NYISO s Integrating Public Policy Project

Transcription

1 NYISO s Integrating Public Policy Project Phase 2: Study Description and Assumption Review Dr. Nicole Bouchez & Mike Swider MIWG Krey Blvd, Rensselaer February 16, New York Independent System Operator, Inc. All Rights Reserved.

2 Background Prioritized for 2017 at stakeholders request Designed to: Investigate potential market designs that can fully incorporate the cost of carbon into the wholesale markets, and Determine whether other wholesale products or alternatives for incorporating the cost of carbon into the wholesale market could improve market efficiency and address potential market impacts Past presentations August 17, 2016 Business Issue Committee (BIC) First discussion of the possibility of an Integrating Public Policy Project September 12, 2016 Budget & Priorities Working Group (BPWG) - Presentation of stakeholder feedback, proposed scope of the project October 19, 2016 Market Issues Working Group (MIWG) Presentation providing more detail on the scope and timeline of the project November 22, 2016 MIWG Presentation updating project status -- consultant selection and goals of Phases 1 and 2 December 14, 2016 MIWG Consultant s Project Introduction and solicitation of input (Phase 1) January 31, 2016 MIWG Integrating Public Policy Update New York Independent System Operator, Inc. All Rights Reserved. 2

3 Project Description Integrating Public Policy Project The Brattle Group Work NYISO Work PHASE 1: Incorporating the Cost of Carbon Study Study whether incorporating a state policy defined cost of carbon in the wholesale market would improve the overall efficiency of the NYISO energy and capacity markets (Q1 2017) PHASE 2: Market Impact Assessment Study the impacts of decarbonization goals on the current NYISO energy and capacity markets from the high penetration of low carbon or carbon-free resources (Q1-Q2 2017) PHASE 3: Market Rule Assessment Study whether other market products or changes to the existing market structure will be necessary to meet the anticipated reliability needs (Q2-Q3 2017) New York Independent System Operator, Inc. All Rights Reserved. 3

4 Detailed Project Description Project Objectives include determining: The impact of decarbonization goals on the current NYISO energy and capacity markets Study the impacts of decarbonization goals on the current NYISO energy and capacity markets from the high penetration of low carbon or carbonfree resources (Phase 2 Q1-Q2 2017) NYISO Work Determine whether the existing wholesale market construct is sufficient to sustain reliable operations, maintain necessary generation, while incenting new generation where and when needed to meet reliability needs Whether a redesign is needed in the wholesale market Study whether incorporating a state policy defined cost of carbon in the wholesale market would improve the overall efficiency of the NYISO energy and capacity markets (Phase 1 Q1 2017) The Brattle Group Work Compare the costs and efficiency of internalizing the cost of carbon or utilizing a cap and trade mechanism or other alternatives or additions to a Renewable Energy Credit/Zero Emissions Credit mechanism Study whether other market products or changes to the existing market structure will be necessary to meet the anticipated reliability needs (Phase 3 Q2-Q3 2017) NYISO Work The impacts of other regional efforts for integrating public policy on the NYISO wholesale markets New York Independent System Operator, Inc. All Rights Reserved. 4

5 PHASE 2 Market Impact Assessment: Goals NYISO s goal is to provide stakeholders with information regarding potential market conditions with the incorporation of renewable resources to meet 50% of the NYCA load. This will provide insight into what will be needed for the Phase 3: Market Rule Assessment. The NYISO will study the impact on today s market of adding sufficient renewable resources to meet the CES 50% renewable by 2030 goal. This study will be looking at how today s market rules and markets would lead to different results if, in addition to the existing generation fleet, there are sufficient additional renewable resources to reach the state s CES goal New York Independent System Operator, Inc. All Rights Reserved. 5

6 PHASE 2 Market Impact Assessment: Goals The study will be using the NYISO s market software in study mode. Initially studying the Day Ahead Market, intend to expand the study to Real Time and Capacity Markets More information on the Real Time and Capacity Market studies will be presented at a subsequent MIWG This study is not a planning study. The question of underlying transmission upgrades to support CES is an important one but is not part of the scope of this work. In other words, we will not be making any assumptions on generator retirements, new transmission etc New York Independent System Operator, Inc. All Rights Reserved. 6

7 PHASE 2 Market Impact Assessment: Study Description Because we are interested in the market rules and algorithms under different conditions we will be looking at different market days we are targeting: Summer, at or near peak, Winter, at or near peak, Shoulder periods. We do not yet know how many different days we will be able to study or what the exact days will be. We are currently considering using (days subject to change): July 25, 2016, March 22, 2016 note that one of the nuclear plants was out for refueling at that time, Additional date(s) TBD. Seeking stakeholder feedback on criteria for selecting days and days to include or avoid New York Independent System Operator, Inc. All Rights Reserved. 7

8 PHASE 2 Market Impact Assessment: Assumptions Study to assess the system impacts of injecting incremental generation into the as is system. The primary source of projections for the quantity and location of qualified CES renewable generation is the NYSDPS Final Supplemental Environmental Impact Statement ( Final EIS ) in CASE 15-E-0302 Actual data from like days, where available, used to create 24- hour generation shapes. Modeled generation shapes used in all other cases. Because we are looking at today s system, and because a flat annual energy forecast (net of energy efficiency) is a reasonable assumption given all the uncertainties, we are not planning on modeling additional demand response New York Independent System Operator, Inc. All Rights Reserved. 8

9 PHASE 2 Market Impact Assessment: Assumptions Final EIS projects MWs and GW-hours based on three procurement scenarios. The Blend case represents the average (50/50). Proposing to use the Base-Blend case. Renewable Resource Renewable Generation (GWH) Renewable Generation (MW) Base Case High Load Base Case High Load PPA Blend Fixed REC PPA Blend Fixed REC PPA Blend Fixed REC PPA Blend Fixed REC Land-based Wind 6,251 5,853 5,455 8,311 7,570 6,829 1,811 1,691 1,572 2,445 2,221 1,996 Utility-scale Solar , Hydro Biomass/ADG ,098 1, Offshore Wind Imports ,776 1,769 1, To 2030 Total 7,707 7,708 7,708 11,778 11,779 11,778 2,143 2,186 2,229 3,445 3,605 3,764 Land-based Wind 13,651 14,326 15,002 19,802 19,276 18,749 4,000 4,188 4,375 5,905 5,738 5,570 Utility-scale Solar 3,274 4,582 5,889 6,144 7,127 8,110 2,736 3,855 4,974 5,200 6,032 6,865 Hydro 2,809 2,720 2,630 2,867 2,837 2, Biomass/ADG 722 1,179 1, ,602 2, Offshore Wind 6,839 4,275 1,711 7,826 6,646 5,467 1,599 1, ,830 1,554 1,278 Imports 1,759 1,972 2,185 2,879 2,761 2, Total 29,054 29,054 29,054 40,250 40,249 40,250 9,508 10,321 11,131 14,504 14,952 15,402 Source: Final Environmental Impact Statement, Exhibit New York Independent System Operator, Inc. All Rights Reserved. 9

10 PHASE 2 Market Impact Assessment: Assumptions Existing Renewable MWs 2016, Additional Renewable MWs per EIS (NEW), and Total Renewable MWs in MW 2016 A B C D E F G H I J K On-shore Wind Off-shore Wind Utility-Scale Solar 32 Hydro 2, , Biomass ADG/LFG EIS MW ("NEW") On-shore Wind , Off-shore Wind Utility-Scale Solar , Hydro Biomass ADG/LFG MW 2030 On-shore Wind 1, ,516 1,452 1, Off-shore Wind Utility-Scale Solar , Hydro 2, , Biomass ADG/LFG TOTAL 4, ,227 2,621 2,286 2, ,005 Total New York Independent System Operator, Inc. All Rights Reserved

11 PHASE 2 Market Impact Assessment: Assumptions Large-Scale Solar Zonal MWs directly from the Final EIS, Exhibit 5-8. Hourly profile shape was based on a clear sky model, with 27% axis tilt, due south orientation. Hourly output scaled to match annual GWh in EIS. Behind-the-meter Solar MWs scaled to Final EIS assumption of 5,000 GWh. The scaling approach was to use an annual clear-sky profile, adjusted to a 13.5% AC capacity factor. Zonal distributions based on current zonal distributions provided by NYSERDA, net of existing BTM solar. Run-of-river Hydro Zonal MWs based on Final EIS, Exhibit Daily profiles based on like days New York Independent System Operator, Inc. All Rights Reserved. 11

12 PHASE 2 Market Impact Assessment: Assumptions On-shore wind Total MWs from EIS, Exhibit 4-1. Zonal distribution based on current NYISO Interconnection queue. Daily profiles from actual profiles for the study day. Zone F profile based on Zone C. Total GWh in EIS requires a capacity factor 50% higher than historical average for wind generators in NYCA. Actual wind facility profiles were first scaled to new MWhour profiles, respecting upper operating limits. MWh scaled = (2 * MWh actual ) (MWh actual * (MWh actual /MW nameplate )) Existing facilities in each zone are summed and that profile is increased by the ratio of new EIS MWs to existing MWs New York Independent System Operator, Inc. All Rights Reserved. 12

13 PHASE 2 Market Impact Assessment: Assumptions Off-shore wind Total MWs for J and K based on EIS, Exhibit Daily profiles from NREL Wind Prospector, 2012 case, with a site south of NYC chosen for Zone J, and a site chosen off the Eastern tip on Long Island chosen for Zone K. Hourly MWs scaled to annual GWh projection in the EIS using same methodology as with on-shore wind Biomass New Zonal MWs from Final EIS. Daily profiles based on existing facilities. Anaerobic Digesters/LFG Zonal MWs from Final EIS, Exhibit Hourly profiled as flat based on a review of existing facilities New York Independent System Operator, Inc. All Rights Reserved. 13

14 MW Example: Off-shore Wind Summer Day (July 25, 2016) 700 July 25 Off-Shore Wind Profiles Zone K Scaled NREL Zone K Zone J Scaled NREL Zone J New York Independent System Operator, Inc. All Rights Reserved. 14

15 MW Example: Total additional renewables on a summer day (July 25, 2016) New Renewable MWs, July Wind LS Solar BTM Solar Hydro Biomass LFG All Sources New York Independent System Operator, Inc. All Rights Reserved. 15

16 MW Example: Total additional renewables on a shoulder day (March 22, 2016) New Renewable MWs, March Wind LS Solar BTM Solar Hydro Biomass LFG All Sources New York Independent System Operator, Inc. All Rights Reserved. 16

17 PHASE 2 Simulations and Additional Assumptions Mechanically we will be spreading out the resources within the zones. This avoids artificially creating intrazonal congestion that would be resolved in the interconnection process. In simulations incremental Behind-the-Meter solar resources will modify fixed load. Incremental generation resources will be modeled as Virtual Supply with a low offer price. Some modifications to bid shapes will be needed for resources that offer opportunity costs based on LBMP expectations. The NYISO will provide a description of the modifications when finalized New York Independent System Operator, Inc. All Rights Reserved. 17

18 PHASE 2 Market Impact Assessment: Outputs NYISO intends to provide the following study results to stakeholders: NYISO Energy Market LBMPs NYISO Ancillary Service Prices NYISO Capacity Market Clearing Prices Curtailments of renewable resources due to transmission constraints Levels of imports and exports As well as qualitative descriptions of the market changes New York Independent System Operator, Inc. All Rights Reserved. 18

19 Next Stakeholder Steps Phase 2: Market Impact Assessment Expecting to review preliminary results in late March/early April Reminder: Phase 1: Incorporating the Cost of Carbon Study MIWG mid March Brattle will present their draft report for stakeholder feedback Targeting completion of whitepaper late April/early May Please provide any additional feedback to: All feedback provided will be periodically posted New York Independent System Operator, Inc. All Rights Reserved. 19

20 The mission of the New York Independent System Operator, in collaboration with its stakeholders, is to serve the public interest and provide benefit to consumers by: Maintaining and enhancing regional reliability Operating open, fair and competitive wholesale electricity markets Planning the power system for the future Providing factual information to policy makers, stakeholders and investors in the power system New York Independent System Operator, Inc. All Rights Reserved. 20