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History of UFE(shortened version of presentation provided at UFE Taskforce Workshop on 9/14/2004)

UFE Taskforce Meeting

February 21, 2006

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Agenda

• A Primer on UFE

• History of UFE Allocation Discussions

• UFE References in Protocols

• Example of UFE Calculation and Allocation

• UFE Data Available to the Market

• Profile Discontinuity Issue

• PWG/ERCOT Activities with UFE Impact

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A Primer on UFE

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• Unaccounted-For-Energy is the difference between the total generation supplied to a specific physical region and the total load plus losses in that same physical region during each settlement interval

• UFE may be positive or negative in any single settlement interval

Generation + Gen. Metered Inflows- Gen. Metered Outflows Total Generation

End-Use Load + Distribution Losses + Transmission Losses Total Load

UFE ( )

Negative UFE generally indicates load/loss overestimated

What is UFE?

( )

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Interval DataMetered Accounts

Profiled Energy UsageNon-Interval Data

Non-Metered Accounts

Distribution Line Losses

ERCOT Wide (Postage Stamp)

Transmission Line Losses

UFE

Net Load (Generation) for

Settlement Interval

(Includes Actual Losses in

the UFE Zone)

GAP - - - - - - >

CALCULATION OF UFE

Net Generation

compared to

Retail LoadBuild-up

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DISTRIBUTION UTILITY• Inaccuracy of method used to calculate distribution losses.

• Unrecorded services.

METERING AGENT • Incorrect meter data.

• Inaccuracy in calculation of un-metered service consumption.

• Meter reading errors.

• Errors in estimation of meter readings.

ERCOT SYSTEMS• Inaccuracy of load profiles on a settlement interval basis.

• Incorrect aggregation of retail load or zonal generation.

• Inaccuracy in method used to calculate transmission losses.

• Incorrect assignment of customer to profile type.

•Incorrect assignment of customers to UFE zone.

•Theft

Contributors to UFE

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UFE’s Effect on Settlements

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History of UFE Allocation Discussions

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Utility survey performed to determine estimate of percentage of UFE by each contributing factor.

• Nine companies responded to reformatted survey

• Categorized contributing factors to customer type

• Final allocation algorithms were developed based upon the survey results

UFE Allocation Discussion History

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Allocation methodology must recognize that high voltage customers and interval data recorders contribute less to UFE on an interval by interval basis.

UFE Allocation Principle

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FactorNumber Description

ResponseAverage Min Max

Associated with Methodology: 1 Inaccuracy of load profiles on a settlement interval basis 54.78 27.0 732 Inaccuracy of method used to model transmission losses 6.67 1.0 273 Inaccuracy of method used to model distribution losses 8.78 2.0 27

Incorrect aggregation of metered load data :4 Customers assigned to wrong UFE area 2.35 0.0 105 Double counting of meters 1.26 0.0 56 Bad load meter data (e.g. multipliers, C.T.s, etc) 4.67 0.1 107 Theft 3.07 0.1 7

Incorrect aggregation of generation metered data:8 Incorrect netting of generation in a zone 1.00 0.0 29 Double counting of meters 0.33 0.0 110 Estimated meter readings 2.22 0.0 9

11Bad generation meter data (e.g. multipliers, C.T.s, etc) 1.56 0.0 3

Inaccuracy in estimating loads:12 Inaccurate estimation of meter readings 6.33 2.0 1013 Inaccurate calculation of un-metered service consumption. 4.39 2.0 7

14Inaccurate or missing estimate of unrecorded services (services that are being provided before meter installation) 2.44 0.0 5

Total Percent: 99.9

February 08, 2000 Survey 2 Results

Factors that Contribute Toward UFE(Percent of Cost Contribution per Settlement Period)

Utility Survey of UFE Contributing Factors

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02/08/2000Attributed to

AllCustomers

Attributed to All

Distribution

Attributed to Distribution

Profiled

Total

Total 26.4 18.7 54.8 99.9

Factor # Contributing Factor: % from

New

Associated with Methodology: Survey

1 Inaccuracy of load profiles on a settlement interval basis - - 54.78 54.78

2 Inaccuracy of method used to model transmission losses 6.67 - - 6.67

3 Inaccuracy of method used to model distribution losses - 8.78 - 8.78

Incorrect aggregation of metered load data :4 Customers assigned to wrong UFE area 2.35 - - 2.35

5 Double counting of meters 1.26 - - 1.26

6 Bad load meter data (e.g. multipliers, C.T.s, etc) 4.67 - - 4.67

7 Theft - 3.07 - 3.07

Incorrect aggregation of generation metered data:8 Incorrect netting of generation in a zone 1.00 - - 1.00

9 Double counting of meters 0.33 - - 0.33

10 Estimated meter readings 2.22 - - 2.22

11 Bad generation meter data (e.g. multipliers, C.T.s, etc) 1.56 - - 1.56

Inaccuracy in estimating loads:12 Inaccurate estimation of meter readings 6.33 - - 6.33

13 Inaccurate calculation of un-metered service consumption. - 4.39 - 4.39

14Inaccurate or missing estimate of unrecorded services (services that are being provided before meter installation)

- 2.44 - 2.44

Totals 26.4 18.7 54.8 99.9

Allocation of UFE by Customer Hiearchy

UFE Allocation Factors by Delivery Point Type

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• Decision was made to accept the Allocation mechanism defined by a representative of Austin Energy as the output of the algorithm most closely matched the results of the UFE Allocation survey data

• Results were incorporated into Protocols

UFE Allocation Discussion History

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January 2006 Allocation Percentages (based upon interval by interval analysis of initial settlements)

TOTAL UFE RANGEMAX 801.36MIN 500.24AVG 26.80AVG % 0.39%

Non-IDR UFE PERCENTAGESMAX 87.15%MIN 76.37%AVG 81.56%

DISTRIBUTION IDR UFE PERCENTAGESMAX 19.84%MIN 10.99%AVG 15.90%

TRANSMISSION IDR UFE PERCENTAGESMAX 3.90%MIN 1.73%AVG 2.54%

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UFE References in Protocols

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Section 11.3.6 Unaccounted for Energy Calculation (UFE) and Allocation

The Data Aggregation System shall adjust the net loss adjusted Load for each aggregated group for Unaccounted for Energy (UFE).

The Data Aggregation process will calculate the difference between net loss adjusted Load for the entire ERCOT System, which has been adjusted for Distribution Losses and Transmission Losses, and the total system Load (generation) in order to determine the total UFE.

The calculated UFE for each Settlement Interval is then allocated to Loads.

Net flow out of ERCOT on a DC Tie will be deemed as Load, and net flow into ERCOT on a DC Tie will be deemed as a Resource

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Section 11.3.6.1 Calculation of ERCOT-Wide UFE

The Data Aggregation System will calculate ERCOT-wide UFE as the difference between the total generation supplied to a specific physical region (ERCOT) and the total Load, adjusted for losses in that same physical region (ERCOT) during each Settlement Interval.

UFE may be positive or negative in any single Settlement Interval.

UFEi (MWh) = ERCOT Generationi TotalERCOT Net Loss Adjusted Loadi Total

–

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ERCOT will allocate UFE to specific categories based upon adjusted Load Ratio Share. The adjusted Load Ratio Share will be determined using the following UFE category weighting factors:

(1) 0.00 - Transmission Voltage level IDR Non Opt-in Entities(2) 0.10 - Distribution Voltage level IDR Non Opt-in Entities(3) 0.10 - Transmission Voltage level IDR Premises(4) 0.50 - Distribution Voltage level IDR Premises(5) 1.00 - Distribution Voltage level Profiled Premises

The ERCOT Data Aggregation System shall provide a mechanism to change the UFE category weighting factors for specific transition periods.

Section 11.3.6.2 Allocation of UFE

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Section 18 – Load Profiling

Section 18.2.1 Guidelines for Development of Load Profiles – (3) Minimize the Load Profiles’ contribution to UFE over all Settlement Intervals, paying particular attention to higher cost periods

Section 18.2.8.1 Samples - ERCOT will review load research sample validity (e.g. difference-of-means test) at the following times: 1) every year, and 2) when discrepancies (such as excessive UFE) or disputes warrant.

Section 18.2.8.2 Models - ERCOT shall monitor the applicability of the Load Profiling models by comparing all available actual IDR data samples with estimates generated from the profile model by interval for the same time period. Should these comparisons reveal significant discrepancies, ERCOT should take appropriate action and coordinate with the appropriate ERCOT TAC subcommittee (UFE analysis function), if necessary.

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Example of UFE Calculation and

Allocation

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Calculate & Allocate UFE

Step 1 Determine Load Per UFE Category

Profile ID Meter Type IDR

TDSP = NOIE and Profile ID Meter Type = IDR andDLF Code = “T”

TDSP = NOIE and Profile ID Meter Type = IDR andDLF Code “T”

TDSP NOIE andProfile ID Meter Type = IDR andDLF Code = “T”

TDSP NOIE andProfile ID Meter Type = IDR andDLF Code “T”

Transmission Voltage Level IDR Non Opt-in Entities

Distribution Voltage Level IDR Non Opt-in Entities

Transmission Voltage Level IDR

Distribution Voltage Level IDR

Distribution Voltage level Profiled

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Step 2 Determine Adjusted Load Per UFE Category

UFE Category Gross MWh

Transmission Voltage level IDR Non Opt-in Entities

10,000.0000 0.0000 0.00000.0000

0.0000

Distribution Voltage level IDR Non Opt-in Entities

0.0000 0.1000 0.00000.0000

0.0000

Transmission Voltage level IDR Premises

8,000.0000 0.1000 800.00000.0385

103.3462

Distribution Voltage level IDR Premises

8,000.0000 0.5000 4,000.00000.1923

516.7308

Distribution Voltage level Profiled Premises

16,000.0000 1.0000 16,000.00000.7692

2,066.9231

Totals 42,000.0000 20,800.0000 =LUFE 2,687.0000

UFE Category Gross MWhAdjustment Weighting

Net Adjusted MWh

LRS of Adjusted MWH

10,000.0000 0.0000 0.00000.0000

0.0000

0.0000 0.1000 0.00000.0000

0.0000

8,000.0000 0.1000 800.00000.0385

103.3462

8,000.0000 0.5000 4,000.00000.1923

516.7308

16,000.0000 1.0000 16,000.00000.7692

2,066.9231

Totals 42,000.0000 20,800.0000 =LUFE 2,687.0000

Calculate & Allocate UFE

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Step 3 Calculate Total UFE per UFE Zone

Generation(MWh)

44,687.0000

Total Loss Adjusted Load(MWh)

Total UFE(MWh)

42,000.0000 2,687.0000

Calculate & Allocate UFE

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Step 4 Allocate UFE to Each UFE Load Category

UFE Category Gross MWhAdjustment Weighting

Net Adjusted MWh

LRS of Adjusted MWH

Total UFEto Category

Transmission Voltage level IDR Non Opt-in Entities

10,000.0000 0.0000 0.00000.0000

0.0000

Distribution Voltage level IDR Non Opt-in Entities

0.0000 0.1000 0.00000.0000

0.0000

Transmission Voltage level IDR Premises

8,000.0000 0.1000 800.00000.0385

103.3462

Distribution Voltage level IDR Premises

8,000.0000 0.5000 4,000.00000.1923

516.7308

Distribution Voltage level Profiled Premises

16,000.0000 1.0000 16,000.00000.7692

2,066.9231

Totals 42,000.0000 20,800.0000 =LUFE 2,687.0000

Calculate & Allocate UFE

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Step 5 Allocate UFE to Loads withineach UFE Load Category

Data Cuts in: Distribution Voltage level IDR Premises

Gross MWhLRS of Ufe Category

UFE Allocation

UFE Adjusted Load

QSEA_LSEA_TSDPA_PC12345_DLFA_CM1_UFE1 900.0000 0.1125 58.1322 958.1322

QSEA_LSEB_TSDPA_PC12345_DLFB_CM2_UFE1 1,200.0000 0.1500 77.5096 1,277.5096

QSEB_LSED_TSDPB_PC12345_DLFA_CM3_UFE1 4,000.0000 0.5000 258.3654 4,258.3654

QSEB_LSEC_TSDPC_PC12345_DLFA_CM4_UFE1 1,450.0000 0.1813 93.6575 1,543.6575

QSEC_LSEE_TSDPA_PC12345_DLFC_CM1_UFE1 450.0000 0.0563 29.0661 479.0661

Totals 8,000.0000 1.0000 516.7308 8,516.7308

Calculate & Allocate UFE

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UFE Data Available to Market

UFE Data Sets Made Available to the Public

• Total Load per UFE Zone

• Total Generation per UFE Zone

• Total UFE per UFE Zone

• Total Load per UFE Category per zone

• Total UFE allocated to each UFE Category per zone

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ERCOT Generation for 12/2 and 12/3

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Date/Time

MW

H

ERCOT Generation

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ERCOT Generation & NIDR Load for 12/2 and 12/3

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Date

Mw

h

Generation NIDR Load

Note: NIDR Load includes distribution and transmission losses

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Generation & NIDR Load for last intervals of 12/2 & the first intervals of 12/3

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Date

Mw

h

Generation NIDR Load

Note: NIDR Load includes distribution and transmission losses

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RESHIWR_EAST profile for last intervalsof 12/2 & the first intervals of 12/3

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

Date

Kw

h

RESHIWR_EAST

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Other profiles for last intervals of 12/2 & the first intervals of 12/3

0.00

0.10

0.20

0.30

0.40

0.50

0.60

Date

Kw

h

RESHIWR_NORTH RESLOWR_NORTH

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Discontinuity of profiles

Four profiles decreased significantly between the first interval of 12/3 from the last interval on 12/2 Decreased by: 121% for RESHIWR_EAST 90% for RESLOWR_EAST 88% for RESHIWR_NORTH 77% for RESLOWR_NORTH

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Discontinuity of profiles

Seven profiles decreased by 30% to 50% Decreased by: 52% for BUSLOLF_WEST 43% for RESLOWR_NCENT 42% for RESHIWR_WEST 40% for RESHIWR_COAST 40% for RESLOWR_WEST 36% for BUSMEDLF_NORTH 34% for BUSLOLF_EAST

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Discontinuity of profiles

Seven profiles decreased by 20% to 25%

Five profiles decreased by 10% to 19%

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ERCOT Generation

ERCOT’s generation decreased by 2.4% during the same time frame (i.e., between the first interval on 12/3 and the last interval on 12/2).

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UFE

Seeing that the profiles resulted in a significantly lower kwh value between the first interval on 12/3 as compared to the last interval on 12/2, the amount of UFE in the early morning hours increased significantly.

The total NIDR transmission adjusted load decreased by 16% while ERCOT’s generation decreased by only 2% during the same timeframe.

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PWG/ERCOT Activities with UFE Impact

IDR Requirement Threshold

Load Research Project

Profile ID Assignments Annual Validation Responsibility Change to ERCOT Residential Profile ID Assignment Algorithm

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IDR Requirement Threshold

Effective October 1 the IDR Requirement Threshold was lowered from 1,000 kW to 700 kW

Recommendation was based on ERCOT analysis of all ESIIDs with IDRs having demands less than 1,000 kW

To date 1,376 ESIIDs have met the IDR threshold since October

As of the February report 653 IDRs had been installed since October

TDSPs/CRs appear to be on schedule with completing the required installations by the April 30 deadline in Protocols

As of April 30 ERCOT will have approximately 10,400 IDRs (9,400 on competitive ESIIDs) in use for settlement

About 3,900 GWH moved from settlement with profiles to settlement with IDRs

Next Steps Evaluate improvements in settlement accuracy associated with the lower threshold Use ERCOT load research data to evaluate further lowering of the threshold

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Load Research Project

Load Research sample data has been (and continues to be) collected from a sample of about 4,000 ESI IDs

The samples are stratified by Profile Type, Weather Zone and Annualized kWh consumption; for Business Profile Types an additional level of stratification by service voltage level has been incorporated

ERCOT has been focused on sample point maintenance and data validation issues since these are a prerequisite to beginning data analysis

The first phase of analysis will target comparing current model performance … a comparison of profiles estimated by the load research sample vs. profiles generated by the current ERCOT models … scheduled to be complete next month

The second phase of the Load Research Project will target development, as indicated, of new models and an assessment of supplemental sampling needs … additional sample points are expected to be selected in April and IDRs installed by November

A prerequisite to this analysis is resolution of Profile ID assignment issues currently being addressed by PWG

The third phase will target an assessment of profiling methodology … a comparison of the adjusted static models with other methodologies, notably lagged-dynamic profiling and perhaps others as they are identified

New Profile Request for Oil and Gas

Ercot is analyzing a subset of the load research data along with a small supplemental sample to evaluate the merits of establishing a new Profile for ESI IDs involved with Oil and Gas Extraction

The expected outcome of the analysis is approval of a new profile type and model Initial examination indicates that oil and gas ESI IDs load shapes are significantly different than the profiles they’re being settled on

and thus contribute to settlement inaccuracy

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Profile ID Assignment

Since market open, during the Annual Validation process, high levels of ESI IDs migrating between Profile ID assignments have been occurring

PWG has made changes in the Profile ID assignment methodology each year in an attempt to reduce migration Migration reductions have been realized, but the rates remain high

Beyond the obvious transaction processing issues the migrations have indicated a continuing high level of inaccurate Profile ID assignments, which results in settlement error

The Annual Validation process looks back at historical usage to make the Profile ID assignment and applies the Profile ID prospectively

Thus for a substantial number of ESI IDs, the assignment is “out of phase” with the usage

The ERCOT Residential Customer Survey has revealed that there is a substantial amount of error in the Residential Profile ID Assignment methodology that has been in use

ESI IDs with electric heating systems assigned to RESLOWR, and ESI IDs with non-electric heating systems assigned to RESHIWR Many of the erroneous assignments are caused by occupancy changes Very little heating system conversion is occurring

ERCOT has developed an improved Residential Profile ID Assignment algorithm, which is expected to result in more accurate assignments

The principle way the algorithm achieves this accuracy improvement is by using multiple years of historical usage … thus reducing the impact of year-to-year occupancy changes

TDSPs will not be able to support use of multiple years of history in the Profile ID assignment process, for this reason and others, PWG is recommending shifting the Annual Validation calculation responsibility to ERCOT

An LPGRR to change Annual Validation Calculation Responsibility will be submitted by PWG in the near future

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Questions