ERCOT stakeholders on Wednesday approved a binding document revision that codifies the grid operator’s plans to deploy more operating reserves — and do so earlier — in anticipation of tight conditions this summer.

Jeff Billo, ERCOT director of forecasting and ancillary services, told the Technical Advisory Committee during a special webinar that the grid operator’s near-term strategy is to increase responsive reserve service procurement from 2.3 GW to 2.8 GW during peak load hours on all days and to increase non-spinning reserve service so that at least 6.5 GW of ancillary services are maintained for all hours of all days.

ERCOT will add 1 GW of non-spin for days when a higher potential of weather-forecast uncertainty could result in a higher net load (load minus wind and solar generation). The changes are effective July 12.

“Going forward, ERCOT is going to operate the grid with a greater margin between emergency conditions and normal conditions,” Billo said. “This will cover for the days when we are losing a significant amount of generation due to forced outages.”

The grid operator was forced to call for week-long conservation measures on June 14 when it lost more than 12 GW of capacity to mostly mechanical failures. It ended last week with nearly 10 GW of capacity still offline. (See Generation Outages Force ERCOT Conservation Alert.)

Billo said the forced outages have had a significant impact on ERCOT’s operating reserve margin.

“That change is a big reason we’re increasing the amount of ancillary services going forward,” he said. “You’re getting that physical responsive capacity on the system. We felt that was an important part of the strategy going forward.”

As Billo explained to TAC the week before, ERCOT staff is formalizing its forecasting processes, which rely on a staff meteorologist and various vendors. Operating days will be classified as having high, medium or low potential for forecast variabilities, findings that will feed into procuring additional AS.

“Meteorologists are not perfect. It’s a science and an art, and sometimes they miss,” Billo said.

Staff also considered relying on the reliability unit commitment process before deciding to increase AS deployment.

Stakeholders expressed some concern over potential price suppression but passed the other binding document revision request (OBDRR031) by a 25-2 margin, with two abstentions. Retailers Just Energy and Demand Control 2 opposed the motion.

“We rely on the volatility of prices in the current summer to reflect risk in forward summers,” said Luminant’s Ian Haley, who abstained from the vote, during TAC’s discussion. “If this change goes through and there is unbelievable price suppression for the entire summer, that has implications for forward prices.”

Eric Goff, representing the residential consumer segment, urged caution before voting for the measure.

“The consumer segment feels that while ERCOT has pretty clearly said it wants to be conservative in general, it’s reacting to recent events,” he said. “We can tell this has not been a clearly deliberative process. … We prefer this whole issue be revisited when the summer concludes in October.”

TAC directed its Wholesale Market and Reliability and Operations subcommittees to analyze the summer outcomes and provide recommendations during the committee’s October meeting. The WMS will also review the market effects of ERCOT’s more conservative procurement and deployment objectives, while ROS will review the volumetric impacts and the inclusion of constrained capacity in the grid operator’s calculation of physical responsive capability, TAC Chair Clif Lange said.

Billo promised the committee that the grid operator would update the market on its AS procurement by the 20th of each month. The 2022 cycle for updating ERCOT’s AS methodology begins in the fall.

ERCOT issued a market notice Thursday with the details.

In-person Meetings Return in September

ERCOT will resume in-person meetings on Sept. 1, beginning with the WMS meeting, staff told the committee.

The grid operator is considering a hybrid model to accommodate those not ready to return for face-to-face meetings and will share more details during the July TAC webinar.