Monitor’s State of the Market Report Seeks Changes to MISO ELMP.)

The Monitor reiterated his suggestion that MISO and PJM scrap pseudo-ties in favor of firm flow entitlements, advice that PJM has recently turned down.

“I don’t know how anyone who understands dispatch could think this is a good idea, but there seem to be a lot of people on the other side of the border that think this is a good idea,” said Patton, who added he’d be interested in checking in with PJM “in a few months” to see if their footprint is weary from high prices.

Dynegy’s Mark Volpe asked Patton if MISO’s pseudo-ties “far from the seam” are a main contributor to higher congestion.

“The farther you are from the seam, the more constraints you’re going to impact, and it’s harder for PJM to model all those constraints,” Patton said. He said MISO’s $302.2 million worth of real-time congestion in the first quarter is up 51% from winter but still down 17% from spring 2015.

Stakeholders asked if MISO could list all pseudo-tied units. Jeff Bladen, executive director of market services, said the RTO doesn’t publicly post information on which resources are pseudo-tied, but market participants could access the nonpublic information using MISO’s commercial model, which provides inputs to the real-time and day-ahead markets.

Patton also told stakeholders the RTO should “close some loopholes” in the Planning Resource Auction design by applying physical withholding thresholds on a company basis, rather than a market participant basis, to address companies with affiliates.

Stakeholders asked if the recommendation would break up local resource zones; Patton said that would be an entirely different recommendation.

Patton also suggested MISO apply a “reasonable” transfer capability in the next PRA. He said the binding transfer constraint of 874 MW between MISO South and Midwest used in the April auction caused the uniform $72/MW-day clearing prices in zones 2, 3, 4, 5, 6 and 7. Patton wants the limit set “based on the expected ability to reliably transfer power in real-time operations.”

Subcommittee Chair Kent Feliks said the session was the beginning of stakeholders’ review. “I think the point of this today was to get the recommendations on the table to start picking them apart,” he said.

MISO, Monitor Seek Change to Contingency Reserve Selection

MISO may change the economic selection and dispatch behind contingency reserves in an effort to reduce uplift charges.

Akshay Korad, an engineer with MISO’s market evaluation and design department, told stakeholders MISO historically experiences “significant uplift” when contingency reserves are deployed. The current logic seeks to minimize scheduling costs and not production costs.

Type I demand response providing spinning reserves received about $900,000 per year in uplift charges from 2010 to 2015 because of high curtailment costs — which are not accounted for when the RTO selects the resources.

Offline supplemental generators deployed for contingency reserves were paid an average of $275,000 per year in uplift from 2010 to 2015, with last year’s costs totaling $720,000. Korad said offline resources are selected based solely on their reserve capacity offer. “Minimum runtime and commitment costs are not considered in the selection,” he said.

MISO and the Monitor are proposing different solutions, but both would add deployment-cost considerations.

The Monitor advocates the creation of a supply curve for contingency reserves with a deployment risk adder for each resource. The approach would require a Tariff change to ban negative contingency reserve offers.

MISO proposes adding deployment cost considerations to its scheduling logic.

Thomas Sikes of WPPI Energy asked if MISO could offer deployment cost historical data with its proposal. Korad said such information hadn’t been collected. Other stakeholders pointed out that work on dispatch of contingency reserves has consistently been rated a low priority on MISO’s project selection process.

Stakeholders were asked to provide input on the two proposals within a few weeks.

MISO Moving to 3-Hour Clearing Window by November

MISO’s David Savageau said the RTO is on track to “consistently” solve the day-ahead market within three hours.

The RTO is reducing the clearing window from the current four hours in order to post day-ahead results earlier under FERC Order 809. (See FERC Orders MISO to Shift Electric Schedule.)

Savageau said work will continue on the day-ahead and reliability assessment commitment software over the next four months. MISO is “confident it will meet the three-hour window in November,” he said.

MISO Sends Out Customer Survey

MISO has sent its 2016 customer satisfaction survey to 1,200 potential respondents, MISO spokesperson Jay Hermacinski told stakeholders, urging their participation. The survey, independently administered by Opinion Dynamics, is open for responses until Aug. 5.

“We take the results seriously. We analyze the data geographically, we share results with the Board of Directors, we post results to our website,” Hermacinski said.