Interconnection is the process of connecting a battery energy storage system (BESS) to the electric grid through a regional transmission organization (RTO) or local utility. For utility-scale projects, this process determines when — and whether — a project reaches commercial operation. It is consistently the longest phase in BESS development, often exceeding all other permitting timelines combined. The full development sequence is detailed in the BESS permitting guide.
The interconnection process involves submitting an application, completing engineering studies, negotiating an interconnection agreement, and funding any required network upgrades. Each step has its own timeline, cost, and risk profile.
A developer begins by submitting an interconnection request to the RTO or utility that operates the transmission system at the project’s point of interconnection. This request specifies the project’s capacity, technology type, and proposed interconnection point.
The RTO then conducts a series of engineering studies — typically a feasibility study, a system impact study, and a facilities study — to determine what transmission upgrades are needed to accommodate the new generation or storage resource. In cluster-based study regions like PJM and MISO, projects are grouped by vintage and geography and studied together.
Once studies are complete, the developer receives a generator interconnection agreement (GIA) specifying the required upgrades, their cost, the developer’s share of those costs, and the timeline for completion. Signing the GIA and posting financial security moves the project toward construction.
The U.S. interconnection queue has been severely backlogged. By 2022, PJM’s queue alone exceeded 250 GW. MISO’s current queue holds approximately 650 GW, of which roughly 50 GW is battery storage capacity. Historically, only about 9% of BESS submissions in NYISO’s queue have advanced to commercial operation.
FERC Order 2023, issued in 2023, mandated reforms across all RTOs to clear backlogs and reduce study timelines. PJM responded with a cluster-based transition process. Its first Transition Cycle, completed in 2025, processed 130 interconnection agreements in approximately 22 months — a major improvement. PJM now targets 1 to 2 years for new interconnection agreements under its reformed process, with Cycle 1 applications accepted beginning in April 2026.
MISO introduced the Expedited Resource Addition Study (ERAS), a targeted process that can issue a generator interconnection agreement in as little as 3 months for qualifying projects. MISO accepts ERAS applications on a rolling basis.
Network upgrade costs are allocated among interconnecting projects based on their impact on the transmission system. These costs can range from minimal — for projects at unconstrained points of interconnection — to tens of millions of dollars for projects that trigger major transmission upgrades.
Under PJM’s reformed process, cost allocation follows a flow contribution analysis: each project pays based on its proportional impact on required upgrades. Costs are first estimated during Phase 1 studies and finalized in Phase 3. Developers must post financial security at multiple milestones.
Upgrade costs are the single largest source of project attrition in interconnection queues. Many projects withdraw when study results reveal upgrade costs that exceed project economics. Developers can mitigate this risk by selecting interconnection points near existing transmission capacity and by conducting preliminary power flow analysis before committing to a queue position.
Start the interconnection process early — before other permits are finalized. Because interconnection consistently runs the longest, initiating the queue application during the early stages of site development ensures that study timelines don’t extend the overall project schedule unnecessarily.
Site selection with interconnection in mind is the most effective risk mitigation. Projects located near existing substations with available capacity face lower upgrade costs and shorter study timelines than those requiring new transmission facilities. Co-location with retiring thermal generation assets can provide access to existing interconnection rights.
Developers should also track RTO reform timelines and take advantage of expedited processes where available. MISO’s ERAS program and PJM’s streamlined cycle process both offer faster paths for projects that meet readiness requirements. Demonstrating site control, permitting progress, and financial readiness early strengthens queue position under reformed processes that prioritize project maturity.
Carina Energy is a boutique owner’s representative firm specializing in BESS permitting and development. If you need support managing your interconnection strategy, get in touch to discuss your project.
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