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Discussion: Developing a consistent approach to activating and deactivating constraints within CRR Auctions, SCED and DAM Kris Dixit.

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Presentation on theme: "Discussion: Developing a consistent approach to activating and deactivating constraints within CRR Auctions, SCED and DAM Kris Dixit."— Presentation transcript:

1 Discussion: Developing a consistent approach to activating and deactivating constraints within CRR Auctions, SCED and DAM Kris Dixit

2 Goals To provide more consistency and transparency in how ERCOT Operations manages transmission congestion within SCED Make sure that these rules make it easy for the DAM group and the CRR group to account for constraints that are deactivated in SCED

3 Issues to be discussed Validity of 69kV Lines in SCED, CRR and DAM Clarification of the ERCOT 2% rule in deactivating constraints Activation of constraints during system wide scarcity

4 Issue 1 – Validity of 69 kV lines in SCED, CRR and DAM Purpose of Analysis – This analysis specifically focuses on 69kV constraints that were deactivated in SCED but were activated in the CRR auctions – These are some examples as a premise for discussion and do not provide an exhaustive list of all constraints that were deactivated within SCED but were activated in the CRR auctions – We also present some 69kV lines as examples of constraints (from CRR Auctions) that do not meet the 2% criteria that ERCOT uses to deactivate constraints – Only two auctions were considered for this analysis. Y Annual and Jan 2012 Monthly Auction

5 Example 1 Constraint: Fort Mason to Gillespie 69kV line Contingency: SFORGIL8:Fort Mason to Gillespie 138kV line Last time this constraint was activated in SCED: April 12, 2011 ERCOT has a MP for this area… Corrective action is to place the Yellow Jacket PST in Manual Mode. This contingency/constraint showed up in the Y Auction and the Jan 2012 Auctions. Total Shadow price in Y Auction: $229,771 x 16.5MW = $3,758,222 Total Shadow price in Jan 2012 Auction: $60,416 x 27MW = $1,631,252

6 Example 2 Constraint: Balinger to Humble 69kV line Contingency: SCOLBAL8, Coleman Lake - Ivey Tap to Balinger 138kV line Last time this constraint was activated in SCED: 1/21/2011 After Jan 2011, the flow on this constraint also exceeded capacity in April 2011 and Feb 2012 Reason for Deactivation: The contingency was resolved by adjusting the Firerock phase shifter transformer (PST). This contingency/constraint showed up in the Jan 2012 Auctions. Total Shadow price in Jan 2012 Auction: $73,837 x 24.3MW= $1,794,237

7 Issue 1 -Other lines that need to be analyzed The following are lines that had shadow prices in the two CRR auctions analyzed but may not get activated in SCED due to the 2% rule EDDY1_ TROY1_ SONR2A 8239 FRIR2A HICKORY LOCUST BTE_1_ BTE_2_5 345 A TNOLDOCEAN TNPHILLPS50 1

8 Examples of 69kV lines deactivated due to the 2% rule (not an exhaustive list) ContingencyElementEqFromToFrom KVTo KVViolationDSTFlag Wickett Tnp to Permian N Wickett Tnp to Permian N Wickett Tnp to Permian N Wink Tnp to Wink Sub N Wink Tnp Winkat1 138/ N Wickett Tnp to Permian N Oldocean to Sclpcogn N Oldocean to Sclpcogn N Oldocean to Sclpcogn N Apache to Caddotn 138HEIGHTTN TRANSF HEIGHAT2XFHEIGHTTN N Apache to Caddotn N Apache to Caddotn 138HEIGHTTN TRANSF HEIGHAT1XFHEIGHTTN N Apache to Amocotn N Apache to Amocotn 138HEIGHTTN TRANSF HEIGHAT2XFHEIGHTTN N Tejas To Coman_Tn 138 KV / GHEIGHTTN TRANSF HEIGHAT2XFHEIGHTTN Tejas To Coman_Tn 138 KV / Tejas To Coman_Tn 138 KV / Tejas To Coman_Tn 138 KV / Tejas To Coman_Tn 138 KV / GHEIGHTTN TRANSF HEIGHAT1XFHEIGHTTN Tejas To Coman_Tn 138 KV / Navy Kickapoo to Navy N Navy Kickapoo to Navy N Caddotn To Apache 138 KV / GHEIGHTTN TRANSF HEIGHAT2XFHEIGHTTN Airline TransformerWinding 1AIRLINE TRANSF 138_69A2XFAIRLINE Caddotn To Apache 138 KV / Apache To Amocotn 138 KV / Apache To Amocotn 138 KV / GHEIGHTTN TRANSF HEIGHAT2XFHEIGHTTN Caddotn To Apache 138 KV / GHEIGHTTN TRANSF HEIGHAT1XFHEIGHTTN Caddotn To Apache 138 KV / Apache To Amocotn 138 KV / GHEIGHTTN TRANSF HEIGHAT1XFHEIGHTTN Caddotn To Apache 138 KV / Apache To Amocotn 138 KV / Apache To Amocotn 138 KV / Caddotn To Apache 138 KV / Magruder To Victoria 69 KV Apache To Amocotn 138 KV /

9 Issue 2 –Clarification of the 2% rule Should ERCOT operations activate constraints that have multiple generators with greater than 2% shift factor on that constraint but cannot move those generators because 1.Generator is a wind generator and cannot be dispatched up from its current level 2.Generator has a high negative shift factor on the constraint but is offline 3.Generator has a high negative shift factor on the constraint but is currently operating at its HSL How does the ERCOT DAM group account for these constraints within the DAM Engine? How does the ERCOT CRR group account for these constraints within the CRR Auction Engine? – Is it possible for ERCOT operations to give the CRR auction group a list of lines that they will not activate because of the issues specified above?

10 Issue 3 – ERCOT deactivating constraints during system wide scarcity Should ERCOT deactivate constraints in times of system wide scarcity? With the Texas Two Step, during system wide scarcity the first step should create a reference price of system wide offer cap Under such circumstances the only way a generator will get a base point to reduce generation would be if it has * – 56% positive shift factor on an Interface constraint – 62% positive shift factor on a 345kV line constraint – 80% positive shift factor on a 138kV line constraint – 100% positive shift factor on a 69kV line constraint If a generator is found to have any of the above shift factors, ERCOT should identify such generators and contingency/constraint pairs prior to the CRR auction and let MPs know that they do not intend to activate those constraints Accordingly the CRR auction must deactivate those constraints within its model as well to maintain consistency * Assumes a max marginal cost of $200 for all generators

11 August 2011 high and low SPPs when congestion was allowed to occur (8/1/2011 HE 14:05) Top 10 PricesBottom 10 Prices SPNC_SPNCE_4$3,409STEA_STEAM_1$2,935 SPNC_SPNCE_5$3,409STEAM_ENG123$2,935 WHTTAIL_WR1$3,307STEA_STEAM_2$2,935 JACKCNTY_CC1$3,204STEA_STEAM_3$2,935 JACKCNTY_CT1$3,204LHSES_UNIT1$2,932 JACKCNTY_CT2$3,204LHSES_UNIT2$2,932 JACKCNTY_STG$3,204OLIN_OLING_1$2,931 NTX_NTX_123$3,123OLIN_OLING_2$2,931 BRTSW_BCW1$3,091OLIN_OLING_3$2,931 WFCOGEN_13$3,084OLIN_OLING_4$2,931 WFCOGEN_24$3,084NEWM_NEWMA_5$2,931

12 Questions for CMWG Issue 1 – Should we question the validity of 69kV lines within SCED given that There are many lines that need only a few outages to cross the 2% threshold, thus making it difficult to remove them from the CRR models They are generally a very small upgrade away from not congesting any more – Or should we consider leaving all 69kV lines in SCED and revisit 69kV shadow price caps? Issue 3 – What are the benefits of deactivating all constraints during system wide scarcity given that locational price signals are high across the board? What are the impacts to the CRR Markets when there is uncertainty in real time constraint management by ERCOT operations?

13 Appendix

14 Did uncertainty in constraint management impact CRR auction results? MPs spent approximately $385MM in the 2011 CRR auctions (including BOY 11 auction). They valued the entire ERCOT congestion market for 2011 at a little over $400MM In the Cal 12 year auction, MPs spent approximately $158MM. Since 55% of capacity was sold, they valued the ERCOT congestion market for 2012 at a little over $280MM* What portion of this $120 MM difference was because of credit issues? What portion of this was because of uncertainty in constraint management? What portion of this $120 MM difference was because of resale of CRRs acquired in BOY 2011? * Price was adjusted for gas forwards on Oct 15, based on gas forwards for each previous monthly auction. In this particular case, the gas forwards for Cal 12 averaged higher than the gas forwards for each of the previous 2011 months. Hence the CRR auction revenue was used as is.

15 CRR Auction Revenues AuctionCRR Auction Revenue% of CapacityTotal Market Value Jan-11$15,843,028 Feb-11$14,726,765 Mar-11$19,870,198 Apr-11$19,837,830 May-11$21,924,935 Jun-11$31,392,092 Jul-11$23,545,860 Aug-11$24,480,429 Sep-11$14,518,171 Oct-11$13,369,077 Nov-11$8,168,286 Dec-11$12,781,620 BOY 11$141,724,188 Total$362,182,47990%$402,424,976 Cal 2012$155,977,43955%$283,595,343


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