June 17 – Variable Resources Working Group

1. June 17 – Variable Resources Working Group Jaren Lutenegger Supervisor, Operations Analysis & Integration To be Implemented on July 1, 2019 Hydro DDG EcoMax Auto-Redec

2. Definitions/Acronyms

3. Overview • Background • New Process Methodology • Applicability • Timing • Inputs • Effects on calculation of DNE limit • Examples • Benefits

4. Background DNE Dispatch was implemented in 2016 to allow wind and intermittent hydro resources to become Dispatchable Resources For DDGs, EcoMax provides the amount of expected generation absent ISO curtailment Given the intermittent nature of DDGs, EcoMax values may change very frequently Accurate and up to date EcoMax values improve the accuracy of the economic dispatch process for all resources

5. Current: Comparison to Wind EcoMax Auto-Redecs

6. New Process Methodology • Will apply to all existing hydro DDGs • Process will run every 5 minutes • Process will have precision of 0.1 MW • Inputs • Recent actual resource MW output • Bid EcoMax • Sensitivity to binding transmission constraints • No new data required from the resource

7. New Process Methodology • Use recent actual MW output to determine an estimated unconstrained expected generation amount • If Actual Output > Bid EcoMax • Redec EcoMax higher to reflect increased expected generation capability • If Actual Output < Bid EcoMax • Determine if Actual Output may be affected by a transmission constraint • If it is due to a transmission constraint • Use the Bid EcoMax to avoid negative impacts to Economic Dispatch • If it is not due to a transmission constraint • Redec the EcoMax lower to reflect decreased expected generation capability

8. Example 1 – Generation above Bid EcoMax • Bid limits • Recent actual output has been 16 MW • DNE limit is 20 MW • An EcoMax Redec would be entered at 16 MW • The DNE limit will remain at 20 MW

9. Example 2a – Generation below Bid EcoMaxDue to river conditions • Bid limits • Recent actual output has been 10 MW • DNE limit is 20 MW • An EcoMax Redec would be entered at 10 MW • Because the DNE is high and the actual output is lower than the bid, it is reasonable to presume the resource only has 10 MW of generation capability at this time • The DNE limit will remain at 20 MW

10. Example 2b – Generation below Bid EcoMaxDue to System Pricing (No Transmission Constraints) • Bid limits • Recent actual output has been 10 MW • DNE limit is 10 MW due to a system pricing below the MW-Price pairs • An EcoMax Redec would be entered at 10 MW • The DNE will remain at 10 MW • It is unaffected by the EcoMaxRedec as the low DNE limit was a result of system LMP and MW-Price pairs which have not changed • Once the system LMP increases above the MW-Price pairs, the DNE will increase up to 20 MW • As the resource increases output in response to the higher DNE, the EcoMax will be increased as well.

11. Example 2c – Generation below Bid EcoMaxDue to a Transmission Constraint • Bid limits • Recent actual output has been 10 MW • DNE limit is 10 MW due to a binding transmission constraint that requires the resource’s output to be curtailed • The bid EcoMax of 12 MW would be used • The DNE limit will be 10 MW • If the EcoMax were reduced down to 10 MW, it could cause the transmission constraint not to bind, negatively affect system pricing, and create unwanted chatter in the DNE

12. Benefits • Decreased reliance on manual redeclaration phone calls between DE and ISO-NE Operators • Increased timeliness and accuracy of EcoMax redeclarations for Hydro DNE resources • Improved energy accounting of Hydro DNE resources in real-time dispatch • Allows for more reliable and economic dispatch of all resources

13. Future: Comparison to Wind EcoMax Auto-Redecs

14. New Process Applied to Recent Data • Resource was not constrained by ISO Dispatch • EcoMax tracks very well with resource output • EcoMax cannot go below EcoMin

15. New Process Applied to Recent Data • Resource was not constrained by ISO Dispatch • EcoMax tracks very well with resource output • EcoMax cannot go below EcoMin

16. DE and Lead Market Participant Responsibilities • Lead Market Participant still has the responsibility to submit accurate bids via eMarket for use in Day Ahead and peak hour planning processes • Limits will still be available on resource RTU for DE awareness • If the DE is aware of updated capability that is not being reflected in the EcoMaxvalue they still have the responsibility to communicate their updated capability to the ISO via telephone by requesting a manual redeclaration • Updates to EcoMin values must still be communicated to the ISO via telephone requesting a manual redeclaration

17. Summary Process will be implemented on July 1, 2019 Fewer telephone calls by the DE should be necessary for manual EcoMax redeclarations Increased timeliness and precision should result in more accurate energy accounting for Hydro DNE resources as well as more economic dispatch for all resources A memo will be sent to the DE Ops Management contacts detailing this process prior to implementation

18. Jaren Lutenegger (860) 683-3302 | jlutenegger@iso-ne.com