California Community Choice Association
Submitted 09/08/2021, 02:12 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
California Community Choice Association (CalCCA) appreciates the opportunity to submit comments on the Energy Imbalance Market (EIM) Resource Sufficiency Evaluation (RSE) Enhancements Straw Proposal,[1] and the August 23, 2021 Workshop Presentations/Discussion. CalCCA generally agrees with the California Independent System Operator Corporation’s (CAISO) principles outlined in the Straw Proposal, and believes that the proposed enhancements will improve the accuracy and equitable application of the RSE. These comments are limited to CalCCA’s support of the CAISO’s decision to delay consideration of RSE failure consequences to after the implementation of the enhancements. CalCCA opposes the imposition of any financial consequences or operational consequences beyond the current capping of incremental upward EIM transfers.
[1] EIM Resource Sufficiency Evaluation Enhancements Straw Proposal, Aug. 16, 2021 (Straw Proposal).
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
No comments at this time.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
No comments at this time.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
No comments at this time.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
No comments at this time.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
No comments at this time.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
No comments at this time.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
No comments at this time.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
No comments at this time.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
No comments at this time.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
CalCCA appreciates the CAISO concluding that imposing revised RSE failure consequences at this time is not appropriate given the enhancements being made with this initiative as well as the pricing improvements made in the Market Enhancements for Summer 2021 Initiative. CalCCA also agrees with the CAISO that any changes to the current RSE failure consequences should not be considered until the enhancements in Phase 1 are implemented and data regarding any RSE failures at that time are evaluated. However, during any phase of this initiative, CalCCA opposes any future development of additional consequences (beyond the current capping of incremental upward EIM transfers) for failure of the RSE, including financial penalties or additional operational consequences.
As noted by the CAISO in the Straw Proposal, “[t]he addition of financial consequences for a failure of the EIM’s RSE represents a fundamental change to the existing voluntary nature of EIM Participation.”[1] EIM entities can voluntarily elect to participate in and make supply available to the EIM through the base scheduling process. EIM participants already face existing penalties for non-compliance with responsibilities in the Balancing Area Authority. In addition, the CAISO’s market process clears supply with forecasted demand. To do this resource adequacy resources have a must offer obligation to ensure sufficient offers are made available to the market to meet forecasted demand. Any financial consequences for failure of the RSE could dissuade entities from fully participating in the EIM to avoid the risk of incurring financial penalties. In addition, even if financial penalties are limited to times of stressed grid conditions (as contemplated in the Issue Paper[2]), entities could be dissuaded from participating at a time when transfers are most beneficial.
Operational consequences beyond the current capping of incremental upward EIM transfers to prevent leaning should not be considered. Any such operational consequences could exacerbate reliability challenges if a decrease in the transfer limit occurs when an entity is already experiencing reliability challenges.
CalCCA does not support financial or additional operational consequences for failing the RSE, as such consequences will have adverse impacts on the EIM, a voluntary market, by hindering EIM participation beyond what is necessary to avoid leaning.
[1] Straw Proposal at 21.
[2] EIM Resource Sufficiency Evaluation Enhancements Issue Paper, May 28, 2021 (Issue Paper) at 4.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
No comments at this time.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
No comments at this time.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
No comments at this time.
NV Energy
Submitted 09/08/2021, 01:29 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
NV Energy appreciates the opportunity to provide these additional comments on the resource sufficiency evaluation enhancement straw proposal. NV Energy strongly supports the CAISO’s statement that, “[t]he consequences of resource sufficiency evaluation failures should not cause operational or reliability issues.” To support this vitally important objective, NV Energy believes the resource sufficiency evaluation can be improved:
- By establishing clear targets that the EIM Entity would be informed of in advance with sufficient time to make necessary adjustments, and
- That to the extent supply is available for EIM Transfers, failure should result in a financial consequence, not a limitation on imports.
Currently, 14 EIM Entities and CAISO are participating in the EIM. Four additional entities, Avista, Tucson Electric Power, Tacoma Power, and BPA are slated to join in 2022. Accordingly, the EIM serves the imbalance needs of a significant portion of the Western interconnection. The expansion of the EIM impacts the ability of western Balancing Authorities to use traditional, bilateral means to respond to intra-day and intra-hour events. Moreover, the extreme weather experienced during 2020 and 2021 cannot be viewed as anomalies. These changed circumstances require an immediate reconsideration of the “freeze” on EIM Transfers as it can pose an unnecessary and unwarranted threat to reliability.
NV Energy strongly recommends that for the summer of 2022 and beyond that available EIM supply be made available to Balancing Authorities experiencing operational challenges. There can be scarcity prices tiered to either the amount of the insufficiency or the number of times the resource sufficiency evaluation has been failed, or both.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
The CAISO proposes that the capacity test consider the start-up time when evaluating an offline bid-in resource by considering both (1) the resource’s start-up time, and (2) the hours for which bids for the resource were submitted. A resource would be counted in the upcoming hour’s capacity test even if it had a start-up time longer than the real-time pre-dispatch (RTPD) horizon, but only if there was a bid for the resource for the upcoming hour available to the real-time market when it ran at the time calculated as the beginning of the upcoming hour minus the resource’s start-up time.
NV Energy reiterates the comment that it submitted on July 9th, that it the CAISO should not only be concerned with excluding resources that have minimum run and start times longer than the short-term unit commitment horizon, but also to include all short start units by reviewing use-limited resource opportunity cost adders. NV Energy explained that by limiting the total costs attributed to startup and opportunity costs, NV Energy is restricted in offering in its full portfolio of resources to the EIM market. For example, quick start peaking units would bring significant value in aiding in passing hourly resource sufficiency tests. However, if such units are under strict environmental and/or start up limitations, significant cost adders need to be allowed, beyond those currently available, if such units are to be bid into the market. If the resource sufficiency evaluation is to be a true measure of an EIM Entities available capacity, they should have the ability to offer in their full amount capacity while being able to manage start-up constraints.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
The CAISO proposes to calculate the quantity of any power balance constraint relaxation, if needed, that is present in the market solution. This quantity will then be accounted for in the flexible ramping sufficiency test, for both the upward and downward requirements. This adder to account for power balance constraint relaxation will exclude any operator load adjustments inherent to the market schedule.
NV Energy understands the idea that it may be beneficial to adjust tests so that results make intuitive sense. There are times when an entity may fail the bid range capacity test but pass the flex test. NV Energy would like to understand the mechanics behind the proposal which seemingly makes the flex test more difficult to pass. Instead of matching the flex result to the bid range capacity result (design it so that they both fail) it may be more beneficial to make the bid range capacity result match the flex result (design it so that they both pass). CAISO’s assumption is that the bid range capacity test is more reflective of actual conditions. However, the passed flex tests may be the better metric.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
NV Energy agrees that if the CAISO is not subject to the balancing test, the CAISO should not be allocated any of the penalty revenue.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
NV Energy continues to support the inclusion of an EIM Entity’s demand response program in the resource sufficiency test calculation. In our July 9th comments, NV Energy noted,
Currently, the CAISO does not account for demand response in the short-term load forecast, unless the demand response schedule is greater than five percent of system load. Even without meeting the five percent threshold currently in place, EIM Entities still have significant demand response programs (150-200 MW in NV Energy’s case) yet the hourly load forecast does not account for the load reduction. This has significant impacts on the EIM Entities’ ability to pass hourly sufficiency tests as loads, and thus sufficiency test requirements, are set to higher levels over evening peak periods that are not representative of the effects of demand response.
The CAISO has concerns that there is a potential for fictitious demand adjustments to be made for the purpose of passing the capacity for flexible ramp sufficiency test. The CAISO proposes that each EIM Entity who plans to utilize a demand response program sign an attestation that adjustments made to the demand forecast used by the RSE correspond to expected reductions in demand provided by their programs. NV Energy does not believe any attestation is necessary. Rather the use of demand by all EIM participants, including CAISO will be part of DMM’s monitoring of the resource sufficiency program
In addition, the CAISO requests comments from stakeholders on if a more stringent threshold than the existing 5% is appropriate for the under-scheduling test and if the 150% of the LMP charge that the existing test proposes is sufficient to ensure that adjustments to base schedules to represent expected demand response is not misused. NV Energy does not believe any changes to these tests is warranted without actual evidence of EIM Entities overstating their demand response capabilities.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
The CAISO proposes that CAISO imports that have not accepted their award and submitted a transmission profile e-Tag equal to their hour ahead scheduling process schedule by the forty minutes prior to the operating hour (T-40) deadline, should not be counted as available capacity for the purpose of passing the resource sufficiency evaluation. NV Energy supports this change as it provides better consistency between the scheduling and tagging requirements for EIM Entities to count imports for the resource sufficiency evaluation. The requirement should be reduced to T-30 when the change is implemented this Fall as approved in FERC Docket ER21-955.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
As noted in response to (1), NV Energy no longer believes a limitation or “freeze” on imports is appropriate. With the expansion of the EIM to the vast majority of the Western market, it is increasingly challenging for EIM Entities to resolve intra-day and intra-hour deviations without access to the EIM. In order to address and resolve system emergencies, the EIM should not impose a market rule that would prevent a Balancing Authority from accessing available supply to prevent loss of load, assuming that available supply existed. This supply that would be available above the intertie freeze level would have a scarcity price, but it is better for the EIM to support this form of voluntary transaction and enhance regional reliability. There can be scarcity prices tiered to either the amount of the insufficiency or the number of times the resource sufficiency evaluation has been failed, or both.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
The CAISO agrees that additional data transparency is needed and proposes to provide each balancing authority area’s detailed RSE advisory and binding results for their capacity and flexible ramping tests. The CAISO will provide the following data inputs for each balancing authority area following the capacity and flexible ramping tests results:
- Trade Date
- Resource’s Master File ID
- Mega-watt quantity of capacity available for each hour
- Mega-watt ramping capacity for each hour
- Ramping type
- Test time
- Balancing authority area specific load forecast by hour
- Balancing authority area specific export quantity by hour
- Balancing authority area specific uncertainty requirement by hour
- Balancing authority area specific diversity benefit amount by hour
NV Energy appreciates CAISO’s willingness to store and present this extra information and does believe it would help each entity study their own performance in efforts to continually improve. NV Energy asks the CAISO to identify what data will only be provided to the EIM Entity and what, if any, will be made publicly available.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
As a starting point, the CAISO proposes the following information to be reported on for each EIM participant:
- Unloaded capacity versus EIM transfers during tight system conditions
- Capacity considered as available in the RSE versus what is available in real-time
- Renewable forecast used in the RSE versus renewable forecast used in real-time pre-dispatch
- Load forecast used in the RSE versus load forecast observed in real-time dispatch
The CAISO and DMM seek stakeholder comments on the proposed standard performance reporting metrics and any additional metrics that should be considered.
The additional metrics proposed by CAISO could be beneficial. NV Energy proposes that any metrics be developed with the intent that they are purely for information only for an initial period of time. Until the metrics are reported for a test period NV Energy does not believe they should be used for any performance measurements or consequences.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
The historical net import/export deviation calculates, with a 95% confidence interval, a future projection of intertie deviation between T-40 and T-20 using a retroactive review of deviations from the previous 90-days. This ensures that largest 2.5% of deviations are excluded from the calculation. Consequently, it ensures that the largest magnitude of intertie uncertainty relating to a failure to deliver is not added to the capacity requirement. This equates to 54 hours across the last 90 days. Additionally, the EIM Business Practice Manual (BPM) includes a provision to exclude outlier data from this calculation. NV Energy can support continued use of the 95% confidence interval. It is important to ensure outliers are omitted from the calculation.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
The CAISO agrees with the majority of stakeholders to defer additional policy development on this topic, until after enhancements to the RSE have been completed and implemented. After implementation the CAISO, with stakeholders, will review the performance of the RSE and then determine the appropriate resource sufficiency evaluation consequences.
NV Energy notes there may be a difference between adding a financial penalty as the only consequence of test failure versus the potential for a voluntary choice an EIM Entity makes not to be limited to the intertie freeze consequence but to access the additional supply available through the EIM at a scarcity price. As stated in our July 9th comments, NV Energy continues to support the addition of an optional financial payment. NV Energy believes this important enhancement should be accelerated to be available for the Summer of 2022 as a key tool to better ensure reliability and protect against unnecessary loss of load events. If there is available supply, then it should be a pricing issue and not a physical withholding by means of a market constraint.
The concept of limiting transfers to an entity in need is counter-intuitive to the enhanced reliability the EIM can provide. With BPA, Avista, Tucson, and Tacoma all slated to enter EIM in spring of 2022, it becomes even more critical for entities to have access to this incredibly diverse portfolio of resources during critical times. Now more than ever, the bilateral power market is less liquid as entities shift their excess capacity into the EIM market. Entities should have access to this capacity. This is not to say an entity should have a free pass to enter an hour resource insufficient, if excess transfer capability exists in the market and an entity is in dire need of assistance, a mechanism should exist to facilitate that exchange.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
The CAISO proposes to revisit the need to account for operator load conformance in the RSE during the second phase of this initiative. This will allow the implementation of the flexible ramping product enhancements, which will significantly reduce systemic load forecast adjustments. The recent inclusion of the uncertainty requirement in both the capacity and flexible ramping sufficiency tests also accounts for load forecast error that is addressed by operator load forecast adjustments. During the second phase of this initiative, the CAISO will be able to determine if the remaining load conformance is in excess of the uncertainty requirements which are intended to capture forecast error, and if there is still a need for this to be accounted for in the RSE. NV Energy agrees that it is not necessary to address load conformance issues in the EIM resource sufficiency test at this time.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
NV Energy supports the correction so that the decisional classification recognizes that the initiative would not exist “but for” the EIM and, that under the rules that existed prior to the August 20th change, the EIM Governing Body would have primary decisional authority. As this initiative is clearly related to the EIM Entities in their capacity as participants in the EIM, it will fall under the joint authority model recently adopted by the EIM Governing Body and the CAISO Board of Governors.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
Pacific Gas & Electric
Submitted 09/08/2021, 03:56 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
PG&E appreciates CAISO’s efforts to build confidence in the accuracy of the resource sufficiency evaluation (RSE) tests and provide greater transparency and reporting of RSE performance to market participants. PG&E summarizes its comments and requests to the CAISO as the following:
- Ensure that the effect of excluding more capacity from the RSE calculations does not jeopardize reliability or limit access to emergency supply.
- Quantify the volume of CAISO import awards that may be eliminated from the RSE calculation.
- Evaluate the potential benefits of increased accuracy against increased costs that BAAs may incur in order to pass a more stringent RSE.
- Describe the mechanisms to ensure equitable administration of the RSE in all EIM areas.
- Confirm that CAISO market participants will receive the same quality of information as EIM Entities without divulging market-sensitive information.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
The use of the STUC horizon is more appropriate than a shorter time horizon to accurately measure feasible capacity
PG&E agrees with CAISO’s rationale that the capacity should be physically capable of being available during the hour of evaluation in order to count in the capacity test. PG&E also supports CAISO’s recognition of economically displaced capacity, and that the RSE should not exclude offline capacity that bids in and could have been available if not for the impact of EIM transfers or other commitment decisions in previous intervals.
The straw proposal presents reasonable criteria to determine a resource’s availability in the real-time horizon, including the resource’s start-up time and the hours for which bids were received. The use of STUC (starting at T-270), as opposed to a shorter real-time horizon, is an appropriate time horizon for considering capacity in the RSE. Proposals from EIM stakeholders to use a shorter time horizon than STUC could exclude capacity from some Short Start[1] units from the RSE, even in cases when these units could have been started up in the STUC horizon but were not needed at the time to meet forecasted demand.
STUC is also a proper horizon for evaluating dispatch decisions with cross-temporal aspects such as commitment or Non-Generator Resources (NGR) dispatch. Similarly to commitment decisions, NGR dispatch could possibly be reversed by the FMM or RTD, and/or require “counter-dispatch” (charging to support future discharge), but this should not exclude energy anticipated in the STUC from contributing to the RSE. Excluding capacity from the RSE that could have been available if not for the EIM or other economic decisions could create a false measure of scarcity that undermines the purpose and benefits of the EIM.
Interaction between CAISO’s optimization process and the RSE
It is PG&E’s understanding that the CAISO real-time optimization does not consider the RSE requirements and does not have a specific mechanism to cure deficiencies or ensure RSE success. The lack of such mechanisms seems to put the CAISO BAA at risk of RSE failures more than other EIM BAAs which have functions dedicated to passing the RSE. As a matter of equitability, this is an area where the CAISO BAA lacks the same opportunities as other EIM areas to pass the RSE.
If the CAISO’s market optimization does not consider the RSE requirements or the new rules to exclude temporally constrained resources, the risk of increased RSE failures seems to increase even further. PG&E asks CAISO to consider ways to include new mechanisms to ensure the CAISO BAA has the opportunity to cure a capacity test deficiency the way other BAAs do.
[1] CAISO’s recent tariff revisions define Short Start units as units with “Cycle Time with Zero to 240 minutes” and Long Start units as those with “Cycle Time greater than 240 minutes and Start-Up Time less than or equal to 1080 minutes.” Pg. 7 at http://www.caiso.com/Documents/BusinessRequirementsSpecificationv11-Short-LongStartDefinitions.pdf
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
The quantity of the PBC relaxation adder to the flexible ramping test should be transparent and consistent among all EIM Entities
PG&E understands that the motivation for adjusting the initial reference point of the flexible ramping sufficiency test is to more accurately count available capacity when Power Balance Constraint (PBC) relaxations occur. However, PG&E requests clarifications from CAISO on whether the adder will be (a) the numeric value of the relaxed megawatt amount of the PBC, or (b) the actual megawatts that operators or certain market mechanisms would have secured after identifying the PBC violation. In practice, the two are not always equal in quantity, and it seems appropriate to use the latter. In the CAISO, operators may resort to exceptional dispatch to resolve feasibilities, which is inapplicable to the other EIM entities. PG&E requests that the CAISO (i) confirm that this understanding is correct, and (ii) clarify how to count the actual megawatts secured in other EIM entities. PG&E believes that it is important for CAISO to assure stakeholders that these modifications to the RSE following PBC relaxations are transparent and consistent among all EIM entities.
In addition, PG&E requests clarification from the CAISO whether the adder of PBC relaxation is only applicable to the flexible ramping test and why it is not applied to (or has been included) the capacity test.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
PG&E does not oppose excluding the CAISO BAA from over/under-scheduling revenue allocation from other EIM entities, but believes this issue should be monitored and reported by DMM
Under the straw proposal, CAISO proposes that EIM areas that are not subject to the balancing test should not receive the revenues that can result when other EIM areas fail the balancing test and incur subsequent over/under-scheduling penalties. In effect, the CAISO BAA would be excluded from receiving revenue from over/under-scheduling penalties on the basis that the CAISO BAA is not subject to those penalties. This appears to be a reasonable compromise that PG&E does not oppose at this time.
Although the CAISO BAA is not subject to the balance test, partly because of the differences in its scheduling practices from other EIM areas[1], it should be noted that the CAISO BAA still incurs costs and operates its day-ahead and real-time markets to fulfill the purpose of the balancing test to accurately balance demand and protect against under- or over-scheduling. PG&E believes DMM should monitor and report the allocation of revenue from over/under-scheduling penalties so that this issue can be revisited in the future if needed.
[1] In explaining why this test does not apply to the CAISO BAA, CAISO first notes that the balancing test is based on the base scheduling process, which non-CAISO EIM Entities use but the CAISO BAA does not. Further, CAISO explains that the CAISO’s automated market processes do not give the CAISO the ability to game the market by over- or under-scheduling to take advantage of differences in congestion, obviating the need to apply this test to the CAISO BAA.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
PG&E is open to greater participation of demand response in the RSE, but asks for equitable treatment of DR programs across the EIM footprint
PG&E is open to proposals to allow EIM entities to account for demand response (DR) load reduction in the RSE. The straw proposal introduces a new option for EIM entities to account for DR programs in the RSE by reducing their demand forecast by the amount of expected load reduction. To help disincentivize inaccurate DR counting in the RSE, the CAISO proposes to rely on existing under/overscheduling penalties that apply when the scheduling error exceeds 5% of actual demand.
Common Criteria
The proposal does not contemplate common criteria or requirements among EIM participants to verify and measure DR resources. In the CAISO BAA, there are detailed requirements for resources to register as Proxy Demand Response and Reliability Demand Response Resources to participate in the CAISO’s markets. In keeping with the initiative’s goal of equitable administration of the RSE across the EIM footprint, CAISO should explore whether it is feasible or practical to develop a set of standard criteria for demand response programs to count in RSE calculations
Equal RSE Standards
The proposal does not mention whether the expected CAISO BAA load reduction (associated with the load-modifying / non-load-side DR inside of the CAISO BAA) would also be included in the RSE. Previously the CAISO has expressed hesitancy on relying on this type of DR for reliability processes. However, it may be appropriate to consider including these expected load reductions in the CAISO BAA’s RSE to ensure that all EIM BAAs are treated equally.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
CAISO should quantify the volume of CAISO import awards that may be eliminated from the RSE calculation
To address the potential for overcounting speculative imports in the RSE, the straw proposal suggests that CAISO import schedules that do not submit a e-Tag with a valid transmission profile 40 minutes prior to the hour should not count toward the RSE. Currently, CAISO imports that fail to submit a transmission profile by the T-40 deadline are cancelled and subject to penalties for under/over delivery of their awarded schedule.
PG&E understands that new penalties resulting from the Intertie Deviation Settlement process have reduced the quantity of undelivered imports, but that the CAISO is still analyzing the impact of those changes. To help stakeholders better understand the implications of this proposal, PG&E requests more information about the magnitude of CAISO imports that may be disqualified from the RSE under this proposal.
Cost impact due to additional RSE failures
PG&E is concerned about the increased risk of RSE failures if the new RSE rules exclude a significant amount of CAISO imports and the CAISO BAA does not have an opportunity to cure any deficiencies in the RSE timeframe. RSE failures can increase the cost of supply for CAISO and potentially contribute to reliability challenges. In the absence of more information about the magnitude of the problem, PG&E asks the CAISO to consider how the reduction in the availability of imports counted in the RSE could inflate the real-time prices.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
CAISO should defer consideration of this reform to Phase 2’s review of RSE failure consequences
The straw proposal suggests that EIM transfers should automatically be limited when a BAA is utilizing firm load as reserves. PG&E understands the motivation of this change is to avoid circumstances in which a BAA could erroneously pass the RSE when it is clearly experiencing real-time scarcity and has taken emergency actions to arm load. However, PG&E believes that this change should be addressed in Phase 2 of this initiative dealing with RSE failure consequences, since limiting EIM transfers could impose considerable physical and financial consequences on the CAISO and EIM entities.
PG&E continues to note its concern that abruptly limiting incremental EIM transfers during emergencies could exacerbate emergency conditions by limiting access to needed import supply that may be available. In keeping with CAISO’s principles that consequences of EIM RSE should not harm reliability in any individual BAA,[1] PG&E believes that it is critical to ensure that the EIM failure consequences do not inadvertently or unnecessarily jeopardize reliability during emergency conditions.
PG&E supports continued consideration in this initiative of exploring targeted financial consequences, instead of imposing physical transfer limitations, for failure of the RSE in emergency circumstances, as noted above.
[1] “The consequences of resource sufficiency evaluation failures should not cause operational or reliability issues.” CAISO Straw Proposal, p. 5. http://www.caiso.com/InitiativeDocuments/StrawProposal-EIMResourceSufficiencyEvaluationEnhancements.pdf
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
PG&E appreciates and supports CAISO’s effort to provide more granular and detailed metrics to EIM entities about their own RSE performance. PG&E understands that DMM will take over from CAISO regular reporting duties on issues such as RSE failures as well as new metrics on the performance and accuracy of the RSE. For each EIM BAA, CAISO will also provide detailed information on advisory and binding RSE results through CAISO Market Results Interface (CMRI).
In implementing these transparency improvements, CAISO and DMM should continue to protect proprietary and market-sensitive information to prevent any potential for market manipulation. PG&E asks CAISO for clarification and assurance that CAISO market participants such as CAISO LSEs should receive a comparable level and quality of BAA-level information as their counterparts who serve as EIM Entity SCs.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
PG&E supports the straw proposal’s direction for DMM to release after-the-fact metrics to assess RSE accuracy and performance for each EIM BAA.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
PG&E appreciates stakeholders’ discussion of the flaws with the current uncertainty calculation and looks forward to CAISO’s implementation of the new quantile regression methodology. PG&E requests that the CAISO or DMM publish data in the future to demonstrate that the proposed quantile regression method is effective in correcting the flaws in the current method for setting the flexiramp requirement. PG&E agrees with the MSC that until the method for setting the uncertainty requirement is well tested, including the uncertainty requirement in the bid range capacity requirement could result in some number of unintended sufficiency test failures. PG&E believes that the CAISO should retain the ability to switch off the feature of adding uncertainties to the capacity requirements on short notice if needed.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
PG&E supports CAISO’s proposal to defer consideration of failure consequences until after the RSE changes from this and other recent initiatives, including the Summer 2021 Readiness initiative, have been implemented and adequately reviewed.
PG&E would like to reiterate that it is worthwhile to explore whether the failure consequences should be more nuanced and depend on other conditions such as (i) the state of the EIM overall (i.e., is the whole EIM short or just one BAA); (ii) are there economic transfers available; (iii) the magnitude and frequency of failure; etc., as just three examples.
During normal conditions, it appears that the current operational penalties can work against the EIM’s purpose to leverage regional diversity and allow entities to trade residual capacity that is voluntarily offered into the market. DMM has noted that “limiting transfers between balancing areas when an area fails a resource sufficiency test will often decrease the overall efficiency of the EIM market dispatch.” PG&E supports further discussion of how well-designed consequences could deter inappropriate leaning and offer improved market efficiency and reliability benefits to the EIM as opposed to the current penalty.
PG&E would also like to better understand the importance of the current operational penalties in preventing cascading reliability challenges, and whether moving away from operational penalties and toward financial consequences could cause unacceptable reliability challenges. If financial consequences are pursued, PG&E believes they should be targeted, incorporated into the market optimization process, and that the revenue allocation methodology should minimize opportunities for gaming or the incentive to withhold.
When one imagines all the scenarios that might lead to a BAA failure of an RSE, there are large differences in the amount of inappropriate leaning and the effects on the reliability of EIM. Therefore, it is worth exploring how the penalties of failure can be refined to reflect those differences.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
PG&E does not support addressing load conformance adjustments in phase 2 of this initiative
PG&E agrees with CAISO’s concerns with including operator load adjustment issues in the scope of this RSE initiative. PG&E also notes the Market Surveillance Committee’s[1] objection to including this issue in the RSE initiative, stating that including CAISO load conformance adjustments in the RSE would overstate actual load and “cause the CAISO to fail the test when it should not.”
[1] “Load Conformance Adjustments and the Resource Sufficiency Test.” Scott Harvey. Member, California ISO Market Surveillance Committee. August 27, 2021 http://www.caiso.com/Documents/LoadConformanceandResourceSufficiencyTests-Presentation-Aug27_2021.pdf
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
PG&E believes the current classification is consistent with the current governance rules. PG&E requests that CAISO confirm that, upon final implementation of the necessary changes to CAISO governance documents, and consistent with the recent Governance Review Committee Part Two approval, this initiative would be reclassified to the Joint Authority category.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
PacifiCorp
Submitted 09/08/2021, 11:51 am
1.
Please provide a summary of your organization’s comments on the straw proposal:
PacifiCorp appreciates the opportunity to comment on the CAISO’s straw proposal for the EIM resource sufficiency evaluation enhancements. Additionally, PacifiCorp supports the comments made by the EIM Entities and intends these individual comments to be supplemental to the joint EIM Entity comments. Included within these comments, PacifiCorp proposes additional options for CAISO to consider during this stakeholder initiative.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
PacifiCorp proposes that all uncertainty components (Net Scheduled Interchange and Net Load deviations) be included into a single amount of the uncertainty rather than separated out as separate uncertainty components. Additionally, all uncertainty should be removed from the capacity test and moved into the flexible ramping test. It is not necessary to include uncertainty in the capacity test if the totality of uncertainty is captured in the flexible ramping test. These proposed changes would allow the uncertainties to offset when moving in different directions.
Furthermore, PacifiCorp proposes that during flexible ramping test failures the interchange limit should be locked at the greater of the last market interval or the EIM Entity’s capacity that was brought to the market for that interval. This would allow the EIM Entity to import or export up to the amount of capacity that was brought to the market and would still prevent leaning.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
PacifiCorp does not support the CAISO’s proposal to automatically subject an EIM Entity to over and under scheduling penalties anytime a load forecast adjustment is used to reflect demand response. However, PacifiCorp does understand that mitigation measures may need to be in place to prevent issues with the use of this tool. Therefore, PacifiCorp proposes a separate option. PacifiCorp proposes that the penalties remain in effect as they are today with a separate after the fact process that is used anytime a demand response adjustment is made. The after the fact process would assess the balancing test against the demand forecast less the actual demand response. Additionally, it would be more appropriate to enhance/accelerate the formal registration of demand response resources so they would be limited to imbalance penalties and having the deviations placed in the flex ramp sufficiency test.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
Public Generating Pool
Submitted 09/08/2021, 12:25 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
The Public Generating Pool (PGP[1]) appreciates the opportunity to comment on the EIM RSE Enhancements Issue Paper and Workshop. PGP takes great interest in this initiative as there are PGP members who are (or will be) EIM participants that will be directly impacted by the outcome of this initiative. PGP is very supportive of this initiative and looks forward to helping make this effort a success.
PGP is very appreciatitive with the attention CAISO is giving this very important initiative. PGP supports the two-phased approach to this initiative and is generally supportive of the specific improvements included in this straw proposal. However, there are a few questions and areas of concern that will be discussed in the following responses.
[1] PGP represents eleven consumer-owned utilities in Washington and Oregon that own almost 8,000 MW of generation, approximately 7,000 MW of which is hydro and over 97% of which is carbon free. Four of the PGP members operate their own balancing authority areas (BAAs), while the remaining members have service territories within the Bonneville Power Administration’s (BPA) BAA. As a group, PGP members also purchase over 45 percent of BPA’s preference power.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
CAISO indicates in the straw proposal that it agrees with stakeholders that capacity from resources that are unavailable because of start-up or cycling time should not be counted in the capacity test. However, CAISO believes that excluding resources that are unavailable due to market optimization would create adverse market incentives. To strike a balance, CAISO proposes to count offline capacity that has a start-up time no longer than the period of time covered by the short-term unit commitment (STUC) horizon (approximately 4.5 hours) unless this offline capacity was not following a binding market instruction.
PGP agrees with the principle that the RSE should accurately measure the achievable capacity of the BAA, but PGP believes that the straw proposal falls short in this area. CAISO shared an example at the workshop which showed resources whose capacity was counted even though they were offline at the time of the final RSE test and their startup time indicated that they would remain offline during the operating hour, which is counter to the principle of accurate measurement of BAA capacity.
Because this proposal falls short of accurately measuring a BAA’s achievable capacity, PGP believes that an accurate RSE measure of achievable capacity requires the start-up time to be more closely aligned with the RSE time horizon, which would suggest only including offline or derated resources that have two hours or less start-up time. An alternative would be to retain the STUC time horizon, but modify the STUC process to anticipate RSE capacity requirements in future hours to ensure that resources needed for capacity remain online. PGP also requests that CAISO provide an estimate of the amount of generation that would be excluded during tight system conditions by moving from the STUC time horizon to T-2 hours.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
PGP supports CAISO’s proposal to increase the accuracy of the flexible ramping test to account for any quantity of power balance relaxation that may be present in the market solution. PGP agrees that this change will ensure that the reference point in the flexible ramping test has a more accurate ramping requirement due to capacity shortfalls. However, CAISO also indicates that operator load adjustments will be excluded from this adjustment. Given the frequency of operator load adjustments, PGP is concerned about exclusion of these operator actions (see question 12).
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
Many stakeholders, including PGP, have recommended applying the balancing test to CAISO. In the straw proposal, CAISO reaffirms their position to exclude CAISO from the balancing test for the following reasons:
- Inherent difference between CAISO (no base schedules) and EIM Entities (submit base schedules)
- CAISO imbalance is settled relative to day-ahead IFM awards, so there is no ability to “game” the balancing test
- Mechanisms (such as convergence bidding) exist to incent accurate scheduling to the IFM demand forecast.
PGP recognizes the inherent differences and the inability of CAISO to game the balancing test. PGP also agrees that the mechanisms to incent accurate scheduling are effective, but, as seen in August 2020, these mechanisms may not work all of the time. CAISO’s May 28, 2021 issue paper stated that:
…during the Market Enhancements for 2021 Summer Readiness initiative stakeholders questioned whether the financial penalties associated with this test should be applied to the CAISO from an equitability perspective. The concern that raised is that the CAISO’s market process can produce schedules that are not balanced to forecasted demand when the power balance constraint is relaxed due to a lack of supply available to the CAISO.
It is PGP’s understanding that an inability of CAISO to balance forecasted demand due to the lack of supply is effectively no different than an EIM entity submitting schedules that are lower than its forecasted demand. The EIM entity would be exposed to underscheduling penalties, while CAISO, when there is insufficient supply, would not. PGP requests that CAISO confirm or correct PGP’s understanding of this point.
CAISO also indicated that currently all market participants are allocated revenues that are received from penalties associated with the balancing test. In the straw proposal, CAISO is proposing to excluded themselves from receiving these revenues. PGP supports this approach if CAISO is excluded from the balancing test.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
Currently, CAISO only allows demand response (DR) that is greater than 4% of an EIM Entity’s load to be reflected in the capacity test. CAISO’s straw proposal creates two options for capturing DR in the market: 1) DR may be registered as a participating resource and bid into the market, or 2) For entities using CAISO’s forecast, adjust the demand forecast for the amount DR which will be reflected in the RSE tests. PGP supports this proposal.
CAISO also expressed concern about whether the forecast adjusted for DR could be misused as a way to pass the RSE. CAISO proposes requiring an attestation that adjustments based on DR correspond to expected demand reductions and asks stakeholders whether the current imbalance thresholds and penalties should be made more stringent to discourage misuse. PGP supports the proposed attestation requirement, but does not believe that there is enough information to warrant changing the existing balancing test penalty structure for DR demand forecast adjustments at this time. If the concern persists after the proposed DR changes are implemented, more stringent balancing test penalty structure could be a potential consideration for Phase 2.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
CAISO agrees with stakeholders that speculative imports (i.e., imports that do not have a reasonable assurance of being delivered) should not be counted in the capacity test. CAISO proposes to exclude imports that do not have a transmission profile e-tag submitted by T-40. However, CAISO is not proposing that the e-Tag needs to include the energy profile by T-40 since the NERC scheduling deadline is at T-20. CAISO also proposed to reduce the import awards in the Real-Time Pre-Dispatch (RTPD) run at T-52.5 by the amount of imports that have not submitted a transmission profile.
PGP believes that the inclusion of the e-Tag transmission profile at T-40 is a good step forward in identifying and excluding speculative supply from the RSE and supports this proposal. However, it is possible that a speculative import may have energy supply that is less than the transmission profile. PGP would like to see regular reporting of the T-40 transmission profile and T-20 energy profile in order to monitor whether speculative imports are occurring.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
CAISO agrees with stakeholders that a BA should be deemed insufficient when they are in an Energy Emergency Alert (EEA) and is proposing to limit EIM transfers when a BA is in an EEA and when they are arming load to meet reserve requirements. PGP believes that there should not be any requirement for a BA to be arming load to meet reserve requirements in order to limit EIM transfers. PGP supports limiting EIM transfers when an EEA is in effect, irrespective of whether load has been armed for reserves.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
CAISO agrees with stakeholders that additional reporting on the performance of the RSE and supplying market participants with additional data for RSE validation will enhance market participants’ trust in the RSE. CAISO also recognizes the value of using an independent third party to develop metrics and reports related to RSE performance. CAISO proposed to assign the responsibility of reporting and metric development to the Department of Market Monitoring (DMM). CAISO is also proposing to supply all necessary data to the DMM, as well as to the EIM Governing Body Market Expert, once it is established.
CAISO’s straw proposal also includes providing to each market participant additional data that is used in the RSE tests which will allow market participants to validate the data and to spot check their own RSE performance.
PGP supports these proposals.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
In addition to the information and metrics that CAISO is proposing to be reported, PGP would like to include the following:
- Load forecasting adjustments made by CAISO operators including data from 2019-present (per question 12).
- The difference between the e-tag transmission profile at T-40 and the energy profile tagged at T-20 (per question 6)
- As part of the proposed "Capacity considered as available in the RSE versus what is available in real-time", specifically include the amount of generation taken offline by the STUC process that would be unavailable during the operating hour (per question 2).
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
The methodology for developing the uncertainty requirements for variable energy resources and load is being updated in the Flexible Ramping Product Refinements initiative. Because of the timing of this initiative and the RSE Enhancements initiative, CAISO proposes to not develop metrics for the existing methodology. PGP has no objection to this proposal.
CAISO also asks stakeholders to comment on the 95% confidence interval and previous 90 days of data that is used for the uncertainty in net import/export deviation between T-40 and T-20. PGP supports use of the 95% confidence interval, but questions whether looking at the previous 90 days provides relevant data to inform what an appropriate P97.5 import deviation should be. For example, the first high load day of the summer (Jul 15, 2022, for example) will be using lower load data from spring months (Apr 15, 2022 – Jul 14, 2022) which may not have had many import deviations. Ideally, determining a 95% confidence interval should include sufficient data in similar conditions which may require looking back one or more years. For example, to develop uncertainty data for Jul 15, 2022, in addition to the previous 90 days of data, one could also include data from June 1, 2021 to Aug 31, 2021 which may be more representative of summer conditions.
Without seeing the data that CAISO is using for this calculation, it is not possible to know the correct methodology. However, PGP believes that achieving the correct P95% confidence interval requires more data that looking back 90 days. PGP recommends evaluating other ISOs/RTOs practices to see if there are any other techniques to evaluate uncertainty in import/export deviations.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
PGP agrees with CAISO’s proposal to address failure consequences in Phase 2.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
CAISO states in the straw proposal that improvements in market design are the best way to address the need for CAISO operators to address systemic load forecast adjustments and proposes to defer addressing RSE implications to Phase 2 of this initiative. Two in-flight initiatives (day-ahead market enhancements and flexible ramping product) are intended to have features that should reduce the need for operators for make load adjustments. CAISO proposes to revisit this issue in Phase 2 to see if these adjustments are still systemic after implementation of these two in-flight initiatives.
The prevalence of these load adjustments indicates that this issue warrants attention sooner rather than later and should be included in Phase 1 of this initiative. At a minimum, PGP would like CAISO and DMM to provide regular reporting of these load adjustments (as referenced in question 9) to help inform whether RSE consideration of operator load forecast adjustments should be included in Phase 1.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
PGP agrees that it is appropriate for the EIM Governing Body to have primary authority on this initiative.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
Public Power Council
Submitted 09/08/2021, 04:52 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
Supports with caveats
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
PPC is supportive of CAISO adopting modifications to account for intertemporal constraints that effect the ability of resources to be available for dispatch by the market in real-time. We understand the challenges described by the CAISO around the possibility for creating competing incentives if these intertemporal constraints are assessed using a shorter availability horizon as proposed by stakeholders. At the same time, PPC continues to have concerns that using the STUC horizon to assess these intertemporal constraints will not actually reflect the availability of resources to the EIM for the purposes of assessing the balancing test.
If the CAISO implements the improvements to the capacity test as proposed using the STUC horizon as an initial step to improve the capacity test, we request that once this improvement is in place, CAISO or the DMM evaluate the amount of capacity which is being considered “available” for the purposes of the capacity test, but which is not actually available to be dispatched by the EIM. This analysis could help inform our understanding of the magnitude of this inaccuracy, the equity of the application of the capacity test and whether the improvement as proposed by CAISO meets the principles established for the RSE.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
PPC is supportive of the CAISO's proposal to include power balance constraint relaxations in the flexible ramping test. This is an improvement that will increase the equitable application of the RSE among the CAISO BAA and other EIM partcipants.
However, we are concerned that the exclusion of load forecast adjustments from the proposed modifications and from the RSE generally does not fully address potential inequities. The discussion at the MSC provided helpful information around why the CAISO relies on large, systematic amounts of load conformance at this time. As described on the MSC call, the options available to help ensure the RSE is passed, specifically through increasing imports and creating headroom on generators within the BAA, are different for the EIM Entities and the CAISO BAA. Nevertheless, it is not clear to PPC that this leads to a need to exclude load forecast adjustments from the RSE, nor that the exclusion of these adjustments provides a more comparable treatment of the CAISO BAA in the flexible ramping test compared to other EIM Entities. Instead, it draws attention to the use of load conformance to address a broad range of issues in a manner that obscures the specific problems operators are attempting to solve through these forecast adjustments. While there are initiatives underway to address some of these issues and potentially reduce the CAISO’s reliance on load conformance, they would not eliminate our concern with their exclusion from the RSE. We look forward to more discussion on this topic.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
PPC appreciates the explanation provided by CAISO on why the balancing test is currently not applied to the CAISO BAA. We understand there could be potential issues since the CAISO BAA imbalance energy is settled against integrated forward market schedules instead of the real-time demand forecast. However, we continue to be concerned that not applying the balancing test to the CAISO BAA may allow leaning in the EIM. Given the challenges CAISO described with applying the balancing test to the CAISO BAA, we would request that this conversation is revisited in the second phase of the RSE Enhancements initiative and that it be informed by an analysis on the physical capacity in the CAISO BAA that is able to be dispatched in real-time compared to the real-time demand forecast. It will be important that speculative capacity and virtual bids are not included in this analysis. Such an evaluation could better inform stakeholders on whether concerns about potential leaning are valid and allow for exploration of potential solutions given the context and challenges described by the CAISO related to applying the capacity test as it is design today.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
No comments at this time.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
PPC supports the CAISO’s proposed requirements for import schedules to be considered in the RSE. The proposed measures should help reduce the speculative imports included in the RSE.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
PPC supports an automatic failure of the RSE when a BAA is under an energy emergency. As stated during the stakeholder meeting, this is a clear sign that a BAA does not have sufficient resources and should not be passing the RSE.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
PPC supports CAISO’s proposal for DMM to take over regular reporting on the RSE performance. Additionally, we believe that once the EIM Governing Body Expert (GBE) is appointed, it may be appropriate for the GBE to conduct their own analysis on the performance of the RSE. We support the initial reporting metrics proposed by the CAISO and appreciate the effort to create additional transparency for EIM participants and stakeholders. We look forward to additional opportunities to further refine these metrics, if necessary, in the future.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
To the extent that data can be made available publicly (not only to EIM Entities or specific market participants) DMM should do so. We understand there will be limits to this based on market sensitive information.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
No comments at this time. We look forward to additional discussion and analysis on how recent changes may impact the uncertainty calculation.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
PPC supports the proposed scope for phase 2 of this initiative. We understand the potential benefits from improving the accuracy and the transparency of the test first, as well as evaluating the effectiveness of enhancements made as part of the Summer 2021 Readiness initiative before discussing changes to the failure consequence. We continue to believe there is a need to revisit the consequences of failing the RSE and we look forward to a more informed discussion of this matter during phase 2.
In addition to the currently proposed scope, we request that the application of the balancing test to the CAISO BAA be included as part of phase 2 if it is not addressed in Phase 1 (as is currently proposed). As stated above, we understand the complexities of this issue as described by the CAISO but continue to have concerns that not applying the balancing test to the CAISO BAA results in inequitable outcomes. We would appreciate the opportunity to have more discussion on possible solutions, and to have that discussion be informed by additional information as studies are conducted by the DMM after phase 1.
Regarding the timeline for starting Phase 2, PPC proposes to start Phase 2 (specifically regarding changes to the failure consequences) as soon as Phase 1 is concluded (i.e., January 2022), rather than waiting until the Fall of 2022 or later.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
As discussed above, excluding load adjustements in the RSE results may result in inequitible outcomes between the CAISO BAA and other EIM Entities. This is an important issue and PPC supports exploring this issue further as part of Phase 1.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
PPC supports this classification. As described in our previous comments, this issue would not exist but for the EIM and primary authority for the EIM Governing Body on this issue is appropriate.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
PPC appreciates the CAISO’s efforts to work with stakeholders to improve the RSE. We hope that this initiative will be a starting point for continued monitoring and improvement of the RSE and support many of the changes proposed by the CAISO as a solid first step in the process.
Sacramento Municipal Utility District
Submitted 09/08/2021, 04:48 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
The Sacramento Municipal Utility District (SMUD) appreciates the opportunity to provide comments and input on the CAISO’s effort to refine and enhance the EIM’s Resource Sufficiency Evaluation (RSE). SMUD is an active market participant in the CAISO’s Day-Ahead and Real-Time Markets. We are situated in the Balancing Authority of Northern California (BANC) Balancing Authority (BA), which is an EIM Entity and through which SMUD participates in the CAISO’s EIM.
SMUD has a few comments below in response to the “EIM Resource Sufficiency Evaluation Enhancements Straw Proposal,” dated August 16, 2021 (Proposal) and the related workshops on June 25 and 28, 2021.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
No comments at this time.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
No comments at this time.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
It is critical for both the integrity of the EIM and to maintain adequate reliability, that EIM participants show evidence of a balanced system before entering the Real-Time Market. We therefore expect the CAISO BAA to balance in the same way as other EIM participants in Real-Time. We recognize it is possible that after the Day-Ahead Market, unexpected circumstances may arise, such as outages for awarded units, load forecast is off, or operating conditions change which can affect balancing of the CAISO BAA. These circumstances could potentially put the CAISO BAA out of balance by T-40 if there is no effective procedure to verify its system balance. However, if CAISO can demonstrate that such a procedure exists, excluding it from the balancing test would be acceptable.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
SMUD supports the inclusion of broader demand response participation in EIM participant forecasts. Demand response provides valuable additional flexibility to meet the resource sufficiency test. While SMUD considers the proposed attestation approach as one way to ensure that the demand response is not fictitious, we do not believe it is necessary. Such performance can be actively monitored and reported on by the Department of Market Monitoring.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
No comments at this time
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
No comments at this time.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
SMUD agrees with, and supports, the CAISO’s statement that "RSE should accurately and transparently measure the capacity and ramping capability of a BAA." We consider transparency an important attribute (e.g., publish more data, lessons learned, etc.). We believe that the CAISO should prioritize transparency because accuracy can be a moving target and gains in accuracy can be inefficient. For example, the current test rules are already complicated and incremental improvements in accuracy can be costly. Therefore, improvements in transparency will likely have a greater benefit on the market and may actually improve accuracy as well.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
No comments at this time.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
SMUD generally supports the uncertainty calculation proposal and notes that it is important to exclude outlier data, especially forced reliability events or other circumstances outside the reasonable control of the EIM participant. The reason for having an intertie deviation component, in the current design, is to incentivize EIM participants to "do a good job" on intertie scheduling and to deliver the scheduled amount accurately. The more inaccurate an EIM participant’s scheduling and delivery practices are, the more they will tend to carry additional capacity over time to pass the resource sufficiency tests. The key is that EIM participants should be able to control how good/bad they schedule and deliver. However, there are circumstances such as curtailment due to forced transmission outages, or other Force Majeure type events that are unforeseen and outside the control of the participant, that should not be counted towards a participant’s accuracy.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
No comments at this time.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
No comments at this time.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
No comments at this time.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
Regarding the Flexible Ramping Sufficiency Test, there has been little to no discussion of the treatment of Hybrid Resources in charging mode. SMUD requests the CAISO address this issue in future meetings and/or proposal(s).
Salt River Project
Submitted 09/08/2021, 12:20 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
Salt River Project Agricultural Improvement and Power District (SRP) appreciates the CAISO’s efforts to enhance the accuracy and transparency of the EIM Resource Sufficiency Evaluation (RSE) as outlined in the straw proposal. SRP generally supports the CAISO’s proposed phasing for this initiative, which will allow the enhancements made in the first phase to inform development of potential RSE failure consequences. However, SRP requests a near-term solution for load forecast adjustments before phase 2, as described in comment 12.
In addition to these comments, SRP supports the EIM Entities’ joint comments on this straw proposal.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
SRP generally supports the use of the Short-Term Unit Commitment (STUC) horizon data to ensure near real time capacity is accounted for in the Bid Range Capacity Test (BRCT) but suggests the CAISO incorporate visibility of the BRCT performance in real time through the Balancing Authority Area Operations Portal (BAAOP), similar to the Flexible Ramping Sufficiency Test. This will enable operators to take action to improve upon the BRCT.
For purposes of evaluating this proposed enhancement, SRP requests an analysis of how this change would have affected the outcome during the August 2020 heat wave.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
SRP supports the addition of power balance relaxation to the future hour Flex Ramp requirement. SRP understands this can also be treated as a credit to the requirement if the Balancing Authority (BA) had over generation imbalance.
SRP requests further clarification on this issue and any correction to our understanding of this issue.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
No comment at this time.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
SRP appreciates the ability to account for demand response programs through the load adjustment process. SRP seeks more clarification on how this will be implemented in the market solution.
While this will default to failing the balancing test and application of over/under scheduling test penalties, SRP believes that the 5% under scheduling trigger is still relevant. If it is found that after-the-fact that there is a misuse of this ability, SRP could support a tighter trigger than the 5% for under scheduling and an associated increase in penalties.
Regarding over/under scheduling penalties in the Demand Response section, SRP requests the CAISO provide additional clarification on whether the over/under scheduling penalties that will be applied due to not balancing to the CAISO forecast will be voided when the meter data is aligned with load balancing after the fact.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
SRP agrees that only import schedule awards that are backed by e-tags should be included in the capacity test.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
SRP agrees that when an EIM Balancing Authority Area (BAA) is in an energy emergency event where firm load is already called upon to be used as non-spin/spin reserves, the EIM BAA should fail RSE tests and the associated incremental EIM transfer should be locked/frozen during those timeframes to prevent further leaning on the EIM.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
SRP agrees with the EIM Entities that the accuracy and transparency improvements proposed by the CAISO should be implemented without delay.
SRP supports the proposal to provide each BAA with detailed RSE capacity test data in the CAISO Market Results Interface (CMRI). However, because the data available in CMRI can mainly be used for detailed after-the-fact analysis, SRP requests the CAISO also consider providing this data real-time in applications such as BAAOP. This will enable more real-time awareness of the test input and provide information for resource adjustments to improve on test results.
Additionally, SRP requests the CAISO provide BRCT test data detail similar to Flexible Ramping Sufficiency Test data currently available in BAAOP to improve transparency and data availability.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
SRP agrees with the EIM Entities that the Department of Market Monitoring should develop and categorize standardized metrics based on the key objectives of performance and accuracy.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
SRP requests the CAISO exclude any reliability events from the Net Schedule Interchange (NSI) histogram. Events like transmission curtailments for reliability or energy assistance sent to a participant in a reserve sharing group should not harm the BA and result in a requirement to carry more reserves. Each BAA is responsible to carry enough reserves during emergency events when transmission path limits are curtailed leading to e-tag curtailments. These are within hour e-tag curtailments to respond to an event and should be excluded from the uncertainty requirement NSI calculation.
SRP requests the CAISO to review the Flex Ramp Uncertainty requirement calculation. Because of this new requirement added to the Bid Range Capacity Test since June 2021, SRP has observed capacity test failure in hours when this component was a significant contributor to the test results. Without the visibility of the source data that goes into calculating uncertainty, SRP cannot assess whether erroneous data is being included that impacts the uncertainty and test results. Therefore, SRP also requests increased visibility and training on how to access the source data used to calculate uncertainty.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
SRP supports the CAISO’s proposal to address RSE failure consequences in phase 2 of this initiative.
SRP encourages CAISO to begin phase 2 immediately after Phase 1.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
SRP supports the joint EIM Entities’ comments. SRP understands that the CAISO is willing to address the use of load forecast adjustment by its real time operators in phase 2 of this initiative; however, SRP sees the need for a near-term solution that can dampen such practices sooner than phase 2. This was not only an issue during the 2020 heat event, but data shows that it is an on-going practice by CAISO to create headroom on their resources in real time.
SRP requests CAISO to address the load forecast adjustments topic in phase 1.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
SRP agrees that the EIM Governing Body should have primary authority for approval of the EIM RSE Enhancements final proposal.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
No additional comments at this time.
Silicon Valley Power
Submitted 09/08/2021, 04:49 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
Silicon Valley Power supports the CAISO’s efforts to improve transparency and ensure the RS test is consistent with the principles of EIM. The focus on improving resource commitment and dispatch processes in this initiative along with other correlated initiatives will help improve fairness and participation, given the differences between organized and bilateral markets.
Silicon Valley Power shares the CAISO’s and many other stakeholder’s concerns about implementing any form of financial consequences. The data provided indicates many EIM entities in addition to the CAISO fail the RS Test. With no evidence of manipulation or intentional leaning, it doesn’t make sense to apply financial penalties as a failure consequence. It’s important to maintain the voluntary nature of the EIM market and encourage participation. A financial penalty structure would cause participants and market operators to over-procure or withhold resources from the market due to risk aversion, causing increased costs to customers and diminishing the value of EIM in the first place. Silicon Valley Power is concerned about the results of an extraordinary situation such as the 1-in-30 year event from last summer driving the redesign of the RS test to influence the independent Resource Adequacy or IRP processes of the participants.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
No comments at this time.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
No comments at this time.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
No comments at this time.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
No comments at this time.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
No comments at this time.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
No comments at this time.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
No comments at this time.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
No comments at this time.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
No comments at this time.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
No comments at this time.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
No comments at this time.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
No comments at this time.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
No comments at this time.
Six Cities
Submitted 09/08/2021, 03:22 pm
Submitted on behalf of
Cities of Anaheim, Azusa, Banning, Colton, Pasadena, and Riverside, California
1.
Please provide a summary of your organization’s comments on the straw proposal:
The Six Cities support, do not oppose, or take no position on most of the CAISO’s proposals as outlined in the Straw Proposal. Specifically, the Six Cities:
- Support the CAISO’s proposal regarding the Resource Sufficiency Evaluation (“RSE”) capacity test, including, specifically, the proposal to address concerns related to intertemporal constraints through the use of the Short-Term Unit Commitment (“STUC”) horizon.
- Support the CAISO’s decision not to apply the balancing test to the CAISO and do not oppose the proposal to reallocate revenues associated with failures of the balancing test by EIM entities.
- Do not oppose the CAISO’s proposal to permit EIM Entities to reflect amounts associated with demand response programs within their balancing areas that they plan to dispatch as adjustments to forecasted demand requirements, recommend that the CAISO consider strengthening penalties to mitigate against possible “gaming” of this forecast adjustment, and urge monitoring of its implementation.
- Do not oppose the proposal to limit incremental EIM transfers when firm load is used as non-spinning/spinning reserves.
- Do not oppose the CAISO’s proposals to provide additional data transparency or to transition reporting responsibilities regarding the RSE to the Department of Market Monitoring (“DMM”).
With respect to the CAISO’s proposal to revise its rules for consideration of imports in the RSE capacity test, the Six Cities request more information.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
As the Six Cities noted in their comments on the Issue Paper, this is a difficult issue to resolve, because, while it may not be reasonable to include in the RSE capacity test resources that are incapable of performing within the necessary timeframes, it is likewise unreasonable to exclude resources that would have been capable of performing within the necessary timeframes but for prior-interval economic dispatch decisions. In proposing to use the timeframe for the STUC process as the metric for evaluating which resources to include, the Six Cities believe that the CAISO has identified a reasonable balance between competing considerations. It would be useful for the CAISO to present data or analyses showing how results of the RSE capacity test for prior periods might have differed if this policy had been in place. Such information will aid stakeholders in fully assessing the impacts of this potential change.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
The Six Cities do not have comments on this topic at this time.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
The Six Cities support the CAISO’s decision not to apply the balancing test component of the RSE to the CAISO balancing authority area. As explained in the Six Cities’ prior comments, the Six Cities are concerned that differences in the market structure within the CAISO area renders the need for this test moot, as the CAISO is not exposed to the same incentives for “gaming” through the use of over- or under-scheduled base schedules.
With respect to the proposal to revise the revenue allocation so that entities not subject to the balancing test (i.e., the CAISO) do not receive revenues that are recouped as a result of test failure, the Six Cities are not conceptually opposed.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
In general, the Six Cities do not oppose the CAISO’s proposal to permit EIM Entities to reflect amounts associated with demand response programs within their balancing areas that they plan to dispatch as adjustments to forecasted demand requirements. At the same time, the Six Cities are sensitive to the potential for misuse of this adjustment, as flagged by the CAISO. (See, e.g., Straw Proposal at 15, referencing the possibility of “fictitious demand adjustments”). To mitigate against such misuse, the Six Cities support consideration of more stringent thresholds for the underscheduling test and/or the associated penalty, but do not have a specific position on revisions to these elements at this time. In addition to enhancement of the applicable underscheduling penalty, the Six Cities would support monitoring of EIM Entities’ use of such adjustments by the DMM as part of its oversight and reporting activities.
With respect to demand response programs within the CAISO area, the Six Cities urge the CAISO to ensure that any CAISO-area demand response that is analogous to the types of programs used by EIM Entities is likewise able to be fully reflected within the RSE.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
Prior to adoption of a rule that prohibits the CAISO from reflecting within the RSE capacity test imports that do not have associated transmission profile e-tags by the T-40 deadline, the Six Cities request that the CAISO provide more information to stakeholders – specifically, CAISO stakeholders that are likely to be impacted by this change – about the magnitude of such imports and the quantities that are likely to be excluded from the RSE going forward. The Six Cities share concerns regarding the potential for reliance on speculative import schedules. That said, however, affected load-serving entities in the CAISO should understand whether the likely impacts from excluding additional imports from the RSE will materially increase the CAISO’s failure rates, increase supply costs and/or cause reliability problems. The Six Cities would also like to clarify how the CAISO will implement this change; the Straw Proposal suggests that import supply without a transmission profile e-tag by T-40 will not be prohibited from market participation, only that such imports will not be included as among the CAISO’s resources in the capacity portion of the RSE.
The Six Cities relatedly request that the CAISO consider and evaluate whether the potential for gaming or other inappropriate market conduct may be increased in the event that import supply within the RSE becomes more restricted. Will suppliers have an incentive to attempt to increase real time prices through reducing the availability of import supply within the new tagging timeframe? If this scenario presents a legitimate risk, are the benefits of excluding untagged import supply from the RSE capacity test outweighed by exposure to real-time price increases as a result of gaming activities?
In short, the Six Cities may not ultimately oppose this change, but believe that more analysis is needed before the CAISO adopts it as part of a Draft Final Proposal.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
The Six Cities do not oppose the CAISO’s proposal on this topic.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
The Six Cities generally do not oppose the CAISO’s proposals regarding data transparency and availability. The proposal to transition analysis and reporting responsibilities related to the RSE to the DMM, as outlined in the Straw Proposal, is reasonable.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
The Six Cities do not have comments on this topic at this time.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
The Six Cities do not have comments on this topic at this time.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
The Six Cities support the CAISO’s proposal to defer this topic to a subsequent phase of this initiative.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
The Six Cities support the CAISO’s proposal to defer this topic to a subsequent phase of this initiative.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
The Six Cities support classification of this initiative based on the application of the criteria set forth in the recently-adopted Part 2 Draft Final Proposal of the Western EIM Governance Review Committee. According to this criteria, this would result in the EIM Governing Body and the CAISO Board of Governors having joint authority over the final proposal in this initiative, which involves a set of “proposals to change or establish any CAISO tariff rule(s) applicable to the EIM Entity balancing authority areas, EIM Entities, or other market participants within the EIM Entity balancing authority areas, in their capacity as participants in EIM.” (See Western Energy Imbalance Market Governance Review, Governance Review Committee Part Two Draft Final Proposal, available at Microsoft Word - Decision-EIM-Governance-Review-Committee-Part-Two-Draft-Final-Proposal-July-19-2021 (westerneim.com) at 8.)
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
The Six Cities note that the dates for the next paper, stakeholder meeting, and comments as shown on page 24 of the Straw Proposal are not the same as the dates included in the August 23, 2021 stakeholder presentation at slide 32. In particular, the schedule included in the presentation provides for only a four-day interval between the stakeholder meeting and the comment deadline, which is only nine days after the target deadline for the CAISO to issue its Draft Final Proposal. While each set of dates provides for a relatively tight period for stakeholders to review, analyze, and prepare comments on the Draft Final Proposal, the dates in the presentation in particular do not provide stakeholders with adequate time for comment preparation. The Six Cities urge the CAISO to revise the applicable comment deadline on the Draft Final Proposal so that it is no earlier than October 22, 2021, and, preferably, includes several additional days such that comments are due on October 25th, which is ten days following the scheduled stakeholder meeting.
Southern California Edison
Submitted 09/08/2021, 08:50 am
1.
Please provide a summary of your organization’s comments on the straw proposal:
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
Vistra Corp.
Submitted 09/08/2021, 04:51 pm
1.
Please provide a summary of your organization’s comments on the straw proposal:
Vistra supports the steps the CAISO is taking to improve the accuracy of its Resource Sufficiency Evaluation (RSE) and to increase transparency into its performance and current consequences. Vistra agrees with the discussed design principles and summarizes them from our perspective as:
- RSE should apply equitably across all Energy Imbalance Market (EIM) Entity Balancing Authority Areas implementation differences depending on whether relying on base schedules or results from the day-ahead market.
- RSE performance including the key inputs driving RSE results should be transparent on a near real-time basis to all market participants through the Open Access Same-Time Information System (OASIS) platform on an hourly and at least on a BAA-level.
- RSE should as accurately as possible estimate whether an EIM Entity BAA has sufficient supply resources to meet its expected real-time demand including any changes in resource or load uncertainty.
- RSE is not and should not be a test on whether each BAA has sufficient resource adequacy to support its reliability requirements. Resource adequacy capacity sufficiency tests should be performed outside the energy & ancillary services markets and appropriate penalties[1] applied. We agree with the CAISO it is important to keep the resource adequacy capacity sufficiency assessments and penalties separate from any discussion on EIM capacity sufficiency for real-time energy market participation.
- Under System Emergency conditions, out-of-market emergency corrective measures are being employed to correct a reliability condition rather than the real-time market solving for the least-cost, security constrained condition under normal conditions. Even if the EIM Entity passes the RSE test under Emergency Energy Actions, we believe that scarcity pricing should be reflected in the BAA’s LMPs so that the internal energy, imports, and EIM transfers contributing to resolving the reliability condition are compensated commensurate with the emergency service they are providing. Or in the interim until scarcity pricing can be ensured, it is likely that the transfers should be capped given the emergency condition.
[1] For example, in California assuming that the Planning Reserve Margin sets a reasonable reserve margin to support reliability then Load Serving Entities failure to meet their system Resource Adequacy obligations are assessed non-summer and summer penalties up to $8.88/kw-month for the summer months.
2.
Please provide a summary of your organization's comments on the section of the proposal related to the capacity test modifications - intertemporal constraints, specifically the use of the short-term unit commitment horizon:
This proposed change is part of phase 1.
Vistra supports the CAISO’s proposal as a positive step forward to include start-up or cycling limitations within the RSE calculation. Ideally, we would like to see ramp limitations factored in as well where for example an offline resource would only be counted in the test up to its expected ramp limited movement in the hour being tested. For example, in the CAISO straw proposal Table 1 example #2, the CAISO explanation states that the unit could ramp to minimum load so the test would credit the EIM Entity for the full Pmax of the unit, however if the unit was not able to further ramp into its operating range above Pmin then we believe the EIM Entity should only receive credit for its Pmin not its full capacity range. We request the CAISO consider if a simple version of ramp rate limitations could be included in Phase 1 in addition to the proposed improvements to include start-up and cycling limitations.
3.
Please provide a summary of your organization's comments on the section of the proposal related to the flexible ramping test modifications:
This proposed change is part of phase 1.
Vistra requests the CAISO provide the formula and an example for its proposal in the next iteration.
4.
Please provide a summary of your organization's comments on the section of the proposal related to the balancing test modifications, including the potential for changes in revenue allocation:
This proposed change is part of phase 1.
Based on our understanding of the balancing test and why the CAISO has been excluded from the test, we assume at the time the tests were developed it was assumed that CAISO would never have insufficient supply resources to meet its collective day-ahead schedules in real-time. Given that assumption, excluding the CAISO made sense. We can support not including the CAISO in the balancing test assuming that continues to be true. From the CAISO description in its paper, it seems to Vistra that there is a feasible path forward to apply an equitable balancing test to the CAISO comparing its supply resources to its integrated forward market commitments. We request the CAISO analyze whether this has been observed during the last year under the tight supply conditions to provide some indication of whether the theoretical concern and solution are worth exploring. If the CAISO has observed instances where there were insufficient supply resources compared to its IFM awards, we request the CAISO explore an equitable approach to apply balancing test to the CAISO in an equitable manner that recognizes the different nature of its use of IFM commitments instead of base schedules.
5.
Please provide a summary of your organization's comments on the proposed ability for an EIM entity to represent demand response via adjustments to the forecasted demand requirement. Please provide feedback on if the existing penalty structure for under-delivery is sufficient to prevent misuse of this functionality:
This proposed change is part of phase 1.
Vistra shares the CAISO’s concern that there is a potential for fictitious demand adjustments to be made for the purpose of passing the capacity for flexible ramp sufficiency test. As mentioned during the stakeholder meeting, Vistra suggests that the CAISO should only include demand reductions for EIM Entity on the demand forecast side of the test if those demand resources are expected to provide an active load reduction and basing the measurement methodology on the Local Regulatory Authorities’ approved program rules.
For instance, there are demand reduction programs that enroll customers to provide firm service level response where a customer with a peak load contribution of 1,000 kW would agree to achieve a firm service level of 250 kW. For capacity counting, it is appropriate to account for this potential reduction up to 750 kW, however when using in an energy calculation it is preferable to calculate expected load reduction for operations’ uses based on what the customer expects they can provide or an approved baseline calculation. In PJM’s load management program, the demand response providers are required to provide monthly load reduction reports that represent expected reductions and to resubmit load reduction reports after day-ahead if a demand response call is warned. Under this scenario, after the day-ahead market a demand response provider would confirm the customer intends to actively respond and what their current demand levels are compared to that Firm Service Level, where if the current demand values are 500 kW then only 250 kW of expected reduction would be reported to operations.
Vistra believes to ensure that over-accounting of demand response does not occur that methodologies analogous to this should occur where the principle is that the expected demand response should be based on baselines from recent operations and confirmation that the customer intends to actively respond. We understand this is a best practice and Local Regulatory Authority rules may differ so encourage the best practice to be adopted where LRA rules do not supersede.
6.
Please provide a summary of your organization's comments on the proposed qualifications for import schedules the CAISO is able to use as an input to the RSE:
This proposed change is part of phase 1.
Vistra is skeptical that this enhancement is necessary as it seems to be conflating requirements for Resource Adequacy imports with incorporating import resources into the RSE. We recognize there is concern related to “speculative imports” being used to serve CAISO internal load both backed by RA contracts and as energy only. We believe that the question of speculative imports is incredibly important in the Resource Adequacy space and we strongly support import rules that result in the equivalent of a Designated Network Resource serving internal CAISO load. In the RSE space, this issue seems less relevant assuming the RA import rules are improved. Essentially, we are skeptical about how significant the size of “speculative” imports may be once the RA rules require the equivalent of Designated Network Resources. Vistra suggests the CAISO focus on coordinating with the California Public Utility Commission to require the equivalent of Designated Network Resources to provide RA. After these changes have been implemented, the CAISO should analyze the frequency of HASP imports failing to submit an e-tag.
7.
Please provide a summary of your organization's comments on the proposal to limit incremental EIM transfers when firm load is used as non-spin/spin reserves:
This topic is included in phase 1.
Vistra supports the CAISO proposal as it is consistent with our fifth principle as well as an appropriate interim measure until scarcity pricing can be ensured. Until the market and the CAISO can be confident in scarcity pricing resulting in both the least cost solution that supports reliability simultaneously, the need to cap transfers makes sense.
8.
Please provide a summary of your organization's comments on the section of the proposal related to additional transparency and data availability:
This topic is included in phase 1.
Vistra appreciates the transparency efforts the CAISO is undertaking. Our interest is to emphasize that this information is not only useful to the EIM Entities. In fact, there are Independent Power Producers and marketers that actively participate throughout the EIM footprint providing valuable services that should not be discounted. It’s a hallmark of any successful, competitive market including imbalance markets that there is enough transparency into prevailing conditions to allow IPPs and marketers accurate information to better inform what and where energy services should be offered.
We respectfully request the CAISO ensure that similar information that it is provided to EIM Entity BAA’s on the drivers that contribute to the RSE results are being published on OASIS for market-wide transparency. We respect that resource level information is confidential. Consistent with the principle that aggregating data on a BAA level sufficiently protects for confidential information inappropriately being released, we request that the CAISO include in its implementation of this proposal BAA-level data through OASIS.
In its Straw Proposal, the CAISO proposes “to assume the role of providing EIM data to market participants, the Department of Market Monitoring, Market Surveillance Committee, and once established, the EIM Governing Body Market Expert.” Vistra respectfully reminds the CAISO that Independent Power Producers and marketers are important market participants in the EIM and such this information at a BAA-level should be available on a near-time basis through OASIS.
We believe the following information should be available on an hourly, BAA-level through OASIS to include bot not limited to:
- RSE Inputs:
- Load forecast
- Supply MW
- Solar forecast MW
- Wind forecast MW
- RSE results:
- RSE results by test type (capacity, flexible ramping, or balancing)
- RSE shortfall quantities that led to test failure
- RSE transfer caps applied when RSE test fails by transfer path
9.
Please provide a summary of your organization's comments on the additional metrics that the Department of Market Monitoring can develop for the RSE:
This proposed change is part of phase 1.
In addition to the above information provided to market participants on a same-time basis with hourly data for each EIM Entity BAA, Vistra believes the DMM can enhance market understanding of the accuracy of the RSE. For example, a comparative analysis of the inputs used in the RSE test compared to actual observations can shine light on how accurate the RSE inputs are to capturing real-time conditions. Further, an assessment of actual EIM transfers between EIM Entity BAAs when a test failure occurs would allow market participants to understand how the actual transfers relate to the transfer caps will shed light onto whether the capping of the transfers limits leaning or not. Vistra appreciates the extensive analysis that DMM has performed to date on the EIM. We look forward to increased transparency and accountability that we hope comes from this greater shift in responsibility to the DMM to ensure the RSE is accurate and equitably applied through the EIM.
10.
Please provide a summary of your organization's comments on the section of the proposal relating to the uncertainty calculation; specifically the use of the last 3 months of deviation data as well as the 95% confidence interval:
This topic is included in phase 1.
At this time, we do not have a specific position on the CAISO proposal. Vistra still holds some discomfort with the approach the CAISO adopted in summer 2021 readiness to include an uncertainty amount in the RSE capacity test using the same formulation of the Flexible Ramping Product calculation. The Flexible Ramping Product uncertainty calculation is estimating uncertainty between roughly 55 minutes between Fifteen Minute Market advisory intervals and the binding Real-Time Dispatch run. While we understand that this uncertainty was the easiest implementation approach given the emergency stakeholder process to address summer 2021, it seems like if we are looking at near-term enhancements that this is the time to explore what an uncertainty value that is more appropriate to the capacity test should be. Intuitively, the uncertainty between day-ahead schedules to real-time demand forecast is greater than a 55-minute horizon and should be greater than the uncertainty included in the Flexible Ramping Product. Given that the capacity test’s reference point for the CAISO is a staler data point, we believe equitable application would be to estimate uncertainty between the day-ahead and binding RTD for the CAISO BAA. We would share a similar concern if our understanding that EIM Entity’s base schedules are within the 55-minute horizon is not correct but instead that information is staler as well.
11.
Please provide your organization’s comments on the proposal to address the RSE failure consequences in the phase 2 of this initiative, including desired timelines for the start on phase 2 of the initiative.
Vistra supports the CAISO proposal to phase this initiative. Once there is more confidence in the validity of the RSE results even during emergency conditions, we believe that there is merit in exploring stricter consequences. For now, we find the CAISO proposal reasonable and prudent.
12.
Please provide your organization’s comments on the proposal to address the load forecast adjustments topic in phase 2 of this initiative:
Vistra is comfortable with deferring a discussion on whether operator load adjustments should be reflected in this test. There is a principled question about whether the real-time load forecast should be the reference point for the RSE tests if the operators have submitted adjustments to it to change the Real-Time Pre-Dispatch or Real-Time Dispatch forecasts. Intuitively, if you trust operator judgement then we are inclined to support this approach as the best representation of expected real-time demand. However, if there is a concern that operation load adjustments are being used to try to drive commitments to achieve greater flexibility going into RTD, there is another question about whether this tool is solely being used to reflect demand. If load forecast adjustments are used for both improving the load forecast used in dispatch and forcing commitments to increase flexibility, then uniform use of the load forecast adjustment in RSE tests is likely inappropriate in some instances and appropriate in other instances. Until the complexity of the operator’s use of this tool is explored in more detail, we find it reasonable to defer this until Phase 2.
13.
Please provide your organization's comments on the proposed EIM Governing Body classification to have primary authority to approve the EIM RSE final proposal:
Vistra supports the primary authority. As a note, we request the CAISO revise its open stakeholder efforts to reflect the Board of Governors approval of joint authority. We believe this effort is under joint authority.
14.
Please provide any additional comments on the EIM RSE Enhancements initiative that have not previously been addressed:
None at this time.
