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NWPP Members’ Market Assessment and Coordination Initiative Update NWPP MC Update for WECC IS-AS April 22, 2015 Facilitator: Dan Williams, PGE.

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Presentation on theme: "NWPP Members’ Market Assessment and Coordination Initiative Update NWPP MC Update for WECC IS-AS April 22, 2015 Facilitator: Dan Williams, PGE."— Presentation transcript:

1 NWPP Members’ Market Assessment and Coordination Initiative Update NWPP MC Update for WECC IS-AS April 22, 2015 Facilitator: Dan Williams, PGE

2 NWPP MC Moving Forward! Launched Phase 4 on April 1 Continuing pivot from policy to action Focus on immediate, tangible operational enhancements that can bring real and durable value to Northwest power and transmission customers Phased, pragmatic approach makes sense for customers – Reduces risk of unintended consequences – Promotes sustainable, reliable outcomes – Two modules already implemented Member SMEs off and running on new modules! 2

3 MC Drivers and Approach Unchanged 3 Address growing operational and commercial challenges affecting regional power system: – reliably and efficiently manage transmission constraints and impacts of variable energy resources – efficiently and equitably access regional balancing diversity and capabilities Proposed infrastructure upgrades and market-based solutions must meet these objectives while respecting unique attributes of the NWPP MC footprint, including: – prevalence of extensive coordinated hydro-thermal generating systems – multiple transmission provider environment – tightly correlated variable energy resource projects – overlapping transmission systems – significant market presence of non-jurisdictional entities

4 4 NWPP MC Initiative 2012 and Beyond Collaborating to deliver near- and long-term benefits to NWPP MC members and their customers by enhancing the reliability and efficiency of meeting the region’s power needs while preserving local decision making now and in the future. Phases 1 & 2 Initial cost/benefit assessments of centralized- market structures and providers Exploration of non- centralized- market solutions and operational enhancements Phase 3 Operational tools development Bilateral market assessments SCED market detail development SCED market operator RFP issuance Regulatory due diligence Phase 4 Continue operational tools and regional infrastructure upgrades Install advanced bilateral and centralized clearing market capabilities Complete SCED market due diligence Phase 5 Full 5- or 15- min SCED with centralized market operator functions and tariff Next generation of operational tools and regional infrastructure upgrades

5 NWPP MC Initiative – Phase 3 Results 5 Operational tools development – Implemented regional data sharing consolidation through Peak Reliability – Implemented Regional Flow Forecast tool in live production environment for reliability entities, testing for merchant entities – Testing Resource Monitoring and Deliverability tool in off-line table- tops to support Resource Sufficiency policy efforts – Tools will be leveraged by Phase 4 teams to deliver incremental value across platforms

6 NWPP MC Initiative – Phase 3 Results 6 Bilateral market assessments – Performed field testing of existing 15-min market opportunities – Supported ancillary services market reform resulting in FERC’s WSPP Schedule D/E approval as follow-up to their Order 784 outcomes Security Constrained Economic Dispatch (SCED) market detail development – Finalized NWPP MC SCED design protocols for 5-min market – Addressed member concerns related to installing a locational marginal pricing market on top of existing Open Access Transmission Tariff requirements – Identified operational gaps between current and future paradigms to proactively address reliability concerns – Explored supplemental programs to access balancing reserves diversity

7 NWPP MC Initiative – Phase 3 Results 7 SCED market operator RFP issuance and response review – Detailed responses received, neither supported a go-forward decision from members – RFP closed while workgroups explore other alternatives with respondents Regulatory due diligence activity – Completed significant regulatory scoping, including drafting of FERC Petition for Declaratory Order – Engaged in comprehensive dialogue with regulators on SCED design and entity concerns

8 NWPP MC Initiative – Phase 3 Results 8 Tangible intangibles – 150+ subject matter experts from member utilities engaged over 12- month period to solve challenges unique to NWPP MC footprint – Monthly Executive Committee meetings held to unite regional leaders on common purpose and direct program objectives based on member and customer needs – Completed objectives $1M under budget, which allowed further investment in operational tools for 2015 – Developed path forward (Phase 4) that supports maximizing member and customer value long-term

9 Focus on implementation – Regionally tailored to system needs – Operations- and market-based modules – Modular approach where each incremental step provides value to customers, and cost/benefits assessed at each step – Options to be evaluated prior to next-steps commitment MC organization in 2015 – Includes all Phase 3 NWPP MC members except PacifiCorp, Grant County PUD, and Clark County PUD – $2M spending authority committed through December 2015 – Will explore options for permanent organization to meet MC member needs beyond Phase 4, including funding and board oversight for SCED and operational tools NWPP MC Phase 4 Activities 9

10 10 “Staying focused on our phased approach is important. I appreciate the work that has been done to date. We are excited about the initiative and through the incremental steps taken, see a higher possibility of implementing things that add durable value for our region and its customers.” – Bill Gaines, Director & CEO of Tacoma Public Utilities “I agree and am supportive of a pivot towards achieving immediate, tangible operational enhancements that can bring real value to Northwest power and transmission customers.“ – Elliot Mainzer, BPA Administrator “The transition from policy to action is a positive step. We’re ‘all in’ to support this effort.” – Steve Wright, General Manager of Chelan County PUD “We’re at a pivot point with this initiative, and PGE is committed to achieving the project goals. We are focused on a pragmatic solution that delivers both enhanced system reliability and improved customer value.” – Jim Piro, CEO of PGE “The scalable approach has a much higher potential for success,” said Teresa Conway, President and CEO of Powerex. “We’re fully in and willing to commit our resources to the effort.”

11 NWPP MC Major Deliverables Phase 4 Kickoff – April-May 2015 NWPP MC PRIMEs (Platforms for Reliability, Integration, and Market Enhancements) Module 1: Regional Flow Forecast Tool Module 2: Resource Monitoring and Deliverability Tool Module 3: Resource Sufficiency Program to support Modules 4,5,6,8 Module 4: 15 Minute Economic Dispatch Module 5: Regulation Diversity Module 6: Balancing Reserves Diversity Module 7: TSP/TOP Coordination Opportunities Module 8: Security Constrained Economic Dispatch (15-min, 5-min) All modules designed to be complementary and lead to a reliable, efficient operations and marketing paradigm for the region Priorities for Module implementation will be set by the Executive Committee in mid-2015, with implementation of key modules likely for 2015/16 11

12 Questions? 12


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