By Amanda Durish Cook

MISO is planning a study to ensure external resources bordering more than one of its local resource zones participate in only one zone in the RTO’s annual Planning Resource Auction.

The proposed electrical connectivity analysis will be included in MISO’s second attempt to win FERC approval to create external resource zones in its capacity auction. It will study the links maintained by external resources bordering more than one MISO local resource zone, MISO staff said during an Aug. 22 special conference call of the Resource Adequacy Subcommittee.

FERC rejected MISO’s first filing for external zones, taking issue with MISO’s proposal to allow external resources bordering two local resource zones to choose the zone in which they receive auction credits. The commission also rejected MISO’s plan to make holders of evergreen supply contracts eligible for excess auction revenues indefinitely. (See MISO Promises External Capacity Zones After FERC Rejection.)

The electrical connectivity analysis will measure a generator’s impacts on tie lines, transmission facilities in each zone it borders and zonal transmission import and export constraints. After the study, the external resource will be assigned to the local resource zone with which it shares the greatest electrical connection.

MISO Director of Resource Adequacy Coordination Laura Rauch said the analysis will ensure external resources on the borders don’t receive local credit in more than one zone and market participants don’t have the ability to influence capacity prices.

Rauch said the proposed analysis will take into account the flow of capacity on the system.

“We do … agree with FERC that there should be more specificity for accreditation beyond line ratings,” she said.

Because MISO’s proposed analysis involves a unit-specific approach, Rauch said MISO isn’t allowed to publicly post accreditation results.

“The result will be confidential, so we want to make sure the process is as transparent as possible,” she said.

Customized Energy Solutions’ Ted Kuhn asked if MISO could simply “scrub the names” and release results of the analysis. Rauch said stakeholders might still be able to identify the units based on which transmission lines MISO studied, though she said MISO will evaluate what it could release without revealing confidential information.

MISO plans to refile its external zone proposal with FERC by Aug. 31, hoping for approval sometime in October. Rauch said the timing of the filing should give MISO enough time before deadlines start approaching for the 2019/20 planning year capacity auction.

2-Year Cutoff

MISO’s refiling will also seek to prohibit external resources with historic supply contracts containing evergreen extension options from receiving excess auction revenues after the original contract term is up. MISO’s first filing allowed holders of such evergreen contracts to receive hedges for price separation in perpetuity. FERC said such a rule would have allowed some generation owners to avoid locational price signals indefinitely.

Now, instead of continuously renewing their eligibility, evergreen contract holders will be eligible for hedges until the end of the original term of the agreement or for two years, whichever is longer.

Rauch said the edited provision will also apply to evergreen contract holders who already have a contract extension in place.

“The idea is you get two years to be able to adjust and adapt,” Rauch said.