QSE Managers Working Group Meeting Notes 9 April, 2010 Report to WMS 21 April, 2010 David Detelich - Chairperson.

QSE Managers Working QSE Managers Working GroupGroupMeeting NotesMeeting Notes

9 April, 20109 April, 2010

Report to WMS Report to WMS

21 April, 201021 April, 2010

David Detelich - ChairpersonDavid Detelich - Chairperson

QMWG Topics QMWG Topics

Offering Reliability Must Run (RMR) Units Offering Reliability Must Run (RMR) Units into the Nodal Market (Possible vote) into the Nodal Market (Possible vote)

Wind-powered Generation Resource Wind-powered Generation Resource Production Potential (WGRPP) Forecast Production Potential (WGRPP) Forecast Accuracy Accuracy

Load Forecast Accuracy Load Forecast Accuracy PRR848, Allow ERCOT Option to Cancel PRR848, Allow ERCOT Option to Cancel

RPRS Capacity Commitments (Possible RPRS Capacity Commitments (Possible vote) vote)

QMWG Topics cont.QMWG Topics cont.

NPRR216, Allow ERCOT Option to Cancel NPRR216, Allow ERCOT Option to Cancel Commitments Previously Issued Through Commitments Previously Issued Through RUC (Possible vote) RUC (Possible vote)

NPRR210, Wind Forecasting Change to NPRR210, Wind Forecasting Change to P50, Synchronization with PRR841 P50, Synchronization with PRR841 (Possible vote) (Possible vote)

Nodal: Offering Duct Burner capacity Nodal: Offering Duct Burner capacity (Update) (Update)

2011 Ancillary Service Methodology 2011 Ancillary Service Methodology

Nodal Reliability Must-Run Nodal Reliability Must-Run (RMR) Offers(RMR) Offers

ERCOT Action Item: Produce Whitepaper ERCOT Action Item: Produce Whitepaper on subject – not completedon subject – not completed

ERCOT is discussing internally the topic of ERCOT is discussing internally the topic of how to offer the RMR units in DAM and how to offer the RMR units in DAM and RUCRUC

Market Participants would like to be a part Market Participants would like to be a part of that discussionof that discussion

Recommend discussing at next QMWG Recommend discussing at next QMWG meeting.meeting.

Market Impacts of RMR OffersMarket Impacts of RMR Offers

Offered in DAM; struck in DAMOffered in DAM; struck in DAM Price convergencePrice convergence How does a higher cost in offers affect thatHow does a higher cost in offers affect that

Offered in DAM; struck in RUCOffered in DAM; struck in RUC Not offered in DAM; struck in RUCNot offered in DAM; struck in RUC

Higher prices for load at the congested nodeHigher prices for load at the congested node May impact adjacent nodes as wellMay impact adjacent nodes as well

Nodal Settlement of RMRNodal Settlement of RMR

Slide provided by ERCOTSlide provided by ERCOT

WGRPP Forecast AccuracyWGRPP Forecast Accuracy

Discussion of Analysis RequirementsDiscussion of Analysis Requirements Discussion of Change to P50Discussion of Change to P50

April data should show adoption of changeApril data should show adoption of change

Discussion of MET dataDiscussion of MET data

PRR811 implementation continuesPRR811 implementation continues

Number of Resources with:

0 data points with issues 40 1 data point with issues 16 2 data points with issues 7 3 data points with issues 3 4 data points with issues 11

all data points have issues 5 Total number of Resources 82

Load Forecast AccuracyLoad Forecast Accuracy

Reviewed report from Potomac Reviewed report from Potomac Economics available from their website. Economics available from their website. Forecast error MW in 4 hour intervalsForecast error MW in 4 hour intervals Visualize the bias over peak hoursVisualize the bias over peak hours

PRR848, Allow ERCOT Option to PRR848, Allow ERCOT Option to Cancel RPRS Capacity CommitmentsCancel RPRS Capacity Commitments

This PRR does not include compensationThis PRR does not include compensation Spent fuelSpent fuel Opportunity costs Opportunity costs

RPRS procurements are being reduced by RPRS procurements are being reduced by the application of the new A/S procurement the application of the new A/S procurement methodologymethodology NSRSNSRS Net Load errorNet Load error

QMWG recommends rejectionQMWG recommends rejection

NPRR216, Allow ERCOT Option to NPRR216, Allow ERCOT Option to Cancel Commitments Previously Cancel Commitments Previously

Issued Through RUCIssued Through RUC QMWG supports concept with discussion QMWG supports concept with discussion

request on the payments to the generators. request on the payments to the generators. Allows ERCOT to run commitment studies the Allows ERCOT to run commitment studies the

way a utility would where they can commit or way a utility would where they can commit or decommit units. decommit units.

Adds another incentive for resources to Adds another incentive for resources to participate in the Day Ahead Market.participate in the Day Ahead Market.

Would want to see evidence that the savings to Would want to see evidence that the savings to the market outweigh the costs to the generators, the market outweigh the costs to the generators, uncompensated costs. uncompensated costs.

NPRR216 QMWG RecommendationNPRR216 QMWG Recommendation

QMWG feels a holistic approach is needed to the QMWG feels a holistic approach is needed to the problem of managing the reserves required on the problem of managing the reserves required on the system. system.

Currently the issue is being addressed in various Currently the issue is being addressed in various stakeholder venues. stakeholder venues.

QMWG proposes to compare the current solution QMWG proposes to compare the current solution proposals for managing uncertainty.proposals for managing uncertainty. delaying commitment, (NRG proposal)delaying commitment, (NRG proposal) AS methodologyAS methodology

Recommend that the NPRR be remanded to WMS. Recommend that the NPRR be remanded to WMS.

NPRR210, Wind Forecasting Change NPRR210, Wind Forecasting Change to P50, Synchronization with PRR841to P50, Synchronization with PRR841

TAC voted to remand NPRR210 to PRSTAC voted to remand NPRR210 to PRS Morgan Stanley comments raises the Morgan Stanley comments raises the

concern that Wind-powered Generation concern that Wind-powered Generation Resources (WGRs) may sell capacity not Resources (WGRs) may sell capacity not committed in Day-Aheadcommitted in Day-Ahead could result in insufficient capacity when wind could result in insufficient capacity when wind

production is below the forecastproduction is below the forecast Could require ERCOT to commit additional units.Could require ERCOT to commit additional units.

WMS Action (Vote)WMS Action (Vote)

Nodal: Offering Duct Burner Nodal: Offering Duct Burner capacitycapacity

Questions received from:Questions received from: Brazos Electric CooperativeBrazos Electric Cooperative EDF Trading EDF Trading

Duct burner capacity raises utilization and Duct burner capacity raises utilization and performance questions not addressed by the performance questions not addressed by the Nodal Market Design:Nodal Market Design: Could take more than 5 minutes to ramp inCould take more than 5 minutes to ramp in Temperature sensitivity changes the point that duct Temperature sensitivity changes the point that duct

burner capacity is added and ramp rate changesburner capacity is added and ramp rate changes

2011 Ancillary Service 2011 Ancillary Service MethodologyMethodology

Market Participants request that ERCOT map Market Participants request that ERCOT map out the process for updating the A/S out the process for updating the A/S methodology.methodology.

Issues that ERCOT should evaluate and Issues that ERCOT should evaluate and address:address: Quantity of A/S required at start of Nodal marketQuantity of A/S required at start of Nodal market How to step to the steady state quantities after Nodal How to step to the steady state quantities after Nodal

go livego live Develop Net Load Risk values specific for each dayDevelop Net Load Risk values specific for each day Improvements on the NSRS quantity determination.Improvements on the NSRS quantity determination.

Next meetingNext meeting

Next Meeting: May 4, 2010Next Meeting: May 4, 2010 TopicsTopics

Wind generation forecast accuracy calculationsWind generation forecast accuracy calculations Load Forecasting AccuracyLoad Forecasting Accuracy Nodal Reliability Must-Run (RMR): ERCOT Nodal Reliability Must-Run (RMR): ERCOT

Created Three-Part Supply OfferCreated Three-Part Supply Offer Nodal: Offering Duct Burner capacityNodal: Offering Duct Burner capacity 2011 Ancillary Service Methodology 2011 Ancillary Service Methodology GREDP and other metrics calculationsGREDP and other metrics calculations