Christopher Hailstone is a veteran of the utility sector who possesses a profound understanding of how the modern grid functions under the pressure of the energy transition. His expertise in energy management and grid reliability makes him a leading voice on the technical and regulatory hurdles that determine whether a clean energy project succeeds or languishes in a queue. Today, Christopher joins us to dissect the findings of the latest “Freeing the Grid” report, a critical scorecard that reveals which states are truly paving the way for distributed energy resources and which are inadvertently blocking the path to a more resilient power system.
This conversation explores the mechanics of distributed energy resource integration, focusing on why some states excel while others fail to adopt basic interconnection rules. We discuss the technical importance of IEEE standards, the impact of transparent public reporting on investor confidence, and the friction between rising energy demands from data centers and the bureaucratic bottlenecks slowing down solar and storage deployment.
New Mexico recently set a national benchmark by integrating IEEE technical standards and maintaining transparent public reports; how do these specific technical and administrative choices change the day-to-day reality for developers on the ground?
When a state like New Mexico earns the only “A” grade in the country, it signals to the entire industry that they have moved past the era of guesswork and entered a period of regulatory certainty. By incorporating the IEEE Standard 1547-2018, the state provides a clear, technical “rulebook” that ensures every piece of equipment, from a small residential solar array to a massive storage system, speaks the same language as the utility grid. This reduces the friction of individual project reviews because the safety and performance parameters are already baked into the policy. Developers no longer have to navigate a fog of ambiguous requirements; instead, they have frequent public reports on the interconnection queue that act as a lighthouse, showing exactly where the bottlenecks are and how long they can expect to wait. It turns a process that used to feel like a bureaucratic black hole into a predictable, data-driven timeline where projects can be financed and built with much higher confidence.
The report mentions that over 80% of states scored a “C” or worse on their interconnection policies; what are the most common points of failure that keep these states from moving toward an “A” or “B” grade?
The most heartbreaking part of these findings is that about 25% of states still lack broadly applicable interconnection rules entirely, leaving developers to negotiate with utilities on a case-by-case basis which is incredibly inefficient. Many states fail because they haven’t updated their criteria to match the scale of modern projects; for instance, the best-performing states like Arizona and California apply their rules to systems up to 20 MW, while others are stuck with outdated limits. We see a lot of “D” grades because states are still assessing energy storage based on “nameplate capacity”—the theoretical maximum power—rather than “export capacity,” which is what the grid actually feels. This nuance is vital because it determines the cost of upgrades a developer must pay; if a state like Texas would switch to export-based assessments for resources over 25 kW, they could unlock a massive amount of capacity without compromising safety. When a state sits at a “C” or “D,” it usually means their timelines are too long, their fees are too high, or they lack a simplified review process for the smaller, inverter-based systems that make up the bulk of our distributed growth.
We saw Oregon and New Jersey make significant leaps from “D” to “B” grades in the latest update; what specific shifts in their review processes or cost structures allowed for such a dramatic improvement?
Oregon and New Jersey are the comeback stories of this report because they stopped treating distributed energy as a niche experiment and started treating it as a core component of their grid strategy. They improved by streamlining their review categories, particularly for systems up to 5 MW, which allows smaller community solar and commercial projects to bypass the most grueling stages of utility scrutiny. New Jersey, in particular, excelled by expanding the applicability of its rules, though they still have work to do when it comes to the transparency of their interconnection queues and equipment screening. These states recognized that the old manual way of reviewing every single application was a recipe for stagnation, so they moved toward more automated, standardized “screens” that quickly identify projects that pose no risk to the grid. It is a shift from a “no, unless” mindset to a “yes, if” mindset, which is exactly what you need when you are trying to meet rising demand from massive new loads like data centers and hyperscalers.
How do you see the current pressure on regulators to rein in electric rate hikes and meet growing demand influencing the adoption of these interconnection best practices?
There is an intense, almost visceral pressure on regulators right now because they are caught between a rock and a hard place: they must keep electricity affordable while finding enough power to serve a digital economy that is hungrier for energy than ever before. As Chris Nichols from IREC pointed out, the “Freeing the Grid” roadmap is more than just a list of rules; it is a tool for economic survival because distributed solar and storage are often faster and cheaper to deploy than building new gas-fired power plants. When a utility or a hyperscaler needs to power a data center, they can’t wait a decade for a traditional plant to come online, so they look to distributed resources that can be integrated in a fraction of the time. If a state has an efficient interconnection policy, it can bring that clean, cheap power online quickly, which helps mitigate the need for the massive capital expenditures that drive up rate hikes for every single customer on the system. This creates a sensory shift in the utility boardroom, moving from seeing solar as a disruption to seeing it as a vital pressure-release valve for a grid that is currently stretched to its absolute limit.
What is your forecast for the state of DER interconnection over the next five years as states continue to grapple with these scorecard rankings?
My forecast is that we are going to see a “great divide” between states that embrace these 50-plus criteria and those that remain stuck in the “F” category, like Georgia or Tennessee, which currently lack jurisdiction-wide rules. I expect that as the reliability and resilience benefits of community solar become undeniable, the 25% of states currently without rules will be forced by public and economic pressure to adopt the New Mexico model. We will likely see a surge in states adopting “cluster study” options and ombudsman programs to resolve disputes because the sheer volume of applications is going to overwhelm traditional mediation. Ultimately, the states that achieve an “A” or “B” grade will become the primary targets for green investment, leaving the “D” and “F” states to struggle with higher energy costs and a less reliable grid because they failed to modernize their bureaucracy. The momentum is clearly moving toward transparency and technical standardization, and within five years, I believe the “C” grade will no longer be the average, but a sign of a state that is falling dangerously behind the curve.
