ISO Proposed Flexible Capacity Requirements

Stephen Keehn

Senior Advisor

California ISO

CPUC Workshop

January 26, 2012

The ISO proposes adding flexible capacity requirements to the existing RA program

• The requirements:

– Three flexible capacity categories based on system needs from Renewable Integration Studies

• Maximum ramping

• Load following

• Regulation

– Applies system-wide to the entire RA fleet

• The ISO proposes for 2013 that the requirements be based on the capabilities of the 2012 RA fleet

• For subsequent years, the requirements will be calculated from historical analysis of system net load data

LSEs have the first opportunity to satisfy the requirement and cure any deficiencies

• The ISO will determine the amount of flexible capacity it requires in each category

• After LSEs make their 2013 RA showings, the ISO will determine if the 2013 RA showings in aggregate satisfy the requirements in the three flexible capacity categories

• If there is a deficit in any of the flexible capacity requirements, LSEs have the opportunity to cure the deficiency

• If the deficit remains, the ISO will exercise its backstop procurement authority to cure the deficiency

The cost of ISO backstop procurement will be assigned first to the deficient LSEs

• Backstop procurement costs will be allocated to those LSEs that did not satisfy the flexible capacity requirements

– Example of how this could work:

• Assume RA requirement is 50,000 MW and load following flexible requirement is 10,000 MW

• Percentage is 20%

• Cost of backstop would be allocated to LSEs with less than 20% of their RA portfolio as load following in proportion to their shortage relative to all LSE shortages

• Exact mechanism will be developed in ISO stakeholder process

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Flexible capacity procurement will require other changes to RA program

• Flexible capacity requirements will be assessed on a monthly basis– Allows resources to have different flexible capacity amounts in

different months of the year – Flexible needs may not correspond directly to total RA needs

• Year-ahead RA showings will be for the entire year, not just the 5 summer months– Ramping needs are a concern in the shoulder months when

renewable output is high but load is low

The CAISO proposes three flexible capacity categories, and, therefore, requirements

• Maximum Ramping– To meet maximum expected continuous ramp need

• Load Following– To meet dispatch needs

• Regulation– To ensure sufficient regulation capacity

Resources can have flexible capacity that fulfills requirements in the different categories

Flexible Capacity Requirements for the 2013 RA Compliance Year

• For 2013 ISO proposes basing requirements on capabilities of 2012 RA Fleet– Simple basis for 2013 needs determination– ISO believes that maintaining the same flexibility as the 2012 RA

fleet will ensure reliability in 2013– Allows time for further analysis and stakeholder discussions to

refine requirements for 2014 and beyond

• For 2013, to calculate flexible capacity requirements: – Calculate annual fleet flexibility capability for peak summer month– Apply factor for each month

• Factor is ratio of monthly load level to peak summer month load level

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ISO 2013 RA Flexible Capacity Requirements Based on the 2012 RA Fleet Capabilities

• Maximum Ramping 22,055 MW– Includes steam and gas turbines, excludes hydro

30,955 MW (if incl. hydro)

• Load Following 9,696 MW– Includes steam and gas turbines, excludes hydro

• Regulation 1,380 MW– Includes hydro

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These values are illustrative and based on August 2012 annual showings

Requirements will be refined for 2014 and beyond

• To be determined by analysis of load (net of solar and wind) system variability– ISO is still studying and validating approach– Not just ramping need for the time period, but must account for:

• Units on forced outages• Forecast errors• Use limited resources• Units on line vs. off-line

– The load following and regulation requirement must account for both up and down capability

– Flexibility requirements must link to obligations of units• For example, resource may not self-schedule to qualify as a flexible capacity

resource

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Description- Maximum Ramping

• Units must be able to respond to ISO dispatch instructions– Intermittent generation, baseload units, and units that

self-schedule do not count• Requirement determined by largest continuous ramp

– Total MW of ramp– Continuous ramp for 5 minute dispatch

• For 2013 propose to set requirement based on ramping capability from resources that are dispatchable and not use limited

Description- Maximum Ramping (cont.)

• Each resource’s contribution to maximum ramping capacity over the time period is:

– NQC - Pmin if the unit cannot start fast enough

– NQC if the unit can start and get to its NQC in the ramp interval

• This may overstate the ramping capability of the fleet

– Units requiring the full time to ramp their capacity can only provide their maximum ramp capacity if started ramping at the beginning of the ramp period

– this must be accounted for in calculating the max ramping requirement in subsequent years

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Description- Load Following

• For 2014 and beyond, requirement is the 15 minute ramping capacity need based on the ISO’s largest 15 minute net load ramp expected for the month

• For 2013 this value will be based on the amount of 15 minute ramp capability of the dispatchable 2012 RA fleet

• Each resource’s contribution is the minimum of

NQC – Pmin

RampRate * 15 minutes

Where: RampRate is the unit’s MW/min weighted average ramp rate

Description- Regulation

• The regulation requirement is expressed in MW/min

• Units must be regulation certified by the ISO

• Ramp rate is based on a unit’s MW weighted average ramp rate as certified by the ISO

A unit may fulfill requirements in several flexible capacity categories- Example 1

• Example 1: – NQC = 500 MW, Pmin = 300 MW – Ramp rate =10MW/min, regulation certified– 3 hour start-up– Not self-scheduled

• Provides the following RA capacity:Generic: 500 MW (NQC)

Maximum Ramping 500 MW (NQC, start < Max Ramp Time)

Load Following 150 MW (10 MW/min * 15 min)

Regulation 10 MW/min

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A unit may fulfill requirements in several flexible capacity categories- Example 2

• Example 2: – NQC = 500 MW, Pmin = 200 MW – ramp rate =5 MW/min, not regulation certified– 18 hour start-up– not self-scheduled

• Provides the following RA capacity:Generic: 500 MW (NQC)

Maximum Ramping 300 MW (NQC - Pmin, start > Max Ramp Time)

Load Following 150 MW (10 MW/min * 15 min)

Regulation 10 MW/min (not regulation certified)

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Use limited resources need further consideration in the context of flexible capacity

• The ISO has not fully determined the potential impacts of Use Limited Resources (ULRs) on the flexible capacity requirements

• For this year, the ISO believes that the Energy Division proposal for revised MCC buckets that incorporate dispatchability may have potential to address ULRs– May require refinements to the definitions of some of

the buckets• Excluding hydro for 2013 should also be considered

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ISO Proposed Flexibility Requirements and Potential Relationship to Energy Division Proposed Buckets

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Current Proposed ISO Recommended Flexibility Requirements

Bucket

Name

Monthly

hours of

operatio

n

Maximum

cumulativ

e

percentag

e of

resources

Operatio

nal

Characte

ristics

Hours of

operation

Maximum

Cumulative

percentage

of

resources

Operation

Characteristi

cs

Capacity

(MW)

Ramp Duration

-15 minute

ramp

-Longest

Duration

(minutes)

Average

Speed

(MW/min)

Comment

Bucket 4 All

hours

100% None All hours 100% Dispatchable 7,736

20,044

15

660

516

30

Steam

Turbines

Bucket 3 415 30.1% None All hours >60% Non-

dispatchable

Bucket 2 171 18.6% None Limited

hours

<50% Dispatchable 1,960

2,011

~8,899

15

67

131

30

GT

Hydro

Bucket 1 87 13.6% None Limited

hours

<25% Non-

dispatchable

1

5

1,830

7,403

Regulation

These values are illustrative and based on August 2012 annual showings