Thursday, February 21, 2019

SPP Strategic Planning Committee Briefs: Jan. 16, 2019

By Tom Kleckner

SPC, Stakeholders to Address EPA 111b Rulemaking

NEW ORLEANS — SPP staff have been tasked with providing “at least an outline” of comments next week for submittal to EPA in response to its proposed rulemaking under Clean Air Act Section 111b.

Usha Turner, OGE Energy’s director of environmental affairs and federal public policy, appeared before SPP’s Strategic Planning Committee last week to make the request, saying that the RTO’s role as a reliability manager “carries significance” on this issue.

EPA in December proposed revisions to a 2015 Clean Air Act rule stipulating that partial carbon capture and storage (CCS) technology was the best system of emission reduction (BSER) for new coal-fired plants. Turner said the changes would mainly revise CO2 emissions limits that apply to new coal plants but pointed out that the agency is also accepting comments on the need to revise the rule to allow more flexibility in operating simple cycle combustion turbines (SCCTs).

January’s Strategic Planning Committee meeting in New Orleans | © RTO Insider

“It would be important for SPP to engage,” Turner told the SPC during its Jan. 16 meeting. “We found in talking with the EPA last year a lack of understanding of how this market works, and why the diversity and flexibility of resources and the diversity in technology is very important in your role of providing affordable and reliable electricity in your service territory.”

The comment period is open through Feb. 21. Turner said the deadline could be delayed, however, by the partial government shutdown.

OGE Energy’s Usha Turner | © RTO Insider

Turner said SCCTs have a rolling 12-month efficiency-based generation output limit, but if a unit exceeds this limit, it must comply with combined cycle units’ CO2 limits.

“The rule establishes output-based restrictions for simple cycle units,” Turner explained. “If you operate those units above a certain capacity factor, you must meet the emissions standards of a combined cycle unit, which, by design, is unachievable.”

“This is a pretty substantial issue,” said Golden Spread Electric Cooperative’s Mike Wise, noting his company discussed the issue with EPA recently when installing its own CTs. “We’re concerned about these rules. The pool’s need for these resources shouldn’t be unduly constrained.”

“Our area is really a good laboratory,” SPP Vice President of Engineering Lanny Nickell said. “We should not be constraining these units that absolutely keep the grid’s reliability functioning properly.”

Nickell said he wasn’t sure whether the Feb. 21 deadline would provide SPP enough time to study the rule’s impact, but he said common sense told him that “new units, more efficient and economical, are being punished.”

“I believe that’s where we end up. We’ll see more emissions,” he said.

Michael Desselle, the RTO’s chief compliance and administrative officer, reminded the SPC about the organization’s agnostic view of resources.

Advanced Power Alliance’s Steve Gaw | © RTO Insider

“If there’s any advocacy we should be talking about, it’s to leave us the flexibility in the marketplace, and the RTO, for reliability purposes,” he said. “You need a diverse portfolio of resources.”

Steve Gaw, representing the Advanced Power Alliance (formerly The Wind Coalition), said he was concerned about a lack of analysis about the rule’s impact on the market. “I’m not sure SPP should be advocating for individual companies with varied interests,” he said.

Altenbaumer Continues to Exert his Influence

Larry Altenbaumer is playing a strong hand in his first year as chairman of SPP’s Board of Directors.

In the few months since replacing Jim Eckelberger last year, Altenbaumer has revamped board meetings, shortening the duration and focusing them on strategic discussions with members and the Regional State Committee. (See “Altenbaumer Tweaks New Governance Schedule,” SPP Board of Directors/Member Committee Briefs: Oct. 30, 2018.)

Pointing to stakeholder satisfaction surveys that indicate shortfalls in strategic planning, Altenbaumer said he wants to make better use of the opportunities for the board and its interaction with the Members Committee and the RSC.

Altenbaumer has also assumed chairmanship of the SPC. Long-time committee chair Wise is now vice chair.

Altenbaumer told the SPC he will also chair a task force on affordability and value, an initiative he has been pushing since last January. He hopes the group’s work will be incorporated into SPP’s 2020 operations planning and budget cycle.

“We’ll make an assessment in October this year about what further steps might need to be addressed,” Altenbaumer said.

The task force is scheduled to hold its first meeting on Jan. 30, following the board’s regular quarterly meeting. Altenbaumer said the meetings will be “quasi closed,” with each SPP member entitled to have one representative attend.

Outside groups will be invited to present best practices and their own successful experience within other organizations, Altenbaumer said. He said the group will identify ways to better communicate the task force’s efforts and will work to “keep the RSC up to speed.”

The task force will report to the board and also includes CEO Nick Brown and Directors Bruce Scherr and Julian Brix; Markets and Operations Policy Committee Chair Holly Carias, with NextEra Energy Resources; Wise; retired Director Harry Skilton; and member representatives Darrin Ives (Evergy), Jerry Peace (OGE Energy) and Jim Jacoby (American Electric Power).

SPC leadership: (left to right) SPP’s Barbara Sugg, Chair Larry Altenbaumer and Vice Chair Mike Wise. | © RTO Insider

Staff Continue Work on Validating NITS Data

SPP staff will continue to work with members as it struggles to provide a solid foundation for validating accurate network integration transmission service (NITS) data.

SPP COO Carl Monroe | © RTO Insider

COO Carl Monroe reviewed staff’s 2018 efforts in surveying customers’ understanding of their responsibility to report NITS load. He said grandfathered agreements and behind-the-meter generation have hindered integrating the reported data.

Transmission customers are legally responsible for reporting their load, Monroe said, but this information may also be provided by meter agents. He said a single NITS contract can involve multiple pricing zones, with each zone comprising multiple delivery points, and that a single transmission zone can have multiple settlement locations.

Asked by Altenbaumer how close SPP is to where it should be in reporting the data on a 1-to-10 scale, Monroe said, “Eight or 9. I’m not sure it’s a 10, but that’s a Carl Monroe sense.”

While the work is not yet complete, Monroe said he is ready to facilitate a discussion with interested stakeholders to draft a revision request for mapping NITS data.

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