Business Requirements Specification

Transcription

1 Business Commitment Cost Refinements 2012: Green House Gas Doc ID: GNFDMDEHU6BB Page 1 of 15

2 Table of Contents 1. INTRODUCTION PURPOSE REFERENCES DETAILS OF BUSINESS NEED/PROBLEM DESCRIPTION BUSINESS PROCESS IMPACTS HIGH LEVEL BUSINESS PROCESS Description DESCRIPTION JUSTIFICATION BUSINESS REQUIREMENTS BUSINESS PROCESS: MANAGE ENTITY AND RESOURCE MAINTENANCE UPDATES Business Requirements BUSINESS PROCESS: POTOMAC CALCULATIONS Business Requirements BUSINESS PROCESS: MANAGE DAY AHEAD & REAL TIME MARKET Business Requirements APPENDIX A: GREENHOUSE GAS ALLOWANCE PRICE APPENDIX B: TERMS AND DEFINITIONS Doc ID: GNFDMDEHU6BB Page 2 of 15

3 Disclaimer All information contained in this draft Business (BRS) as provided by the California Independent System Operator Corporation (ISO) is prepared for discussion and information purposes only. The draft BRS is provided as is without representation or warranty of any kind, including, without limitation, a representation or warranty as to accuracy, completeness, or appropriateness for any particular purpose. The draft BRS shall be revised as the development and review of the business requirements progresses. The ISO assumes no responsibility for the consequences of any errors or omissions. The ISO may revise or withdraw all or part of this information at any time at its discretion without notice. Doc ID: GNFDMDEHU6BB Page 3 of 15

4 1. Introduction 1.1 Purpose The purpose of this document is to capture and record a description of what the Users and Business Stakeholders of the project wish to obtain by providing high-level business requirements. This document establishes the basis for the agreement between the initiators and implementers of the project. The information in this document serves as input to determining the scope of Information Systems projects and to all Business Process Modeling and System Requirements Specifications efforts. These requirements will serve as the initial set of business unit requirements for the appropriate software application/systems development effort. It is understood that ITS will perform additional requirements and systems analysis and may produce To Be Business Process Models, System s, and Use Cases to serve as the set of requirements documents used by the ITS development teams to buy, modify, or build the necessary software and hardware systems. The Business Unit(s) involved in the project will have an opportunity to review and approve all ITS requirements documentation produced. 1.2 References All references represent external requirements documents or stakeholder requests developed and submitted by the Business Units. 1. Policy-related documents, including the Draft Final Proposal and stakeholder comments are located on the Commitment Cost Refinements 2012 Stakeholder Initiatives web page at: Doc ID: GNFDMDEHU6BB Page 4 of 15

5 2. Details of Business Need/Problem 2.1 Description California s thermal generating resources will bear a per-mwh cost associated with the GHG allowances needed for their energy output. Therefore, there is reason to consider including those costs in the costbased calculations for minimum load and start-up costs, as well as default energy bids and generated bids. Key considerations in defining how those costs might be determined are (1) determining GHG emission quantities and (2) identifying an appropriate price index to use for the GHG allowance cost. Doc ID: GNFDMDEHU6BB Page 5 of 15

6 3. Business Process Impacts 3.1 High Level Business Process Description The Commitment Cost Refinements 2012: Green House Gas initiative impacts the following existing business process diagram: Manage Day Ahead Market Manage Reliability Requirements 3.2 Description Specific impacts on these business processes that the Commitment Cost Refinements 2012: Green House Gas team has identified to date are as follows: Manage Day Ahead Market: Minor updates shall be made to show any potential changes to the processing of Default energy bids (DEBS) and Proxy bids. Manage Reliability Requirements: A new sub process needs to be establish to coordinate the storing (in Masterfile) of the eligibility requirements (as approved by California Air Resources Board) for greenhouse gas allowance costs. 3.3 Justification California s thermal generating resources will bear a per-mwh cost associated with the GHG allowances needed for their energy output. Therefore, there is reason to consider including those costs in the costbased calculations for minimum load and start-up costs, as well as default energy bids and generated bids. Key considerations in defining how those costs might be determined are (1) determining GHG emission quantities and (2) identifying an appropriate price index to use for the GHG allowance cost. Doc ID: GNFDMDEHU6BB Page 6 of 15

7 4. Business Requirements The sections below describe the Business Processes and the associated Business Requirements involved in the project. These may represent high level functional, non-functional, reporting and/or infrastructure requirements. These business requirements directly relate to the high level scope items determined for the project. 4.1 Business Process: Manage Entity and Resource Maintenance Updates Creation of new field to capture resource specific characteristics Business Requirements ID# BRQ001 BRQ002 Business Feature ISO must publish the greenhouse gas allowance index price of each trading month used in the calculation of projected proxy costs on a public website. Business Rule: This report will be published monthly on the first business day after the 21 st calendar day. System must use the greenhouse gas allowance index price (monthly) as sent by POTOMAC for use in the projected proxy cost calculation. Requirement Type Tariff Application(s) Impacted N/A RLC; Masterfile BRQ003 System shall allow the SC of a resource to view and submit (modifiable field in RDT) the compliance obligation for greenhouse gas allowance. RLC; Masterfile BRQ022 Business Rule: Business unit shall validate compliance obligation with CARB. The ISO shall only include greenhouse gas allowance costs in its calculation of variable costs for units that are eligible per resource. Tariff Masterfile BRQ004 System must make eligibility for greenhouse gas allowance of a resource available to downstream systems (RLC and SIBR). Masterfile Doc ID: GNFDMDEHU6BB Page 7 of 15

8 ID# BRQ005 Business Feature All data sent and received from POTOMAC must be stored. Requirement Type Application(s) Impacted EDR; RLC BRQ006 Business Rule: Storage timeframe should be consistent with other data sent and received from POTOMAC. The ISO shall use a daily GHG allowance price for the costs that POTOMAC calculates daily. Example: See column Avg GHG allowance price in Appendix A. RLC POTOMAC BRQ007 Business Rule: The cost referenced above are - Greenhouse gas allowance Incremental energy costs (one curve per resource, up to ten segments), Greenhouse gas allowance Minimum load energy costs (one value per resource), and Greenhouse gas allowance Start-up costs (one curve per resource, up to three segments) The ISO shall also use the average of the daily GHG allowance price over the first twenty-one days of each month to determine allowance costs to be used in the calculation of registered costs to be fixed for the next month. Tariff RLC POTOMAC; Masterfile BRQ009 Example: See highlighted row value within the AVG GHG allowance price column in Appendix A. Resources must submit their documented emissions rates if they are subject to greenhouse gas compliance obligation. Masterfile Business Rule: A value must be provided by the Market Participant. Business Rule: Emission rates shall match value submitted to CARB for determination of compliance obligation. Doc ID: GNFDMDEHU6BB Page 8 of 15

9 4.2 Business Process: POTOMAC Calculations The below requirements describe calculations that POTOMAC shall perform. POTOMAC will perform calculations related to Generated Bids and calculating the following which is included in the greenhouse gas allowance costs: incremental energy costs, minimal load energy costs, start-up costs, and multi-stage generator transitions Business Requirements ID# BRQ008 BRQ010 Business Feature The ISO shall calculate each unit s greenhouse gas allowance costs based on the unit s heat rate characteristics, per mmbtu, and gas price index. and a resource s emission rate. For non-gas thermal units it shall be based on the per MWh emissions rate and greenhouse gas index. Greenhouse gas allowance Incremental energy costs (one curve per resource, up to 10 segments): Include greenhouse gas allowance costs as a per MWh incremental cost per segment of the incremental heat rate curve., which can be calculated as: Allowance cost per MWh = incremental CO2 emissions per MWh (mtco2e/mwh) * 1 allowance per mtco2e * greenhouse gas allowance price (daily) Where, Incremental CO2 emissions per MWh (mtco2e/mwh) = unit s incremental heat rate (mmbtu/mwh) * ( mtco2e/mmbtu) Requirement Type Application(s) Impacted RLC POTOMAC RLC POTOMAC For non-gas thermal resources: The cost for GHG allowance shall be included in the existing average heat cost that is currently submitted to Masterfile via RDT or API. Note: The number of segments follows the Masterfile definition of incremental heat rate curve. Example: The final curve can look like: (20MW, 50 MW), 2($/MWh) (50MW, 100MW), 3($/MWh) (100MW, 120MW), 4($/MWh) Doc ID: GNFDMDEHU6BB Page 9 of 15

10 ID# BRQ023 Business Feature The cost of the greenhouse gas allowances shall be incorporated into the incremental energy costs. Requirement Type Application(s) Impacted TBD Example: Add the greenhouse gas allowance incremental energy cost to the incremental energy cost. BRQ011 Greenhouse gas allowance Minimum load energy costs (one value per resource): Include greenhouse gas allowance costs as a per MWh cost for a unit s minimum load output, which can be calculated as: Allowance cost per MWh = average CO2 emissions per MWh at minimum load (mtco2e/mwh) * 1 allowance per mtco2e * greenhouse gas allowance price (daily) Where, Average CO2 emissions per MWh (mtco2e/mwh) = unit s average heat rate at minimum load (mmbtu/mwh) * ( mtco2e/mmbtu) Tariff RLC POTOMAC For non-gas thermal units: The cost for GHG allowance shall be included in the existing minimum load cost that is currently submitted to Masterfile via RDT or API. BRQ024 Example: The final number can look like 2($/MWh) The cost of the greenhouse gas allowances shall be incorporated into the minimum load energy costs. Example: Add the greenhouse gas allowance Minimum load energy cost to the minimum load cost. TBD Doc ID: GNFDMDEHU6BB Page 10 of 15

11 ID# BRQ012 Business Feature The cost of the greenhouse gas allowances shall be incorporated into the start-up costs as follows: Greenhouse gas allowance start-up costs (one curve per resource, up to three segments): Include greenhouse gas allowance costs as a cost per start-up, which can be calculated as: Allowance cost per start-up = CO2 emissions per start-up (mtco2/start-up) * 1 allowance per mtco2 * greenhouse gas allowance price (daily) Where, CO2 emissions per start-up (mtco2/start-up) = unit s start-up fuel requirement (mmbtu/start-up) * ( mtco2/mmbtu) Requirement Type Tariff Application(s) Impacted RLC POTOMAC For Non-gas thermal units: The cost for GHG allowance shall be included in the existing start-up cost for each segment that is currently submitted to Masterfile via RDT or API. Note: The number of segments follows the Masterfile definition of start-up cost curve. BRQ025 BRQ014 Example: The final curve should look like 18 hours, $ hours, $300 3 hours, $50 The cost of the greenhouse gas allowances shall be incorporated into the start-up costs. Example: Add the greenhouse gas allowance start-up cost to the start-up cost. The ISO shall not include greenhouse gas allowance costs in its calculation of variable costs (incremental energy costs, minimum load, start-up) for units that do not have a compliance obligation for greenhouse gas allowance costs. Tariff TBD RLC POTOMAC Business Rule: These units will not have a GHG cap compliance obligation. Doc ID: GNFDMDEHU6BB Page 11 of 15

12 ID# BRQ015 Business Feature The ISO shall base the GHG allowance price on a publically available index of GHG allowance future prices. Requirement Type Application(s) Impacted RLC POTOMAC; Masterfile Business Rule: The ISO shall use the average of prices from three separate commercially published indices. Tariff BRQ016 BRQ026 Business Rule: In the event that the three prices are not available, the ISO will use the average of the prices from two separate indices. The price used will be the published daily settlement price of the California GHG future product with the next delivery date. POTOMAC/RLC must publish the following data: Business Rule: System must receive the Greenhouse gas allowance Incremental energy costs (one curve per resource, up to ten segments), Greenhouse gas allowance Minimum load energy costs (one value per resource), and Greenhouse gas allowance Start-up costs (one curve per resource, up to three segments). The ISO must publish the daily greenhouse gas allowance index price on a public site. POTOMAC; RLC OASIS Doc ID: GNFDMDEHU6BB Page 12 of 15

13 4.3 Business Process: Manage Day Ahead & Real Time Market This section describes requirements associated with system consumption and use of bids Business Requirements ID# BRQ017 Business Feature Calculation DEBs (both DA and RT markets) must add in the Greenhouse gas allowance Incremental energy costs (one curve per resource, up to ten segments) only for resources that are eligible for GHG allowances. Requirement Type Application(s) Impacted RLC; POTOMAC BRQ018 Business Rule: Eligibility is stored within Masterfile. System must consume the following data from POTOMAC. SIBR; RLC BRQ019 Business Rule: System must receive the Greenhouse gas allowance Incremental energy costs (one curve per resource, up to ten segments), Greenhouse gas allowance Minimum load energy costs (one value per resource), and Greenhouse gas allowance Start-up costs (one curve per resource, up to three segments). Calculation of generated bids and proxy energy bids must add in the Greenhouse gas allowance Incremental energy costs (one curve per resource, up to ten segments) only for resources that are eligible for GHG allowances. SIBR BRQ020 Business Rule: Eligibility is stored within Masterfile. Calculation of proxy start-up costs must add in the Greenhouse gas allowance Start-up costs (one curve per resource, up to three segments) only for resources that are eligible for GHG allowances. SIBR BRQ021 Business Rule: Eligibility is stored within Masterfile. Calculation of proxy Minimum load costs (one value per resource) must add in the proxy Minimum load energy costs (one value per resource) only for resources that are eligible for GHG allowances. SIBR Business Rule: Eligibility is stored within Masterfile. Doc ID: GNFDMDEHU6BB Page 13 of 15

14 5. Appendix A: Greenhouse Gas Allowance Price Greenhouse Gas Allowance Price Avg GHG Allowance Price (Daily RLC->OASIS) Registered cost for Trade Month Month-to-date Average RLC->MF Closing Date Trade Month (Vintage) Prices Gas Traded? Provider _A Provider _B 8/31/2013 Dec-13 No - WEEKEND N/A N/A 9/1/2013 Dec-13 No - WEEKEND October /2/2013 Dec-13 Yes - TRADED October /3/2013 Dec-13 Yes - TRADED October /4/2013 Dec-13 Yes - TRADED October /5/2013 Dec-13 Yes - TRADED October /6/2013 Dec-13 Yes - TRADED October /7/2013 Dec-13 No - WEEKEND October /8/2013 Dec-13 No - WEEKEND October /9/2013 Dec-13 Yes - TRADED October /10/2013 Dec-13 Yes - TRADED October /11/2013 Dec-13 Yes - TRADED October /12/2013 Dec-13 Yes - TRADED October /13/2013 Dec-13 Yes - TRADED October /14/2013 Dec-13 No - WEEKEND October /15/2013 Dec-13 No - WEEKEND October /16/2013 Dec-13 Yes - TRADED October /17/2013 Dec-13 Yes - TRADED October /18/2013 Dec-13 Yes - TRADED October /19/2013 Dec-13 Yes - TRADED October /20/2013 Dec-13 Yes - TRADED October /21/2013 Dec-13 No - WEEKEND October /22/2013 Dec-13 No - WEEKEND /23/2013 Dec-13 Yes - TRADED /24/2013 Dec-13 Yes - TRADED /25/2013 Dec-13 Yes - TRADED /26/2013 Dec-13 Yes - TRADED /27/2013 Dec-13 Yes - TRADED /28/2013 Dec-13 No - WEEKEND /29/2013 Dec-13 No - WEEKEND /30/2013 Dec-13 Yes - TRADED /31/2012 Dec-13 No - WEEKEND <-Used in Registered Cost Calculation/ Doc ID: GNFDMDEHU6BB Page 14 of 15

15 6. Appendix B: Terms and Definitions The following terms are used within this document. Where applicable, the terms are sourced from the current Business Practice Manual for Definitions & Acronyms. Term Acronym Definition Greenhouse Gas Allowance Index Price N/A Several providers produce price index services that are available by subscription that include California carbon allowance prices. It appears that these prices are based on surveys of brokers that trade carbon allowance forwards in the over-the-counter market (will define within Appendix). Tariff or Term? Doc ID: GNFDMDEHU6BB Page 15 of 15