Meeting Summary – 10/18/24 WMWG Meeting

1 – Antitrust Admonition – Blake Holt

2 – Questions on Standing Reports – Blake Holt

• No questions were raised about the standing reports.

3 – Notice on Open Action Items – Blake Holt

• Blake Holt highlighted several stagnant open action items assigned to WMWG and proposed removing them unless objections are raised.
• The group seeks feedback by next month’s meeting to recommend retaining or removing these action items.
• The first item on reviewing EPA regulations remains due to recent Supreme Court decisions.
• Item two  on reviewing wholesale market queues for scarcity pricing could be struck; ERCOT’s new RTC may address this.
• The minimum threshold to post WSL information action was deemed potentially obsolete by new NPRR461 initiatives.
• Item to increase settlement granularity to 15-minute intervals was briefly mentioned.
• Ryan King suggested some action items may be redundant due to current or planned measures and updates.
• Amanda Frazier proposed redlining the document for the next meeting, reflecting suggested changes.

4 – Pricing Impacts of LDL Override Decisions made during 4/8 Eclipse – ERCOT Staff

PricingImpactsofLDLOverride_r1.pdf

• Cory Carswell, an engineer with ERCOT, presented an analysis on pricing impacts from LDL overrides during the April 8 solar eclipse.
• ERCOT implemented several precautionary measures, including procuring an additional gigawatt of non-spin ancillary services, issuing LDL overrides to coal resources, and committing resources through the HR process.
• The analysis focused on the net impact to energy value during the LDL override period, finding a minimal total net impact of approximately $70,000, primarily in the Houston load zone.
• Marginal system cost changes, resource mix, and congestion costs between original and rerun scenarios showed minor variances.
• Original scenarios saw increased coal generation due to LDL overrides; without them, natural gas replaced coal generation with minimal overall resource mix change.
• Congestion cost impact was minimal, with consistent constraint management across the system observed.
• Net energy value impacts were most notable in the Houston load zone but remained minimal overall.
• Questions addressed involved the minimal RDPA run effects corroborating the findings.

5 – NPRR1202, Refundable Deposit of Large Load Interconnection Studies – NPRR1202 Commenters

• NPRR1202 has been inactive for a while, but recently received many comments.
• The NPRR is technically on hold as the LFLTF is dormant.

5.1 – Longhorn Power Comments – Bob Wittmeyer

• Bob Wittmeyer discussed changes to the proposal to treat large loads and generators equally and eliminate refundable deposits for a maintenance fee.
• The goal is to speed up the process of connecting generation and load to the ERCOT system by addressing current bottlenecks.
• There is a significant backlog of projects partly due to a shortage of integration engineers at ERCOT.
• Wittmeyer suggests building a pool of funds to hire additional staff and expedite projects, without preferential treatment for any entity.
• Efforts are being made to ensure new fees are not passed onto residential or small commercial customers.
• Wittmeyer is seeking feedback on other systems impacted by new connections and ways to support funding shortages.
• ERCOT CFO Richard Schiele clarified that most of ERCOT’s operations are funded by a system administration fee, and interconnection fees cover specific operational costs.
• Discussion touched on how funding decisions are made by ERCOT and approved by the PUC.
• Further comments were discussed in regard to NPRR1202 and its implications, with a call for emails on systems affected.

5.2 – ERCOT Comments – Bill Blevins & Doug Fohn

• ERCOT highlighted actions taken to address issues from the large load task force.
• A new fee system for large loads has been proposed to clean up the project queue.
• Rules have been introduced in PGRR115 to remove inactive projects if no interconnection agreement is reached within 180 days.
• ERCOT has added a team and contractors to handle the increase in workload related to large loads.
• A recurring fee is under consideration, but further rules are needed first to assess its necessity.
• Comments were generally supportive of NPRR and the introduction of fees over deposits.
• There were questions and suggestions regarding where collected fees would be applied.
• Concerns were raised about fee utilization and ERCOT’s ability to use additional funds for staffing.
• An upfront fee was supported as a means to filter speculative projects.
• Discussion acknowledged ERCOT’s limitations due to budget constraints defined by the commission.
• Comments concluded with acknowledgment of the necessity to expedite interconnections to benefit consumers.

6 – NPRR1229, RTM CMP Energy Payment – Tentative Discussion – Lucas Turner

• STEC is preparing additional comments on NPRR1229.
• Discussion postponed to next month.
• No discussion on this item today.

7 – NPRR1235, Dispatchable Reliability Reserve Service – Group notice that discussion is moving to SAWG – Blake Holt

• NPRR1235 was previously discussed at WMS last month.
• Current discussions on NPRR1235 have been moved to SAWG.
• Group is informed to be ready to handle specific tasks as NPRR1235 progresses.

8 – NPRR1241, Firm Fuel Supply Service FFSS Availability and Hourly Standby Fee – Katie Rich

• Discussion on NPRR1241 regarding firm fuel supply service availability and hourly standby fee.
• Katie Rich updated that discussions with stakeholders are ongoing.
• New language is being developed to create a more linear curve for setting penalties and clawbacks.
• Draft language is being prepared to share with stakeholders before the next meeting.
• Ino suggests holding comments until the new language is submitted by Katie.

9 – Group Discussion on CARD Allocation Methods – WMWG Participants

• Recap of proposed CARD allocation methods: IMM’s average over 500 peak demand hours per month, Georgetown’s use of last year’s 4-CP averages, Luminant’s top 60-120 hours per month approach.
• Andrew Reimers raised concerns about Shams Siddiqi’s proposal potentially leading to CARD exceeding 4-CP, possibly incentivizing consumption during intervals.
• Bob Wittmeyer questioned the logic of tying CARD revenue, derived from congestion due to lack of transmission, to those who pay for transmission.
• Shams argued that the allocation is a netting process to minimize market distortion.
• Dave Maggio presented an analysis showing potential disparities in CARD allocation, particularly in the western load zone.
• There was general support for Shams’ approach as it aligns costs with those paying transmission costs.
• Concerns were shared about timing and lag issues with 4CP-based allocations.
• Some participants prefer Luminant’s method due to its balance of complexity and seasonality preservation.
• There was discussion about the potential impact of new loads and deviations in current allocation share.
• Concerns were raised about changing the summer months allocation method due to the strong 4-CP signals.
• Participants emphasized the need for a clear methodology that doesn’t incentivize adverse behavior.

Next Steps

• Consider drafting an NPRR based on the discussions.
• Bill Barnes suggested presenting the discussion outcomes and options to WMS for a vote.
• Formal concept vote at WMS to direct subsequent protocol language development.
• Further collaboration with ERCOT staff to finalize proposals.

10 – Other Business – Blake Holt

• The next ERCOT meeting is scheduled for November 11.
• David Detelich raised concerns about NPRR1253 related to charging load and load signals.
• David is uncertain if NPRR1253 solves the issue of mismatches in load signals, particularly concerning the 4-CP signal.
• There were questions about whether ERCOT’s load forecast incorporates feedback loops that exclude WSL or charging load.
• The discussion on NPRR1253 remains tabled at PRS; comments are awaited from ERCOT.
• A suggestion was made to potentially refer questions to a working group for further exploration.
• Dave Maggio and others discussed the need for more education on how load forecasting and charging loads from energy storage resources are incorporated.
• It was agreed to possibly provide educational materials at a future meeting regarding load forecasting.

11 – Adjourn – Blake Holt