Meeting Summary – 09/11/24 WMS Meeting

0 – Validation for WMS Standing Representatives – Pamela Hanson

1 – Antitrust Admonition – Eric Blakey

2 – Agenda Review – Eric Blakey

3 – Approval of WMS Meeting Minutes – Vote – Eric Blakey

• July minutes will be added to the combo ballot for approval.

4 – Technical Advisory Committee TAC Update – Eric Blakey

• Stakeholder process was the major topic of discussion.
• Chairman Gleason commented on improvements needed for the stakeholder process.
• TAC workshop scheduled for the fifth was canceled and will now be the first topic at the next TAC meeting on September 19.
• The TAC meeting on September 19 will start at 09:00 am and the first two hours will be focused on the stakeholder process.
• Further discussion on the stakeholder process will occur under agenda item 15.
• WMS report was presented and generally well received, though there were comments.
• TAC chair Caitlin Smith appreciated the collaboration with the IMM and his presentation on the state of the market report.
• There will be further discussion on TAC assignments and open action items under item 15.

5 – ERCOT Operations and Market Items

5.1 – Proposed Changes to Ancillary Service Methodology for 2025 – Vote – Luis Hinojosa

• Presented a high-level overview and proposed changes to the 2025 Ancillary Service (AS) Methodology.
• Initial discussions kicked off in July and continued with ROS and TAC.
• Changes in regulation service from net load ramping to forecasted net load error.
• Adjustments to generation to be dispatched (GTBD) application to use net load forecast error.
• Three changes in ERCOT: 
  • Removal of 90th percentile minimum for sunset hours,
  • Adjusted the frequency recovery portion of accounting for historical load to the 70th percentile, matching RRS methodology.
  • Compute the minimum ECRS requirements as the larger of the capacity needed to recover frequency and capacity needed to support net load forecast errors.
• Non-spin service changes: using 4-hour net load forecast error for low peak hours and 6-hour ahead methodology for others.
• No changes in RRS methodology, but changes to the IFRO resulting in new minimum RSPFR limit for 2025 at 1,365 MW from 1,185 MW.
• Proposed methodology sheets and quantities by month will be updated and presented to TAC next week.
• Questions raised about potential regulation shortfalls in winter mornings and their risks.
• Discussion on possible nesting methodology for non-spin and ECRS proposed by IMM.
• General support for ERCOT’s proposed plans but suggestions for PUC involvement in policy settings.

Decisions:

• To endorse proposed changes to the Ancillary Service Methdology for 2025 as submitted by ERCOT Staff.

5.2 – Congestion Revenue Rights Auction Mitigation – Samantha Findley

• Performance issues in long-term auctions, especially those spanning three years.
• Increase in settlement points, registered CRRAH account holders, and counterparties causing constraints on optimization.
• Historical performance issues: A recent sequence took 363 hours to converge on a solution, causing delays.
• Medium and long-term market design changes proposed to improve auction performance.
• Short-term mitigation includes new per TOU limits, potentially setting a transaction adjustment period to ensure timely auction solutions.
• Potential changes discussed: Lowering per account holder limits, increasing minimum bid prices, removing multi-month bid functionality, and modifying capacity percentages for long term auctions.
• Concerns about the future impact due to increasing CRRAH account holders and settlement points.
• Sympathy expressed for stakeholders facing disruption in congestion hedging strategies with limited notice.
• Discussion on hardware and software optimizations undertaken, including running up to 28 CPUs.
• Feedback from stakeholders on improving systems, concerns over potential limits, and future planning for system capacity.

5.3 – Large Load Interconnection Report – Manuel Navarro Catalan – Chris Cosway

• Significant growth in co-located and standalone projects.
• Standalone projects make up the majority of new megawatts and are growing faster.
• Current total queue capacity increased by 4,439 MW since last month.
• Significant increase in projects with in-service dates in 2028.
• Most megawatts are under ERCOT review due to pending and under review studies.
• Slight decrease in planning studies approved recently, but steady approved energized megawatts.
• 5,496 MW approved to energize, with a notable amount in the west load zone and consisting mostly of standalone projects.
• Observed a steady increase in non-simultaneous peak load and simultaneous peak consumption.

Bill Barnes

• Request to provide information on what has actually been energized.
• Include a breakdown of loads by type if possible.
• Request for a timeline on the remaining approved loads.

Brian Sams

• Echoed Bill Barnes’ comments on the need for more transparency.
• Emphasis on the importance of understanding potential double counting in the large load queue.
• More transparency would add credibility to long-term load forecasts.

Seth Cochran

• Inquired about the expected timeline for projects to come online.
• Questioned the proportion of projects that might not come online.
• Asked about the duration for which projects can stay in the queue without progress.

Bob Wittmeyer

• Noted the necessity of considering load ramp schedules.
• Suggested a legal review of sharing limitations.
• Commented on the hibernation of the large flexible load task force.
• Referred to NPRR1202 dealing with queue filtering and associated fees.

Ian Haley

• Supported the idea of including connected loads in reports for clarity.

General Discussion

• Overall transparency and detailed breakdowns in reports are crucial for stakeholders.
• Continuation of monthly reports to address evolving questions from stakeholders.

6 – Wholesale Market Working Group – WMWG – Amanda Frazier

6.1 – NPRR1235 Dispatchable Reliability Reserve Service Discussion

• ERCOT outlined their comments from August 23.
• High-level discussion about adding ESRs to the service with no real consensus or plan to endorse.
• Understanding that ESRs wouldn’t be added in phase one.
• ERCOT committed to continue looking at the issue and to file an NPRR this year but did not commit to moving forward with phase two.
• Details of comments from the NPRR were reviewed to highlight specific policy decisions embedded in the language.
• Reminder for market participants to review the detailed NPRR.

6.2 – NPRR1229, CMP Payment Policy Questions Discussion

• This was the second discussion on NPRR1229, which was filed by STEC following an incident with one of their plants.
• The proposal involves a payment for when ERCOT implements a CMP if it impacts a generator.
• ERCOT has policy concerns about this NPRR and has engaged with STEC and market participants offline.
• There is a consideration whether this issue should be elevated to TAC for higher-level policy discussions.
• A clarification was made that there was no specific incident of a unit trip offline, but it’s more about what actions are needed if such an event occurs.
• Decision on WMS’s recommendation is postponed until item twelve, 

6.3 – NPRR1238, Voluntary Registration of Loads with Curtailable Load Capabilities – ORDC Implications

• Luminant proposed a change but decided not to pursue it due to timing with real-time co-optimization.
• The issue is considered OBE (overtaken by events) and will not stay on the discussion for WMW.

6.4 – NPRR1241 Firm Fuel Supply & Hourly Standby Fee

• Discussion on changes to the calculation of the hourly standby fee for firm fuel service.
• ERCOT reviewed the NPRR and is open to discussions about it, but no substantive agreement was reached.
• Initial discussion, NPRR1241 had not been reviewed by PRS or WMS yet.
• Consideration of tabling the NPRR and referring it back to WMWG for further discussion was proposed.
• ERCOT is internally reviewing the NPRR and might provide suggestions for improvement.

6.5 – NPRR 1230 / Other

• NPRR1230 will be monitored by CMWG instead of WMWG moving forward.

• Awaiting further internal suggestions from ERCOT.
• Potential tabling and referral of NPRR1241 to WMWG.

7 – Demand Side Working Group – DSWG – Nathaniel Mancha

• Skipped to second slide to save time, focusing on the 4CP update.
• ERCOT provided an update on ADER and some NPRRs.
• Presented two alternatives for a 4CP adjustment solution
  • Increasing market transparency with daily reports or telemetry data.
  • Removing WSL from 4CP calculations.
• Concern over the growing impact of WSL adjustments on load data and pricing.
• Proposal to remove WSL from certain calculations for quicker demand side insights.
• Discussion on implementing these recommendations and the responsible parties for NPRRs.
• Mark provided an update: difficulty in implementing changes due to PUC rule implications on WSL calculations.
• A market participant filed an SCR to request WSL through ICCP; ERCOT recommended converting it into an NPRR. Draft NPRR has been submitted.
• Current telemetry does not allow for direct calculation of WSL in real-time. The energy storage resource dashboard is used as a proxy.
• Agreement on the importance of real-time data over daily extracts.
• Discussion on ERCOT’s role in sponsoring NPRR filings.

8 – Demand Side Working Group – DSWG – Nathaniel Mancha

• Topic: VCMRR042 – Verifiable Cost Manual Revision Request
  • Related to SO2 and NOx emission prices
  • Seasonal index pricing: May to September
  • Annual index pricing: October to April
  • New concept for ERCOT’s monthly calculation process: average for first 15 days of prior month
  • Seasonal pricing starts at approximately $850 per short ton
  • Monthly adjustments paused with a plus/minus 10% threshold
• Topic: Grey Box Language Addition
  • Addressed process changes for future automation
  • Need for clarity on manual vs. automated processes
  • Vistra and ERCOT to meet offline for further discussion
• Topic: New Concept for Emission Cost Recovery
  • Concerns about QSA running out of emission credits
  • Purchases of additional credits not covered under current verifiable cost manual
  • Dispute-based recovery model proposed
  • Eligible recovery to be uplifted to load on an LRS basis
  • Group seeks to disincentivize over-procurement and credit only actual consumption
  • Language modification and clarity requested
  • There will be further discussion surrounding alternative options.
• Topic: Future Meeting Plans
  • October meeting date pending
  • Progress on earlier discussed topics to determine date

9 – Supply Analysis Working Group – SAWG – Kevin Hanson

• Pete Warren presented on the CONE / Peaker net margin threshold draft NPRR.
• ERCOT will revisit the CONE Peaker topic after the 8/29 PUC open meeting.
• PUC adopted $140 kw per year as a cone for studies based on a frame CT reference technology.
• PUC adopted $140 kw per year as the CONE for planning studies based on a frame CT reference technology.

10 – WMS Revision Requests Tabled at WMS – Possible Vote – Eric Blakey

• Both requests can remain tabled.

10.1 – SMOGRR028, Add Series Reactor Compensation Factors – MWG

• Reached out for an update; ERCOT is still working on technical comments.
• The technical routine is the reason for the delay.
• Plan to keep this matter tabled to MWG.

10.2 – VCMRR042, SO2 and NOx Emission Index Prices Used in Verifiable Cost Calculations – RCWG

• Language is being developed for VCMRR042.
• Will discuss VCMRR042 further at RCWG.

11 – New Protocol Revision Subcommittee – PRS – Referrals – Vote – Eric Blakey

11.1 – NPRR1241, Firm Fuel Supply Service – FFSS – Availability and Hourly Standby Fee

• Discussion on NPRR1241 regarding firm fuel supply service availability and hourly standby fee.
• Request for formal referral to WMWG (Wholesale Market Working Group) was noted.
• Need for further refinement of clawback and/or withholding amounts based on past seasons’ berm fuel deployment experiences.
• Changing proportionality criteria for maximum clawback on unavailability.
• NPRR aims to align performance incentives with respective risks.
• Request to continue discussions with ERCOT and WMWG.
• Suggestion to table and refer the matter to WMWG for further discussion.
• No opposition or concerns raised regarding the referral.

12 – Revision Requests Tabled at PRS and Referred to WMS – Possible Vote – Eric Blakey

12.1 – NPRR1070, Planning Criteria for GTC Exit Solutions

• No new updates on NPRR1070.

12.2 – NPRR1200, Utilization of Calculated Values for Non-WSL for ESRs – MWG

• NPRR1200 MWG is not met.

12.3 – NPRR1202, Refundable Deposits for Large Load Interconnection Studies – WMWG

• The item is currently hibernated.
• WMSWG has completed all necessary actions they are aware of.
• Suggestion to keep the item tabled at WMS.
• Awaiting comments from different parties.
• No vote required.

12.4 – NPRR1214, Reliability Deployment Price Adder Fix to Provide Locational Price Signals, Reduce Uplift and Risk – CMWG

• NPRR1214 is still under review by CMWG.

12.5 – NPRR1229, Real-Time Constraint Management Plan Energy Payment – WMWG

• Discussion about NPRR1229 potentially being addressed as a policy decision at the PUC due to the policy questions it has raised.
• Suggestion to deny the request and allow an appeal to the commission as a more formal process.
• Clarification needed on the process TAC would use to handle the policy questions.
• A question was raised if there had been any briefings from STEC to the commission on this issue.
• Lucas Turner responded there has been no outreach on policy questions but is working on comments to address some questions.
• There is ongoing communication with STEC for language clarification on NPRR1229.
• ERCOT has posted policy questions for WMWG but has not received responses.
• Discussion on the need to address policy questions meaningfully to clarify NPRR1229.
• Mention of significant policy questions like compensation to generators when they trip offline and opportunity costs.
• Consensus that policy questions require more detailed answers before ERCOT can clarify NPRR1229.
• Suggestions for the WMS’ next steps, including possibly moving the discussion forward at the WMWG.

12.6 – NPRR1235, Dispatchable Reliability Reserve Service as a Stand-Alone Ancillary Service – SAWG and WMWG

• Katie Riche discussed NPRR1235 about Dispatchable Reliability Reserve Service as a standalone ancillary service.
• ERCOT plans to bring additional language for storage participation in DRRS.
• ERCOT will ask PRS for direction on phase two.
• Katie Rich requested that NPRR1235 be brought back next month for further discussion.
• Dan Mantina from ERCOT presented an update on summer drought risk.
• Pete Warkin discussed reliability standard updates and a presentation filed at the PUC.
• Pete Warkin also discussed the CONE/VOLL studies; ERCOT filed the Brattle volume study on August 22.
• The PUC adopted a $35,000 price for planning study volumes, increased from the initially proposed $30,000.
• Discussions on December 2024 CDR planning process led by Pete Warkin.
• ERCOT board approved NPRR1219, with PUC approval expected in September, and supplemental tabs to be added from May 2025.
• Upcoming ELCC stay for storage between early to mid-October and a new NPRR for thermal resources by ERCOT.
• Change in providers for developing solar wind shapes, with an announcement expected upon identification of the new company.
• Next meeting in October; September 27 meeting canceled.
• David Dalitsch asked for clarification on NPRR1235 discussion needs at SAWG.
• Katie Rich explained NPRR1235 was tabled to discuss how it fits into resource adequacy, pending decisions from the last open meeting.

12.7 – NPRR1238, Voluntary Registration of Loads with Curtailable Load Capabilities – WMWG

• NPRR1238 was discussed previously, needs approval from WMS.
• Importance expressed to move forward urgently despite removal of urgency status.
• Effort to align NPRR1238 with NPRR1234 mentioned.
• Current discussions ongoing at OWG, awaiting ROS input.
• ORDC discussion at WMWG completed, now it’s back to WMS for approval.
• No additional language being added, related concerns addressed by ERCOT staff.
• Oncor’s comments included issues like including interconnecting TDSPs and changing from ‘ceasing’ to ‘reducing’ consumption during curtailment.
• Some OWG team members still reviewing the language but no opposition to advancing from WMS perspective.
• Possibility of ERCOT creating comments to be discussed in the LFLTF
• No objections from LFLTF regarding NPRR1238.
• Nabaraj Pokharel queried ERCOT’s position; decision pending input from appropriate ERCOT representatives.
• Agreement to table the item until further information is available from ERCOT.

13 – Major Transmission Elements – MTE – list – Vote – Rickey Floyd

• Reviewed updates to MTE list from the last OWG meeting on October 15.
• TOs presented their recommendations for removals and edits.
• OWG reached consensus on proposed removals and edits.
• No additions to the MTE list were recommended this year.
• OWG recommends WMS endorses the updated list.

14 – Combo Ballot – Vote – Eric Blakey

15 – Other Business – Eric Blakey

15.1 – Review Open Action Items – Jim Lee

• Jim Lee indicated he did not have any updates.

15.2 – Review of Stakeholder Process

• WMS subcommittee provided an opportunity to communicate potential improvements to TAC.
• Discussion on improving information provided to the board and commissioners.
• Focus on significant topics like ancillary services for 2024, document 245 and 1190.
• Consideration of changing voting requirement to two-thirds instead of 50% for better process, though the impact is uncertain.
• Issue of transparency and governance was raised.
• Suggestions for increasing communication visibility at the TAC level.
• No major changes proposed at subcommittee level until further discussion at TAC.
• Next TAC meeting announcement and reminder about the start time.
• Open invitation for suggestions to improve WMS efficiency and communication.

15.3 – TAC assignments – Eric Blakey

• Discussion about reviewing TAC assignments per Caitlin’s suggestion.
• Noted the importance of working groups to review assignments related to EPA and 1230.
• Concerns about not discussing the EPA updates in WMS and the appropriateness of current assignments.
• Mention of old open action items and parking lot items that need review and potential removal.
• Request for recommendations to clean out the parking lot and decide on the necessity of these items.
• Uncertainty about the purpose of the parking lot items as they are rarely used in other subcommittees.

16 – Adjourn – Eric Blakey

• • Eric Blakey concluded the meeting.