Below is a summary of the issues scheduled to be brought to a vote at the Markets and Reliability and Members committees Thursday. Each item is listed by agenda number, description and projected time of discussion, followed by a summary of the issue and links to prior coverage in RTO Insider.
RTO Insider will be in Valley Forge covering the discussions and votes (note change from normal location in Wilmington). See next Tuesday’s newsletter for a full report.
Markets and Reliability Committee
2. PJM MANUALS (9:10-9:25)
The committee will be asked to endorse the following manual changes:
A. Manual 12: Balancing Operations. Updates Section 4.5, “Qualifying Regulating Resources,” for clarity, accuracy and consistency, including a description of current regulation testing procedures; consolidates “PJM Actions” from previous subsections into Section 4.5.
B. Manual 14B: PJM Region Transmission Planning Process. Adds language that describes Capacity Emergency Transfer Limit (CETL) easily resolved constraints to match that in the Tariff. (See MRC / MC Approvals.)
C. Manual 11: Energy & Ancillary Services Market Operations. Conforming revisions, adding references to “pre-emergency” demand response. (See PJM Wins on DR, Loses on Arbitrage Fix in Late FERC Rulings.)
3. RPM TRIENNIAL REVIEW (9:25-10:30)
The committee will be asked to approve changes to parameters used in capacity auctions: the cost of new entry (CONE), the energy and ancillary services (E&AS) offset and the variable resource requirement (VRR) curve. The changes, which were considered by the Capacity Senior Task Force in PJM’s triennial review, would be implemented for the 2015 Base Residual Auction (BRA).
The packages of proposed changes brought to a vote will be based on the results of a formal CSTF poll, which will be completed before the MRC meeting.
In informal polling at the CSTF, only two of nine packages received more than 50% support: Public Service Enterprise Group’s package B and Dayton Power and Light’s package I (both 57% in favor). The two packages are identical in seven of 11 attributes, differing only on calculation of gross CONE, net E&AS offset, VRR shape (system) and net CONE method (RTO). (See table.)
In the informal polling, a majority also favored increasing the weighted average cost of capital in calculating gross CONE, with 57% expressing support and another 13% saying they would consider it, while 31% were firmly in opposition.
Changes to the levelization method found little support, with 71% saying they support the status quo. Changes to the net E&AS offset also proved unpopular, with only 40% wanting to abandon the status quo.
A majority — 59% to 63% — favored changing the VRR curve from the current concave shape to a convex shape.
The Maryland Public Service Commission sent PJM a letter detailing its opposition to three changes to the VRR curve proposed by the RTO: moving the curve’s “point a” to the right to increase capacity price levels sooner if reserve levels are threatened; changing to a convex shape from the current concave curve; and moving the entire curve an additional 1% to the right.
The PSC said PJM’s proposal is based on unduly conservative assumptions and would be expensive for consumers. Had the changes been in place for the last three BRAs, total capacity spending would have increased by $1 billion to $1.7 billion, a PJM simulation estimated.
BRAs are held three years before the delivery year, with the RTO able to acquire additional capacity in interim auctions. The PSC said this structure “provides an adequate time period for PJM and government to react to” any shortfalls. The PSC also said an analysis by The Brattle Group for PJM ignores this flexibility, “thus severely overstating the risk of inadequate generation, which it asserts as justification for PJM’s modified VRR curve.”
4. REGIONAL PLANNING PROCESS SENIOR TASK FORCE (RPPTF) (10:30-10:40)
The committee will be asked to approve Operating Agreement revisions defining supplemental transmission projects. (See PJM’s `To Do’ List.)
5. POWER METER AND IN-SCHEDULE DATA SUBMITTAL DEADLINES (10:40-10:50)
Members will consider proposed manual and Tariff revisions extending the deadlines for electric distribution companies (EDCs) to submit Power Meter and InSchedule data to address problems with reporting output for non-utility generators. (See PJM MIC OKs Settlement, Credit Changes.)
6. CAPACITY CONTRIBUTION RECONCILIATION (10:50-11:00)
The committee will vote on proposed manual and Reliability Assurance Agreement changes recommended by the Market Settlements Subcommittee that would allow EDCs to submit corrections to Peak Load Contribution and Network Service Peak Load assignments until noon on the next business day. The changes are intended to aid Pennsylvania EDCs squeezed by new Pennsylvania Public Utility Commission deadlines. (See PJM MIC OKs Settlement, Credit Changes.)
7. FTR/ARR SENIOR TASK FORCE (FTRSTF) PROBLEM STATEMENT, ISSUE CHARGE AND CHARTER (11:00-11:30)
Members will discuss, and may vote on, proposed updates to the FTRSTF problem statement, issue charge and charter. The task force was formed to evaluate the causes for Financial Transmission Rights underfunding and determine whether enhancements can be made to the current FTR and Auction Revenue Rights processes to improve FTR funding levels.
Members Committee
2. CONSENT AGENDA (1:20-1:25)
B. The committee will be asked to approve a “back stop” mechanism for acquiring black start services through transmission providers when PJM solicitations fail to obtain service for a zone. Members will also vote on minor Tariff and manual changes relating to the compensation of black start units. Both sets of changes were approved by the MRC July 31. (See MRC Briefs.)
3. RPM TRIENNIAL REVIEW (1:25-2:30)
See MRC item #3 above.
