MISO next month will implement two new offer floors for emergency pricing to alleviate what the RTO calls “price depression.”
MISO filed the measures with FERC seeking a July 1 effective date and intends to implement by then even if the commission doesn’t respond in time — leaving the plan subject to refund or recalculation.
“We don’t anticipate that since [FERC] already accepted the [emergency pricing] Tariff revisions,” Bob Merring, MISO’s manager of market engineering, said at last week’s Market Subcommittee meeting. The filing is what MISO refers to as a “true-up” between the Tariff and the already-accepted emergency pricing construct complete with offer floors, which won FERC approval in August (ER15-1776).
Merring also noted that the comment period on the filing has passed without any responses.
Accurate emergency pricing is needed “as we move into a world of tightening resources,” he said.
After issuing an emergency alert, MISO would establish a first emergency pricing floor representing the highest economic offer in the market. A second, higher price floor based on offers would be established after the declaration of an emergency event requiring the call-up of emergency generation.
The RTO discussed raising offer floors last year and again at MISO’s May 6 summer readiness workshop. (See MISO Sees Enough Capacity for Summer.)
MISO’s extended LMP allows demand response to set prices under emergency conditions, but the RTO says the construct needs to be expanded to include more emergency resources. Prices can remain depressed if emergency offer prices are lower than prices for economic dispatch prior to an emergency declaration.
Merring said the gap could result in emergency resources entering the market at $0/MWh. “That’s an undesired outcome,” he added.
MISO Clarifying Network Resource Designation
MISO has reworked portions of its Tariff to address stakeholder concerns with a proposal to remove duplicate network resource designations found in Module B and Module E.
The RTO earlier this year proposed changes that would define network resources simply as those that clear in the annual capacity auction. MISO’s Kun Zhu said stakeholders were concerned that resources failing to clear would lose their network resource status. Others pointed out that the resource designation in Module E — dealing with resource adequacy — lasts just one year, while Module B — which focuses on network service — covers multiple years.
MISO is now proposing a new resource designation that would include those with interconnection service, a transmission service request or a scheduling right.
“Whatever we propose here will not disqualify any current network resource,” Zhu said.
The revised designation also specifies that network resources are “owned by market participants but dispatched by MISO.”
Zhu said the new designation will not impact other future uses of network resource status, including transmission planning, auction revenue rights nomination and MISO’s possible “freeze date” reference point change.
Valy Goepfrich, WPPI Energy’s vice president of operations and analytics, said the revised proposal alleviated some of her company’s concerns with the March version of the proposal.
Feedback on the revised proposal must be submitted by June 17. No filing date has been set.
Changes to Uninstructed Deviation Thresholds Longer than Anticipated
MISO’s work with its Independent Market Monitor to re-examine thresholds for uninstructed deviation by generators is taking longer than anticipated. Implementation of a new approach to the issue is not expected until the first half of 2017 because of a delay in scoping the project.
MISO earlier said an alternative to the existing practice would be in place by the fourth quarter of this year.
“While we initially intended to begin briefing stakeholders … as early as this month, the fact that it’s taking longer means a later implementation,” said Jeff Bladen, MISO executive director of market services and liaison to the Market Subcommittee.
The Monitor first recommended tightening thresholds in 2012. Last year, Monitor David Patton said MISO is losing as much as 400 MW to derates during peak conditions because of a “lenient” tolerance band of 8%, with measurement based on four consecutive dispatch intervals. (See MISO Monitor Debates Capacity Rules with Board.)
The RTO will provide an update on the issue at the June 28 MSC meeting.
MSC Tweaks Charter to Avoid Stepping on Resource Adequacy Subcommittee’s Toes
The MSC approved a motion to remove all mention of “capacity” from its charter following a recommendation from the Steering Committee.
“The rationale [is] all things capacity belong in the Resource Adequacy Subcommittee,” said Kent Feliks, MSC chair. “To avoid that overlap, we’re simply moving capacity from the mission statement.” (See “Market Subcommittee won’t Undergo Name Change, will Modify Charter,” MISO Steering Committee Briefs.)
— Amanda Durish Cook
