November 23, 2024
PJM, Monitor Debate Black Start Fuel Requirements Proposals
LS Power
PJM and its Monitor sparred at two different committee meetings as they tried to win stakeholder support for their proposals on black start resources.

VALLEY FORGE, Pa. — PJM and its Independent Market Monitor got into lengthy debates at two different committee meetings last week over each other’s proposed fuel requirements for black start resources (BSRs) as they tried to win last-minute stakeholder support.

Voting on the proposals opened online after the Operating Committee’s meeting concluded Thursday and will close Tuesday at 5 p.m. ET. In a unique situation, voting is open to both the OC and Market Implementation Committee; stakeholders who are members of both need only participate in one committee’s vote, and PJM will remove any double votes. A special joint teleconference of the committees is scheduled for Friday to review the results.

Because the issue was assigned to both committees, each heard identical presentations from PJM and the IMM last week — and sat through nearly identical debates on the proposals’ merits among RTO staff, Monitor Joe Bowring and stakeholders who were confused by certain elements. Both Wednesday’s MIC and Thursday’s OC meetings threatened to run long, but the committees’ respective chairs deferred or shortened other items on their agendas to keep things on schedule.

Both proposals are the culmination of a four-year-long process intended to ensure that BSRs are available when they are needed. They would create two tiers of service, the higher of which provided by fuel-assured BSRs. While the criteria of “fuel assured” varies by resource, they can include dual-fuel capability, on-site fuel storage and connections to multiple gas pipelines.

Each transmission zone would be required to have at least one fuel-assured BSR. Such resources would be selected based on their level of fuel assurance. Also included are additional reliability criteria to mitigate extreme cases in which the unavailability of non-fuel-assured BSRs would result in a large increase in zonal restoration time.

The main differences between the proposals were highlighted at last month’s committee meetings. The Monitor’s plan, for example, would not allow intermittent resources, other than run-of-river hydro, to be BSRs because they cannot currently meet the requirements. (See Members near Vote over PJM, IMM Black Start Fuel Requirements.)

At last week’s meetings, Bowring argued that PJM’s package of revisions — jointly proposed with Brookfield Renewable and the D.C. Office of the People’s Counsel — could result in overpayment for BSRs, as an existing hypothetically “perfect” BSR — one that meets all the physical standards to be fuel assured — would not be required to offer to provide the higher-tier service and meet the performance obligations that came with it; therefore, PJM would not recognize its fuel-assured status.

In such a scenario, Bowring argued that PJM would be required to select another fuel-assured BSR in the same zone in the procurement process, resulting in customers paying twice for the same service. He said all resources that already meet the physical standards to be fuel-assured should also be required to meet the proposed requirements to be designated as such, report on their current status and not receive payment if they cannot not provide the service.

“Customers are already paying these resources to be fuel assured,” Bowring said. “PJM should simply require those resources to meet that obligation.”

Several stakeholders took this to mean that the Monitor was proposing that all existing BSRs become fuel assured. Bowring repeatedly clarified that was not in the proposal, though he did state that all new black start resources should be required to be fuel assured.

PJM staff noted that every transmission zone already has at least one fuel-assured BSR. They acknowledged that the Monitor’s hypothetical scenario was possible, but they argued it was highly unlikely, as the RTO would not necessarily be required to procure another fuel-assured resource and that it could look for other mitigation steps. Bowring responded that the fact that it’s possible “makes my point for me.”

“The zones meet the fuel-assurance requirement based on resources that already meet all the physical standards to be fuel assured but that are not required to become formally fuel assured under PJM’s proposal,” he said. “That is the ‘paying twice’ problem.”

If approved the proposals would go before the Markets and Reliability Committee for a first read next week and voted on at the committee’s meeting next month.

GenerationPJM Market Implementation Committee (MIC)PJM Operating Committee (OC)Resource Adequacy

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