Working Together to Integrate

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1 Working Together to Integrate Variable Generation Resources

2 The Challenge Increasing levels of VERs requires a move from traditional integration methods to a more flexible response from integration resources Operations on both a market and reliability basis have to evolve Integration of VERs is a challenge easier to address together rather then individually

3 Coming Together in 2008 The Joint Initiative was established by ColumbiaGrid, Northern Tier Transmission Group, Westconnect and other interested parties to in part address some of the challenges that VERs were presenting The belief was through the sharing of experiences and ideas that the Joint Initiative would enable creative solutions addressing some of the challenges all faced

4 Beginnings Discussion on VERs began to take shape at the Joint Initiative mid-2008 Very inclusive process It was recognized that the integration of VERs was changing the way that we managed our systems Found that t working on a silo-ed basis was not the most effective approach Each individual organization was focusing on addressing the challenges they faced and agreed that a coordinated approach would be more effective

5 Joint Initiative Structure Joint Initiative structure consists of: Think Tank designed to introduce and explore ideas Identify priorities Strike Teams Infrastructure Products & Services ATC MOD Coordination

6 Initial Work Initial work was centered on what the industry was facing and what the priorities were Scheduling quickly surfaced as the area requiring the most focus Think Tank split the task of scheduling revision into two main areas The first area was Infrastructure Responsible for the development of the Dynamic Scheduling System Split into a technical work group and a policy work group Acts as a communication environment for dynamic schedules The second area was Products and Services Responsible for creating the I-TAP concept Managed the RFI and RFP process for I-TAP I-TAP is designed to greatly simplify the trading and scheduling process in a bilateral market Developed Common Intra-hour Business Practice

7 Opportunities Identified Improved coordination between transmission providers / Balancing Authority Areas Dynamic Scheduling System Common Intra-Hour Business Practice Increased flexibility for transacting ti and scheduling I-TAP / webexchange Common Intra-Hour Business Practice

8 Dynamic Scheduling System

9 DSS Why? Allows dynamic schedules to be implemented quickly without excess infrastructure requirements Allows for more efficient variable energy resource (VER) integration Other benefits are possible over time as well E.g. increased market access

10 DSS What? Software that connects members EMS systems to each other Utilizes ICCP communication protocol to transfer data between entities Allows scheduled energy to change every two to four seconds

11 DSS How? Participants model a virtual load and virtual generator Participants then link buyers to sellers through interchange schedule using special e-tag code Signals are sent back and forth to ensure both entities are getting the same information After the fact, energy e amount is automatically updated to actual amount of flow during the hour

12 DSS - Status DSS is commercial today growing participation with further testing / configuration underway

13 Intra-Hour Transaction Accelerator Platform AKA A.K.A. I-TAP and webexchange

14 I-TAP / webexchange Why? One stop shop for energy and capacity transactions, OASIS requests, e-tag creation and submittal Will allow faster deal consummation, scheduling and approval Reduces the keystrokes necessary for the completion of transactions thereby increasing the speed in which they can be performed while reducing the potential for errors

15 I-TAP / webexchange What? Has bulletin board for subscribers to post offers to buy or sell energy and / or capacity Utilizes instant messaging technology for communicating between parties Allows subscribers to purchase and manage transmission at the same time as energy / capacity Able to submit an e-tag for the transaction with single click

16 I-TAP / webexchange How? Existing transmission rights are swept into webexchange so transactions can utilize transmission already owned Transmission Providers ATC is available in webexchange and can be secured without interacting directly with OASIS i.e.: the user stays in webexchange environment

17 I-TAP / webexchange How? (2) ATC postings can be displayed to include transmission costs to each buyer Click once and all electronic processes p can start immediately: OASIS request, tag creation and submittal

18 I-TAP / webexchange Other Items of Note Primarily intended for current and next hour transactions due to the increase in efficiency Any duration Bid or Offer can be transacted Offers are anonymous until transaction is consummated Credit remains the responsibility of each individual entity All energy / capacity transactions take place via bilateral agreements between the transacting parties

19 I-TAP / webexchange - Status Just finishing the final development of webexchange Full cycle of the product is now in place Subscribers have been in the development environment since July Factory Acceptance testing taking place October 3-6 Training occurs October Implementation scheduled for November 7, 2011

20 Common Intra-Hour Business Practice

21 Common Intra-Hour Business Practice The common business practice is designed to be a template for development of individual business practices Implemented on July 1, 2011 Allows for schedules to be submitted at the bottom of the hour Increases the ability of VER operators to respond to changes in their generation

22 Lessons Learned and Underway The integration of VERs presents challenges that we are just starting to understand the main issue is not pushing against the changes but rather responding to them If we are able to deliberately respond (i.e. not react) to the changes in variable generation we will be able to integrate it successfully at a reasonable cost Increased flexibility comes with new and increasing challenges How do we manage the cost/benefit relationship for increasing system flexibility while maintaining our focus on system reliability?

23 Lessons Learned and Underway (2) Increased flexibility in scheduling combined with automation will allow us to respond effectively There is no one tool that will solve our problem but rather we must develop a collection of tools to respond in a way that maintains reliability while increasing our efficiency I-TAP / webexchange is a tool that will speak to our effectiveness on the market side DSS will assist with the needs of our infrastructure

24 Lessons Learned and Underway (3) A firm understanding of what product you are transacting with is essential We need continued work from both the transmission providers and the market participants to move forward successfully It is encouraging to see movement by both g g y parties not only on these first steps but also looking forward to see what is next

25 Some of the Progress So Far Tools have either been developed and deployed, or are very close to implementation, to address increased flexibility with scheduling, more effective management of communication for dynamic scheduling, and a far more efficient way of transacting, managing transmission requirements, and scheduling within the market environment

26 Questions JJ Jamieson JJ Jamieson Portland General Electric Company Merchant