CARMEL, Ind. — MISO says it “largely agrees” with its Independent Market Monitor’s five new market recommendations issued this year.

The IMM’s annual State of the Market report, released this summer, listed recommendations for promoting transmission reconfiguration plans, reducing out-of-market commitments, creating a future-looking dispatch model and ensuring MISO only pays for real load reductions. (See MISO Monitor Prescribes 5 New Fixes in Annual Market Report.)

The grid operator said it is actively working on three of the ideas, while the remaining two are on its list of five-year goals.

In reviewing the market performance in 2021, the Monitor said the RTO should:

• work with its transmission owners to identify and implement economic transmission reconfiguration plans to better manage congestion;
• evaluate and restructure its unit commitment process to reduce out-of-market commitments and ensuring make-whole payments;
• develop a multihour, look-ahead dispatch and commitment model to better manage fluctuations in net load and decisions on when to use storage resources. Patton said, “as reliance on intermittent resources grows in MISO, the need to manage extraordinary fluctuations in net load will grow;”
• improve rules around demand participation in energy markets so that MISO only pays for load reductions that occur; and
• consider classifying load-modifying resource (LMR) curtailments as short-term demand in pricing models and the unit dispatch system.

The last recommendation stems from Patton’s observation that LMRs are allowed to set real-time energy prices long after emergency conditions have passed. He said that’s because of MISO’s extended locational marginal pricing (ELMP) model respecting resources’ ramp rates, which makes it impossible to replace a large volume of LMRs within a single dispatch interval.

Patton said the LMRs appear to be necessary and set prices “long after MISO’s resources are sufficient to replace them by ramping up.” He said that if MISO treats LMRs as an operating reserve demand in the ELMP model, it would eliminate the problem.  

MISO said it has yet to begin work on the second stage of its look-ahead commitment tool or categorizing LMR curtailments under short-term demand for pricing purposes.

Zhaoxia Xie, with MISO’s market design team, said staff may encounter some difficulty including LMR curtailments because short term reserves are priced systemwide or zonally, whereas LMRs are modeled at the more local nodal level. But she promised more evaluation on the issue Thursday during a Market Subcommittee meeting.

The RTO said it plans to augment its look ahead commitment tool in 2023 to improve commitment decisions. It said upgrades should reform its unit commitment processes with the added benefit of using storage resources to manage fluctuations in net load.

“This has been a hot topic between MISO and the IMM for a while,” Xie said. She said staff is constantly evaluating improvements in its commitments process.

The grid operator agreed that it could use more stringent rules and procedures for demand participation “to avoid unjust payments.” MISO said it may file tariff revisions with FERC after consulting with stakeholders.

Staff said they’ve been working since January with transmission owners to develop operating procedures for transmission reconfiguration. They will begin a reconfiguration process in 2023’s first quarter to reduce congestion costs.

MISO’s Tony Rowan said the procedure involves a market participant bringing a suggested economic reconfiguration to staff and relevant TOs, who will test the solution over 15 business days for reliability and economic impacts. If MISO and TOs agree the solution puts a dent in congestion without deteriorating system conditions, the reconfiguration plan will go into effect for an agreed-upon duration.

MISO also said it will maintain a public list of the footprint’s top 10 most economically impacted constraints.