1. Wind Management at MISO
IWWG Annual Conference
July 22, 2011

2. MISO Overview

3. Growth of MISO’s value creation
Start-Up
Reliability Coordination & Tariff Administration
Energy Markets
Energy and Ancillary Services Markets (ASM)
1996
Discussions begin to form MISO
First Board of Directors elected
FERC approval as an RTO
Reliability Coordination
Tariff Administration under MISO OATT
Energy Markets Begin
2001
Ancillary
Services Market Initiative begins
Joint Operating Agreement with PJM
Balancing Authority Alignment
ASM Testing
ASM begins
2002
2003
2005
2006
2007
2009
1999
FERC issues order 2000
FERC orders 888/889
FERC issues order 890
Legislative Timeline
1996
2007
1999 3

4. MISO Overview Independent Non-profit 2001 - Reliability Coordinator
Energy Markets
2009 – Ancillary Services
Large Footprint
Midwest ISO is an independent, non-profit reliability coordinator for the transmission of high voltage electricity via a security constrained economic dispatch across all or parts of 13 states and Manitoba
MISO Reliability Coordination Area, June 2011

5. Scope of Operations as of June 1, 2011
5-minute dispatch
1,966 pricing nodes
5,774 generating units in the network model
~ $27.5 billion per year settled in energy markets (2010)
368 market participants serving 40+ million people
Generation Capacity
134,850 MW (market)
146,497 MW (reliability)
Historic Peak Load (set July 31, 2006)
116,030 MW (market)
136,520 MW (reliability)
53,203 miles of transmission
12 states, 1 Canadian province
Scope of Operations
• Generation Capacity
130,000 MW (market)
159,000 MW (reliability)
• Peak Load (set July 31st, 2006)
109,157 MW (market)
129,647 MW (reliability)
• 93,600 miles of transmission
500kV, 345kV, 230kV, 161kV,
138kV, 120kV, 115kV, 69kV
• 15 states
• One Canadian province
• 920,000 square miles
• Nearly $3 billion settled/month
(Day Ahead /w virtuals,2007)
• 1,896 pricing nodes
• Five-minute dispatch
• Offers locked in 30 minutes prior to the scheduling hour
• Spot market prices calculated every five minutes
• <15-minute ramp rate at 1,000 MW
• 280 Market Participants who serve 40+million people
Reliability Tools
• State Estimator and Real Time Contingency Analysis
- 257,000 real-time measurements, solving <90 seconds**
- 8,300 “what-if” contingencies,
solving <5 minutes**
(**on average)
• 13,600 one-line station diagrams

6. MISO Market Footprint
As of June 2011

7. Benefit by Value Driver1
2010 Value Proposition
$54-$68
($254)
Benefit by Value Driver1
(in $ millions)
$259-$323
$12-$19
$1,253-
$1,634
$280-$350
$34-$42
$68-$75
$121-$134
$136-$151
$648-$8743
$221-$244
$322-$482
Benefits Driven by Load / Supply Balance2
Improved Reliability 1
Dispatch of Energy 2
Unloaded Capacity 3
Regulation 4
Spinning Reserves 5
Wind Integration 6
Footprint Diversity 7
Generator Availability Improvement 8
Dynamic Pricing 9
Direct Load Control- Interruptibles 10
MISO Cost Structure 11
Total Net Benefits
Adjusted Total Net Benefits3
Market – Commitment and Dispatch
Generation
Investment Deferral
Demand Response
1Figures shown reflect annual benefits and costs expected for2010
2These benefits will be realized when the load / supply balance narrows
3Adjusted total net benefits exclude benefits driven by load / supply balance

8. Wind Development

9. Wind Generation in Midwest ISO Market

12. Transmission Congestion
High penetration of wind generation in areas that have historically had little generation
Rapid development of wind has outpaced the associated transmission development
Who pays to expand the transmission system?

13. How Does this Impact Operations?
Original market design classified wind as an ‘Intermittent Resource’ and could not economically dispatch
In areas with high wind penetration, it is difficult for the Security Constrained Economic Dispatch (SCED) to manage congestion with only dispatchable resources
Reliability Coordinators must resort to manual curtailment of wind resources adversely impacting constraints

16. No of Wind Curtailments 1,141 2,117 996 Estimated MWh Curtailed
2010 vs. 2011
2009 Total
2010 Total
2011 YTD
No of Wind Curtailments
1,141
2,117
996
Estimated MWh Curtailed
292,000
824,000
289,000
Duration (Hours)
8,005
19,951
7,447

17. Operational Concerns
While Manual Curtailment of Wind is effective as a constraint mitigation option, it has several drawbacks:
Highly manual process, and extremely time consuming for the Reliability Coordinator
Tracking of Resources with Firm vs. Non-Firm Transmission service is time consuming
The Manual Curtailments can not be accounted for in the Security Constrained Economic Dispatch (SCED), therefore there is loss of price transparency
Manual Curtailments are generally less economically optimal as the automated SCED

18. Intermittent Resource in MISO Market
UDS will issue a Dispatch
Target Equal to observed
output at the time of the
State Estimator snapshot
for that case.
Intermittent Resources
- Cannot make RT economic
offers
Cannot set price
Subject to RSG
Not Eligible for Make Whole Payments

19. What is Dispatchable Intermittent Resource?
DIRs are treated much the same as other Generation Resources with one exception:
Instead of using an hourly Economic Max offer, DIRs must submit a ‘Forecast Limit’ for each 5-minute interval. The UDS will use this Forecast limit as the Economic Max for the given interval.

20. DIR Examples Nearby Congestion Unconstrained
In this example the DIR submitted an offer price of -$40
Notice even in the unconstrained example, the forecast isn’t perfect. Some stakeholders have suggested this may be an optimistic illustration based upon the current state of forecasting technology.
Nearby Congestion
Unconstrained

21. Wind Management at MISO
IWWG Annual Conference
July 22, 2011