standards for electric generation, which does not align with the company's disclosed risk factors of energy price volatility, interest rates, fuel costs, and general regulatory/cybersecurity concerns. The company shows no indication of operating power generation facilities or being subject to NERC reliability standards.
Duke Energy CORP
Duke Energy operates as a major electric utility with significant generation assets, including renewable energy resources that would qualify as inverter-based resources (IBRs) subject to NERC reliability standards. As a generator owner of NERC-registered facilities, the company would be directly subject to the ride-through performance requirements, documentation obligations, and compliance mandates for both new and legacy IBR equipment. The rule focuses specifically on inverter-based resource reliability standards for renewable energy generation, while the company's disclosed risks center on coal-related regulations (CCR, EPA Rule 111), commodity price exposure, and market liquidity. There is minimal overlap as the company's risk profile suggests traditional fossil fuel generation rather than renewable IBR operations that would be directly affected by these ride-through requirements.
Evergy, Inc.
Evergy operates as an electric utility company with electricity generation, transmission, and distribution business segments, directly aligning with the rule's focus on generator owners of NERC-registered inverter-based resources. As a utility company generating and distributing electricity, Evergy would be subject to the reliability standards for frequency and voltage protection settings and ride-through requirements for any inverter-based resources in its generation portfolio. The rule focuses specifically on technical performance standards for inverter-based resources in electricity generation, which does not align with any of the company's disclosed risk factors. The company's regulatory risk mentions market rule changes but shows no indication of operating power generation assets or being subject to NERC reliability standards.
NEXTERA ENERGY INC
NextEra Energy operates significant inverter-based resources (IBRs) including solar PV and wind generation facilities through its NEER segment, making it directly subject to the ride-through performance requirements for NERC-registered IBRs. The company's wholesale energy generation business and clean energy investments align perfectly with the rule's focus on generator owners of renewable energy resources. The rule directly impacts multiple key risk factors identified by the company, particularly Regulatory and Legislative Changes and Regulatory Compliance Risks, as it imposes new mandatory performance standards and documentation requirements for inverter-based resources. The rule also aligns with Cost Recovery Uncertainty risk by potentially increasing compliance costs and capital expenditures for legacy equipment upgrades, and with Project Development Restrictions by imposing new technical requirements on renewable energy projects.
SOUTHERN CO
Southern Company operates Southern Power Company, which develops and manages power generation assets including renewable energy projects that would likely include inverter-based resources (IBRs) subject to NERC reliability standards. As a generator owner of potential NERC-registered IBRs, the company would be directly affected by the ride-through performance requirements and compliance documentation mandates. The rule focuses specifically on inverter-based resource reliability standards for electric grid operations, which does not align with any of the company's disclosed risk factors. The company's regulatory compliance risk is generic and not specific to energy generation or grid reliability requirements, while its operational risks relate to facility maintenance rather than performance standards for power generation equipment.
Vistra Corp.
Vistra operates significant electricity generation assets across multiple regions including Texas, East, and West segments, which likely include NERC-registered inverter-based resources (IBRs) subject to the ride-through requirements. As a major power generator, Vistra would be directly affected by the mandatory performance standards for voltage and frequency ride-through compliance for both existing and new IBR facilities. The rule focuses on grid reliability standards for inverter-based resources and ride-through requirements, which does not directly address any of the company's disclosed risk factors. The company's risks center on cybersecurity, renewable energy variability, regulatory compliance costs, generation capacity fluctuations, and market competition - none of which align with the technical performance standards for IBR equipment mandated by this rule.
WEC ENERGY GROUP, INC.
WEC Energy Group operates electric utility generation including renewable energy facilities, which directly aligns with the rule's focus on generator owners of NERC-registered inverter-based resources (IBRs). The company's renewable generation facilities would be subject to the mandatory ride-through performance requirements for voltage and frequency disturbances. The rule focuses on technical performance standards for inverter-based resources in energy generation, while the company's disclosed risks are primarily financial and regulatory accounting concerns with no mention of energy generation operations, grid reliability, or technical compliance requirements. There is minimal overlap as the rule addresses operational technology risks in energy markets, which are not reflected in the company's risk profile.
XCEL ENERGY INC
Xcel Energy operates as a generator owner of electricity through its utility subsidiaries across multiple states, placing it directly within the scope of NERC-registered entities subject to PRC-029-1 requirements for inverter-based resources. As an electric utility company engaged in generation, transmission, and distribution, Xcel would need to ensure compliance with ride-through performance standards for any IBRs in its generation portfolio. The rule focuses exclusively on electrical grid reliability standards for inverter-based resources and generator owners, which has no alignment with the company's single disclosed cybersecurity risk. The company's technology cybersecurity risk relates to business interruption from cyber incidents, while the rule addresses technical performance standards for energy generation equipment with no cybersecurity components.