FERC approved MISO’s reworked ratio for its capacity auctions on Monday, a day before the grid operator began accepting its first offers. It said the RTO’s recalculation ensures it will be “deriving [seasonal accredited capacity] values” consistent with its tariff.
The order also terminated the commission’s show-cause order as it found that MISO satisfactorily recalculated the ratio, which will mean some thermal generators are entering the planning year with lowered capacity accreditation values (EL23-46).
MISO’s Resource Adequacy Subcommittee convened Tuesday, the same day that staff opened the offer window, delayed by FERC’s show-cause order, for its first seasonal planning resource auction. (See MISO Unveils New Seasonal Auction Timeline, Ratio.)
Scott Wright, MISO’s executive director of resource adequacy, said MISO staff is “doing everything [they] can” to carry out the more complicated seasonal auction in a timely fashion. He said he appreciated stakeholders accommodating the dynamic auction schedule. MISO expects to reveal auction clearing prices May 19, about a month later than usual.
MISO’s Durgesh Manjure said that following the auction, MISO stands ready to hear stakeholders’ advice on how to improve it for subsequent years.
“Resource adequacy at MISO is definitely a team sport,” he said.
The auction’s delay hinged on an unforced capacity-to-intermediate seasonal accredited capacity ratio that it uses to determine supply. The ratio helps MISO navigate its new seasonal landscape, converting resources’ seasonal accreditation into unforced capacity terms. The grid operator expresses its planning needs according to unforced capacity values.
The RTO was forced to redo the ratio after a computer error caused some previously exempted planned outages to be counted against some resources’ accreditation values. The grid operator asked FERC that it be allowed to revise individual accreditation values but leave the systemwide ratio alone, as some market participants had already relied on the flawed ratio to enter bilateral capacity arrangements outside of the voluntary auction.
However, FERC ruled that the ratio had to be updated with resources’ latest seasonal accreditation values.
FERC said MISO’s tariff doesn’t afford it “with discretion to decide whether to update the ratio; rather, MISO must calculate the ratio consistent with the formula set forth in the tariff.”
FERC said while it was “sympathetic to arguments” from Vistra and the Electric Power Supply Association (EPSA) that market participants already relied on the erroneous ratio to make supply plans for the planning year, those arguments cannot supersede MISO’s duty to follow rules outlined in its tariff.
Earlier this month, Vistra and EPSA, a trade group representing competitive suppliers, asked FERC to terminate the proceeding and issue an order to prevent MISO from updating the ratio and lowering resources’ capacity credits. Both said a reworked ratio stands to affect careful supply plans that load-serving entities have buttoned up for weeks based on MISO’s first published capacity values. (See Vistra, EPSA Protest MISO’s Show-cause Order.)
FERC also said the ratio recalculation doesn’t intrude on MISO’s tariff provision requiring LSEs to opt out of the auction and submit a fixed resource adequacy plan before the upcoming a planning year.
Finally, the commission said it disagreed with ESPA’s claim that it was interfering with MISO’s auction.
“Rather, we are ensuring that the correct values for auction parameters are being used,” FERC said.
