FERC NOPR on Fast Start Pricing. Market Subcommittee January 12, 2017

Transcription

1 FERC NOPR on Fast Start Pricing Market Subcommittee January 12, 2017

2 Overview Purpose Summarize FERC NOPR on Fast Start Pricing * Compare the proposed rules with ELMP Key Takeaways Five rules are proposed: 1) definition of fast start resources, 2) incorporation of commitment costs, 3) relaxation of EconMin, 4) offline pricing, and 5) Day-Ahead and Real-Time consistency MISO assessed that its current practice with ELMP is very well aligned with the proposed rules; and will suggest 10min start-up time as a minimum requirement of the fast start definition * Note: Docket No. RM Fast-Start Pricing in Markets NOPR 2

3 Proposed Rule 1: Definition of Fast Start Resources Apply fast-start pricing to any resource committed by the RTO/ISO that is able to Start up within ten minutes Has a minimum run time of one hour or less, and Submit economic energy offers to the market (i.e., not self-scheduling energy) ELMP Phase I captures all the criteria; Phase II expands to 60min Start-up time In the requested comments, MISO is considering to Suggest establishing ten minutes start-up time as a minimum requirement to include more peaking resources under Phase II Comment on excluding fuel limited resources from the definition considering their operational constraints that could prevent the resource from starting 3

4 Proposed Rules 2 and 3: Incorporate commitment costs; Relax EconMin to zero Incorporate commitment costs, i.e., start-up and no-load costs, of fast-start resources in energy and operating reserve prices Relax the economic minimum operating limit of fast-start resources and treat them as dispatchable from zero to the economic maximum operating limit for the purpose of pricing ELMP Phase I and II incorporate commitment costs and relax EconMin through fractional commitment in the Ex-Post pricing run The commission proposed to accept any mathematically equivalent formula, including MISO s fractional commitment, and MISO will emphasize the importance of such flexibility 4

5 Proposed Rule 4: Allow Offline Fast Start Pricing If the RTO/ISO allows offline fast-start resources to set prices for addressing certain system needs, the resources must be feasible and economic; The Commission specifies the criteria as Have a start-up time of ten minutes or less Have a generation shift factor of no less than 5 percent for transmission violation Must not have any operational constraints that would prevent the resource s start, e.g., within its minimum down time Consider the full cost of the fast-start resource, including its amortized start-up and no-load costs ELMP I and II allow offline Fast-Start Resources to set prices under shortages and meet all the feasible and economic criteria specified by the Commission MISO appreciates the Commission s continual recognition of the value of offline pricing, and fully agrees on the importance and criteria of resources being feasible and economic 5

6 Proposed Rule 5: Day-Ahead and Real-Time Consistency Incorporate fast-start pricing in both the day-ahead and real-time markets ELMP I and II are (will be) implemented in both Day-Ahead and Real-Time markets 6

7 Comments due February 28, 2017 NOPR Publish in Federal Register Comments 02/28/17 Final Rule Compliance filing Implementation/Tariff change effective 60 days. 90 days * 6 months * * Note: The Commission seeks comments on the compliance timeline 7

8 Contacts Dhiman Chatterjee Congcong Wang Mike Robinson 8

9 Appendix 9

10 Current RTO/ISO practices Proposal CAISO ISO-NE MISO NYISO PJM SPP Definition Can come online in Start-up Start-up 10min; All blockloaded 2h; but only price quick-start; cold CT that can start in Register as of FSR 2h and can be 30min; min min run 1h; RTO committed in its run time 1h; committed; not resources block-load units; start-up 10min; 15min market or min down fuel limited qualify to allow all resources min run 1h; min short-term commit time 1h Expanding to provide 10min with a limited down 1h process; only price more peaking nonsynchronous for transmission range to set price certain (nearly) units under block-loaded units Phase II reserve management Commitm ent cost Relax EconMin Include minimum load costs but not start-up cost DA-relax in both dispatch and pricing run; RTrelax to zero in pricing run Yes Yes No; but include startup for offline Yes Yes; through Yes partial commitment No Relax only up to 90%; DApricing/dispatch combined; RTpricing run then dispatch run Offline No No Yes; reserve Yes No No pricing /trans shortage DA/RT Yes, but different Real-time Yes Yes, different Yes, but different NA No No; in a screening run not production run 10