How to Get a Solar Interconnection Agreement

Traditionally, electricity flows from centralized power plants to end users through the utility grid. However, the grid is designed to accommodate bidirectional power flow, allowing energy from distributed generation sources—such as residential and commercial solar systems—to be fed back into the network through a process known as solar interconnection.

As distributed energy resources (DERs) expand, more homeowners are exporting excess solar power to the grid. To do so, they must secure a solar interconnection agreement with their utility provider, a crucial step in obtaining Permission to Operate (PTO). This agreement ensures the system meets technical and safety standards for grid integration.

With the growing adoption of photovoltaic (PV) solar systems, utilities have streamlined their interconnection agreement solar processes. While requirements vary by region, most utilities have refined their approval workflows, leading to a more predictable interconnection timeline. Below, we break down key aspects of the solar interconnection process based on our extensive experience in solar design, engineering, and grid integration.

What is an Interconnection Agreement for Solar?

A solar interconnection agreement allows homeowners to both draw electricity from the grid when their solar panels aren’t generating enough power and export excess energy back to the utility. This agreement is essential for participating in net metering, where eligible customers receive solar credits for surplus energy sent to the grid.

Is an Interconnection Agreement for Solar Important?

PV interconnection is critical for homeowners who want to maximize financial benefits from their solar investment. Without solar interconnection approval, any excess electricity produced would go unused, preventing homeowners from earning solar credits on their utility bills. Many net metering programs allow these credits to roll over for up to a year, but some utilities compensate surplus energy at a lower wholesale rate rather than the retail rate. Since net metering rules vary by region, understanding your utility’s interconnection policies is essential.

Interconnection agreements for solar are vital for your clients to get the most value from the solar electric system, thus boosting the return on investment. If the solar power system doesn’t have batteries and isn’t connected to the power grid, homeowners get no benefit from the surplus solar power they produce.

For grid-tied solar systems without batteries, interconnection agreements for solar ensure homeowners can tap into the utility grid when needed, such as at night or during cloudy conditions. Off-grid solar systems do not require interconnection, but when the grid is accessible, maintaining a solar interconnection is often the most cost-effective solution.

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Process for Interconnection Agreements for Solar

Applying for a solar interconnection agreement involves several key steps, typically handled by the solar installation company on behalf of the homeowner.

1 - Submit a Solar Interconnection Application

The first step in securing an interconnection agreement for solar is submitting an interconnection application to the utility company. This application must include essential details about the PV system, such as system capacity, installation location, and technical specifications. Providing accurate data helps the utility assess grid compatibility and determine if any upgrades are necessary to support the new solar interconnection.

A complete solar interconnection application may also require electrical diagrams, equipment data sheets, and any necessary permits or certifications. The utility company will review these documents to ensure the system meets safety standards, regulatory requirements, and grid integration protocols. Approval of the solar interconnection agreement is essential for connecting the PV system to the grid and obtaining solar PTO.

2 - Obtain Solar Permits

Securing the necessary solar permits is a critical step in the solar interconnection agreement process. After your solar interconnection application is approved, you must obtain the required solar permits from the local Authority Having Jurisdiction (AHJ) to ensure the system complies with safety standards and regulatory requirements.

Meeting solar permit requirements necessary for solar interconnection commonly requires the following:

• Building and Electrical Codes Compliance: Grid-tied solar systems in the United States must comply with the National Electrical Code (NEC), building codes, and local AHJ requirements. NEC standards, which cover various aspects such as wiring methods, grounding, overcurrent protection, and equipment specifications, are updated periodically. It's critical to comply with the latest version, which is currently the 2023 NEC edition.

• Structural and Electrical System Design: AHJs may request detailed structural and electrical system design plans for an interconnection agreement for solar to ensure the installation meets safety standards. Our solar design service can help with permit-ready solar plan sets with electrical diagrams.

• Equipment and Solar Inverter Specifications: Authorities may require specifications for solar panels, inverters, and other components to ensure they meet performance and safety standards for solar interconnection.

• Solar Site Plan and Location: AHJs may need a site plan showing the proposed location of the solar system to assess its compatibility with local zoning regulations and building codes.

• Electrical Diagrams:These illustrate the PV system’s wiring, circuitry, and solar interconnection to the electrical grid. Detailed schematics help identify any potential safety concerns.

• Structural Analysis and Wind Load Calculations: In some areas, AHJs may request structural analysis and wind load calculations to ensure the solar system can withstand local weather conditions. This is most common for ground mounts and commercial PV systems. The GreenLancer network includes licensed engineers who can complete these solar engineering requirements.

• Solar Permit Application Fee: AHJs often require an application fee to cover administrative costs associated with reviewing and processing the PV permit application. The fees can vary widely by AHJ, system size, and solar system type.

3 - Solar System Inspection

Following the installation of the solar array, authorized inspectors or relevant authorities inspect to verify that the solar project meets all safety and performance requirements. PV systems are inspected before obtaining an interconnection agreement for solar to ensure the installation complies with safety regulations and is correctly and safely installed.

The solar inspection will verify whether:

• The solar system meets NEC and building code requirements and has structural integrity

• The solar permit documents match the actual PV installation

• There is proper labeling of system components, appropriate disconnects, and safety protocols

• The PV system complies with solar interconnection requirements, including proper synchronization, anti-islanding measures, and voltage regulation

4 - Receive Solar PTO

Once the system passes inspection and meets all regulatory requirements, the utility company grants Permission to Operate, finalizing the solar interconnection agreement. PTO approval allows the solar system to begin generating electricity and exporting surplus power to the grid.

Solar PTO confirms that the system complies with safety and operational standards, enabling homeowners to benefit from net metering where available. It also ensures that the system can be monitored and maintained for long-term efficiency. Securing PTO is a key milestone in the interconnection agreement for solar, marking the official activation of the PV system and the start of solar energy savings.

Solar Interconnection Requirements

Connecting a solar system to the grid requires compliance with several technical and regulatory standards to ensure safety, reliability, and grid stability. These solar interconnection requirements govern how PV systems interact with the electrical grid.

Proper Synchronization

Solar systems must match the grid's frequency (typically 50 or 60 Hz) and voltage. This synchronization is critical to prevent damaging surges and ensure smooth power transfer. Inverters play a key role in adjusting the DC output of the panels to meet grid standards.

Anti-Islanding Protection

During a power outage, islanding occurs when a PV system continues supplying power to the grid, posing a risk to utility workers. Anti-islanding protection is required in all solar interconnection agreements to prevent backfeeding and automatically shut down solar generation when the grid goes offline. This function is built into modern inverters, using active and passive detection methods.

Voltage Regulation

To obtain an interconnection agreement for solar, PV systems must maintain voltage levels within the utility’s specified range (typically 110V or 240V for residential). Inverters dynamically adjust power output to prevent voltage fluctuations that could disrupt grid stability or damage electrical equipment.

Protection Systems

Grid-tied solar installations require overcurrent protection, ground fault detection, and rapid shutdown mechanisms. These safety features prevent electrical faults, overheating, or fires. Circuit breakers and inverters with integrated protection features help mitigate risks and ensure compliance with NEC standards.

Metering & Communication

A solar interconnection agreement typically requires a bi-directional utility meter, which records both energy consumption and excess generation sent to the grid. Many utilities install smart meters that enable real-time monitoring and data exchange, allowing homeowners to track solar production and net metering credits.

Interconnection Agreement for Solar

The interconnection agreement for solar outlines the technical, safety, and regulatory conditions for connecting a PV system to the grid. It includes inspection and certification requirements, ensuring that the system meets grid interconnection standards. Without an approved solar interconnection agreement, grid-tied solar systems cannot legally operate.

Information In a Solar Interconnection Agreement

A solar interconnection agreement outlines the technical, safety, and contractual conditions required to connect a solar energy system to the grid. This document ensures compliance with utility regulations and grid standards, detailing the responsibilities of both the system owner and the utility provider.

Technical Requirements

The interconnection agreement for solar specifies the necessary technical standards, including voltage synchronization, frequency matching, and power quality parameters. For example, inverters must comply with IEEE 1547 standards for grid interconnection, and UL 1741 certification ensures compatibility with utility grid-support functions.

Solar Equipment Specifications

The agreement details equipment requirements such as inverters, protective devices, and metering systems. Inverters must include low-voltage ride-through (LVRT) capabilities to maintain system stability during temporary grid disturbances. Bi-directional metering is often required to track both solar energy production and electricity drawn from the grid.

Solar Interconnection Safety Measures

Safety protocols ensure secure grid integration. Rapid shutdown systems (RSS) and anti-islanding protections prevent backfeeding during outages, protecting utility workers. Ground fault detection and compliance with National Electrical Code standards help prevent electrical hazards. Larger systems, such as commercial and utility-scale projects, may require protective relay systems to handle higher voltages.

Metering Arrangements for Solar Interconnection

The agreement defines how solar energy is measured and credited. Many systems use advanced metering infrastructure (AMI) for real-time tracking. Depending on local policies, homeowners or businesses may receive compensation through net metering or feed-in tariffs, ensuring proper credit for excess energy exported to the grid.

Liability and Insurance

Liability clauses in solar interconnection agreements define responsibilities for system failures or damages. Larger solar projects often require substantial insurance coverage to mitigate risks associated with grid disruptions or equipment malfunctions. The insurance requirements may vary, but utility-scale solar installations typically have higher insurance premiums due to their potential impact on grid stability.

Solar Interconnection Fees and Charges

Connecting a solar system to the grid may involve costs for technical reviews, impact studies, and grid upgrades. Commercial and utility-scale projects often require an interconnection study to assess grid reliability and potential infrastructure upgrades. Some utilities may also charge ongoing fees for grid monitoring and communication infrastructure maintenance.

Solar Interconnection Study

A solar interconnection study evaluates the impact of the system on grid stability, voltage regulation, and power quality. It involves load flow simulations, short-circuit analysis, and protective coordination to ensure compliance with IEEE standards. Large-scale systems may require additional grid impact studies to determine necessary upgrades before approval.

How Long Does The Solar Interconnection Process Take?

The timeline for solar interconnection depends on the system size and the utility's approval process. In most cases, a properly completed interconnection agreement for solar allows systems to receive PTO within a few weeks, often in less than a month.

Delays in the solar interconnection process can occur if utility requirements are not met. Common issues include unfulfilled utility requests, system inspection delays, or the use of non-compliant equipment. While most applications move smoothly, some solar installers have encountered longer wait times due to utility meter issues or grid infrastructure constraints.

How Much Does Solar Interconnection Cost?

The solar interconnection process can vary significantly based on the size and complexity of the system and the utility's requirements. Most residential systems with standard interconnection agreements receive Permission to Operate (PTO) in under a month.

However, for larger commercial or utility solar installations, the interconnection agreement process may involve additional steps, such as impact studies to assess grid stability, which can lengthen the timeline. Technical delays can also occur due to equipment incompatibilities or failure to meet grid safety protocols, like anti-islanding measures or voltage regulation requirements. Utility inspections and transformer or meter upgrades might extend the solar interconnection agreement timeframe, particularly if special approvals are needed.

Turning on a System Without Solar PTO

Turning on a solar system without receiving solar PTO could cause issues, as the utility company hasn’t authorized it. This could lead to fines or shutdown orders, especially if power backfeeds during a grid outage. Also, activating the system without solar PTO might void warranties or lead to insurance issues. It's best to wait for official solar PTO approval to avoid these complications and ensure compliance and safe operation.

Solar Interconnection Agreements With Batteries

PV systems with batteries can still qualify for solar interconnection. In fact, solar energy storage systems can allow your customers to take advantage of time-of-use rates if available through the local utility company.

Time-of-use Rates & Solar Interconnection

In some utility territories, the price per kWh of power varies by the time of day and even the time of year. This encourages customers to consume electricity during times of off-peak demand, thus smoothing out demand. If a solar system includes a battery, your customers have more flexibility in where the power originates (the grid vs. the battery). They can draw power from the battery during times when rates are higher and from the grid when rates are lower. Therefore, batteries allow your customers to save even more on their power bills.

Recent Solar Interconnection Reforms

The recent solar interconnection reforms implemented by the Federal Energy Regulatory Commission (FERC) can significantly enhance the efficiency and speed of integrating solar energy systems into the grid. This streamlined process addresses long-standing interconnection challenges, improving timelines to receive solar PTO and activate solar systems faster.

Streamlining Solar Interconnection Agreements with Order No. 2023

In July 2023, the FERC issued Order No. 2023 to address the growing backlog of solar interconnection requests. This order introduced reforms to simplify the interconnection process for electric transmission providers, helping expedite solar projects by standardizing procedures and reducing wait times. These changes have improved how new solar energy systems connect to the grid.

Clarifications with Order No. 2023-A

In March 2024, FERC followed up with Order No. 2023-A, addressing 31 rehearing requests. This additional order clarified interconnection reforms, ensuring smoother implementation and resolving concerns related to grid integration. Both orders are instrumental in promoting the integration of renewable energy, particularly solar, by reducing procedural complexities and delays.

Impact on Solar Interconnection Agreements

Together, these reforms have accelerated the solar interconnection process, making it easier for developers to meet interconnection agreements for solar requirements. By alleviating bottlenecks in the grid connection process, they contribute to the timely completion of solar projects, facilitating cleaner energy adoption across the U.S.

Solar Interconnection Agreements and PTO Are Critical

Although the PV interconnection and solar PTO process may seem daunting at first, it’ll get easier over time after you’ve navigated it once or twice. Depending on the utility company in question, the process may vary a bit, so there may be a learning curve when applying for grid interconnection with a different utility company. However, the benefits of receiving solar PTO are significant and enable your clients to get more value from their solar energy systems.

GreenLancer can expedite the solar interconnection agreement and permitting process with quality PV plan sets and our solar design services, so you can focus on what you do best. Know that GreenLancer’s partners will manage your interconnection application from start to finish. Complete the form below to learn more.