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October 31, 2024

State Briefs

Democrats, Republican Call for Full Disclosure of APS Election Spending

Two Democrats on November’s ballot for seats on the state’s Corporation Commission have aligned themselves with a Republican incumbent in calling for full disclosure by Arizona Public Service as to whether it spent money on the 2014 elections.

Democrats Bill Mundell and Tom Chabin called for an end to “a culture of corruption” and cited alleged personal meetings between Gary Pierce, a former commissioner, and Don Brandt, president and CEO of APS and its parent company.

APS is suing Republican incumbent Robert Burns over his position to force it to make full disclosure. Notwithstanding, Brandt’s company is supporting Burns’ bid for re-election, according to an email Brandt sent to company employees last week.

More: The Arizona Republic

CALIFORNIA

SoCalEd Proposal Addresses Corona’s Dwindling Electric Supply

Southern California Edison engineers and city officials met with Corona residents last week regarding a proposal to build 5 miles of medium-voltage power lines to address the region’s dwindling electric supply — with one area using 92% of its energy production potential last year.

The proposal calls for primarily above-ground lines, including a 66-kV transmission line carrying power to a new substation. It also includes above-ground transmission lines that would bisect the city’s center.

Construction could begin by 2019, with the lines becoming operational by 2012, according to SoCalEd’s website.

More: The Press Enterprise

Jacumba Solar Approved to Build Solar Plant in San Diego County

Jacumba Solar last week received approval for a permit to build a 108-acre solar plant in Jacumba, near San Diego Gas & Electric’s East County Substation.

The plant will use a little more than 81,000 photovoltaic panels on roughly 2,200 fixed, tilted racks to generate 22 MW, which it will deliver to SDG&E’s substation through a 1,500-foot-long overhead transmission line, a press release from the San Diego County Board of Supervisors said.

County staff and proponents of the project said it would help the region meet state goals of producing one-half of all electricity from renewable sources by 2030 and cut greenhouse gas emissions.

More: Times of San Diego

San Diego, SunEdison Tentatively Extend Solar Panel Agreement

An October 2015 agreement between San Diego and SunEdison for installation of banks of solar panels at 25 sites across the city has been tentatively extended to at least April 2017, and possibly to June 2017, after the company failed to install a single panel. The original agreement called for installation of the first solar panels by last month.

SunEdison declared bankruptcy two months before it was supposed to begin construction and sought an extension for the first batch of projects. In July, city officials formally terminated the agreement’s initial five projects.

The city declined to release the new agreement, stating that it has not yet been formally approved, but it said SunEdison agreed to compensate it for opportunity costs related to the delay.

More: The San Diego Union-Tribune

CAISO Flexible Ramping Product Delayed Until Nov. 1

FERC last week granted CAISO’s request to postpone the start date for implementing the ISO’s flexible ramping product until Nov. 1 — one month later than the original start date (ER16-2023).

CAISO last month petitioned to delay the effective date because it did not learn of the commission’s approval of the product until hours after a conference call scheduled to confirm the roll-out to market participants.

The new market mechanism is designed to improve real-time integration of the increasing amount of variable renewable energy resources coming on to the ISO’s system. The product will also be incorporated into the ISO-run Energy Imbalance Market.

More: FERC Approves Ramping Product for CAISO, EIM

CONNECTICUT

UI Customers, Environmentalists Urge Distribution Rate Reduction

While The United Illuminating Co. seeks a distribution rate increase, 16 environmental and consumer groups are urging state regulators to reduce the current fixed-rate charge of $17.25/month its customers currently pay.

In a letter to the Public Utilities Regulatory Authority, the groups noted that the monthly charge is the highest of any investor-owned electric utility in New England and urged PURA to cut it by $6 to $8/month.

Distribution charges account for 27 cents of every dollar that UI customers pay for their electricity, UI spokesman Michael West said. He said the charge allows UI to provide the level of reliability its customers have come to expect.

More: New Haven Register

ILLINOIS

State Senators Continue to Push For Legislation to Save Exelon Plants

State senators are continuing to look for ways to prevent Exelon from shuttering it Clinton Power Station and Quad Cities Generating Station nuclear power plants during the next two years.

Exelon lost $800 million on the two plants over the past seven years and announced it would close the plants after state lawmakers ended their spring legislative session without approving its proposed “Next Generation Energy Plan.”

Sponsors of the legislation have been negotiating with Exelon and other interested groups, and Sen. Donne Trotter, a Democrat, said he plans to use the General Assembly’s fall veto session to continue pushing legislation when lawmakers return on Nov. 15.

More: The Quad-City Times

KANSAS

State Regulators: Westar-GPE Merger in Jeopardy

State regulators last week warned that the proposed $12.2 billion sale of Westar Energy to Great Plains Energy is in jeopardy if the companies don’t supply additional information regarding operational savings, and what departments or functions would remain in Topeka and for how long.

The Corporation Commission said in an order that its staff or the Citizens’ Utility Ratepayer Board could file for relief — which could include asking for dismissal of the merger application — if they maintain that the joint application does not adequately address the agency’s merger standards.

Chuck Caisley, a spokesman for GPE and Westar, said the companies were evaluating the order and are committed to closing the transaction in the spring of 2017 as planned.

More: The Topeka Capital-Journal

LOUISIANA

10 EV Charging Stations Come to Baton Rouge

Downtown Baton Rouge now has 10 electric car charging stations, and city-parish leaders hope to have 50 stations soon as part of their effort to lure green business.

Previously, the only electric car charging stations were near Louisiana State University and in south Baton Rouge.

Entergy gave a $75,000 grant for purchase and installation of the stations.

More: The Advocate

MAINE

Stakeholders Clash over Proposal to Phase out Financial Incentives for Solar

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LePage

A proposal to phase out financial incentives for homeowners using solar panels caused a clash of viewpoints last week at a hearing before the state’s Public Utilities Commission.

Residents and small-business owners said the proposal — which seeks to grandfather net-metering credits for current solar homeowners for 15 years and gradually reduce benefits for new solar owners over 10 years — would stifle solar energy’s growth and already is reducing the number of installations. Representatives from utilities, government and consumer affairs testified that the current financial incentives for rooftop solar hurt other ratepayers.

Last spring, the Legislature passed a compromise solar bill following a yearlong study and negotiations among stakeholders, but it was two votes shy of overriding a veto by Gov. Paul LePage.

More: Portland Press Herald

NEBRASKA

Lincoln Purchasing Its First Electric Car

lincoln_nebraska_source_google
| Google.com

Lincoln is purchasing its first electric car for about $22,000, along with dual plug-in electric charging stations for privately owned electric vehicles for nine downtown garages. Some of the funds will come from a state grant.

There are currently 67 electric vehicles registered in Lancaster County, but the group that spearheaded the grant hopes the new charging stations will encourage more electric car purchases.

More: The Lincoln Journal Star

NEW YORK

300 Electric Vehicle Charging Stations Coming to Public Locations

NYGovCuomoSourcegov
Cuomo

Gov. Andrew Cuomo announced last week a five-year New York Power Authority contract for the installation of 300 electric vehicle charging stations at public locations across the state.

The agreement supports the governor’s ChargeNY Program, which aims for 3,000 charging stations online in the state by 2018.

It also is an important step in accomplishing the state’s goal to reduce greenhouse gas emissions 40% by 2030 from 1990 levels and ensure 50% of electricity consumed comes from renewable energy sources by 2030.

More: Gov. Andrew Cuomo

NYISO Report Finds Two Localized Transmission Security Reliability Needs

nyisoA new NYISO report found two localized transmission security reliability needs that will begin in 2017 — involving New York State Electric and Gas’ Oakdale 345/115-kV transformer and Long Island Power Authority’s East Garden City-Valley Stream 138-kV line — that require remedial action soon.

The ISO said in a press release that it will consider transmission plan updates from the transmission owners and then, if necessary, issue a solicitation for market-based and regulated solutions.

NYISO’s 2016 Reliability Needs Assessment report also found that the state’s bulk power system has adequate power generation resources to meet reliability needs for the next decade.

More: NYISO

OHIO

Feds Plans to Auction Gas Lease Rights for Wayne National Forest

wayneThe federal government gave notice last week that it is planning an online auction for Dec. 13 for oil and gas lease rights for Wayne National Forest, which could lead to fracking on public land.

Opponents have 30 days to file a formal protest.

The land is located in the far eastern part of the forest, where there are substantial oil and gas reserves and less opposition to energy drilling.

More: The Columbus Dispatch

OREGON

Commission Recommends Taxpayer-Funded Solar Incentives

oregon_public_utility_commission_logoThe Public Utility Commission voted last week to pass a recommendation to the Legislature that it consider adopting taxpayer-funded incentives for solar energy programs that all residents can benefit from, regardless of their utility provider.

The state already has several taxpayer-funded programs intended to encourage solar energy development, but some of the incentives are scheduled to end soon. There also are a small number of ratepayer-funded programs, for which customers of specific utilities pay.

The commission noted that calculating the benefits and costs of each program is difficult because projects and customers are often eligible for more than one incentive program.

More: Portland Tribune

PENNSYLVANIA

FirstEnergy Rate Case Settlements to Increase Residential Rates

PaPenelec(FirstEnergy)FirstEnergy’s utilities filed distribution rate case settlement agreements with state regulators last week that, if approved, would result in rate increases for residential customers.

Met-Ed customers would see an average increase of 10.7%; Penelec customers 12.8%. Penn Power 10.4%; and West Penn Power 7.2%.

The state Public Utilities Commission is expected to issue final orders on the agreements and new rates on or before Jan. 26, 2017.  Pursuant to the agreement, the utilities would not file for additional distribution base rate increases in the state until January 2019 at the earliest.

More: FirstEnergy

VIRGINIA

Dominion Required to Increase Water Monitoring at Possum Point

dominionvirginia(dominion)As Dominion Resources works to drain and consolidate five coal ash ponds at its Possum Point Power Station in Dumfries, state regulators are demanding that it install nine additional wells on the property and test water samples from monitoring wells on a biweekly basis.

Two of the nine additional wells will be monitoring wells installed near the property’s perimeter and may help detect whether groundwater from Dominion’s coal ash ponds is flowing toward nearby residential wells and contaminating drinking water.

Dominion is hoping to receive a solid waste permit so that it can move all its coal ash into one pond and bury it beneath two feet of soil.

More: Inside NoVa

WEST VIRGINIA

Grassroots Effort Opposes Pipeline Extension in Eastern Panhandle

mountaineergasA grassroots effort is growing against a proposal by Mountaineer Gas Company of West Virginia to extend its natural gas distribution line by 56 miles in the Eastern Panhandle.

If approved by regulators, the pipeline project, slated to begin in 2018, would pass through Berkeley, Jefferson and Morgan counties, using buried lines 6 to 12 inches in diameter.

The state’s Public Service Commission has received 70 letters in opposition, said Russell J. Mokhiber, of Morgan County USA blog, who conducted an opposition meeting last week and distributed fliers saying “just say no to the gas pipeline.”

More: The Journal

WISCONSIN

Judge to Decide Fate of Badger-Coulee Power Line Project

americantransmissioncosourceatcA La Crosse County judge will decide the fate of a 180-mile 345-kV transmission line from the La Crosse to Madison areas.

American Transmission Co. and Xcel Energy developed the Badger-Coulee Transmission Line project in 2010, and the Public Service Commission approved it in 2015.

The Town of Holland maintains that the commission did not legally approve the project — estimated to cost about $580 million — because it did not establish a need for it.

More: Wisconsin Public Radio

Late Changes to MISO Auction Plan Renew Calls for Filing Delay

By Amanda Durish Cook

MISO announced on Friday it had changed four elements of its proposed forward capacity auction, prompting renewed calls from some stakeholders to delay a FERC filing planned for Nov. 1.

RTO officials — who described the changes as a “refinement” to a “limited set of design elements” — insisted the filing will be made as scheduled.

On an Oct. 21 Resource Adequacy Subcommittee conference call, MISO revealed it had adopted the Independent Market Monitor’s suggestion to incorporate a pivotal supplier test in the forward auction for the RTO’s retail-choice regions.

Officials also said they will include a three-year forward peak load contribution calculation and modify the design’s materiality test, congestion calculation and cost allocation.

Pivotal Supplier Test

The pivotal supplier test would allow the Monitor to identify resources inside or outside MISO’s footprint that are large enough to affect market outcomes. Suppliers identified as pivotal would be subject to the RTO’s existing physical and economic withholding provisions.

Dynegy’s Mark Volpe said that while the Monitor “should certainly suggest marketing monitoring measures,” the pivotal supplier test had not been explored in the stakeholder process and was not simply a “tweak.” He asked for a conference call with the Monitor prior to Nov. 1 to discuss the test. MISO staff said that was unlikely to happen.

Congestion Charges

Under other changes, MISO would allocate congestion charges resulting from the clearing of infeasible resources to buyers rather than sellers as originally proposed. Officials said the change was made to avoid discouraging sellers’ participation in the auction and to align the cost allocation with other FERC-approved capacity markets.

The RTO also said it will limit congestion charges in the forward auction to situations in which constraint changes lead to a less than one-day-in-five-years loss-of-load expectation. MISO’s prior draft allowed congestion charges to occur anytime a locational constraint binds and proved more restrictive under the forward auction than the prompt Planning Resource Auction. The change will maintain the relationship between the variable reliability target and the quantity of capacity procured for competitive retail demand, MISO said.

Consumers Energy’s Jeff Beattie noted that MISO’s retail-choice areas are “heavily interconnected” and said he doubted the new cost allocation would ever occur.

miso forward auction peak load contribution
Bladen | © RTO Insider

Jeff Bladen, executive director of MISO market services, agreed that new congestion costs would only occur under “extreme circumstances” when incremental resources are need to step in for megawatts that cannot be delivered.

“In a sense, it’s a replacement charge because the constraints modeled need to be changed,” Bladen said. He said the charge is needed because MISO “can’t guarantee feasibility three years into the future.” He noted that ISO-NE, NYISO and PJM use a similar method.

Peak Load Contribution

The addition of a peak load contribution calculation was intended to “alleviate retail customer risk from their purchase/offer obligations” in the forward auction against any PLC changes that take place in the PRA, MISO said.

Bladen said the PLC provides “equal footing between demand and supply resources that enter into the forward auction.”

Materiality Test

The materiality threshold determines whether local resource zones will be included in the forward auction. It will be used in Michigan and Wisconsin, where the zonal boundaries traverse state lines.

The original proposal would have determined materiality based on the potential impact of competitive retail demand on the systemwide LOLE and could change from year to year.

Under the revision, MISO would determine materiality based on the greater of the LOLE impact and a fixed percentage (0.5%) of the systemwide planning reserve margin requirement.

MISO said the change provides a “reasonable balance” between reliability and certainty.

Filing Delay Sought

Several stakeholders asked for a delay in the filing to better understand the latest changes.

“This congestion charge is just not clear yet,” Indianapolis Power and Light’s Ted Leffler said.

Minnesota Public Utilities Commission staffer Hwikwon Ham said he wasn’t yet comfortable with wording on the Tariff changes.

RASC Chair Gary Mathis said if the subcommittee demanded a filing delay, it would only be taken under advisement by MISO. The next scheduled meeting of the RASC will be held on Nov. 2, a day after MISO’s projected filing date.

Bladen said MISO is “very proud of how the proposal has evolved and the balance it strikes.”

“Thanks for your comments and contributions,” he said.

Company Briefs

Tesla Motors and Panasonic have announced they plan to produce solar modules together if Tesla’s shareholders vote on Nov. 17 to approve a $2.2 billion acquisition of SolarCity.

tesla_visit_3_9267529364The companies have signed a nonbinding letter of intent under which Panasonic would make solar cells and modules at the SolarCity factory in Buffalo, N.Y. Tesla would work out a long-term deal to buy and use those solar panels in a system combining them with its Powerwall and Powerpack battery storage products. That is all contingent, however, on Tesla’s acquisition of SolarCity.

Panasonic is presently spending $1.6 billion so it can produce battery cells that will be used for Tesla’s Model 3 electric car and energy storage products for home and utilities.

More: The Buffalo News

Luminant to Shutter Texas Lignite Coal Mine

Luminant plans to shutter its Oak Hill, Texas, mine, which is one of the four lignite coal mines that feeds its Martin Lake power plant.

The company, which is Texas’ largest power generator, closed three small North Texas mines earlier this year to switch from lignite to Wyoming’s Powder River Basin coal.

Earlier this year, Luminant bought two major gas-fired power plants in northeastern Texas.

More: Fuel Fix

MGE Names Keebler as New CEO and President

Jeffrey Keebler will be taking over as CEO and president of Madison Gas & Electric on March 1, 2017. He will succeed Gary Wolter, who is retiring.

Keebler, who has been with MGE since 1995, presently serves as senior vice president of energy supply and planning.

He holds a bachelor’s degree in finance and economics from the University of Wisconsin-La Crosse and a master’s degree in business administration from the University of Wisconsin-Whitewater.

More: Wisconsin State Journal

Regulators: Empire Can’t Raise Oklahoma Rates without Hearing

State regulators last week rejected a request by Empire District Electric to raise Oklahoma customers’ rates to match those of Empire’s Missouri customers.

The state’s Corporation Commission did not rule out a rate hike, but it said Empire would have to go through a rate change hearing to establish justification.

Empire had asked for a rate increase of up to 45.37% per month per 1,000 kWh.

More: The Miami News-Record

Layoff Plan Set for Fort Calhoun Ahead of Shutdown

The Omaha Public Power District released a plan last week to begin reducing the number of workers at its Fort Calhoun nuclear plant in Blair, Neb., which permanently ceased operations Monday.

As part of the decommissioning, the plant will lay off about 270 workers over the next 20 months in six batches. The first round of cuts — 60 people — is scheduled for Nov. 1, while the second round is set for the first quarter of 2017. Laid off employees will be placed in career transition workshops, OPPD said.

More: The Associated Press

Enbridge Reduces US, Canadian Workforce by 5%

Enbridge announced last week a 5% workforce reduction across the company, amounting to the elimination of 530 jobs in the U.S. and Canada.

The company shed 370 positions in Canada and 160 in the U.S., 45 of which are in Houston.

Enbridge spokesman Michael Barnes said the cutbacks are not related to the company’s plans to purchase Houston-based Spectra Energy in a $28 billion deal expected to close early next year.

More: Houston Chronicle

Minnesota Power Plans Shutdown Of Two Coal-Fired Generators

Minnesota Power announced last week that it will shut down two of its coal-fired generators in Cohasset by the end of 2018 as it transitions to natural gas and renewable resources.

In June, the Minnesota Public Utilities Commission ordered the utility to shut down Boswell Units 1 and 2 by 2022.

The utility has achieved a 25% renewable energy mix, beating the state’s goal of 25% by 2025. It expects to reduce carbon emissions on its system by about 20% by 2020 and 30% by 2025 compared with 2005 levels.

More: Duluth News Tribune

MidAmerican to Reduce Its Reactive Service Rate

FERC last week approved an offer of settlement by MidAmerican Energy in which it agreed to reduce its reactive service rate from $0.18/MWh to $0.14/MWh, effective May 1, 2016. The settlement was uncontested.

More: FERC

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RTOs Brief FERC on Winter Preparations

By Michael Brooks

WASHINGTON — Grid operators assured FERC last week they are confident in their ability to maintain reliability this winter, reporting improvements in gas-electric coordination and monitoring technology.

ISO-NE is making no promises beyond this winter, however, citing concerns over generation retirements and setbacks to efforts to improve New England’s stressed natural gas infrastructure.

It was the second panel on winter preparedness that the commission has convened since the polar vortex of 2014, when frozen coal piles, poorly winterized natural gas plants and other problems idled scores of generators in PJM and the Northeast.

The panel featured the same lineup as last year, except for PJM Vice President of Operations Mike Bryson, who took the place of former COO Mike Kormos, now with Exelon.

After the RTOs’ presentations, FERC staffers also professed confidence in a presentation of their Winter 2016-17 Energy Market Assessment.

The National Oceanic and Atmospheric Administration predicts normal winter temperatures for most of the U.S., with above-average temperatures in Alaska and the South, especially the Southwest, and below-average temperatures in North Dakota, Minnesota and northern Wisconsin. Gas storage is well above annual averages and the mild temperatures should mitigate gas constraints, staff said.

ferc winter gas-electric coordination
| NOAA

Despite the mild forecast and the unusually warm winter of 2015-16, the RTOs assured the commission that they were being proactive.

“We’re giving winter preparedness the same level of enthusiasm and hyper-awareness as we have the last year … so we’re certainly not sound asleep at the wheels at the heel of a mild winter,” said Wes Yeomans, NYISO vice president of operations. “We have a very good memory of very cold and tight conditions.”

Todd Ramey, vice president of system operations and market services for MISO, agreed. The RTO is “not taking our eye off the ball,” he said.

Unique Market Enhancements

Much of the speakers’ presentations covered ground familiar from last year, they admitted, but there have been a few new developments since then.

Both Yeomans and Bryson said their organizations had hired staff from the natural gas industry to support their control rooms in winter gas-electric coordination. Yeomans said the new hires “help us understand the gas commercial dynamics.”

Bryson said the person PJM hired “is very helpful to us, because he speaks gas, and we don’t.”

“It’s amazing because while we knew he was going to be a good hire, he has provided a lot of insight into the way the gas pipelines [and local distribution companies] think and it forces us to rethink our approach in some ways,” Bryson said.

Yeomans also said the Northeast gas pipeline system is displayed on a large video board in the NYISO control room, with pipelines under operational flow orders brightly lit, which he said enhances operators’ awareness. SPP’s Bruce Rew, vice president of operations, also highlighted his control room’s visualization technology, the Macomber Map, which depicts the transmission system geographically with power flows and constraints. (See ERCOT, SPP Collaborate to Improve Visualization Tool.) The map can also overlay weather systems with the grid, keeping operators aware of potentially hazardous conditions.

Ramey devoted much of his presentation to MISO’s new ramping product. The service holds back a portion of rampable capacity from five-minute dispatch to respond to short-term variations in load. (See MISO Seeks to Launch Ramp Product April 1.) “We found that to be a significant enhancement within our market design” and ensures “there is enough ramp on the system to meet future dispatch needs both known and unknown five to 10 minutes in the future,” he said.

ferc winter gas-electric coordination
| FERC

California

The closure of the Aliso Canyon storage facility following a massive gas leak continues to be a concern for California, but both CAISO Executive Director of System Operations Nancy Traweek and FERC staff told commissioners that the reduced gas capacity should not threaten electric reliability in the state.

Traweek said CAISO’s increased coordination with pipeline companies and advanced planning during the summer, when the state’s demand peaks, will mitigate any risks associated with Aliso Canyon.

CAISO has asked the commission to extend for an additional year temporary Tariff changes made in response to the loss of the storage facility. (See related story, FERC OKs Natural Gas Index for CAISO.)

ferc winter gas-electric coordination
| FERC

She also highlighted the expansion of the Energy Imbalance Market. (See related stories, Sacramento Utility to Join EIM; Other BANC Members May Follow.)

“It’s exciting to see that now others in the West are benefiting from energy markets in real time and consolidated dispatch,” Traweek said.

ISO-NE

Peter Brandien, ISO-NE vice president of system operations, said New England would be fine this winter but he was not so sure about future winters.

“We have some units that have indicated they’re going to retire — we have those units this year,” Brandien said. “So this is probably going to be my last best winter.”

When the representatives were asked by Chairman Norman Bay about their overall comfort level going into the winter, all expressed optimism except Brandien, who did not directly answer the question. Instead he talked about the importance of Spectra Energy’s Algonquin Incremental Market pipeline and the region’s dependence on LNG imports.

Commissioner Cheryl LaFleur noticed this, asking how quickly the RTO can get an LNG delivery in the event of an emergency, such as the loss of a pipeline or nuclear plant.

Brandien said that although New England has had sufficient LNG supplies in prior winters, there is no guarantee that it will receive the same amount this year. The region is supplied by three primary facilities: the Everett Marine Terminal in Everett, Mass., Canaport in New Brunswick and the Northeast Gateway off the coast of Boston. LNG ships may dock at the facilities for days without offloading their cargo if they find a better price elsewhere, Brandien said.

LaFleur also asked whether the RTO was preparing for the coming generator retirements.

“I wish I had a good answer that gave me comfort, that as the non-gas resources retire that I had some sort of magic bullet,” Brandien replied. “The region doesn’t seem to be motivated to go down the path to expand the gas infrastructure. They want to invest in different things, [such as] solar, offshore wind, onshore wind [and] energy efficiency.”

‘Cautiously Optimistic’

“The outlook for winter is cautiously optimistic, with markets well supplied for the coming season,” FERC staff told the commission. “Staff will continue to monitor developments within the electric and natural gas markets, with particular attention paid to the issues at Aliso Canyon and in the Northeast.”

Bay praised the efforts of the RTOs. “I think this is another example of the benefits to consumers living in a region served by an RTO/ISO,” he said.

When asked whether presentations by the RTOs on winter preparations would continue every year, Bay said he found them “very informative and very helpful, and it’s so helpful to hear about the different things the RTOs/ISOs are doing to help prepare for winter …”

“Significant progress has been made [since the polar vortex], but there’s always more work to be done,” he said.

CAISO Planners Looking Ahead to Summer 2017 Solar Eclipse

By Robert Mullin

CAISO is seeking stakeholder input on how to respond to a solar eclipse that will significantly curtail output from California’s growing solar generation portfolio next August.

“It will not be a total eclipse [in California], but it will affect what solar production we have in California,” Jim Blatchford, an ISO senior advisor for short-term forecasting, said during a Oct. 20 call to discuss the issue.

The state will begin experiencing the effects of the Aug. 21, 2017, eclipse at about 9 a.m. PT, just as solar output is ramping up to its mid-day peak.

CAISO expects output to drop at an average rate of 46 MW/minute, from 6,603 MW to 2,828 MW at 10:22 a.m., when the eclipse reaches its totality.

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During next summer’s eclipse, solar output in CAISO’s balancing area is expected to decline from 6,603 MW to 2,828 MW in fewer than 90 minutes, followed by an even sharper upward ramp as sunshine reemerges. | CAISO

“This is just for large-scale utility solar — not behind-the-meter,” Amber Motley, manager of short-term forecasting at the ISO, pointed out.

By that time, the sun will be completely obscured south of Portland, Ore., while California’s San Juaquin and Coachella valleys — both key solar producing regions — will see coverage of around 76% and 62%, respectively. Utility-scale solar output is forecast to be about 5,050 MW below what it would otherwise be without the eclipse.

The loss of output will require steady ramping from other generation sources to cover the 3,775-MW difference between the 9 a.m. peak and the 10:22 a.m. trough.

As the eclipse begins to pass, solar output is projected to increase at a rate of 56 MW/minute until noon — nearly four times the norm for that time of day. That will require a sharp downward ramp of other resources.

Motley noted that the ISO has not calculated the eclipse’s effect on California’s rooftop solar — currently estimated to be at about 5,000 MW — but expects that variable will be factored into the load rather than generation forecast.

CAISO must also focus on the impact of the eclipse on the Western Energy Imbalance Market. Arizona Public Service, NV Energy and PacifiCorp have a combined 3,270 MW in utility-scale solar and 816 MW in rooftop installations.

Arizona and Nevada will not be as affected as PacifiCorp’s sprawling territory, Blatchford noted. Utah alone will experience a 70% reduction in radiance.

The ISO is looking for advice from European electricity planners, who experienced a similar event last year. The planners increased reserves, made strategic use of pumped storage, limited planned outages and reduced DC line capacities between different regions. Germany procured twice its normal level of regulation reserves, while Italy curtailed PV production ahead of the eclipse.

“They were going to lose 90 GW, so they had a lot riding on this,” Blatchford said. “They did a very good job there, I thought.”

In light of Europe’s success, CAISO is hoping to develop a plan that encompasses the West at large. The effort would take up several possible mitigation measures, including cooperation with the Western Electricity Coordinating Council, gas-electric coordination, use of flexible ramping and hydroelectric resources, EIM transfer capability, reserve procurement and development of special operating procedures for the event.

“I think we have a lot of market products that we can use … and help with the coordination of this event,” Motley said.

Stakeholders are asked to provide feedback on potential measures by Nov. 3. The ISO expects to develop an eclipse mitigation procedure early next year, with publication of a final plan targeted for March.

“This is a unique event that we don’t get to deal with on a day-to-day basis,” Motley said.

Judge Rules for ATC in Wildlife Hospital’s Tree-Cutting Case

By Amanda Durish Cook

A Wisconsin wildlife hospital and refuge lost its case against American Transmission Co., as a judge decided that the company has the right to remove trees from the sanctuary’s property.

Walworth County Judge Daniel Johnson ruled against Fellow Mortals Wildlife Hospital in Lake Geneva, Wis., following a four-day trial. Johnson ruled that ATC had the right to cut any trees in the 50-foot easement that in the company’s “reasonable opinion” could pose a threat to its 138-kV line in the future.

“So if the tree can grow tall enough that it reaches the lines even 50 years from now, it could come down,” said attorney Robert Kennedy, who represented the hospital.

Kennedy said this likely means the end for the sanctuary’s “Grandfather Spruce,” an estimated 100-year-old Norway spruce, that had only been periodically trimmed since the easement was granted. (See Wildlife Refuge Preps for Trial Against ATC Clear-Cut.)

But ATC spokeswoman Jackie Olson said the company has not yet formulated a tree-cutting plan for Fellow Mortals. “We respect the care and commitment that Fellow Mortals has for rehabilitating wildlife. Our team is working to plan our next steps,” she said.

No Precedent

At issue was a 1970 easement between the hospital’s previous property owner and ATC’s predecessor, Wisconsin Power and Light. Until recently, the transmission company had allowed periodic trimming of Grandfather Spruce and other trees.

The hospital filed suit after receiving notice that ATC planned to clear-cut the 50-foot easement, which Fellow Mortals said would remove screening that protects its animals from a nearby roadway.

Johnson said he regretted there would be an impact on the sanctuary, but he concluded that the issue was one of “cold, hard real estate,” Kennedy recounted.

Kennedy, however, said Johnson’s ruling would not set a precedent unless the case reached the appellate level.

“It’s possible that other courts at a trial level might rule differently,” he said, noting that many older aging easements bear language similar to the one currently held on Fellow Mortals. “It appears that ATC recognized back in the early 2000s that the easement language was ambiguous and they stopped using that wording. All of the newer easement language is refined,” Kennedy said.

“Easements like this literally allow power companies to destroy large swaths of natural forest,” Kennedy added. “When you consider how many thousand miles of line ATC has and the acreage it covers, that’s a vast amount of natural timber that’s going down. Legislators should have looked at that and done something to protect the natural growth.”

Hospital Prepares for Cutting

In response to the Oct. 13 ruling, Fellow Mortals founders Yvonne Wallace Blane and Steven Blane are working with their staff to move as many animals into the hospital as they can to shield them from the tree-cutting. “We have an order of priorities. I assume they’re able to start cutting at any time,” Yvonne Blane said.

Blane said Johnson visited the habitat and praised the hospital’s work.

“I think the judge didn’t have a choice,” Blane said. “What was worked out [in the 1970 easement] is ambiguous. No one is arguing that line areas [don’t] need to be safe and maintained. But after 46 years of trimming, it’s a change in policy that this company is making.”

Blane said the animal relocation includes capturing 39 birds that are permanent residents of the hospital’s sanctuary area, including a 36-year-old great horned owl that serves as a foster parent to other orphaned owls. She also said her staff is working to release any treated animals that are ready to re-enter the wild. But she said there’s not much she can do for four elderly deer that have been affected by chronic wasting disease and are permanent residents of the hospital; they will have to weather the cutting in a half-acre pen.

Blane said she was proud that the case did not provoke animosity. “ATC attorneys and staff were very respectful. Our issue is not with the people; it’s with the policy,” Blane said.

She said she does not rule out the possibility that the company might return to the occasional trimming schedules, leaving the trees standing. “Perhaps knowing that they can do whatever they want, someone with the ability to be harsh would be kind. They might not care about public opinion, but boy, that would make so many people happy.”

Hospital’s Work Continues

Blane said Fellow Mortals spent $40,000 in donations on the case and was not looking to appeal the decision. She said moving the hospital is impractical because it would cost millions. So the Blanes and their staff plan to continue their work from the current location.

“We have to adjust; we have to move on. We’re not going to let us make this bitter; we’re not going to stamp our feet here. We’re going to show some dignity. One defeat doesn’t ruin everything.”

On Oct. 12, after the third day of the trial, the hospital was called to rescue an immature red-tailed hawk that had gotten caught on an Alliant Energy power line. The bird, which was suffering from hypothermia and shock, had exposed leg muscle from struggling against the pole. Blane said the bird will be in the hospital’s care while the leg heals, perhaps over the winter.

Sacramento Utility to Join EIM; Other BANC Members May Follow

By Robert Mullin

The Sacramento Municipal Utility District (SMUD) announced on Friday it will begin negotiations with CAISO to join the Western Energy Imbalance Market, and other members of the Balancing Authority of Northern California (BANC) may follow.

BANC said a cost-benefit analysis with the Western Area Power Administration’s Sierra-Nevada Region (WAPA-SNR) determined that some of its six members would benefit from joining the EIM.

“We also view the EIM as a tool to help us integrate increasing penetrations of variable renewable energy resources in the future,” Jim Shetler, BANC’s general manager, said in a statement.

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Completed in 2012, the Sacramento Municipal Utility District’s Solano Wind Farm has 230 MW of capacity. | Sacramento Municipal Utility District

The joint powers agency said it will seek an arrangement allowing it to phase in members who want to join the EIM. Any agreement must recognize “the unique situation faced by the BANC members as public power entities and their existing arrangements,” the agency said.

SMUD would be the first BANC member to participate. The utility expects $2.8 million in yearly net benefits from transacting in the market — a figure that nets out the estimated $6.7 million in implementation fees and $2.6 million in annual operations costs.

In a presentation to its board of directors last week, SMUD management said EIM participation will improve the region’s renewable integration, potentially reduce reliance on gas-fired generation and provide “many of the benefits of regionalization while preserving [local] control over resources.”

“We view this is an extension of our existing market engagement with the CAISO,” said SMUD CEO Arlen Orchard. “SMUD also believes this further demonstrates our commitment to collaboratively work with California entities to help achieve the state’s energy and environmental goals.”

SMUD operates under an agreement that enables the utility to bid power into CAISO through a single hub in which one proxy price is selected to represent all connection points between the two areas. The ISO entered into a similar agreement with WAPA last year.

“We are extremely pleased to see a major regional public power utility like SMUD step forward to engage in the EIM,” CAISO CEO Steve Berberich said.

In addition to SMUD, BANC’s members are the Modesto Irrigation District, the cities of Redding, Roseville and Shasta Lake, and the Trinity Public Utility District.

The joint powers agency’s footprint extends from Modesto, Calif., to the Oregon border and includes a portion WAPA’s transmission grid and the U.S. Bureau of Reclamation’s hydroelectric resources in California. The agency’s members also control capacity on the California-Oregon Intertie, one of two high-voltage transmission lines linking California with the Pacific Northwest.

sacramento municipal utility district, eim
The footprint of the Balancing Authority of Northern California extends north to south from the Oregon border to Modesto, and east to west from Sacramento to the Sierra Nevada range. | Balancing Authority of Northern California

Founded 70 years ago, SMUD serves 1.4 million people, making it the sixth largest municipally owned utility in the country and the second largest in California, behind the Los Angeles Department of Water and Power.

BANC, which began operations in 2011, is the third largest balancing area in California and the 16th largest of the 38 balancing areas in the Western Electricity Coordination Council. Created as an alternative to CAISO, BANC is responsible for balancing load among its members, as well as coordinating system operations with neighboring balancing areas. BANC contracts with SMUD to perform day-to-day balancing functions.

BANC’s announcement came three days after Mexico’s grid operator said it will explore EIM participation for Baja California Norte, a region already interconnected with CAISO. (See Mexico Grid Operator to Explore Participation in EIM.)

The current EIM members are Arizona Public Service, NV Energy, PacifiCorp and Puget Sound Energy. (See Arizona Public Service, Puget Sound Energy Begin Trading in EIM.) Portland General Electric is slated to join the market in October 2017, followed by Idaho Power in April 2018.

More Work Needed on Western RTO Proposal, Stakeholders Say

By Robert Mullin

CAISO’s latest draft of governing principles for a Western RTO is an improvement, but more changes are needed to win approval from regulators in the states in which PacifiCorp operates, speakers at a California Energy Commission (CEC) governance workshop said Monday.

caiso western rto
Edmonds | Linkedin

“Our states are very sensitive to the perception that California can swing a veto,” PacifiCorp Transmission general counsel Sara Edmonds said.

Edmonds was referring to a provision that would institute load-weighted voting on the proposed Western States Committee (WSC) — the body comprising representatives from states considering participating in a future RTO. (See Latest Proposal Fills Out Western RTO Governance Plan.)

Veto Rights

As currently conceived, the voting rule — which requires any initiative be approved by 75% of voting members representing 75% of load — would not only prevent California from ramming through favored policies, but also permit that state to singlehandedly block any measures with which it disagrees.

“Ultimately, why we came to this [voting model] is that it gives some power to the weight of load, but gives all parties the ability to block a vote,” said Stacey Crowley, vice president of regional and federal affairs at CAISO. “It really does drive consensus.”

“I also understand that [weighted voting] is very important to California,” Edmonds said, noting that her company will seek to obtain feedback from state utility commissions on the issue.

caiso western rto
Gardner | Western Resource Advocates

“I can tell you that a weighted voting model that gives California veto power will be problematic,” said Jennifer Gardner, an attorney for Western Resource Advocates (WRA), a Colorado-based environmental group that supports the ISO’s bid to regionalize the Western grid. (See Q&A: Western Resource Advocates Sees Benefits from Western RTO.)

In an alternative voting proposal submitted to the CEC last month, WRA pointed out that California would represent 76% of the load in an expanded ISO in which PacifiCorp was the only service area outside the current footprint. Including Arizona Public Service and NV Energy would still leave California with a 61% share, which would fall to a slim majority of 52% with the addition of Portland General Electric, Puget Sound Energy and Idaho Power.

Tiered Voting

WRA’s proposal: a tiered voting process in which every state would hold one vote under most circumstances and the WSC would attempt to work toward consensus. For issues where consensus voting might be difficult, other rules would apply, such as majority voting for day-to-day decisions and two-thirds majority voting for amending bylaws.

Load-weighted voting could apply for decisions related to the WSC’s areas of “primary authority” — tariff revisions that currently fall under the remit of state regulators. The weighting would be simplified so that any state with more than a 50% of the RTO’s load would wield two votes, while all others would get one. Gardner noted that the New England States Committee on Electricity follows a similar practice.

“What’s really important with that group is that they achieve all of their decisions based on consensus,” Gardner said. “If not, they revert to voting based on load.”

caiso western rto
Florio | Linkedin

The California Public Utilities Commission’s Mike Florio said he was “taken aback” by the WSC’s limited role in the initial development of the resource adequacy and transmission access charge rules for an RTO.

“I think the counting rules [for resource adequacy] should be uniform for all the states,” Florio said. “That’s why it’s something that should fall to the Western States Committee.”

The ISO has played its strongest role with local resource adequacy, but the process is still in play for flexible capacity, Florio said.

“There is a significant role for the states there that hasn’t been outlined to date,” he added. “I’d think the states would want to have some kind of backstop role.”

Clarity on Roles

“I think we need to get much more clear on the very specific roles between the ISO board and the WSC — and versus the WSC,” said Dede Hapner, vice president of FERC and ISO relations with Pacific Gas and Electric.

caiso western rto
Hapner | University of Michigan

Hapner said the most recent governance proposal provided a larger role for the WSC than the previous version and that industry participants must think about areas where the committee could trump the board.

“How much will be acceptable to the FERC?” she asked.

Hapner also advocated for the creation of a “transitional” WSC to begin quickly addressing issues of concern to participating states.

Concurring with that view was Rachel Gold of the Large-Scale Solar Association.

“Seating the WSC earlier — even in informal fashion — will be important to getting to ‘yes’ here,” she said.

caiso western rto
Gendron | BPA

Other Western states would likely want to weigh in on rules around resource adequacy and greenhouse gas accounting, Gold noted.

Mark Gendron, vice president of power services at the Bonneville Power Administration, had a similar take. While his agency was pleased with the proposal’s attention to complex technical issues such as resource adequacy, it thinks it will take time to work through those matters.

“We’re concerned that some of the decisions on some of these technical issues could be made prior to the [seating of the] new board and Western States Committee,” Gendron said.

Potential Shortcoming

caiso western rto
Cromwell | Linkedin

Robert Cromwell, director of power contracts and resource acquisition at Seattle City Light, pointed out a potential shortcoming in the ISO’s decision to make the WSC a body of general state representatives rather than regulators: Utility commissions might still have to weigh in on whether they could fulfill a WSC decision based on their own state laws.

The panelists found some positives in the latest proposal as well.

“We have repeatedly requested that consumer and environmental advocates be separated [in the Transitional Committee guiding development of the RTO],” Gardner said. “We appreciate CAISO taking our concerns.”

PacifiCorp’s Edmonds supported the proposal’s creation of a Nominating Committee and Approval Committee to select members of the final RTO board — the latter of which would comprise WSC members.

“The current revised proposal appears to shift more responsibilities to states, and I know our states are looking at this,” Edmonds said.

Edmonds also noted that the fleshed-out proposal deferred fewer governance design details to the Transitional Committee, calling that a “good thing.”

Florio and Gendron both complimented the proposal for emphasizing that the WSC should be a collaborative body.

caiso western rto
Weisenmiller | CPUC

“I think the emphasis on a collaborative, consensus-based process is appropriate,” Florio said.

Hapner supported the proposal’s shorter transition to seating a final board and agreed with the redistribution of sector representation on the Transitional Committee, which folded generators and marketers into the independent power producers sector and created an exclusive grouping for end-use consumer advocates.

“The consensus seems to be that we’re making progress, but there’s still a lot of work to be done,” concluded CEC Chair Robert Weisenmiller.

Federal Suit Challenges NY Nuclear Subsidies

By Ted Caddell and William Opalka

Despite its best efforts to avoid litigation, the New York Public Service Commission saw its Clean Energy Standard challenged in federal court Wednesday by a group of energy companies and trade groups calling the rule’s subsidies to several nuclear power plants unconstitutional.

The suit, filed in U.S. District Court for the Southern District of New York in Manhattan, claims the zero-emission credits (ZECs) intrude on FERC’s jurisdiction over interstate electricity transactions, asking the court to find them invalid and order the PSC to withdraw them from the CES.

The ZECs are “purely protectionist in nature, enacted for political reasons to save jobs at the subsidized generators and the property tax revenues there from,” said the plaintiffs, which include Dynegy, Eastern Generation, NRG Energy and the Electric Power Supply Association.

The CES, adopted by the PSC in August, mandated that New York obtain 50% of its power from renewable resources by 2030. The ZECs were seen as a way to keep the state’s nuclear plants operating while utility-scale renewables are built. The 12-year subsidies would help keep open Exelon’s R.E. Ginna and Nine Mile Point and Entergy’s James A. FitzPatrick plant, the sale of which to Exelon is pending regulatory approval.

new york nuclear power
Nine Mile Point | Constellation Energy Nuclear Group

When it issued its order, the PSC said it had revised it in a way that it believed would avoid legal issues that caused the U.S. Supreme Court to void a contract between Maryland and Competitive Power Ventures in Hughes v. Talen. (See NY Attempts to Thread Legal Needle with Clean Energy Standards, Nuke Incentives.) The court found the contract unconstitutional, as it was tied to prices in PJM’s capacity market, over which FERC has jurisdiction. The PSC instead tied the price of its ZECs to EPA’s social cost of carbon and the price of carbon allowances in the Regional Greenhouse Gas Initiative.

The plaintiffs, however, said the ZECs were still tethered to FERC-regulated wholesale energy prices and thus unconstitutional.

“Apparently recognizing that its original proposal was plainly unconstitutional under Hughes, the PSC staff hastily revised its recommendation in July 2016 and changed the formula for determining the amount of ZEC subsidies,” they said. “Although the new formula was ostensibly based upon a federal interagency working group’s ‘social cost of carbon,’ this was window dressing, changing the name but not the intent to replace the FERC-determined energy price with a state-determined energy price.”

The plaintiffs argued that the subsidies disadvantage out-of-state generators who participate in NYISO’s markets.

“The ZEC order is directly discriminatory, as only specified New York nuclear facilities are eligible to receive ZECs,” they said. “Although states have the right to regulate the retail sale of electricity within their own borders, the wholesale sale of electricity involves interstate commerce, which the state may not regulate. NYISO’s wholesale marketers are interstate and international in nature, as they involve the sale and transmission of energy and capacity from generators located in other states and in Canada, and the purchase of such commodities by customers in other states.”

They also claimed that the ZECs could inhibit competition because they “would cause more efficient interstate generators to leave the market and discourage the entry of new competitors.”

Proponents of the CES were quick to denounce the suit.

“This lawsuit, filed by gas, oil and coal generators, is blatantly putting specific business interests ahead of what is best for New York,” said Gary Toth, vice chair of the County of Oswego Industrial Development Agency.

“Today’s lawsuit … is wholly inconsistent with the values of the countless New Yorkers who want to achieve a clean energy future,” said Ted Skerpon, chairman of the IBEW Utility Labor Council of New York.

“The bottom line here is that eliminating the nuclear provision from the CES will cause electricity prices to spike and will put thousands of New Yorkers out of work,” said Gregory Lancette, president of the Central-Northern New York Building and Construction Trades Council.

“Ultimately, if upstate nuclear plants close, it is the generation facilities that burn coal, oil, and gas that will benefit from the electricity price spikes that would result,” said Dave Young, president of the Rochester Building & Construction Trades Council.

Downstate Legislators Blast ZECs Again

On Monday, a group of New York City-area legislators again blasted the ZECs in a second letter sent to the PSC.

The legislators, now numbering seven, also said the PSC’s response to their first letter mischaracterized their opposition. (See New York Legislators Question Nuclear Subsidy.) They said they support the standard’s renewables goal but contend that the $965 million ratepayers will spend on the subsidies over the first two years of the program will be disproportionately borne by downstate ratepayers. They again called for the cost review of the power plants’ operating costs to be made public.

new york nuclear power
Audrey Zibelman, NY PSC Chair © RTO Insider

“The commission has kept the cost review concealed from the public, presumably on the grounds that the costs of the nuclear plants are trade secrets, but the commission in its order acknowledged there was little competition involved,” the letter states. “Upon sale of the FitzPatrick plant, Exelon/Constellation will become nearly the exclusive owner. Accordingly, there is no justification for withholding this information on the basis that the costs are protected trade secrets.”

The PSC responded to the first letter by saying the benefits of low emissions are shared statewide. It also has said the move toward a low-carbon energy portfolio would suffer if the nuclear plants retired prematurely.

UPDATED: PJM to Seek FERC OK for Seasonal Capacity Proposal

By Rich Heidorn Jr. and Rory D. Sweeney

pjm ferc seasonal capacity
Adam Keech, PJM | © RTO Insider

COLUMBUS, Ohio – PJM officials said Wednesday they will seek FERC approval of the RTO’s seasonal capacity proposal despite a lack of stakeholder consensus.

The proposal, which would relax the current prohibition on seasonal resources aggregating across locational deliverability areas, received less than one-third support in a Seasonal Capacity Resources Senior Task Force poll last month. (See No Consensus Among PJM Stakeholders on Seasonal Resources.)

Adam Keech, executive director of PJM market operations, told the annual meeting of the Organization of PJM States Inc. that the PJM Board of Managers had approved making a FERC filing in November.

In addition to what Keech called PJM’s “facilitated aggregation” proposal — which is intended to improve the ability of intermittent resources and demand response to participate in the capacity auction — the RTO also will consider changes in load forecasting and incorporating summer DR’s curtailment capabilities after the auction, Keech said.

“We’re looking for other ways to value seasonal resources” in addition to changes in capacity rules, Keech said. “We recognize there’s more work to be done in this area.”

Keech said PJM’s proposal is a response to complaints that the aggregation options offered to seasonal resources under Capacity Performance rules are unworkable because of the difficulty summer and winter resources had in “finding one another” and reaching commercial agreements.

Under the proposal, PJM would match summer and winter resources, eliminating the need for commercial ties between them. Summer and winter resources would have separate six-month obligations and would not be liable for another resource’s nonperformance.

The RTO’s proposal also would allow resources to aggregate beyond LDA borders, with unmatched resources moving up to the next LDA level until a match is found. For example, an offer containing individual resources located in the EMAAC LDA and SWMAAC LDA would be modeled in the MAAC LDA. An offer with resources in COMED and EMAAC would be modeled in the “Rest of RTO.” Performance penalties would be distributed evenly between the resources, no matter which failed to perform.

Measurement Rules, Injection Rights, Load Forecasting

Keech said PJM also will propose a change in how it measures winter DR, returning to the former firm service level (FSL) calculation “that is more conducive for demand response capability for industrial resources.”

pjm ferc seasonal capacity
Susan Bruce, McNees Wallace & Nurick | © RTO Insider

PJM also plans to propose that wind be able to obtain higher winter capacity injection rights, in recognition that wind farms, which are rated at a 13% capacity factor in the summer, can produce 40% of their nameplate capacity in the winter. Hydro resources “potentially” could receive higher winter injection rights as well, Keech said.

Another initiative will seek ways to better incorporate DR into load forecasts, which would reduce costs by reducing the amount of capacity procured. PJM’s current method requires load reductions to be repeated for 15 years before they are reflected in the load forecast, Keech said. “There’s probably some room to improve in that area,” he said.

In addition, PJM is considering registering summer load curtailment capabilities after the capacity auction, which he said will borrow from its former interruptible load for reliability (ILR) program and “operational attributes” concept.

“We realize the operational flexibility value to that,” Keech said, adding “the details remain to be ironed out.”

Mixed Reception

The announcement of PJM’s plans got a mixed reception from other speakers at the OPSI meeting.

John Farber, an analyst with the Delaware Public Service Commission, called PJM’s choice “disappointing.”

Susan Bruce, counsel for the PJM Industrial Customer Coalition, said the group supports PJM’s filing. “We think it will help with the next auction,” she said. “It’s not a silver bullet though.”

Katie Guerry, of DR aggregator EnerNOC, made a pitch for her company’s proposal, which combined PJM’s plan with a “balancing ratio” that changes how DR is valued. It won support from one-third of the task force. Keech said PJM is discussing whether to apply the balancing ratio — currently used only for generation — to other resources.

pjm ferc seasonal capacity
James Wilson, Wilson Energy Economics | © RTO Insider

James Wilson, a consultant for state consumer advocates, said PJM’s proposal falls short of his winter performance equivalents plan, which would auction “WIPES” credits that allow capacity resources to not perform in the winter. Opposed by PJM, Wilson’s proposal was supported by less than a quarter of task force members.

Wilson said the 2014 polar vortex was “a real wake-up call on the value of winter capacity” and said the CP rules properly created much stronger incentives for performance.

But he said CP went in the “wrong direction” in not recognizing the seasonal nature of both capacity resources and PJM’s peak loads. PJM’s projected 2020 summer peak load is 20,000 MW greater than its winter peak in a 50/50 forecast — with the difference rising to 26,000 MW in a 90/10 forecast.

“PJM’s reliability studies have always suggested that all of the outage risk is really in the summer, not in the winter,” he said.

Wilson said his “simple simulation” found that a “full seasonal” approach would save ratepayers about $1 billion annually by procuring 20,000 MW less in winter and accommodating more participation by seasonal resources — solar, wind and DR.

He said separate summer and winter price signals “would be potentially very helpful” for both renewable developers and gas-fired generators weighing the cost of obtaining firm gas supplies in winter.

Wilson praised PJM’s efforts to revise its load forecasts to recognize increasing energy efficiency. The changes reduced the forecast peak for the 2019/20 Base Residual Auction by 5,660 MW (-3.5%). (See Changes to PJM Load Forecast Cuts Benchmark Peaks.)

“But it’s too soon to … conclude that we’ve solved the over-forecasting problem,” Wilson said.

No Consensus in Task Force

The task force polled members last month on five proposed rule changes, with the most popular proposal — retaining the base capacity product for an additional year, delivery year 2020/21 — claiming 43% support. Only 48% of members who voted favored any change, while 52% chose the status quo.

Bruce Campbell of energy management company CPower said “a handful of large entities” can skew the voting in lower committees not subject to sector-weighted voting because they have multiple business units represented with stakeholder votes. “It’s my opinion that that probably has happened in this case,” he said.