California’s New Smart Inverter Requirements: What “Rule 21” Means for Solar Design

In the fall of 2017, California became the first U.S. state to require the use of advanced, or “smart,” inverters in solar projects (and other forms of distributed electricity generation). These changes, implemented through updates to “Rule 21,” require that inverters have certain capabilities to help ensure proper operation of the electric grid as more and more renewables are connected.

While these requirements are specific to California for now, the changes are representative of approaches other states are likely to consider in the future. So, if you’re a solar professional, it’s a good idea to get familiar with these changes no matter where you’re based. In today’s post, we explain the new inverter requirements under Rule 21 and what they mean.

Why Are These Changes Being Implemented?

The significant expansion of solar and other renewable energy sources is a huge opportunity—for tackling climate change, improving public health, delivering cost savings to consumers, and much more. However, it also presents new challenges for the management of the electric grid, which was originally built for one-way flows of power from power plants to the grid and then to consumers.

Customer-sited “distributed energy resources” (DERs)—like solar—introduce two-way power flow, as systems feed excess energy back to the grid. The variable nature of energy sources like wind and solar, which fluctuate depending on weather conditions, adds additional complications for grid managers.

California has led the nation in the deployment of solar and is likely to continue as the state works toward achieving its target of sourcing 100% of its electricity from renewable sources by 2045. As the proportion of renewables reaches unprecedented levels, there is a need for grid operators to have additional tools at their disposal to manage these resources and keep the grid running smoothly.

As the “brains” of solar projects, inverters can support grid management, but to date regulations have prevented the use of the full range of inverter capabilities.

Picture of the inside of an inverterSmart inverters, now mandated under California’s Rule 21, can help support management of the electric grid.

Beginning a few years ago, California utilities warned that advanced inverter capabilities would be needed to avoid potential grid disruptions. With more nuanced capabilities for determining when and how solar systems disconnect from and reconnect to the grid in the case of a power outage or other disturbance, smart inverters can help ensure that solar and other DER systems don’t make grid disturbances worse.

For instance, during and after a disruption on the grid, variations in voltage and frequency may occur. Historically, PV systems have been required to immediately disconnect when these conditions are detected; however, if a large amount of DER capacity disconnects at once this could further destabilize the grid. Similarly, the grid could be stressed if many solar installations reconnect to the grid at once after an outage, or increase their power output at too steep a rate. Smart inverter functions allow systems to remain connected to the grid under a wider range of voltage and frequency levels.

Requiring these changes now also has cost-saving benefits, because they may prevent the need for costly retrofits to the inverter fleet. These issues—both grid instability and the need for expensive inverter retrofits—occurred in Germany, where solar capacity expanded very rapidly over the span of ten years.

Beyond preventing grid disruptions, the use of advanced inverter functions has the potential to improve the stability of the grid. For example, dynamic volt/var operations (also called dynamic reactive power compensation) of smart inverters allow systems to help counteract voltage deviations on the grid. Furthermore, eventually, remote communication capabilities will be rolled out that allow grid operators to remotely adjust the operation of inverters to support the grid.

The Smart Electric Power Association and the Electric Power Research Institute note   that smart inverters may be one of the most cost-effective mechanisms for addressing many grid management challenges, and in some cases, “could help defer or avoid certain distribution, transmission, and electric supply upgrades.”

Craig Lewis, Executive Director of the Clean Coalition , a nonprofit that works to accelerate the transition to renewable energy and a modern grid, notes that “enabling the full suite of advanced inverter functionality is essential to bring high-levels of distributed generation online quickly and cost-effectively – in California and every other leading market around the world.”

On September 9, 2017, new requirements for inverters used in solar projects came into effect in California. These changes were implemented by the California Public Utilities Commission through significant updates to its Electric Tariff Rule 21 (or “Rule 21”), a set of existing interconnection requirements.

What’s Changing Under Rule 21?

The revisions to Rule 21 are being implemented in three phases.

Phase One, which went into effect on September 9, 2017, requires that any solar project which applies for interconnection to the grid must use an advanced inverter capable of performing seven autonomous grid support functions. Inverters that are eligible for use under Rule 21 are those that have been tested and certified under the new UL testing protocol known as UL 1741 Supplement A (SA).

A complete list of eligible inverters can be found on the California Energy Commission (CEC) website . The list—which is updated monthly—contains over 3,200 eligible inverters.

One of the main changes under UL 1741-SA is that inverters are now allowed to operate under a wider range of voltage and frequency levels. As  Solar Power World explains , under the previous testing protocol, UL 1741, “the old interconnection requirements only allowed inverters to operate within a narrow range of… frequency and voltage requirements.” This meant that the use of many commercially available inverter functions, including those that offer grid support benefits, was prevented.

Graphic explaining Rule 21 Smart Inverter Requirements- Phase 1

Phase Two will establish communication requirements for inverters , setting standards for how inverters communicate with each other and utility systems. This will be important for enabling grid managers to eventually make remote adjustments to inverter operations to keep the grid running smoothly. Phase Two will also require that inverters have the capability to communicate over the internet. (However, internet connections for solar systems will not be required at this stage, because it has not yet been determined whether utilities or solar customers will be responsible for paying for internet connections.)

The exact date that Phase Two will go into effect is not yet determined, but it will be either March 1, 2018, or nine months after the release of an industry-recognized certification test standard for inverter communication protocols, whichever is later.

Graphic explaining Rule 21 Smart Inverter Requirements- Phase 2

Finally, Phase Three will require additional advanced inverter functions , “like data monitoring, remote connection and disconnection, and maximum power controls.” The specific requirements and timing of this phase have not yet been determined, although the Smart Inverter Working Group , which has been instrumental in establishing the details of Rule 21 revisions, has released recommendations (available here ).


How to Comply with Rule 21

To comply with the current phase of Rule 21, the main thing you need to know is that the inverter you select for your solar design must be one that has been certified under UL 1741-SA ; consult the CEC database  to be sure.

After choosing a certified inverter, some setup may be required to ensure that the inverter operates under the default parameters of Rule 21. As Solar Power World explains, the necessary settings can be determined during the interconnection process with the local utility and set up either remotely or through the inverter interface.

Coming Soon to a State Near You?

While California is the first state to take these steps, as a solar contractor it’s a good idea to be aware of these changes wherever you work, because other states are likely to be considering similar moves in the future.

Hawaii, Nevada, Arizona, Vermont, and Massachusetts are among states that may soon follow California’s lead. Quoted in Solar Power World, John Drummond, applications engineer at inverter company Chint Power Systems, says his company “expect[s] these kinds of advanced inverter functions to be required in the entire country in the next few years.”

As we work towards a future where clean, renewable energy is the norm, smart inverters will play an important role in managing the modern grid. We hope this article has given you a better understanding of how regulations are changing to manage rising levels of renewable energy and the details of Rule 21’s new inverter requirements for solar systems in California.

Editor’s note: This article was updated in September 2019 to reflect California’s passage of SB100 which sets a target of sourcing 100% of the state’s electricity from clean energy by 2045.

Gwen Brown

Gwen Brown is the Senior Content Marketer at Aurora Solar, managing the development of educational solar resources like blog posts and webinars. Previously, she was a Senior Research Associate at the Environmental Law Institute. She graduated Phi Beta Kappa from Gettysburg College.