Assessing IBR Risks

One of the more significant recent changes to the Bulk Power System (BPS) is the introduction of large numbers of inverter-based resources (IBRs). These wind, solar, and battery storage units introduce well-documented operational challenges and system events. From a regulatory perspective, these challenges include momentary cessation and other ride-through issues, particularly during voltage transients. Texas RE’s risk-based compliance monitoring is focused on the system risk posed by these types of unpredictable behavior. If the dynamic response of generating units cannot be accurately predicted, then the system could operate in an unreliable state.

Adding to the complexity of IBR penetration is that a significant number of them are not currently BPS facilities and therefore are not currently subject to North American Electric Reliability Corporation (NERC) Reliability Standards. To address this, NERC implemented new rules requiring registration of Category 2 IBRs (resources of >20 MVA and interconnected at 60kV or higher). This process has been in progress for several months and will become effective in May 2026. Future Category 2 IBRs will reach their effective registration dates when they achieve commercial operation.

It is important for Category 2 IBR entities to understand their compliance obligations under all Reliability Standards, and to be particularly aware of those Standards that have been recently approved and revised. For example, the Federal Energy Regulatory Commission (FERC) recently approved three new Standards that apply to all IBRs: PRC-028-1, PRC-029-1, and PRC-030-1. While it is important to review and comply with all three, it is just as important to understand each Standard’s Implementation Plan (IP). These three IPs have different mandatory compliance dates (such as different commercial operation dates or whether an entity is Category 1 or Category 2). Some Standards have phased-in Requirements effective in 2026, and others becoming enforceable in 2030. All the IPs must be carefully reviewed to ensure appropriate and timely compliance.

Texas RE will continue to develop Inherent Risk Assessments (IRAs) and Compliance Oversight Plans (COPs) for newly registered entities and review them for existing entities that add Category 2 functions. These assessments and plans will serve the same function as they have in the past: to inform entities of how Texas RE assesses their respective risk profiles, and to give insight into how Texas RE plans to approach them with respect to compliance oversight engagements.