Thursday, February 21, 2019

ERCOT Finds No Alternatives to Greens Bayou; RMR Rule Changes Advance

By Tom Kleckner

ERCOT will continue its reliability-must-run agreement with NRG Energy’s Greens Bayou Unit 5 after a solicitation produced no viable alternatives.

The Texas grid operator had solicited proposals for must-run alternatives (MRAs) after it entered an RMR contract with NRG Texas Power for its Houston-area unit, a 371-MW gas-fired plant, on June 2. (See ERCOT Seeks Alternatives to Houston-Area RMR Unit.) The contract is projected to cost the market $60 million.

ERCOT said the proposed MRAs it received by the Aug. 24 deadline would not “adequately meet the reliability need served by the Greens Bayou 5 unit.” The ISO received eight offers from four qualified scheduling entities (QSEs) with a combined capacity of 385.9 MW for most of the contract months, but it said some of those offers did not qualify as eligible MRA resources and the others did not provide an “acceptable solution to the reliability concern” necessary to replace Greens Bayou.

greens bayou, ercot

Greens Bayou Source: NRG Energy

The Greens Bayou RMR agreement addresses reliability concerns on a Houston-area transmission line. Under the agreement, the unit will remain available during summer peak demand periods through June 2018 to support system reliability under certain critical operating conditions.

ERCOT has said the $590 million Houston Import Project, scheduled to be completed by summer 2018, will solve the reliability concern.

RMR Rule Changes Proposed

Meanwhile, the Protocol Revision Subcommittee last week advanced three nodal protocol revision requests (NPRRs) related to ERCOT’s RMR procedures. They will be taken up next week by the Technical Advisory Committee, which in July rejected an NRG request to allow the economic dispatch of RMR units. (See “Pricing Change on RMR Units Rejected, Appealed to ERCOT Board,” ERCOT Technical Advisory Committee Briefs.)

  • NPRR788 modifies the RMR planning studies to include forecasted peak loads and introduces a new requirement that a potential RMR unit must have “a meaningful impact on the expected transmission overload” to be considered for an agreement.
  • NPRR795 creates a mechanism to refund capital expenditures funded by ERCOT under an RMR agreement, if the agreement is terminated. The refund would be based on the expenditures’ depreciated book value if the resource returns to commercial operations; otherwise, it would be based on the salvage value.
  • NPRR793 would clarify the reliability unit commitment process to ensure RMR units are not accidentally committed as a reliability unit before other resources. The revision request adds several responsibilities for RMR unit owners, revises RMR formulas and adds further clarifications.

Luminant, Calpine Notices

ERCOT, which already has more than 81,000 MW of capacity to meet the fall and winter’s expected peak demand of less than 59,000 MW, recently got news of an additional resource.

Luminant notified ERCOT on Sept. 14 that its 805-MW coal unit at Martin Lake in East Texas, which had been running only from May to late September, will now be available for year-round dispatch. The status change is effective Oct. 1.

The Texas grid operator has also reviewed Calpine’s notice that it would be suspending operations at its 400-MW, gas-fired Clear Lake Power Plant and determined the five steam and gas turbines are needed to support transmission system reliability. ERCOT will issue a final determination by Oct. 10.

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