itc transmission company - michigan and limited capacity surpluses. • itc is not able to achieve...

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ITC Transmission CompanyTransmission Tie Analysis DRAFT

August 2006

Presentation to Michigan CNF Workgroup 8/8/2006


2

PURPOSE OF THE ANALYSIS

• Examine ITC Area Relationship between:• Required Internal Reserves v.• Transmission Capability• At Constant Supply System Loss of Load Probability (LOLP)

• Examine trade-off between Transmission and Internal Reserves

• Produce, for further economic analysis, Three Scenarios of ITC transmission/capacity expansion with Consistent Reliability.


3

LOLP PERSPECTIVE

• LOLP is defined in this study as the cumulative loss of load hours based on an analysis that examines the probability of a supply system deficiency during the peak hour of each day of the year.

• Most of the probability of load loss due to supply deficiencies accumulates during the peak hours.

• LOLP is valuable as a relative measure of the adequacy of and changes in system reliability due to changes in system conditions.

• LOLP targets should include consideration of historical system performance, reserve levels and transmission support for reliability.

• The LOLP target that we are using is 1 day in 10 years.


4

FOR CONSISTANCY, THE STARTING POINT WAS THE MOST RECENT MISO MARELI ANAYSIS FOR The Capacity Needs Forum (CNF)

MPSC-CNF Integration Group Meeting LOLP Analysis Update July 25, 2005

This Study

Area Isolated (2009)

Area with transmission

capability

Area Isolated

30.1 days/yr

.39 days/yr

Area with transmission

capability

ITC

32.3 days/yr 1.03 days/yr(simultaneous

TTC is 2800MW)

1.03 days/yr

METC

.38 days/yr 0 days/yr(simultaneous

TTC is 3500MW)

Not tested

NOTE: MPSC-CNF data from Integration Group presentation revised 8/12/2005


5

MISO MARELI v. ITC ANAYSIS COMPARISON CONTINUED

Benchmark to MPSC-CNF “With Support”system Summary - 2009 LOLP RESULT

Sink From Import Value LOLP MPSC-CNF

ITC MAIN 3000 .69 .69ITC TVA 2800 1.03 1.03

ITC MAAC 2500 1.76 1.77

ITC VACAR 2700 1.24 1.24

This Study benchmark

NOTE: MPSC-CNF data from Integration Group presentation revised 8/12/2005


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Study Parameter Comparison (“This Study” includes ITC data refinements)

MPSC-CNF This Study

ITC Load 13,648 13,648Internal Capacity * 12,110 12,500

Reserve -11% - 8%

Consumers Load 11,212 10,950Internal Capacity 13,450 13,483

Reserve 20% 23%

Wolverine Load 494 494Internal Capacity 386 372

Reserve - 22% - 25%

Lansing Board Load 526 526Internal Capacity 532 539

Reserve 1% 2%

* ITC Internal Capacity Reconciled in Appendix 1NOTE: MPSC-CNF data from Integration Group presentation revised 8/12/2005


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ITC ANALYSIS TRANSMISSION STRUCTURE

• Two separate analysis

AEP

500

METC ITC

Variable

2500

METC ITC

Variable

1) ITC-METC only 2) ITC-METC-SOUTH


8

KEY DEFINITIONS

• See Appendix 3 for additional details.• Chart Keys

• Single Area Isolated – LOLP for an area with no ties.• Single Area Full Import – LOLP assuming tie accesses its full

capability worth of generation reserves.• 2009 – LOLP assuming studied internal and external reserves and

modeled transmission capability, with “no loss sharing.”• No Loss Sharing – External areas supply emergency assistance only

from surpluses on their system

• Capacity Benefit – Transmission Benefit to reliability measured in MW• Internal Reserves – Generation reserve capacity accessable on internal

transmission only• CBM – Transmission Set-Aside for Capacity Benefit Margin• TRM – Transmission Set-Aside for uncertainties


9

ITC – METC ONLY STRUCTURE RESULTS

• ITC-METC only areas modeled• ITC LOLP

• Single Area• Effect of Transmission Ties

• Points (a system reliability view):• Transmission is a key element of reliability• This model clearly shows saturation effects of both limited

transmission and limited capacity surpluses.• ITC is Not able to achieve reliability standard (1:10) without

assistance from outside Michigan• ITC Tie Capacity Benefit (another view)• Point: (A transmission benefit view of the same system)

• Transmission benefits saturate


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ITC-METC ONLY STRUCTURE

ITC Base Reserve LOLP

0

5

10

15

20

25

30

35

500 1000 1500 2000 2500 3000 3500 4000 4500 5000 10000

TIE CAPACITY

DA

. / Y

R.

SINGLE AREA ISOLATED SINGLE AREA FULL IMPORT 2009


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METC Base Reserve LOLP(tie capacity is bidirectional - prior to ITC capacity updates)

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

500 1000 1500 2000 2500 3000 3500 4000 4500 5000 10000

TIE CAPACITY

DA

. / Y

R.

SINGLE AREA ISOLATED SINGLE AREA FULL IMPORT 2009


12


ITC BASE RESERVE CAPACITY BENEFIT

0

200

400

600

800

1000

1200

1400

1600

1800

2000

500 1000 1500 2000 2500 3000 3500 4000 4500 5000 10000

TIE CAPACITY

MW

CAPACITY BENEFIT


13

ITC ANALYSIS TRANSMISSION STRUCTURE

ITC-METC-South Analysis

AEP

500

METC ITCVariable

2500


14

ITC – METC- SOUTH STRUCTURE RESULTS

• ITC-METC JOINED BY LINK TO AREAS SOUTH OF MI• ITC LOLP

• A big assumption – Transmission is reserved as CBM (TRM?)• Points (a system reliability view):

• Ties to South provide significant reliability benefits• Reserves and/or Transmission improve reliability• “No Transmission” requires > 20% reserves (500 MW to South

remains)• “No Reserves” requires approx. 2700 MW METC tie benefit plus

500 MW to South (3200 MW total)• Counting just METC and AEP generation surpluses support

transmission benefits up to approximately 3500 MW.


15

ITC-METC-SOUTH STRUCTURE RESULTS –(zoomed view of previous slide)

2009 Full System LOLP v. ITC-METC Tie Capability(for varying internal reserve levels)

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

0 1500 3000 4000

ITC-METC Tie Capability

LOLP

-8% Internal Reserve

0% Internal Reserves





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ITC-METC-SOUTH STRUCTURE RESULTS– ITC LOLP FOR ESTIMATED 2009 RESERVES

• This 1:10 result requires Tie Capability:• about 3200 MW to ITC from METC, plus• 2500 MW METC from South, plus• 500 MW ITC from South.

• Assumes transmission is set aside for firm reliability purposes.


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ITC-METC-SOUTH STRUCTURE RESULTS

ITC LOLP FOR BASE RESERVE

ITC Base Reserve LOLP

15.02

8.91

4.87

2.29

0.960.36 0.020.020.020.040.12

0

2

4

6

8

10

12

14

16

0 500 1000 1500 2000 2500 3000 3500 4000 4500 5000ITC-METC TIE CAPABILITY

DA

. / Y

R.

2009 LOLP: - 8% RESERVE

Loop Flow and Firm Reservations andRTO allocations?

Current assumption fortransmission


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• ITC Capacity Benefit of Ties (for base level reserves)• Longer linear portion due to access to greater reserves to the South

(compare to slide 12.)• Rapid saturation above 3500 MW due to combined effects of 3000

MW bottleneck to the South and total available capacity reserve.

• “Capacity Benefit” is “ideal” capacity• “Ideal” capacity is capacity that is fully available to cover shortages

when they occur.• The “benefit” limited by pool of available generation.• On the linear portion of the curve 1 MW of tie always can access 1MW

of generation.

• “Ideal” capacity – not to be confused with internal reserves (slides 22, 23.)


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ITC BASE RESERVE TOTAL TIE CAPACITY BENEFIT

0

500

1000

1500

2000

2500

3000

3500

4000

4500

0 500 1000 1500 2000 2500 3000 3500 4000 4500 5000METC-ITC TIE CAPACITY (MW)

MWCAPACITY BENEFIT(res -8)


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• Question:

• Transmission Capability = Generation Capacity• What decides the proper balance?

• Equivalance is not 1:1 and limited in magnitude• Coordinated Sharing• Policy

• Equitable “Tie Benefit” requires everyone to do their share

• i.e. no “leaning” (If Area A and Area B do independent studies and each relies on the other’s assumed reserve levels, both may underplan for system reliability.)

• What is the Internal Reserve v. Transmission trade-off?


21


MW Reserves for 1:10(base reserve is -1148 MW)

(2009 load is 13,648 MW)

3,071

1,092

-887

-1,500

-1,000

-500

0

500

1,000

1,500

2,000

2,500

3,000

3,500

0 1500 3000

ITC - METC Tie Capability

MW

Res

erve

s

(8%)

(22.5%)

(- 6.5%)


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(Values in first 3 columns read from previous graph)

METC Tie capability

1:10 Reserve %

1:10 Reserve MW

Added Tie

Saved Reserve

Reserve Value per MW of Tie

Benefit (MW)

0 22.5 3,071

1500 8 1,092 1,500 1,979 1.32

3000 -6.5 -887 1,500 1,979 1.32


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• 1500 MW of additional tie capability can substitute for nearly 2000 MW of internal reserves.

• 1 MW Tie Capacity = 1.32 MW Internal Reserves• 1 MW Internal Reserves replaces .76 MW Tie Capacity

• The value of Internal Reserve depends on Unit characteristics relative to the area load profile.

• Unit size relative to load• Unit availability characteristics


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ITC – AEP only TRANSMISSION STRUCTURE(Sensitivity to test tie saturation drivers)

ITC-AEP only Analysis

AEP

Variable3,000 – 10,000 MW

ITC


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COMPARE TIE BENEFITS OF TWO STRUCTURES

ITC BASE (-8%) INTERNAL RESERVE TIE CAPACITY BENEFIT

3000

3500

4000

4500

5000

5500

6000

6500

7000

3000

3200

3400

3600

3800

4000

4200

4400

4600

4800

5000

5200

5400

5600

5800

6000

6200

6400

6600

ITC Simultaneous Tie Capability (MW)

MW

Capacity Benefit AEP OnlyStructure

Vary ITC-METC Tie (tiesouth is 500 MW)

Linear (Capacity Benefit AEP OnlyStructure)


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CONCLUSIONS FROM ITC-AEP only STRUCTURE

• Tie Benefit for the 3-area structure saturates about 3500 MW• METC-area Capacity and Ties to South are Limits

• Tie Benefit for the 2-area ITC/AEP structure saturates above 6700 MW• AEP has more surplus capacity of which to take advantage

• The results point to transmission limit issues as more distant capacity is relied upon for reliability

• More distant areas’ own use of transmission may take priority


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KEY OBSERVATIONS

• Firm transmission reservations that diminish CBM will limit transmission reliability benefits to the ITC area.

• CBM is the set aside of transmission capacity for use during generation deficiency situations. This margin will limit “firm” uses of the transmission system. However, the capacity is available for non-firm use when CBM is not needed (which may be most of the time).

• Currently, there are is no margin for CBM (TRM?) subtracted from METC to ITC flowgates. Many flowgates interconnecting METC and ITC to the south have little or no CBM set aside. This issue is under investigation with MISO.


28

KEY OBSERVATIONS

• The amount of reserves required for a 1 day in 10 year LOLP is not a fixed number but depends on assumptions of transmission available for reliability.

• For ITC forecast load (CNF base forecast) and capacity for 2009, 2000 MW simultaneous CBM 8% reserves achieves 1 in 10 LOLP

• For 3500 MW ITC simultaneous CBM, -6.5% is required.

• For - 8% internal reserve, the ITC area needs about 3700 MW of simultaneous import capability that is incremental to other firm uses (such as firm transactions or allocations of flowgate capacity to other RTOs) for 1 in 10 reliability.


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KEY OBSERVATIONS

• If 1500 MW of the simultaneous import capability is used up because of other firm uses, it would imply a LOLE higher than 1 day in 10 years. Restoring LOLE to 1 day in ten years could be accomplished by increasing simultaneous import capability to 5200 MW.

• Procurement of reliability reserve obligations from “off-system” sources uses firm transmission. System reliability depends upon restoring the CBM assumptions built into the reserve requirement determination.

• Increasing tie CBM capacity reduces the total required internal reserves.


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KEY OBSERVATIONS

• Internal transmission limits are assumed to not limit “on-system” load access to internal resources or external resources delivered across the ties.

• Disparities in ITC/METC system reliability (recall base LOLP comparison) shows Michigan transmission does not support comparable reliability for all points on the system.

• Additional Transmission is required to share Michigan reserve benefits.


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Appendix 1Capacity Changes in the ITC Area


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ITC Area Capacity Changes for ITC Analysis(total +390 MW in 2009)

DETED Interruptible:1 245.00Fermi:2 137.00River Rouge:1 28.00St. Clair:7 15.00St. Clair:3 8.00Sumpter Energy Assoc.:GTGS10 4.00Carleton Farms Generating Project:1 2.40Ann Arbor Generating Station:1 0.80Lyon Generating Facility:GTGS7 -2.00St. Clair:4 -4.00St. Clair:1 -10.00Mistersky:5 -10.00Mistersky:6 -11.00Mistersky:7 -13.00


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Appendix 2

3-Area StructureVarious ITC/METC transmission capabilities

ITC -8% starting internal reserve500 MW ITC/South transmission capability

Additional Firm Tie or Internal reserve needed for 1:10 LOLP


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APPENDIX 2 - Additional Firm Tie or Internal reserve needed for 1:10 LOLP

METC/ITC import (Res -8%) (add'l firm copied from next worksheet)

MW METC / ITC Import 1000 1500 2000 2500 3000 3500 4000 4500 5000

add'l firm capacity for 1:10 2071 1574 1070 583 104 -313 -523 -576 -585

ITC INTERNAL CAPACITY 12500 12500 12500 12500 12500 12500 12500 12500 12500

ITC INTERNAL LOAD 13648 13648 13648 13648 13648 13648 13648 13648 13648

INTERNAL RESERVE (MW) -1148 -1148 -1148 -1148 -1148 -1148 -1148 -1148 -1148

INTERNAL RESERVE (%) -8% -8% -8% -8% -8% -8% -8% -8% -8%

Assumed Internal Availability 0.76 0.76 0.76 0.76 0.76 0.76 0.76 0.76 0.76

INTERNAL MW RESERVE for 1:10 1,576 923 260 -381 -1,012 -1,560 -1,836 -1,906 -1,917

INTERNAL % RESERVE for 1:10 11.6% 6.8% 1.9% -2.8% -7.4% -11.4% -13.4% -14.0% -14.0%

Capacity Benefit of Ties (MW) 1499.4 2000.1 2499.9 2997.2 3481.1 3887.6 4107.6 4155 4161.7

INTERNAL Reserve plus TIE BENEFIT needed for 1:10 3,076 2,923 2,760 2,616 2,469 2,328 2,272 2,249 2,245

TOTAL RESERVE % for 1:10 22.5% 21.4% 20.2% 19.2% 18.1% 17.1% 16.6% 16.5% 16.4%


35

Appendix 3Terms and Definitions applicable to this analysis


36

APPENDIX 3

LOLP – Loss of Load Probability – Cumulative probability that the peak daily load will be greater than available capacity plus support available over the transmissioin ties. Calculated for the peak hour of each day for a year this metric can be compared to the “1 day in 10 year” standard (LOLP=.1) LOLH – Loss of load Hours. The LOLP accumulated over a number of analyzed hours.INTERNAL CAPACITY or RESERVES – Total Generation Capacity or

Capacity in excess of an Area’s annual peak load and located within the Area’s local transmission system.MPSC-CNF – Michigan Public Service Commission Capacity Needs ForumTTC – Total Transmission Capability. The total ability of the transmissiointies to support transfers, including currently reserved firm transmission service (base transfers).


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APPENDIX 3

SIMULTANEOUS/ NON-SIMULTANEOUS – Referring to a measure of transmission capability from multiple areas, simultaneous means the maximum total transfer capability from all the areas together. Non-simultaneous means the maximum transfer capability from each area take one at a time.TIE CAPABILITY – Transmission capability available for emergency support. TIE CAPACITY BENEFIT or CAPACITY BENEFIT – The fully available firm generation support available to an area from all available transmission interfaces.SINGLE AREA ISOLATED – The LOLP for an Area assuming zero transmission tie capability.SINGLE AREA FULL IMPORT – The LOLP for an Area assuming it can receive emergency generation support up to the full capability of its transmission ties (external capacity is always available when needed.)


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APPENDIX 3

2009 Full System LOLP – Also abbreviated “2009” – Calculated LOLP based on studied internal and external capacity and transmission limits, with all their limitations active. External capacity is only available up to the transmission limit and if the external system is not itself short of supply. CBM – Capacity Benefit Margin – An amount of firm transmissioincapability reserved for access to energency supplies of generation during times when an area is short of internal supplies. TRM – TRANSMISSION RESERVE MARGIN – An amount of firm transmission capability reserved to account for uncertainties in the calculation of the Available Transmission Capability (for example, loop flows and load forecast error.)MARELI – New Energy’s Multi-Area Reliability softwareNO LOSS SHARING – A MARELI option that limits emergency assistance between areas to times when they have generation surpluses. LossSharing would enable “short areas” to share their load loss within the larger system.

itc transmission company - michigan and limited capacity surpluses. • itc is not able to achieve...

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