Thursday, February 21, 2019

Emergency Ops, Calm Summer Top Talk at MISO Board Week

By Amanda Durish Cook

ST. PAUL, Minn. — A systemwide emergency, market innovations and the relatively calm summer conditions on the grid topped executive discussions at MISO’s Board of Directors meetings this week.

A Sept. 18 meeting of the Markets Committee of the Board of Directors began with an initial look into MISO’s Sept. 15 declaration of emergency conditions, issued just one a day after the RTO released a forecast showing a 19% chance of such an occurrence at least once this fall. (See MISO in Conservative Ops After Emergency Declaration.)

Shawn McFarlane | © RTO Insider

“Our fall outlook noted the potential for tight conditions, and that has indeed … been the case since Saturday,” MISO Executive Director of Market Operations Shawn McFarlane began.

At the time of the meeting, MISO was still under conservative operations, which remained in effect until Sept. 19.

McFarlane said the emergency was the result of high temperatures and the ramping up of planned fall outages, and noted that MISO lost a “significantly large” unit on Sept. 14, followed by the loss of smaller units the next day. As a rule, MISO does not reveal which companies experience unplanned outages, although Entergy reported that its Grand Gulf Nuclear Station on the Mississippi-Louisiana border went offline Friday because of feedwater system issues.

MISO made about 600 MW of emergency energy purchases during the event and for about 15 minutes exceeded its 3,000-MW north-to-south sub-regional contract limit on the SPP line linking its North and South regions.

However, McFarlane stressed that MISO coordinated with SPP and other parties to the contract ahead of the high flows.

“We will emphasize that we communicated with SPP and others ahead of time,” he said.

MISO Executive Director of Energy Rob Benbow said the RTO made emergency purchases from both SPP and Southern Co. He said that although communications regarding the purchases were effective, some Southern operators were confused about MISO’s process and that the RTO will reach out to company staff to better clarify processes.

Markets Committee of the Board of Directors | © RTO Insider

Benbow also said MISO brought in extra staff ahead of the event to oversee the system.

In his chairman’s report at the Sept. 20 Board of Directors meeting, Director Michael Curran praised SPP, Southern and the Tennessee Valley Authority for assisting MISO South during the emergency.

“It was a lot of good things at the seams. We have very good neighbors,” Curran said.

He also added a warning about thin reserves and increasing outages: “It’s not going to be just a weather pattern. … This is going to be the new normal.”

‘Missed’ Forecast

McFarlane said the determining factor in the emergency conditions was a MISO forecast that missed the mark by about 7% of actual conditions.

“A lot of others had difficulty forecasting the heat. It’s not an excuse, but many underestimated the high loads. … I would put this in our top three or four forecast misses. It was a significant miss since we began forecasting in 2005,” McFarlane said.

“This is one of seven forecasts where we missed it by 5% or more,” said MISO President Clair Moeller, adding that most of the midcontinent failed to accurately predict the heat.

Because the forecast became inaccurate so quickly, many units with long lead times could not respond in time, Moeller noted. CEO John Bear added that more fast-start resources will be needed as the generation fleet evolves.

McFarlane also said demand response was difficult to access during the event because of rapid heating and the fact that load-modifying resources aren’t obligated to offer beyond the summer months.

“This is an advertisement for Resource Availability and Need,” McFarlane said, referring to MISO’s initiative to change load-modifying resource and outage coordination rules. (See MISO Moving to Combat Shifting Resource Availability.)

Moeller said MISO is also examining how it plans for system conditions in light of the emergency.

“We’re doing something you shouldn’t do. We’re using historic performance to predict future performance. The question is how to adjust our math,” Moeller said. “The worst thing you can do to a gas pipeline is not give notice and take gas, and that’s what we love to do, not give notice and take gas.”

WPPI Energy’s Valy Goepfrich took the microphone at the board meeting to urge MISO leadership to “R-E-L-A-X.” She said that MISO’s supply has exceeded load for years, and that the RTO and utilities are only experiencing bumps in learning how to effectively balance a more equalized supply-to-load ratio.

Market Innovation

Richard Doying, executive vice president of market development strategy, said MISO is currently researching new distributed resource integration models and how it can use historical data to better compute and manage transmission constraints. The RTO is also continuing ongoing research into how renewable penetration changes the operations and economics of the grid, he said. (See MISO Renewable Study Predicts Later Peak, Narrower LOLE Risk.)

Richard Doying (left) and David Patton | © RTO Insider

Doying said in order to truly develop MISO’s market, RTO staff need to contemplate rebuilding the current system from scratch. He said if MISO were able to revisit 2004 knowing what it knows now, the markets system would have looked very different.

“We probably would have built a very different set of operating procedures,” he said.

MISO is also expanding its overall use of market improvement pilots and simulations, where it can test a full-scale change without impacting the grid, Doying said.

Director Thomas Rainwater urged leadership not to get stuck in a single line of thinking in market innovation, reminding the room that Betamax was once cutting-edge.

Doying said MISO’s ongoing market platform replacement will be flexible enough to accommodate a wide range of future market styles. He said the RTO will release a revised market strategy document in 2019.

However, Independent Market Monitor David Patton said market development should be an “evolution, not revolution,” and told RTO leadership to focus more on the efficient pricing of energy.

Solid Summer Performance

Despite last week’s emergency conditions, MISO said it was able to manage a relatively calm summer.

“There were a few operational challenges and overall — very benign. Nothing like the last few days,” McFarlane said.

“High level summary: It was hot,” he joked.

MISO’s system peaked in late June at 121.6 GW, about a month ahead the usual summer peak, McFarlane said. The RTO had predicted a 125-GW peak. Load averaged 86.6 GW, compared to 82.7 GW during last summer.

Patton said the heat caused a jump in energy prices over last summer, with prices averaging $31.12/MWh over the season, up 8.1% from 2017.

The loss of a 500-kV line in MISO South over June 3-4 highlighted the need to develop a 30-minute reserve product, according to Patton. The line trip caused transmission violations that were priced at $4,000/MW of flow, causing the Louisiana hub price to jump to $2,500/MWh for about an hour-and-a-half late on June 3, he said.

MISO also experienced its lowest wind output in the footprint ever on July 29: 1 MW out of about 18 GW of total wind capacity in the footprint. McFarlane said the RTO and the media often call attention to maximum wind output and wind records but don’t often highlight low wind generation and wind output volatility.

“What are the lessons then?” Rainwater asked.

“We have to be prepared for almost anything. If anyone has a better answer, let me know,” McFarlane said.