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Report to TAC

Report to TAC. February 2009. In Brief . Chair and Vice-Chair for 2009 Working Group Reports QMWG VCWG Staff reports EPS Meters with Loss Compensation Local Congestion Management with WGRs SCR 754 – issues PRR 766 Non-Implemented Approved Zonal PRRs EILS: Cost Comparison

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Report to TAC

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  1. Report to TAC February 2009

  2. In Brief • Chair and Vice-Chair for 2009 • Working Group Reports • QMWG • VCWG • Staff reports • EPS Meters with Loss Compensation • Local Congestion Management with WGRs • SCR 754 – issues • PRR 766 • Non-Implemented Approved Zonal PRRs • EILS: Cost Comparison • Other WMS action

  3. Working Group ReportsQMWG • Affirm David Detelich, CPS Energy as Chairman • WGRPP Forecast Accuracy Analysis • ERCOT will start presenting to ROS

  4. Working Group ReportsQMWG • Optimal Procurement of A/S • WMS believes the procurement of NSRS as described in the 2009 ERCOT Methodologies for Determining Ancillary Service Requirements has improved using the Net Load concept and current tools available. WMS endorses changing from on-peak/off-peak periods to the 4 hour blocks for NSRS sizing. WMS further agrees alternatives that ERCOT is developing will further optimize the procurement of NSRS.

  5. Working Group ReportsQMWG 4 hour blocks for NSRS sizing • This analysis results in less total capacity purchased. • ERCOT to continue analysis and propose in future AS methodology

  6. Working Group ReportsVCWG • Affirm Heddie Lookadoo, NRG and Ino Gonzales, ERCOT as Co-Chairs • Affirm Russell Lovelace, Shell Energy as Vice-Chair • Nodal Fuel Adder

  7. Working Group ReportsVCWG • Nodal Fuel Adder • FIP issues in the RUC • FIP only recovers a fuel index price. Does not recover other costs of fuel; such as intra-day premiums, transport, swing, imbalance. • RUC committed units will typically purchase at Spot Gas Prices after the market closes • Language in the nodal protocols would result in an under-recovery of costs for RUC deployed units in a vast majority of instances.

  8. Working Group ReportsVCWG • Nodal Fuel Adder • Recommendations herein only suggests modifying FIP in two sections of the nodal protocols: • Section 5.6.1.1 - Verifiable Startup Costs* • Section 5.6.1.2 - Verifiable Minimum-Energy Costs* • FIP + 10% will better align cost recovery to actual gas prices. • FIP + 10% was chosen because • it is similar to wording in current zonal protocols: Section “6.8.1.11(3)(b) - For gas fired Resources, such documentation will not be required if the requested incremental fuel cost is less than one hundred ten percent (110%) of the Fuel Index Price • similar to other markets costs

  9. Working Group ReportsVCWG • Nodal Fuel Adder • VCWG Options: • Option 1 : FIP * 1.X • Option 2: FIP * 1.X with a Deadband 1.Y - 1.X • WMS endorse Option 1 and set X at 10%, and direct VCWG to address Settlement issues associated with Option 2 and return to WMS with more robust recommendation.

  10. Other WMS activity • NPRR 147 – DAM Short Pay Changes • Remanded to new MCWG for review and recommendation • NPRR 167 – referred back to WMS • Allows QSE or Resource to submit VC • Local Congestion Management with WGR • SPS and WGR tripping under N-1 • Requires WGR to monitor element that trips the SPS – concerns that element is not always radial • To be discussed at CMWG • Endorsed SCR 754 WGRPP Forecasts Posted on Zonal TML • Delayed 6 months (ERCOT) • Non-Implemented Approved Zonal PRRs • ERCOT updated list for WMS priority vote • PRR 601 referred to CMWG and ERCOT to review impacts of 7/7 versus 7/8

  11. EILS: Cost Comparison with AS • October 2008 – January 2009 Contract Period * Average MCPCs through Jan. 15, 2009

  12. EILS: further from 1000MW Business Hours 1 (HE 0900 through 1300, Monday thru Friday except ERCOT Holidays; 420 hours):          MW procured:                                        163.6          Number of EILS Resources:                38 (includes 24 aggregations)          Projected cost:                                       $762,783.00          Average cost per MW per Hour:          $11.10 Business Hours 2 (HE 1400 through 1600, Monday thru Friday except ERCOT Holidays; 252 hours)          MW procured:                                        168.2          Number of EILS Resources:                38 (includes 24 aggregations)          Projected cost:                                       $489,872.88          Average cost per MW per Hour:          $11.56 Business Hours 3 (Hours Ending 1700 through 2000, Monday thru Friday except ERCOT Holidays; 336 hours)          MW procured:                                        163.4          Number of EILS Resources:                36 (includes 22 aggregations)          Projected cost:                                       $638,010.24          Average cost per MW per Hour:          $11.62 Non-Business Hours (all other hours; 1,873 hours):          MW procured:                                        139.4          Number of EILS Resources:                33 (includes 21 aggregations)          Projected cost:                                       $2,647,075.31          Average cost per MW per Hour:          $10.14 Total projected cost of EILS for this Contract Period is $4,537,741.43. 

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