Monday, October 22, 2018

MISO Looks to Address Changing Resource Availability

By Amanda Durish Cook

CARMEL, Ind. — MISO is kicking off an effort to examine its changing resource availability in the face of increasing generation retirements, poor outage coordination, growing volumes of emergency-only capacity and rising use of intermittent resources.

“In the past, a [maximum generation event] occurred every year or two when MISO needed access to emergency-only resources. Now, there have been 12 since the start of the 2016/17 planning year, and they have occurred in all four seasons,” the RTO wrote in a white paper laying out the issue.

To remedy the situation, MISO is broadly proposing to increase transparency of resource availability times and energy requirements, revamp availability requirements, and improve price signals to attract generator response.

But it needs stakeholder feedback to develop the specific rules and market improvements needed to meet those goals, RTO staff said at an April 5 Reliability Subcommittee meeting.

‘Degrading Ability’

MISO resource availability

Bladen | © RTO Insider

Executive Director of Market Design Jeff Bladen said MISO is experiencing a “degrading ability to convert committed capacity” in a reliable fashion because of “more volatile supply and demand conditions,” forcing it to increasingly rely on resources not scheduled in the day-ahead market.

“There is less operational energy available through dispatch than the year before,” Bladen said. “Each succeeding year we’ve had fewer megawatts offered.”

MISO had 126 GW in average energy must-offers in the 2014/15 planning year, with about 17 GW of outages. In the 2015/16 and 2016/17 planning years, offers declined to 125 GW and 117 GW, respectively, while outages rose to 18 GW and roughly 23 GW.

Bladen said peaks are becoming less predictable and occur even in shoulder seasons: “It’s becoming apparent that this is a challenge we will face year-round, and not just in the summertime.” He said outages have played a role in most of MISO’s maximum generation events since late 2016, with the majority occurring during off-peak months.

The RTO could once confidently group outages in the spring and fall because it had a greater margin of error.

“That seems to be a fleeting confidence. We have to plan for more volatile loads,” Bladen said.

MISO’s “resource availability and need” topic evolved from a 2015 proposal to create seasonal capacity procurement requirements, a generally unpopular move among stakeholders. RTO officials now say the proposal is no longer as simple as applying separate clearing requirements in a two- or four-season capacity auction.

“In some cases, we may have jumped to conclusions on some of these challenges — opportunities, but challenges nevertheless. This topic is an evolving one,” Bladen said.

Staff have said solutions could include a capacity procurement requirement and an examination of whether current requirements and price signals must be revised in light of shifting availability, a product of tightening supply, more renewable energy participation, increasing instances of extreme weather events and an aging baseload fleet more susceptible to outages.

MISO is already considering whether to factor the effects of planned and maintenance outages on peak in its loss of load expectation study by the 2019/20 planning year, which could boost the RTO’s planning reserve margin requirement. (See MISO RASC Zeroes in on Priorities.)

resource availability miso

Peak loads shown in red versus supply over 2016 and 2017 | MISO

Customized Energy Solutions’ Ted Kuhn asked why MISO is regarding retirements as out of the ordinary given that they’ve always existed.

“The fleet in general is getting older in aggregate,” said Bladen, stressing that MISO’s current retirement rate is amplified when compared to the historical rate.

He said MISO’s expected renewable expansion combined with its aging baseload generation will only exacerbate reliance on emergency-only resources.

“The queue today gives us every indication that more intermittent resources are on the way,” he said.

Bladen added that individual load-modifying resources often don’t perform to the levels accredited to them in the annual capacity auction and can have long start-up times, up to 12 hours.

Madison Gas and Electric’s Megan Wisersky criticized some aspects of MISO’s longstanding rules for load-modifying resources. She noted the RTO has always required load-modifying resources to be available for both capacity and transmission emergencies and restricted them to being price takers in the market.

“It’s almost like this trend is self-fulfilling,” Wisersky said.

Bladen said MISO would be looking for stakeholder input on any changes to the treatment of load-modifying resources.

“The idea is that we give tools to our resources so they have the ability to cure,” he said. MISO’s load-modifying resources currently do not have a must-offer obligation for any time periods outside summer, and they can only be called on five times each summer during emergency declarations.

We Energies Tony Jankowski asked why MISO was hinting at the need for such drastic measures and cautioned against overbuilding the system. Other stakeholders in attendance also worried aloud that the RTO would use the white paper as justification for big changes.

Bladen said MISO’s 25% expectation that it will initiate emergency operating procedures sometime this spring belies the fact the RTO likely faces a nearly 100% chance of entering an emergency during the season.

“We’ve been in a max gen event 12 out of the last 11 quarters. We’re not saying the sky is falling, but we’re saying it’s cloudy, and we’re concerned,” Bladen said.

“Despite the odd way of saying it, our goal is to be adequate,” he added, smiling.

Last month, Reliability Subcommittee Chair Bill SeDoris said he expected the discussion on the topic to extend into 2020.

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