Tuesday, March 19, 2019

MISO Prototyping Short-term Reserve Product

By Amanda Durish Cook

CARMEL, Ind. — MISO will prototype its proposed short-term reserve product to demonstrate cost and benefits to its members.

The move comes in part at the behest of stakeholders, who want more information on the availability of resources that might provide the reserves; the cost and reliability impacts of a reserve product; and how the product would interact with out-of-market commitments, according to MISO Market Design Adviser Bill Peters.

MISO has said it hopes to roll out the product in mid-2021, supported by its soon-to-be-replaced market platform. (See New MISO Platform Headed to the Cloud.)

The product would be designed to furnish capacity within 30 minutes. The RTO has said it will be especially helpful in MISO South, which has less than 500 MW of offline capacity available within that time frame.

However, Robert Francis, speaking on behalf of the Entergy Operating Companies, questioned whether MISO South’s load pockets even have an adequate number of offline resources to support the 30-minute response time.

Bill Peters | © RTO Insider

“One concern is that there may not be sufficient online and offline resources in the load pockets to enable the proposed product to work as intended,” Francis said in comments to MISO. “Of the load pocket units that are typically online during periods of system stress, are these units historically dispatched at levels that they would lend themselves to the [reserve] product?”

Peters said the reserve product will better compensate available resources while “incenting new capability for offline response.” He said there won’t be a minimum target amount of such reserves.

MISO Director of Market Design Kevin Vannoy said the short-term reserves would differentiate themselves from the current contingency reserves by addressing either an excess of flow on the regional dispatch transfer constraint or restoring normal operating conditions in a load pocket following the loss of a generator sooner to avoid violations of contracts and reliability standards.

“This is a method of making sure we’re able to replenish contingency reserves following a contingency. To date, we’ve been flush, but we’re finding” that reserves are thinning, Vannoy said. He added that the short-term reserve’s price signal will attract more generation willing to furnish reserves.

MISO has published a conceptual design of short-term operating reserves where online resources and offline resources can either register as a supplier or provide availability through hourly offers in the day-ahead and real-time markets. It plans to clear the resources according to opportunity costs, offer prices and a demand curve when insufficient amounts of the reserve exist.

Restoration Energy, Uninstructed Deviations and Tx Settlements

MISO plans to form a task team later this month to begin discussions on how it should price restoration energy — energy delivered to restore the system in the event of the real-time market ceasing to function. The RTO and stakeholders revived the idea of a plan to compensate restoration energy last year. (See Old Analysis Could Guide MISO Restoration Pricing Effort.)

It will also begin holding weekly conference calls Thursday to answer questions about its new uninstructed deviation threshold. The new threshold calculates a generator’s uninstructed deviation with a tolerance based on the minimum of five times the real-time ramp rate or 12% from the average set point instructions. Generators in MISO are currently flagged after they deviate by more than 8% from dispatch signals over four consecutive intervals. (See MISO Plans for New Uninstructed Deviation Rules.)

Lastly, MISO has delayed the introduction of its new transmission settlements system until spring. The new system was slated to go live March 1, but the RTO decided it required more test runs before rollout.

John Weissenborn said MISO decided to delay the new system “to allow testing and validation from market participants.” He said it will schedule a follow-up conference call in the middle of March to evaluate testing progress and discuss implementation.

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