review ranking input from the 2018 market roadmap … msc item 05 market... · 2018. 8. 9. ·...

Lakisha Johnson, Market Strategy

August 9, 2018

Review Ranking Input from the 2018 Market

Roadmap Stakeholder Prioritization Survey

Survey Results data edited after meeting to reflect member status for WEC Energy.

• Objective• Review stakeholder feedback received via the

2018 Market Roadmap Prioritization Survey• Discuss any areas where there may not be

alignment to better understand differences

• Key Takeaways • Strong alignment on Short-term

Capacity Reserves • Broad range of stakeholders participated

in 2018 prioritization process• IMM also participated in the 2018 survey• MISO has NOT yet updated or finalized

the priorities since the June 2018 draft prioritization created prior to the survey feedback. Updating will follow this discussion.

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Executive Summary

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Submit New Issues & Market Roadmap Candidates (Final deadline 5/1) New Candidate Fact Sheets Published (Ongoing through 6/7)

Stakeholders Rank New Candidates(Survey Closes 7/12)

Review Ranking Input (8/9)

Finalize prioritization &Update Work Plan for Market Roadmap

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Publish Monthly Updates to Market Roadmap, Project Fact Sheets and Metrics

Stakeholder Workshop (6/7)Ranking Survey Opens

Today’s focus is to discuss survey results

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STRATEGYVISION ROADMAP

R&D Questions

Federal/State Initiatives

Other Programs

Executive Strategy Retreat

Annual Symposium

Strategy

5-7 YEARS

StakeholdersIMM

FERC

Other Programs

MISO

Implem

entation

PlanningScenarios

Market Roadmap part of broader strategy execution

Market Roadmap focuses on Guiding Principles

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Support an Economically Efficient Wholesale Market System that Minimizes Cost to Serve Load

Facilitate Non-discriminatory Market Participation Regardless of Resource Type, Business Model, Sector or Regional Location

Develop Transparent Market Prices Reflective of Marginal System Cost, and Cost Allocation Reflective of Cost-Causation and Service Beneficiaries

Support Market Participants in Making Efficient Operational and Investment Decisions

Maximize Alignment of Market Requirements with Reliability Requirements of the System

67 External Stakeholders participated in ranking 62 with voting rights

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Members52

Non-Members w/ Voting

Rights10

Non-Member Market

Participant3

Other1

IMM1

Count by Stakeholder Category Count by Segment

1

1

2

5

14

4

1

24

4

6

1

0

2

1

1IMM

Competitive Transmission Developers

Coordination Member

End-User Customers

Environmental/Other Stakeholder

IPPs/EWGs

Munis/Coops/TDUs

Power Marketers/Brokers

Public Consumer Groups

State Regulatory Authorities

Transmission Owners

Detailed Sector Comparison – see separate pdf for ease in reading

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Summary Table

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Company name: Active - MR#2 Enhanced Modeling of Combined Cycle GeneratorsAmerenMember, Transmission Owners This item could be combined with MR #63 - Enhanced Modeling of Generator Operations

WPPI EnergyMember, Munis/Coops/TDUs

With changing resource mix and less excess capacity, and Market System Enhancement project, seems timely to consider how existing resources may be further optimized.

Louisiana Public Service Commission Non-Member with Voting Rights, State Regulatory Authorities

Ranked MR#2 “H” as we believe MISO and its stakeholders are committed to implementing this market improvement. Economics and improved utilization of the capabilities of CCGTs dictate the need to implement this market improvement on schedule. This market product should enhance the implementation of the “partial outage” CCGT technology planned for some regions of MISO’s footprint.

Company name: Active - MR#10 Short-Term Capacity Pricing and Reliability RequirementsDTE EnergyMember, Munis/Coops/TDUs DTE believes this is important, but restricted by the number of high and mediums.

Vectren Energy Delivery Member, TransmissionOwners

If Vectren had been allowed to select four "Medium" priority topics, this one would have been the fourth.

WPPI EnergyMember, Munis/Coops/TDUs MISO has made a resonable case that a short-term capacity reserve product would be useful.


Ranked MR#10 “H” as we believe MISO and its stakeholders are committed to implementing this market improvement. The “Build” stage of this market improvement product is scheduled to begin Quarter #4 of 2018. Reaching the “Build” stage indicates MISO and stakeholder support for this market improvement product.

Minnesota PowerMember, Transmission Owners MP believes that this should be handled as part of the RAN initiative (Market Roadmap Candidate #25)

Company name: Active - MR#25 Address Resource Availability and Need (Formerly Seasonal RAR)

Member, Anonymous This effort should also capture the purpose of MR 67- Accurate values regarding availability should allow MISO to procure capacity to satisfy planning needs and achieve LOLE objective.

DTE EnergyMember, Munis/Coops/TDUs

DTE believes roadmap 67 is part of this larger project. RAN is critical as the industry shifts as outlined in MISO's whitepaper on RAN. Proper institution of the correct market drivers should incent generator operators to improve availability under all scenarios, while also properly valuing resources that perform essential functions to maintain grid reliability, flexibility, and efficiency.


It is reasonable to expect tools, processes, and market product/services will need to evolve in order to comfortably operate a system with less excess capacity and more resources dependent on wind and sun as their fuel.


Suggest this market product maintain a “Low” priority until the MISO stakeholder process is completed and consensus reached on future Resource Availability and Need (RAN).

Wind on the WiresNon-Member with VotingRights, Environmental/Other

WOW does think this is an important effort, and would have ranked this item higher were it not for the limitations of the survey.

Coalition of Midwest Power Producers (COMPP) This is not needed prior to fixing flawed capacity construct.

Stakeholder Comments Received to Make Available Publicly from the 2018 Market Roadmap Stakeholder Prioritization Survey

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Company name: Active - MR#31 Multi-Day Market ForecastMember, Anonymous This information should help Owners make beneficial commitment decisionsDTE EnergyMember, Munis/Coops/TDUs DTE believes this can add economic value and should be part of MISO's workplan if not for the market system enhancement.


While potential value to both generators and load, actual value seems very unlikely given challenge in accurately projecting market energy prices.


The Multi-Day Forecast has merit for units with “slower” start-up times. MISO has noted work on this market product is inactive at this time, but does have implementation scheduled for 1st Quarter 2021. I ranked this market product as “Medium” to maintain focus. CLECO and other generator owners have raised concerns with the extensive routine cycling of base load units (especially) coal leads to inefficient unit commitment and increases O&M costs for the units. Implementation of this market product could result in fewer of these units retiring along with an improvement in the unforced outage rate and reduced energy costs for these units.

Company name: Active - MR#51 Enhanced Storage Resource


DTE believes this project can better leverage existing energy storage within MISO (i.e. Pumped Storage) beyond meeting minimum requirements under FERC Order 841 and believe there is benefit for future storage with the continued renewable penetrationexpected.

E.ON Climate and Renewables North America, LLC Member, IPPs/EWGs We would like this to be coordinated with MISO's current efforts on Order 841 compliance.

WPPI EnergyMember, Munis/Coops/TDUs The first step is to comply with FERC's energy storage order (841) and then to build from there.

Company name: Active - MR#54 Application of Dynamic and Predictive RatingsDC EnergyMember, Power Marketers/Brokers Pursue if MISO will be providing transparency on what ratings are used


DTE believes this project will help leverage existing line capabilities reducing the potential overbuild of transmission and resulting cost impact to our customers.

E.ON Climate and Renewables North America, LLC Member, IPPs/EWGs

In addition to dynamic ratings there is a recent development of devices that can dynamically change the impedance of a line (an example would be SmartWire's products), changing the flows in the system. We understand the integration of such devices would be a separate initiative, but we would ask MISO to consider other type of dynamic system topology changes if this initiative is implemented.


While very supportive of efficient use of transmission, progress won't be made on this Market Roadmap candidate until transmission owners are supportive.


MISO has noted this market product is “Inactive”. MISO has noted implementation of this market product is expected to cost $1 million with about $2 million in APC savings. However, the MISO IMM recommends this market product be implemented. Congestion savings could be significant with utilization of Dynamic & Predictive Ratings. Wind generation is driving a lot of congestion in certain areas of the MISO footprint including the MISO-SPP seam. Quite a bit of the wind generation is off-peak during the winter and shoulder months. There is quite a bit of additional transmission capacity available when wind production is high as temperatures are generally lower along with increased wind speeds. It should be noted that Entergy incorporates these Dynamic and Predictive ratings and these increased ratings were utilized during the January MAXGen Alert.

Wind on the WiresNon-Member with Voting Rights, Environmental/Other

WOW believes there is an important opportunity to make more efficient use of the transmission system with Dynamic Line Ratings, taking into account wind speed and ambient temperature. DLR should be used under normal operating conditions and not reserved only for emergency situations.

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Company name: Modified - MR#33 Incentive for Frequency Response Service

Member, Anonymous

Primary Frequency Response (“PFR”) is an automatic, nearly instantaneous response to deviations in frequency. The responsibility for provision of this essential reliability service lies with the Balancing Authority (“BA”). NERC defines MISO as the BA for PFR. To ensure necessary provision of PFR Transmission Owners (“TOs”), Transmission Providers (“TOPs”), Generation Owners (“GOs”) and Generation Providers (“GOPs”) functionally provide PFR since MISO does not have direct/real time control of generation and load to respond to frequency. A system with fast capability to respond to frequency deviations is key to avoid major system blackouts. With the continued retirement of traditional base load generation and its replacement with renewables, the ability of the system to respond to frequency events is expected to decline. This must be addressed to enhance the resiliency of the system. As the industry continues to work to harden the grid, the provision of PFR is critical.Therefore, an explicit and defined incentive for provision of PFR, such as an ancillary service product in the market or a tariff compensation mechanism, needs to be strongly considered to move resiliency efforts forward and to provide safe, reliable service to end use customers. Market participants will be slow to build resources that provide PFR without a requirement and/or economic incentive to provide PFR. The resources in the MISO footprint that are best equipped to provide this service should be compensated appropriately. For example, an electric storage resource (“ESR”) capable of providing PFR near instantaneously should be paid an incentive to do so. The current market does not incentivize TOs, TOPs, GOs and GOPs to provide PFR. By defining PFR as an ancillary service, it will influence future resource selection.Specifically in regards to an ancillary service mechanism for provision of PFR, consider the following suggestion: MISO should (1) pay the locational marginal price (“LMP”) multiplied by the amount of MWhs of PFR injected in order to respond to under frequency deviations, (2) pay the LMP multiplied by the amount of MWhs of PFR absorbed in order to respond to over frequency deviations and (3) apply a mileage factor of2.9 times the amounts in (1) and (2) for faster responding resources to account for the benefits of faster performance. This suggestion follows the current MISO day-ahead and real-time structures for Secondary Frequency control and the dispatched Regulation market. It is worth noting that the provision of PFR is completely automatic without the technical need for manual dispatch.

DTE EnergyMember, Munis/Coops/TDUs Fundamentally, DTE believes all resources should be paid for the services and benefit they provide to the MISO footprint.WPPI EnergyMember, Munis/Coops/TDUs Not necessary.


This market product is recommended to remain in the “parking lot” until the MISO Renewable Integration Impact Assessment (RIIA) Study is complete. Frequency response is a concern as renewable resources provide a greater share of the generation in MISO’s footprint due to limited or no inertia with these units. Frequency response issues that may be caused by renewable generation are expected to be fully vetted in the RIIA Study which will enhance the development of this market product.

Minnesota PUCNon-Member with VotingRights, State RegulatoryAuthorities

It can be done later. Based on MISO's report at RSC, we don't have immediate need.

Company name: NEW - MR#63 Enhanced Modeling of Generator OperationsMember, Anonymous This should be a follow-on to MR#2 - Enhanced modeling of CC generatorsDTE EnergyMember, Munis/Coops/TDUs

DTE believes this project is a logical next step after the new combined cycle logic is proven. The logic should be easily implemented for all resources with equipment break points. This will improve overall MISO reliability and economics within the MISO footprint.

WPPI EnergyMember, Munis/Coops/TDUs Should be considered in conjunction with Market Roadmap ID 2 Enhanced Modeling of Combined Cycle Generators.

Xcel EnergyMember, Transmission Owners

Xcel Energy supports this initiative but since it is dependent upon completion of the ECC project which is currently scheduled for March 2022, we needed to apply a "High" or "Medium" ranking to another project

WEC Energy GroupMember, Munis/Coops/TDUs

WEC Energy Group supports evaluation and development of this Market Roadmap item once MR#2 (Enhanced Modeling of CC Generators) is implemented and validated. Additionally, we note that this item is dependent on the Market System Enhancement project.

Great Plains InstituteNon-Member w/ Voting Rights, Environmental/Other

Our understanding is that MISO plans to evaluate applicability of the ECC work to other resource types, thus making this duplicative


This appears to be an extension of Market Product #2 and is recommended to be incorporated accordingly.

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Company name: NEW - MR#64 Look Ahead DispatchMember, Anonymous This information should help Owners make beneficial operational decisionsDTE EnergyMember, Munis/Coops/TDUs

This should lower production costs for the footprint on the system by enabling generator owners to more proactively commit/decommit equipment in an effort to more closely follow the MISO setpoint.


Not clear to what extent any issues of a generator operator being unprepared for a future dispatch instruction are best resolved via look ahead dispatch vs. expansion of offer parameters. Open to exploring.


Ranked this market product “Low” due to its complexity and implementation will probably require the new Market System Enhancement software to be in place. This can be pursued at a later and more appropriate time.

Company name: NEW - MR#65 Require the Installed Capacity (ICAP) of Planning Resources be DeliverableDTE EnergyMember, Munis/Coops/TDUs

DTE believes this will increase the amount of generator interconnection studies and add to the already significant backlog, while also increasing costs to our customers with little incremental benefit to reliability.


The impetus for this Market Roadmap candidate appears to have been capacity (resource adequacy) concerns. However, current deliverability requirements do not appear to be a causing capacity issues.


WEC Energy Group is opposed to this Market Roadmap candidate.


Ranked this market product “Low” as the requirement for ERIS to be considered firm resulting in the need for firm transmission is a significant shift. It is recommended this proposed market product go through the LOLEWG stakeholder process to fully understand the ramifications, impacts and feasibility prior to proceeding.

Coalition of Midwest Power Producers (COMPP) Other, IPPs/EWGs Absolutely necessary.

Company name: NEW - MR#66 Remove transmission charges from Coordinated Transmission Service (CTS) transactions

Non-Member Market Particpant, AnonymousIt is critical to remove transmission charges so that the potential benefits outweigh the costs for participants wisining to transact. In its current form, CTS is not serving a useful function (market activity is and will continue to be close to non-existent)

DC EnergyMember, Power Marketers/Brokers This would result in added value to customers by maximizing CTS transactions that would converge the seam

DTE EnergyMember, Munis/Coops/TDUs DTE fundamentally agrees with this project and it should be implemented since it does not impact the market system enhancement.


When CTS was under development, don't recall discussing whether transmisson charges should apply. Open to discussing. Although even if charges assessed on CTS are very small, expect benefits of CTS product minimal. Also, likely not worth pursuing until PJM is willing to reduce its CTS charges.


Suggest that this be a “Do Not Pursue” as removal of these transmission charges should be resolved in the stakeholder forums first. Also, does this constitute a Market Roadmap Candidate? If stakeholders and MISO agree to remove these transmission charges, then the appropriate tariff and/or BMP changes and/or market rules could be changed accordingly. In summary, will need additional explanation as to why this would be classified as a Market Roadmap Candidate.

Coalition of Midwest Power Producers (COMPP) Other, IPPs/EWGs The IMM's SOM report demonstrates this was implemented poorly by MISO.

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Company name:NEW - MR#67 Establish PRA capacity credits for emergency-only resources that better reflect their expected availability and deployment performance

Member, Anonymous This should also be included in MR 25-RAN, to maximize alignment of market requirements with reliability requirementsDTE EnergyMember, Munis/Coops/TDUs DTE agrees with this project and believes it should be solved within the larger RAN (ID 25) project.

Vectren Energy Delivery Member, TransmissionOwners

Vectren considers this one a "High Medium". If the Company had been allowed to select three candidates, this one would have been the third.


As this Market Roadmap Candidate is written, suggests there are issues with PRA capacity credits emergency-only resources receive today. We do not think such a case has been made.


WEC Energy Group fully supports this initiative and considers it within the purview of MR#25 (Resource Availability and Need) along with our "high" ranking of MR#25.


Ranked this “Low” until the MISO stakeholder forum has a chance to evaluate the reordering of the MAXGen Alert resources stack such that MISO does not have to issue a MAXGen Alert to access resources near the bottom of the stack. Market incentives to improve the availability of these resources appears reasonable and is recommended to be pursued, but development of these market incentives (capacity credits) is just one component of reordering of the stack.

Minnesota PUCNon-Member with VotingRights, State RegulatoryAuthorities

It can be done within RAN discussion.

Coalition of Midwest Power Producers (COMPP) Other, IPPs/EWGs

The 12GWs of DR can't perform within two hours and we agree with the IMM's recommendation on developing a new standard.

Minnesota PowerMember, Transmission Owners MP believes that this should be handled as part of the RAN initiative (Market Roadmap Candidate #25)

Company name: NEW - MR#68 Evaluate the feasibility of implementing a 15-minute Day-Ahead Market under the Market System EnhancementDC EnergyMember, Power Marketers/Brokers More granular markets would provide more benefits to consumersDTE EnergyMember, Munis/Coops/TDUs DTE agrees this could add economic value, but the costs are extremely high and question the current technology capability at this time.WPPI EnergyMember, Munis/Coops/TDUs Seems an obvious enhancement previously not possible that would improve alignment between day-ahead and real-time.Louisiana Public Service Commission Non-Member with Voting Rights, State Regulatory Authorities

Suggest this proposed market product be “Do not Pursue” at this time until the Market System Enhancement is implemented. Development of other market products have a higher priority.

Minnesota PUCNon-Member with Voting Rights, State RegulatoryAuthorities

Research can be done outside Market Roadmap discussion

Company name: NEW - MR#69 Allow Dispatchable Intermittent Resources (DIRs) to Provide Regulation ServiceMember, Anonymous The best solution would be to revise regulation to separately clear reg up and reg down, which would ultimately be a better system.DTE EnergyMember, Munis/Coops/TDUs Fundamentally, DTE believes all resources should not be restricted from offering services they are capable of providing.WPPI EnergyMember, Munis/Coops/TDUs While DIRs are capable of providing regulation service, expect it is rarely optimal for DIRs to do so. (i.e., expected benefits not worth effort)


WEC Energy Group is opposed to this Market Roadmap candidate.


Suggest this proposed market product be “Do not Pursue” at this time until the Market System Enhancement is implemented. Development of other market products have a higher priority.

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Thank You!

Questions or feedback:Lakisha Johnson: [email protected]

Mia Adams: [email protected] Sperry: [email protected]

mailto:[email protected]?subject=Market%20Roadmap%20Question

mailto:[email protected]

mailto:[email protected]?subject=Market%20Roadmap%20Question

First Draft of MISO Market Roadmap Candidate Scoring Value Proposition Benefits & Costs Risks Project Readiness DART

2018 Status ID Market Roadmap Candidate Name

Total Score

(rounded)

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Weight: 5% 10% 10% 10% 10% 5% 5% 4% 3% 7% 7% 7% 7% 3% 4% 3% Y/NActive 10 Short-Term Capacity Reserves 5 3 9 9 1 9 9 3 1 1 0 0 9 3 9 3 9 Y

Active 25 Address Resource Availability and Need (Formerly Seasonal RAR) 5 3 9 3 3 9 9 9 1 0 0 0 3 9 1 9 1 N

Active 2 Enhanced Modeling of Combined Cycle Generators 4 9 1 9 0 3 9 9 0 0 0 0 3 9 9 9 3 Y

New 64 Look Ahead Dispatch 3 3 9 9 0 1 3 9 0 1 0 0 1 3 9 0 0 YNew 63 Enhanced Modeling of Generator Operations 3 9 1 3 0 3 9 9 0 0 0 0 0 9 9 0 0 Y

Active 51 Enhanced Storage Resource 3 9 3 3 3 3 3 1 0 1 0 0 3 9 3 0 0 YActive 54 Application of Dynamic & Predictive Ratings 2 3 3 3 0 1 9 9 3 3 1 0 1 3 1 1 1 N

New 67Establish PRA capacity credits for emergency-only resources that better reflect their expected availability and deployment performance

2 0 3 3 0 1 3 3 0 3 0 3 3 1 9 1 1 N

Active 31 Multi-Day Market Forecast 2 3 1 3 0 1 9 3 0 0 0 0 3 3 3 3 1 NModified 33 Incentive for Frequency Response Service 2 3 3 3 0 3 1 1 0 1 0 0 1 3 3 1 0 Y

New 69 Allow Dispatchable Intermittent Resources (DIRs) to Provide Regulation Service 1 3 3 1 0 3 1 1 0 1 0 0 1 3 3 0 0 Y

New 68Evaluate the feasibility of implementing a 15-minute Day-Ahead Market under the Market System Enhancement

1 3 1 3 0 3 3 1 0 0 0 0 0 3 1 0 0 Y

New 66 Remove transmission charges from Coordinated Transmission Service (CTS) transactions 1 1 0 1 0 1 1 1 1 9 0 0 3 0 9 1 0 N

New 65 Require the Installed Capacity (ICAP) of Planning Resources be Deliverable 1 0 1 1 0 0 1 0 0 9 0 1 1 1 9 0 1 N

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Prioritization Matrix – (Pre-Stakeholder Survey)

* DART: Indicates whether market roadmap candidate is likely to impact MISO's day-ahead real-time market management system

Market Roadmap Work Plan Key

PROJECT PHASE INDICATOR DESCRIPTION

Frame F Not typically shown on Market Roadmap; Gap Analysis, Develop Management Position, Develop Analysis Strategy

Evaluate E Research/Gather Information, Proof-of-Concept, Cost-Benefit Analysis, Whitepaper

Concept Design C Develop and Refine Concept, High Level Business Rules and Software Requirements

Build B Software Functional Specification, Vendor Software Design, Preparation for Construction, Capital Dollars, Software Development, Hardware Procurement, Business Process

Implement I Near Pre through near post implementation; Operational Transitional Phase, Implement Production System

Validate V Analysis of Project Effects, Reporting of Findings

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Current Work Plan

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review ranking input from the 2018 market roadmap … msc item 05 market... · 2018. 8. 9. ·...

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