Transmission Congestion Management – IDC Granularity Option 3A

Transmission Congestion Management – IDC Granularity

Option 3A

Larry Kezele and Jeff Norman

June 28, 2005 NERC/NAESB TLR Subcommittee

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Summary of Responses to NERC’s Request for Information (RFI)

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Selection of a Next Generation Transmission Congestion Management

Tool

(IDC Granularity Option 3)

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Respondents

● ABB

● AREVA T&D

● ICF Consulting

● MCG (Minneapolis Consulting Group)

● Nexant – Energy Solutions Division

● OATI (Open Access Technology International)

● PowerWorld

● SunGard Enform Consulting

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Overview of Responses

● Submitted as confidential and contain proprietary information

● Implementation of Granularity Option 3A is technically feasible – (i.e. similar technology implemented in RTO/ISO market areas)

● Phased implementation is possible, minimizing resource commitment

● Respondents have a variety of experience in the electric industry, and most have experience in financial markets

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Projected Cost and Development Time

● $ 2 – 10 Million Clear definition of project scope and

requirements impacts projected cost Multi-year service agreement acceptable

● “Forklift” IDC replacement project

● One to two year implementation time line Customized development, or Customized development of Application

Program Interface modules to commercially available systems

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System Security

● Digital Certificates required

● User names and passwords

● Adherence to NERC cyber security standards

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Data Requirements

● Common practice among vendors is to accept third party data

● Near real time data to support security constrained economic dispatch (5-minute intervals) System flow and loads Generator outputs, ramp rates, capacity limits

● Existing data structures may be adequate

● Create data dependency that doesn’t exist today

● Acquisition and definition of financial data?

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Implementation Concerns

● Staffing and training

● Paradigm shift in transmission congestion management

● Risk related to resolution of congestion management process issues in parallel with tool implementation

● Critical project success factor – Controlled scope

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Definition - Project Scope and Requirements

● Implementation of supporting Business Practices Option 3 provides for socialization of

congestion costs to balancing authorities Option 3A assigns congestion costs to

contributing transactions and balancing authority load

PSEs may chose to curtail based on assignment of redispatch costs

Reservation and scheduling of redispatch energy

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● Implementation of supporting Reliability Standards Inclusion of counterflows Potential re-definition of the role of the NERC

Reliability Coordinator Reliability Coordinator Standards of Conduct

(i.e. independence from market participants)

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● Definition of Financial Model(s) Generator bid/offer system (i.e. bidding rules) Settlements Dispute resolution Compliance with redispatch directives Financial requirements for redispatch

providers

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● Potential impacts to System Reliability Delays in redispatch implementation (e.g., by

allowing a PSE to decide at what financial threshold it is willing to accept redispatch costs) may actually compromise reliability.

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● Potential impacts to other NERC tools E-tag specification OASIS (redispatch transaction transmission

service) System Data Exchange BA, TOP, PSE back end settlement systems

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● Potential impacts to non-NERC tools BA, TOP, PSE back end settlement systems Provision of supporting data RTO/ISO market flow calculators

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● Regulatory Obstacles Potential transmission tariff changes State and Federal approvals required to allow

participation in regional redispatch tariffs

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● Sarbanes-Oxley Compliance Market participants subject to SAS 70 auditing

requirements. Extensive data retention requirements

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Questions?

Documents

Transmission Congestion Management – IDC Granularity Option 3A