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Federal Register / Vol. 86, No. 121 / Monday, June 28, 2021 / Rules and Regulations
states that the Commission is exploring whether to revise the Commissions regulations to remove the Order No.
719 opt-out, recognizing that the Commission, when it established the Order No. 719 opt-out, balanced the interests and concerns of state and local regulatory authorities with the Commissions goal of removing barriers to demand response resource participation in RTO/ISO markets.
Circumstances may have changed in the years since the issuance of Order Nos.
719 and 719A, such that the balance reflected in those orders adopting the Order No. 719 opt-out may have shifted and the RTO/ISO market rules reflecting the Order No. 719 opt-out may no longer be just and reasonable. 75 To ensure an adequate opportunity for interested entities to comment on the Order No. 719 opt-out in light of our decision to set aside Order No. 2222A in part, concurrently with this decision, the Commission is issuing a notice extending the comment periods in Docket No. RM2114000.76
29. Because we set aside our prior decision in Order No. 2222A to not extend the Order No. 719 opt-out to demand response resources that participate in heterogeneous distributed energy resource aggregations, we find that, as the Commission stated in Order No. 2222, the participation of demand response in distributed energy resource aggregations is subject to the opt-out and opt-in requirements of Order Nos.
719 and 719A. Therefore, if the relevant electric retail regulatory authority where a demand response resource is located has either chosen to opt out or has not opted in pursuant to Order Nos. 719 and 719A, then the demand response resource may not participate in a distributed energy resource aggregation. 77
B. Definition of Demand Response for Purposes of Applying the Order No. 719
Opt-Out to Heterogeneous Distributed Energy Resource Aggregations
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30. Order No. 2222 requires each RTO/ISO to revise its tariff to allow market participation by heterogeneous distributed energy resource Order No. 719 opt-out are no longer just and reasonable?.
75 Id. P 21.
76 Notice of Extension of Time for Filing Initial and Reply Comments, Participation of Aggregators of Retail Demand Response Customers in Markets Operated by Regional Transmission Organizations and Independent System Operators, Docket No.
RM2114000 June 17, 2021 extending time to and including July 23, 2021 to file initial comments, and to and including August 23, 2021 to file reply comments.
77 Order No. 2222, 172 FERC 61,247 at P 145.

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aggregations.78 The Commission found that requiring each RTO/ISO to allow heterogeneous aggregations will further enhance competition in RTO/ISO
markets by ensuring that complementary resources, including those with different physical and operational characteristics, can meet qualification and performance requirements such as minimum run times, which will help ensure that these markets produce just and reasonable rates.
31. In Order No. 2222A, for purposes of applying the opt-out, the Commission clarified the definition of heterogeneous aggregations as those that are made up of different types of resources including demand response as opposed to those made up solely of demand response. 79
The Commission found that the optout will continue to apply to aggregations made up solely of resources that participate as demand response resources, consistent with its regulations i.e., consistent with the opt-out requirements of Order No. 719.
The Commission clarified that, if an individual distributed energy resource can be configured to engage in either demand response or injection of energy onto the grid to make wholesale sales e.g., a behind-the-meter generator, it may choose to participate in the wholesale markets by reducing a customers metered load on the grid from the customers expected consumption i.e., as a demand response resource subject to Order No. 719 or it may choose to participate by injecting energy onto the grid to make wholesale sales i.e., as a different type of distributed energy resource. 80 The Commission stated that, if a distributed energy resource aggregation is composed solely of resources that participate as demand response resources, then the Order No. 719 optout would apply to that aggregation.
But, the Commission stated, if a distributed energy resource aggregation contains any resources that participate as another type of distributed energy resource, then the Order No. 719 opt-out would not apply to that aggregation.
a. Request for Clarification 32. Voltus requests clarification that demand response paired with a behindthe-meter distributed energy resource constitutes a heterogeneous distributed energy resource aggregation not subject to the Order No. 719 opt-out.81 Voltus argues that the Commission stated that 78 Id.

P 142.
No. 2222A, 174 FERC 61,197 at P 22.
80 Id. P 29.
81 Voltus Request for Clarification at 1, 4.
79 Order
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resources made up solely of demand response are subject to the opt-out.
Voltus maintains that the Commission could have easily stated that demand response paired with behind-the-meter distributed energy resources to reduce load is a demand response resource subject to the opt-out, but it did not draw this distinction.82
33. Voltus argues that clarification is necessary because paragraph 29 of Order No. 2222A has caused MISO to propose that an aggregation of demand response using behind-the-meter generation and/or storage to reduce load would be subject to the Order No. 719
opt-out.83 Voltus argues that this conclusion is based on an overly broad reading of a single paragraph, which draws no distinction regarding whether a distributed energy resource acts to reduce load. Voltus maintains that it would be needlessly complicated if a resource could evade the opt-out because it is configured to inject but never actually does.84
34. Voltus argues that classifying demand response paired with behindthe-meter resources as a heterogeneous aggregation is consistent with AEE/
AEMAs request for clarification that a behind-the-meter distributed energy resource used to serve onsite load should be paid at the locational marginal price LMP, as required by Order No. 745. Voltus argues that LMP
payments are proper because Order No.
2222A did not change Order No. 745s payment structure for resources that reduce load to the bulk power system.85
b. Commission Determination 35. Because we set aside the Commissions decision in Order No.
2222A to decline to extend the Order No. 719 opt-out to heterogeneous distributed energy resource aggregations, we find that Voltuss request for clarification is largely moot.
36. Nevertheless, with respect to potential confusion underlying Voltuss request for clarification, we note that the Commission has stated previously that load reductions in demand response programs can be facilitated by a variety of technologies and still constitute demand response.86 Thus, we clarify 82 Id.

at 5.
at 1, 4, 5.
84 Id. at 5.
85 Id. at 6.
86 See, e.g., Demand Response Supporters v. N.Y.
Indep. Sys. Operator, Inc., 155 FERC 61,151, at P
13 2016 A reduction in metered load on the grid, even a reduction facilitated by behind-themeter generation, is still a reduction and thus is appropriately considered demand response as defined in section 35.28d4.; Demand Response Compensation in Organized Wholesale Energy Markets, Order No. 745, 76 FR 16658 Mar. 24, 83 Id.

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