Allowing Events To Be Used As Audits When RTEG Is Not Activated Robert B. BurkeNew Asset Auditing Discussions Principal AnalystSeptember 27, 2012 Market Development

Issue Under the existing simultaneous audit requirement, the assets of a RTDR resource activated for an actual event would not be able to use that event as an audit if the RTEG assets associated with the same facility were not activated at the same time. –RTDR resources are activated pursuant to OP-4, Action 2. –RTEG resources are activated pursuant to OP-4, Action 6. –Extremely rare for OP-4, Actions 2 and 6 to be in effect simultaneously. New Asset Auditing Concept © 2012 ISO New England Inc. 2

Purpose of Proposal Develop a methodology to manage the use of RTDR activations used as a seasonal audit and to accurately estimate the additional load that an RTEG asset at the same facility can take off the New England power grid. –RTDR assets would be dispatched before RTEG assets when OP-4 is implemented. –The additional load that an RTEG asset could take off the system after the RTDR is dispatched will be less than the total facility load prior to OP-4. –Auditing the RTEG separately from the RTDR may overstate the additional load that the RTEG could take off the New England power grid under actual OP-4 conditions. New Asset Auditing Concept © 2012 ISO New England Inc. 3

Classic Example – RTDR & RTEG Baseline and Performance New Asset Auditing Concept © 2012 ISO New England Inc. 4 5-Minute Interval Performance Period

Proposed Performance Calculation How can RTEG performance be accurately estimated (neither under- nor over-estimated) when RTDR is activated and not RTEG? Calculate RTEG imputed performance –Take the average total reduction from last like simultaneous seasonal audit –Calculate average reductions provided by RTDR during the event –The difference equals the RTEG imputed performance: Average total reduction from last like simultaneous seasonal audit - Average reduction provided by RTDR during the event = RTEG imputed performance RTEG imputed performance –Cannot exceed the average reduction provided by RTEG from last like simultaneous seasonal audit. –Cannot be less than zero. –Cannot exceed Total Facility Load (includes push back during PRD transition). New Asset Auditing Concept © 2012 ISO New England Inc. 5

Real Performance New Asset Auditing Concept © 2012 ISO New England Inc. 6

Example of Performance Calculation Total performance during simultaneous audit in a previous year: –Average total reductions provided by asset = 122 kW –Average reduction provided by RTDR = 50 kW –Average reduction provided by RTEG = 72 kW Compute RTEG imputed performance: –Take average total reduction from last like simultaneous seasonal audit (i.e., 122 kW) –Calculate average reductions provided by RTDR during the event –The difference equals the RTEG imputed performance: Average total reduction from last like simultaneous seasonal audit - Average reduction provided by RTDR during the event = RTEG imputed performance Examples: Higher RTDR PerformanceLower RTDR Performance 122 kW previous simultaneous audit - 75 kW RTDR current performance - 40 kW RTDR current performance 47 kW RTEG imputed performance 72 kW RTEG imputed performance (Note: maximum cap applies) New Asset Auditing Concept © 2012 ISO New England Inc. 7

Intent of Proposed Design Allows providers to use RTDR events as their seasonal audit and to establish boundaries for the RTEG assets potential performance where both assets are located behind the same retail delivery point, but not audited simultaneously. The methodology accurately estimates the additional load that an RTEG asset at the same facility can take off the New England power grid given that RTDR assets would be dispatched before RTEG assets when OP-4 is implemented. RTEG must still perform a seasonal audit. New Asset Auditing Concept © 2012 ISO New England Inc. 8

Questions New Asset Auditing Concept © 2012 ISO New England Inc. 9