Interconnection Training Program

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1 Disclaimer This training presentation is provided as a reference for preparing for the PJM Certification Exam. Note that the following information may not reflect current PJM rules and operating procedures. For current training material, please visit: PJM 2014

2 Interconnection Training Program Load Scheduling Incremental Loading Tables LS2 Clement Lovasik State & Member Training Winter, PJM

3 LS 2 Objectives Describe how incremental loading tables are derived and used for least cost dispatch of generating units to match load demand. Describe the two modes of submitting bids for generating resources cost based and price based Describe how a cost based incremental loading curve for a generating unit is developed, given the unit s incremental heat rate and fuel cost Develop and use an incremental loading table for a sample system given unit data Describe the least cost method for dispatching generating units for a sample system given an incremental loading table for the system 2

4 Cost Based Bids Generation offers to the PJM market are capped at the unit s production cost plus a 10% adder Start up and no load costs can be updated daily Offer developed using guidelines of the Cost Development Task Force (CDTF) CDTF Rules laid out in PJM Manual 15 Cost based bids are used to cost cap the unit should the units used to control for a contingency fail the Three Pivotal Supplier Test All generators must have a cost based bid on file in emkt

5 Historic LMP-Capped / Negotiated Offers Historic LMP-Capped Offers Generation offers using historic LMPs at the generation bus where energy is injected Value is determined by calculating the average LMP at the generation bus during all hours over the past six months in which the resource was dispatched above minimum. Negotiated Offers Offer is based on a negotiated value with the PJM Market Monitor Case-by-case basis 4

6 Price Based Offers Offer is based on what the generation owner believes the market will bear Start-up and no-load costs can be updated every 6 months Prior to March 31 for period April 1 to September 30 Prior to September 30 for period October 1 to March 31 Units may file with MMU for cost-based start-up and no-loads which may be updated daily When switching to Priced Based offers a unit may not switch back to another type of offer 5

7 Parameter-Limited Schedules What are Parameter-Limited Schedules? Parameter-Limited Schedules are limitations that could be imposed on the parameters that generators submit as part of their offer. All cost based offers are PLS Price based schedules can be PLS or non-pls These pre-determined limits are used when certain operational circumstances exist. 6

8 Parameter Limited Schedules For each unit class, minimum acceptable operating parameters include: Turn Down Ratio (Ratio of Eco Max MW to Eco Min MW) Minimum Down Time Minimum Run Time Maximum Daily Starts Maximum Weekly Starts Future parameters MAY include: Hot Start Notification Time, Warm Start Notification Time, Cold Start Notification Time Some parameters will be set based on operating history of the unit compared to % of PJM-defined unit class i.e. The initial Minimum Down Time for each unit is based on the minimum of the Minimum Down Times submitted over the prior 24 months, if the resultant minimum down time is less than or equal to 110 percent of the PJM-defined unit class Minimum Down Time. If Minimum Down Time submitted for a unit is more than 110 percent of the PJMdefined unit class Minimum Down Time, then the unit s Minimum Down Time will be set equal to 110 percent of the PJM defined unit class Minimum Down Time.

9 Heat Rate Measure of efficiency of a unit in converting heat energy to electrical energy. Ratio of heat supplied by fuel (MBTU) to MWhr of electrical energy delivered by a unit. MBTU stands for one million BTUs, which can also be expressed as one decatherm. BTU stands for British Thermal Units As heat rate increases, efficiency decreases. 8

10 Heat Rate Heat Rate = MBTU = Heat Input (MBTU) MWhr MW Output (MWhr) EXAMPLE: Heat Rate = 312 MBTU/hr = 10.4 MBTU 30 MW MWhr 9

11 Heat Rate Optimum efficiency is normally at about 80% of full load. Efficiency is less at lower loads due to heat required to keep boiler hot an turbine spinning. At higher loads, losses in the turbine reduce efficiency. 10

12 Incremental Heat Rate IHR = Incremental Heat Rate IHR is significant to economic power system operation. IHR is the change in heat input to a unit needed to produce a given change in generation. IHR of a unit increases steadily with generation. 11

13

14 Incremental Heat Rate IHR = Increment of heat input (MBTU) Increment of Power Output (MWhr) 13

15 Incremental Heat Rate Increment of heat input = 392 MBTU/hr - 312MBTU/hr = 80 MBTU/hr Increment of power output = 40 MW - 30 MW = 10 MW IHR = Increment of heat input (MBTU) Increment of Power Output (MWhr) IHR = 80 MBTU/hr = 8.0 MBTU 10 MW MWhr 14

16 Incremental Cost Incremental cost for a unit at a given level of generation is the cost per MW to produce the next increment of power output. Is calculated by taking the product of the incremental heat rate and the fuel cost. 15

17 INCREMENTAL COST (LAMBDA) POWER OUTPUT IHR INC. COST (MW) (MBTU/MWhr) ($/MWhr) (7.6*2.3) = (8.0*2.3) = (8.4*2.3) = (8.8*2.3) = (9.2*2.3) = (10.2*2.3) = (11.6*2.3) = (12.7*2.3) = 29.2 Inc. Cost = IHR * Fuel Cost $/MWhr = MBTU/MWhr * $/MBTU KEY Fuel Cost = $2.30 / MBTU

18

19 Incremental Cost Incremental Cost = MBTU x Fuel Cost MWhr Incremental Cost = 8.0 MBTU x 2.3 = 18.4 $/MWhr MWhr 18

20 Cost for an Increment of Power P = Increase in MBTU needed to produce P Incremental Cost = IHR X Fuel Cost ($) MWhr (MBTU) MWhr X ($) MBTU MBTU MBTU POWER P Relationship between Incremental Cost and Incremental Heat Rate

21 Fuel Generating Unit Electrical Energy $ MBTU X MBTU MWhr = $ MWhr

22 Principle of Economic Dispatch For Economic operation of a power system all generating units should be dispatched at equal incremental cost. Rate 1 Unit 1 Unit 2 Unit 3 Total PRINCIPLE OF ECONOMIC DISPATCH 21

23 Dispatching Generation to Meet Load Load (MW x 1000) $10 $5 $45 $40 $35 $30 $25 $20 $ Hour of Day 22

24 Exercise GT

25 Questions??? 24

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