By Amanda Durish Cook and Tom Kleckner
FERC ordered MISO Thursday to post its day-ahead market results earlier, saying the RTO’s current schedule doesn’t allow gas-fired generators enough time to procure fuel.
The commission said MISO had failed to comply with Order 809, which moved the timely nomination cycle deadline for gas to 1 p.m. CT from 11:30 a.m.
The commission ordered MISO to move the posting of its day-ahead market results “at least” 30 minutes earlier to 12:30 p.m. CT. It also ordered the RTO to set a notification time for its forward reliability assessment commitment (FRAC) that is “sufficiently in advance” of the gas evening nomination cycle (ER15-2256 and EL14-25).
In separate orders, FERC accepted Order 809 compliance filings by SPP and CAISO. Order 809, issued in April, also added a third intraday nomination cycle. (See FERC Approves Final Rule on Gas-Electric Coordination.)
MISO Filing
MISO submitted a compliance filing in July that proposed posting day-ahead market results one hour earlier at 1 p.m. CT and the FRAC notification time two hours earlier to 5 p.m. CT. It also proposed moving its day-ahead market trading deadline one hour earlier during daylight saving time, so that the deadline would be 10 a.m. CT year-round.
The RTO also proposed reducing the day-ahead market solve time from four hours to three, saying that would meet Order 809’s requirement for posting post market results “sufficiently in advance” of the evening nomination cycle to allow gas-fired generators to obtain fuel and pipeline capacity while minimizing the impact on market participants.
MISO said the earlier publication of the day-ahead results would reduce costs by making up to 1,600 MW of longer lead notification generation capacity available. Similarly, the 5 p.m. CT FRAC notification time would allow consideration of up to 4,214 MW of longer lead notification resources.
MISO said its proposals were an effort to balance the Order 809 requirements against stakeholder preferences to maintain a day-ahead market deadline no earlier than 10 a.m. CT. Because most of its footprint operates in the Central Time Zone, MISO said, market participants use the morning hours to determine generation availability, develop forecasts and formulate bids and offers.
FERC not Persuaded
FERC said posting results ahead of the evening gas nomination cycle is not a substitute for posting in advance of the timely nomination cycle, which it said is “the most liquid time to acquire both natural gas supply and pipeline transportation capacity.” MISO’s proposed day-ahead notifications would overlap with the timely gas deadline, leaving generators no time to submit nominations.
The commission said MISO failed to demonstrate that moving its posting at least 30 minutes earlier “will be unduly burdensome or disrupt its markets.”
While MISO said it was not currently experiencing the gas scheduling challenges faced by PJM and the Northeast markets, FERC said, it had “recognized that in the future it could have scheduling difficulties as coal-fired plants retire.”
“For at least part of the year, MISO, like PJM, NYISO and ISO-NE, generally schedules its day-ahead market using Eastern Prevailing Time, which means that it has more time compared to SPP and CAISO during the morning hours to complete its day-ahead schedule in time to meet the 2 p.m. ET (1 p.m. CT) revised timely nomination cycle deadline,” the commission said. “Thus, it is not apparent how requiring MISO to move its day-ahead posting deadline in advance of the timely nomination cycle places an undue burden on the staffs of MISO and its stakeholders.”
The commission acknowledged that MISO’s stakeholders generally prefer to purchase natural gas during its most liquid period (natural gas price certainty) over being able to obtain pipeline service during the timely nomination cycle (quantity certainty). It said MISO should work with stakeholders to reduce its market solve times further “to allow market participants to submit bids reflecting increased fuel price certainty.”
MISO has 30 days to submit a new compliance filing.
SPP Change Approved
FERC, meanwhile, accepted Tariff revisions SPP submitted in August that moved the deadline for day-ahead market offers up 90 minutes to 9:30 a.m. CT (ER15-2377).
The RTO will now post day-ahead results at 2 p.m. CT, up from 4 p.m., and shorten the reoffer period to 45 minutes, with reliability unit commitment (RUC) offers due at 2:45 p.m. CT and results posted by 5:15 p.m. (See “Board Approves Gas-Electric Timeline Change” in SPP BoD/Members Committee Briefs.)
FERC said SPP had “identified characteristics on its system that justify its proposal not to publish its day-ahead market results prior to the timely nomination cycle,” noting its low risk of natural gas pipeline constraints and the impact changes would have on weather forecasting for its “extensive wind resources.”
The commission ordered SPP to submit an annual informational report for the next three years on its efforts to further align its gas and electric scheduling practices. SPP staff have said they can implement the changes — which will require new software — by next fall. The work is being done in conjunction with an enhanced combined-cycle project, at an estimated combined cost of $7.7 million. (See “Enhanced Combined-Cycle Project Moves Forward” in Board of Directors/Members Committee Briefs.)
No Change for CAISO
The commission also said CAISO had shown good cause why its existing day-ahead practices should not be changed (EL14-22).
CAISO’s July compliance filing said its load-serving entities feared less accurate supply forecasts with an earlier start to the day-ahead market. FERC agreed, saying “moving the close of the day-ahead market earlier could reduce the accuracy of demand, hydroelectric supply and variable energy resource output forecasts.”
The ISO’s day-ahead market closes at 10 a.m. PT and market results are published at 1 p.m. PT.
As with SPP, the commission ordered annual informational reports on CAISO’s efforts to improve coordination of gas and electric schedules.
