Texas Nodal Development Process Committee Structure

Ground Rules of this Meeting This is NOT a position advocacy meeting. It

is a meeting to define committee structure for market redesign!!!

Mutual respect is desired from all Everyone get out paper and pen and note

questions on slides and hold them.

Ground Rules of this Meeting Cont. The presentation will be given and questions

taken in sections: Roles/Responsibilities Committee Structure Work flow/appeals process Refinements for presentation at TAC

Purpose of the Meeting

Develop cohesive process for the Texas Wholesale Market redesign

Define roles for those involved Produce recommendation to be

presented at TAC and ultimately the Board

Roles and Responsibilities

Six major players exist in the process ERCOT Staff Stakeholders PUC Staff/MOD TAC ERCOT Board/Board Oversight Committee PUC

ERCOT Staff

Role Process facilitator and advisor

Duties Meeting Chairmanship? Meeting Organization (agenda, when, where) Provide insight and advice on systems and

processes Protocol language development Seams management (more later) Strawman recommendations

Stakeholders

Role Develop the policies needed to operate the Texas

Nodal market Duties

Strawman Development Approval of designs Industry segment concerns

PUC Staff/MOD

Role Ensure that policies & rules established for the

market comply with regulatory policies & rules Ensure policies & rules do not provide improper

market incentives and are non-discriminatory Expedited conflict resolution

Duties Strawman recommendations Reporting to the Commission

Technical Advisory Committee Role

Approve recommendations of the ShAG and provide decisions on issues of dispute

Duties Voting on strawman documents Submitting approved stawman documents to the Board Reporting to the Board Oversight Committee of progress Deciding on appeals Directing PRS to convert Board approved strawmen into

PRRs

ERCOT Board of Directors

Role Approve strawmen produced by TAC Decide on appeals of TAC decisions

Duties Voting on strawman documents Direct TAC to have documents converted to

Protocols Deciding on appeals Report to the LOC on progress?

Board Oversight Committee Role

Act as “subject matter experts” for the Board Oversee market development process Ensure conformity with ERCOT principles Ensure process is non-discriminatory

Duties Assist in development of subcommittee structure Monitor committee process Review issues of conflict with the Board Communicate Board recommendations to TAC

Public Utility Commission

Role Provide final approval of completed Texas Nodal

Design Final arbiter of any disputes in the process

Duties Approval of Protocols including Texas Nodal

Design Provide Orders or guidance on direction of

decisions Rule on appeals

Basic Committee Structure ERCOT BoardERCOT Board

GenerationAdequacy

GenerationAdequacy

TransmissionRights

TransmissionRights

OperatingGuides

OperatingGuides

MarketMitigation

MarketMitigation

Day AheadMarket

Day AheadMarket

SettlementSettlement

OperationsOperations

DesignImplementation

DesignImplementation

CongestionManagement

CongestionManagement

Note: Committees are shown as placeholders and only developed if needed

Board Oversight CommitteeBoard Oversight Committee

Technical Advisory CommitteeTechnical Advisory Committee

Stakeholder Advisory GroupShAG – Yeah Baby!

Stakeholder Advisory GroupShAG – Yeah Baby!

Protocol RevisionSubcommittee

Protocol RevisionSubcommittee

Stakeholders Advisory Group Governance

Chair: Independent or ERCOT Vice Chair: ERCOT Voting Structure

Similar to PRS Allowances for voting by non-ERCOT members and ERCOT? 7/8? Segments with one vote per company in each segment Simple majority to pass? ANY DECISIONS MADE CAN BE APPEALED TO TAC

Issues Clearinghouse for all Texas Nodal Market Decisions Early issue: Standard Market Design vs. ZEN vs. Other?

ERCOT Personnel Minimum of one representative from

Operations Settlement Seams representative

Congestion Management Subc. Governance

Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for input to

ShAG

Issues Definition of nodal market Selection of basic features

Additional ERCOT Representatives: ERCOT Operations

Primary Protocol Section Responsibility Section 6: Ancillary Services

Operations Subcommittee Governance

Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for input

to ShAG

Issues Ancillary Services modification? Dispatch changes to unit specific Congestion management changes Unit specific scheduling changes? (here or DA group) Market data?

Operations Subcommittee Con’t Additional ERCOT Representatives

Operations Operations’ systems Settlement

Primary Protocol Section Responsibility Section 4: Scheduling Section 5: Dispatch Section 6: Ancillary Services Section 7: Congestion Management Section 12: Market Information System Section 17: Market Data Collection and Use

Settlement Subcommittee Governance

Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for input to

ShAG Issues

Node specific resource settlement Process for Load Area creation (same zones for load or new?) Changes to imbalance calculations (settle all or imbalance?) Charge type changes Formula changes

Additional ERCOT Representatives: Wholesale settlement

Primary Protocol Section Responsibility Section 6: Ancillary Services Section 9: Settlements and Billing

Day Ahead Market Subcommittee Governance

Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for input to

ShAG

Issues DAM design

Bidding structure Scheduling process Congestion management process Transmission rights treatment Credit management Market clearing Notification

Trading Hub development

Day Ahead Market Subcommittee Con’t Additional ERCOT Representatives:

Market Operations’ systems Settlement

Primary Protocol Section Responsibility Section 4: Scheduling Section 7: Congestion Management Section 12: Market Information System Section 16: Registration and Qualification of Market participants Section 17: Market Data Collection and Use

Market Mitigation Subcommittee Governance

Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for

input to ShAG Issues

Method to be used to mitigate potential market power abuse in a nodal market

Additional ERCOT Representatives: Market Settlement

Primary Protocol Section Responsibility Section 7: Congestion Management

Operating Guides Subcommittee

Governance Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for

input to ShAG Issues

Changes needed to the Operating Guides to implement unit specific resource management

Additional ERCOT Representatives: Operations

Primary Protocol Section Responsibility None

Transmission Rights Subcommittee Governance

Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for input to

ShAG Issues

Flowgate vs. point-to-point rights or combination Options vs. obligations Auction process Pre-Assigned rights

Additional ERCOT Representatives: Market TCR Auction Settlement

Primary Protocol Section Responsibility Section 7: Congestion Management

Generation Adequacy Subcommittee Governance

Chair: ERCOT, Stakeholder, Independent? Vice Chair: ERCOT seams representative Voting Structure: Non-binding straw votes recorded for input to

ShAG Issues

Method to be used to ensure capacity in ERCOT Additional ERCOT Representatives:

Market Settlement

Primary Protocol Section Responsibility Section 4: Scheduling Section 6: Ancillary Services

Ground Rules

Everyone agrees to play nice Robert’s Rules of Order will

be applied in committees with voting structures

In committees with no voting structures majority and minority opinions will be elevated with straw votes taken

Others?

Work Flow

ShAGSubcommittees---------------------Develop White

PapersStraw Voting

ShAG---------------------Voting of White

Papers

TAC---------------------

Approvals/Appeals

PRS---------------------

Protocol/Development

TAC---------------------

Approval

Board---------------------

Approval

Board---------------------

Appeals

PUCT---------------------

Appeals

White Paper Framework

Key concepts written clearly with sufficient detail for later formation of: Protocols Operating Guides ISO Procedures RFP scope for necessary modification to

ERCOT central systems Crafted with the design of other papers in

mind

Myths to be Dispelled“We are taking our current system and

throwing it away”Fact:

Many of the current settlement and customer registration systems will be largely untouched. This is primarily a “Package 1” modification

“If we don’t find a way to streamline the process we won’t make it in time”

Fact: The original process required only 2

years and 4 months from the first ISONP meeting through the market being placed on line and included many changes not required in this process (single control area, customer registration, etc.)

Using the rule timeline gives us 2 years and 7 months

Also Important to Note

Protocol changes for market redesign may not require large wording changes

Small changes to Protocol language can have profound affects on required system changes

Process used to implement the Protocol changes could be as important or more important than the Protocol revision process itself

Areas of the Protocols that should require no or minimal change Section 1: Overview Section 3: Open Access to the ERCOT Transmission Grid Section 8: Outage Coordination Section 10: Metering Section 13: Transmission and Distribution Losses Section 14: State of Texas Renewable Energy Credit Trading

Program Section 15: Registration Section 18: Load Profiling Section 19: Texas Standard Electronic Transaction Section 20: Alternative Dispute Resolution Section 21: Process for Protocol Revision Section 22: Attachments

Role of Seams Representative Attend as many meetings as possible Inform groups of work going on in other

groups that may affect them Inform internal groups in ERCOT who may be

affected by changes being recommended

Timeline

A timeline should be developed in the initial meetings of the ShAG to establish milestones and aid in determining progress

It should include: Protocol development RFP development and bid process Implementation Testing Production

Other Considerations

Training for the market should be provided on various nodal market designs and differences operating in the US and elsewhere

The first ShAG assembly should be a two day meeting First day to ratify the ground rules and committee

structures Second day to fill chair positions and establish

marching orders

Had Enough?