Page 1362 – RTO Insider

January 23, 2017

FERC Acts on ACE Recovery; Remedial Schemes

By Rich Heidorn Jr.

FERC on Thursday approved a final rule on recovering from balancing contingency events and proposed a second rule to ensure that remedial action schemes do not compromise reliability.

Recovery from a Balancing Event

The final rule approves NERC reliability standard BAL-002-2, which seeks to ensure that balancing authorities and reserve sharing groups can use reserves to balance resources and demand to recover from system contingencies and restore their area control error (ACE) to pre-contingency levels (RM16-7).

ferc remedial action schemes ras — | *MISO*

In response to opposition from NERC, the Edison Electric Institute and most RTOs and ISOs, the commission backed off from a proposal that would have required reliability coordinators to authorize extensions of the 15-minute ACE recovery period.

In its Notice of Proposed Rulemaking in May, the commission said it was unclear how an entity would prepare for a second contingency during the extension under NERC’s proposal. A balancing authority operating out-of-balance for an extended period of time is “leaning on the system” by relying on external resources, which could affect other entities within an interconnection, the commission said.

EEI and the RTOs said that the requirement “would result in unnecessary duplication of requirements adding no tangible benefit to reliability while needlessly increasing the compliance burden.”

Instead, the commission’s final rule adopts a proposal by Arizona Public Service requiring only that an entity that is unable to recover ACE because of a second disturbance inform the reliability coordinator and provide it with a recovery plan.

The commission also approved NERC’s proposal that demand-side resources that are technically capable be included as contingency reserves.

Remedial Action Schemes NOPR

The commission also approved a NOPR backing NERC reliability standard PRC-012-2, which is designed to ensure that remedial action schemes (RAS) do not introduce “unintentional or unacceptable” reliability risks (RM16-20).

The standard defines an RAS as a plan to detect abnormal system conditions and automatically take corrective actions — such as tripping generation or load, or reconfiguring a system — to maintain stability and limit the impact of cascading events.

The NOPR also would withdraw pending standards PRC-012-1, PRC-013-1 and PRC-014-1 and retire standards PRC-015-1 and PRC-016-1.

The commission solicited comment on a proposed clarification that the new standard will not supersede system performance obligations under reliability standard TPL-001-4, which limits “non-consequential load loss” to 75 MW for certain contingencies.

Rehearing Denied on GMD Rule

FERC also rejected rehearing requests by EEI and others on its September order requiring grid operators to assess and protect against the threat of geomagnetic disturbances (RM15-11-001). (See FERC Approves GMD Reliability Standard.)

EEI had challenged the standard’s (TPL-007-1) implementation plan, saying it failed to account for the impacts of changes to the definition of a benchmark GMD event.

The commission said EEI’s concern was “premature.”

“At this time, the commission has no way of knowing what impacts the modified benchmark GMD event definition may have on the approved implementation plan because NERC has not yet developed or proposed a revised” definition, FERC said. It added that NERC may propose a longer implementation plan if needed as a result of a revised definition.

January 23, 2017

ISO-NE Planning Advisory Committee Briefs

ISO-NE will use the same zonal boundaries for its next two Forward Capacity Auctions.

In FCA 10 last year, ISO-NE used two zones: Rest of Pool, which comprises Connecticut, Vermont, New Hampshire, Maine, and western and central Massachusetts; and Southeastern New England (SENE), which includes Northeast Massachusetts/Greater Boston and Southeast Massachusetts/Rhode Island.

FCA 11 (2020/21) and FCA 12 (2021/21) will be conducted in four zones: Southeast Massachusetts/Rhode Island, which includes Greater Boston; Northern New England, which includes Maine, New Hampshire and Vermont; Connecticut; and Rest of Pool, generally central and western Massachusetts.

“Most major transmission projects are already certified,” Al McBride, director of transmission strategies and services, told the Planning Advisory Committee last week, meaning the RTO has determined they will be operational in time for the capacity commitment period.

As they go into service, additional portions of the Greater Hartford/Central Connecticut and Southwest Connecticut transmission project will be included in the Connecticut zone. The project is expected to be completed in 2019.

Likewise, resource retirements are unlikely to have significant impact on the zones. “Our modeling show that even if they occur, it is not likely to change the boundaries,” he said.

New Study Looks at Less Maine Wind, More Offshore

Integrating renewable resources close to load centers in the Southeast Massachusetts/Rhode Island area could be more cost effective than tapping large volumes of wind in Maine, according to a new high-level transmission cost analysis presented to PAC members last week.

In October, ISO-NE staff presented the preliminary estimates for five scenarios for integrating renewable resources in New England by 2030. (See 5 Resource Scenarios Presented to ISO-NE Planning Advisory Committee.)

Renewable energy advocacy group RENEW requested an additional analysis in which large amounts of renewable resources, primarily onshore wind in Maine as outlined in scenario 2, were changed to incorporate a more diverse mix of renewable resources spread over wider geographic areas.

Under scenario 2, Maine wind injections were assumed to be 12,872 MW in 2030, with 1,219 MW of offshore wind in Southeast Massachusetts and Rhode Island. In scenario 6, the Maine wind has been cut by more than half to 5,959 MW, with offshore wind boosted to 5,370 MW.

Even that smaller amount of Maine wind could require a complete overhaul of the AC power system, system planner Marianne Perben said.

Instead, renewable resources would be tied directly into several HVDC connectors connecting the wind integrator system to a hub in Millbury, Mass. Scenario 2 assumes a need for 9,043 MW of congestion relief, while scenario 6 envisions a need for 3,596 MW.

Splitting offshore wind resources between Connecticut, Rhode Island and Southeast Massachusetts could alleviate the need for a congestion relief system for those resources, planners said.

The analysis found that offshore wind could be imported without the need for congestion relief if it were sited off of Connecticut, Rhode Island and Southeast Massachusetts. That would allow the resources to take advantage of interconnections vacated by about 4,400 MW of resources close to the coastline that are expected to be retired by 2030: the Pilgrim nuclear plan, Millstone Unit 1, Montville Units 5 and 6, Brayton Point Units 1 through 4, and Canal Units 1 and 2.

“Under this … assumption, the cost to integrate renewable resources (excluding plant collector and interconnection system costs) in scenario 6 would be driven exclusively by the cost of integrating Maine onshore wind resources and would be significantly reduced, as compared to scenario 2,” the RTO said.

iso-ne planning advisory committee — Renewable collector and interconnection system (left) and approximate path of HVDC congestion relief system (right). | *ISO-NE*

In scenario 2, the total Maine congestion relief system would cost an estimated $20 billion; in scenario 6, the price tag is estimated at $8 billion.

The estimates do not account for individual plants’ interconnection costs or potential costs from the challenge of managing large volumes of renewables during off-peak periods, the RTO said.

ISO-NE Recommends Against Keene Road Project

Staff told the PAC it is recommending the RTO not move forward on the Keene Road transmission project.

In December, staff told the committee that increasing export limits from the current 165 MW to 195 MW would save only $1.35 million to $1.38 million (2015 $) in energy production costs. (See ISO-NE Study Sees Little Savings from Keene Road Tx Upgrade.)

Written comments are due to PACmatters@iso-ne.com by Feb. 17. The RTO will report its final decision at the March or April PAC meetings.

Streamlined Regional System Plan due this Summer

ISO-NE staff is preparing a streamlined regional system plan for unveiling in the summer.

The document, which had become an unwieldy 200 pages, will come in at about 50 pages, said Michael Henderson, director of regional planning and coordination. Instead of duplicating sections of other RTO documents, links will be provided.

In response to stakeholder feedback, the plan will be produced every other year. It had formerly been produced annually.

It will include forecasts of gross load, energy efficiency and behind-the-meter photovoltaics and projections of systemwide need for capacity and reserves, along with transmission system needs.

A draft will be posted for PAC review on July 7, with comments and reviews scheduled throughout the summer. The final document will be presented at a public meeting on Sept. 14.

– William Opalka

January 23, 2017

ISO-NE Scarcity Rules Unfair to Generators, FERC Says

By William Opalka

FERC on Thursday granted a complaint by New England generators that a penalty imposed during a summer heat wave proved that a rule intended to punish resource withholding is unjust and unreasonable (EL16-120).

The commission agreed with the New England Power Generators Association that the peak energy rent adjustment should be raised. (See Generators: ‘Unjust’ Rule Cost $100M in New England Heat Wave.) But it ordered that the amount of increase should be determined in an evidentiary proceeding if stakeholders cannot reach a settlement.

“NEPGA has demonstrated that, as a result of the new reserve constraint penalty factors, the relationship between the amount of compensation that suppliers receive for energy in scarcity periods, and the amount that suppliers must rebate as a result of the operation of the PER mechanism, has rendered the existing PER mechanism unjust and unreasonable,” the commission wrote.

“We agree with NEPGA that for the time period in question, capacity resources were unable to anticipate a future increase in reserve constraint penalty factors and, accordingly, were unable to reflect a corresponding increase in their capacity offers.

“We additionally find that, as NEPGA has suggested, this problem can be remedied by raising the PER strike price. Doing so would return the PER rebate to an amount that more closely reflects the expectations of the parties at the time of the seventh and eighth Forward Capacity Auctions in February 2013 and 2014, respectively, the commission wrote. The higher penalty factors were ordered by the commission in May 2014.

NEPGA said the adjustment created “absurd” results during a six-hour period of intense heat on Aug. 11 that featured unexpected outages and high prices.

The PER adjustment reduces capacity suppliers’ monthly capacity payments by an amount that approximates the “peak energy rents” earned by a hypothetical generator in the real-time energy market.

When the hourly real-time energy market price exceeds a predetermined “strike price,” the RTO calculates an “hourly PER” value that roughly equals the difference between the real-time clearing price and the strike price. These monthly values are added for the month, averaged over a rolling 12-month period and then deducted from suppliers’ monthly capacity payments.

NEPGA requested that the PER strike price be increased by $250/MWh, the same change ISO-NE proposed to stakeholders in 2014. “We note that, while ISO-NE may have found this to be a reasonable increase previously, recent market developments may justify a different increase,” the commission wrote.

FERC last year approved a Tariff change submitted by ISO-NE that eliminates the PER adjustment on June 1, 2018, at the start of the ninth capacity commitment period. The RTO said reforms in the day-ahead energy market and the Pay-for-Performance program that starts on the date have made the rule unnecessary.

January 23, 2017

FERC Approves 8.95% Base ROE in NYPA Settlement

FERC on Thursday accepted a settlement that replaces the New York Power Authority’s stated transmission rates with a cost-of-service formula including a base return on equity of 8.95%. NYPA will receive an additional 50 basis points for its participation in NYISO (ER16-835).

ferc roe nypa — Lineman on transmission pole | *New York Power Authority*

The organization will receive a 50-basis-point “congestion relief adder” for the Marcy South Series Compensation project in Delaware County for the original $55.7 million cost of the project. Costs exceeding the cap will revert to the base ROE.

NYISO filed the request on NYPA’s behalf in January 2016, with the commission ordering a settlement proceeding in March. The settlement, which was not contested, was supported by FERC trial staff. The commission said the rate formula became effective April 1, 2016.

NYPA was ordered to file an amended Tariff within 30 days.

The organization last January said it needed to convert to a formula rate because it anticipates spending approximately $726 million in its transmission life extension and modernization program through 2025. Some assets are more than 70 years old, NYPA said.

– William Opalka

January 23, 2017

FERC Orders Portfolio Approach for PJM FTR Forfeiture Rule

By Rory D. Sweeney

FERC last week rejected PJM’s proposal for revising how it implements its financial transmission rights forfeiture rule, ordering the RTO to instead adopt a portfolio approach suggested by the Independent Market Monitor (EL14-37).

The commission, however, declined to order any refunds.

The ruling was the result of a Section 206 proceeding ordered in 2014 to determine whether the RTO was improperly treating up-to-congestion trades (UTCs) differently than increment offers (INCs) and decrement bids (DECs).

ferc pjm ftr forfeiture rule — Up-to-congestion transactions, which fell sharply following a FERC order setting Sept. 8, 2014 as the effective date for potential uplift charges, rebounded after the 15-month refund period expired.

The order says the forfeiture rule should be applied to UTCs as well as INCs and DECs. The order did not address whether uplift — currently assessed on INCs and DECs — should also be applied to UTCs. Instead, it said that issue would be considered in broader Notice of Proposed Rulemaking on uplift cost allocation. (See related story, FERC Proposes More Transparency, Cost Causation on Uplift.)

The forfeiture rule was implemented in 2000 to prevent market participants from using virtual transactions to create congestion that benefits their FTR positions. The FTR holder forfeits the profit from its FTR when it submits an INC or a DEC at or near an FTR location that results in a higher LMP spread in the day-ahead market than in real time.

The commission ordered the 206 investigation after PJM proposed redefining UTCs as virtual transactions and making them subject to the forfeiture rule, which had previously been applied only to INCs and DECs. (See FERC Orders Review of UTC Rules.)

Worst-Case Scenario

The current rule evaluates virtual transactions individually against the “worst-case” bus — the location at which the transaction has the biggest impact on congestion. A forfeiture is triggered if at least 75% of the energy flowing between the transaction bus and the worst-case bus is reflected in the constraint.

PJM had proposed continuing to evaluate transactions individually but replacing the worst-case bus technique with a generation-weighted reference bus to evaluate DECs and a load-weighted reference bus to evaluate INCs.

Under the worst-case approach, one trader’s INC (an offer to sell energy at a specified source location in the day-ahead market) may be paired with a different market participant’s DEC (a bid to purchase energy at a specified sink location day ahead). PJM said that can result in forfeitures occurring when they should not.

False Positives, Negatives

But the commission ruled that the RTO’s proposed fix didn’t go far enough, saying the individual transaction approach does not capture the impact of a market participant’s overall portfolio of virtual transactions on a constraint.

“This may lead to forfeitures from some participants who have offsetting positions elsewhere and thus whose virtual transactions did not actually impact the constraint. Likewise, the rule may fail to invoke forfeiture on some participants who do not impact the constraint with a single transaction but have additive positions elsewhere that, on net, do impact the constraint significantly,” the commission said.

It ordered PJM to adopt the Monitor’s proposal to evaluate the net effect of a participant’s entire virtual portfolio — INCs, DECs and UTCs — on the constraint.

A UTC would be included in the portfolio as an INC at its source point and as a DEC at its sink. Because UTCs include both source and sink, there is no corresponding worst-case bus with which to compare it. (In a related order, the commission also accepted a PJM compliance filing establishing the criteria for determining the source-sink paths for UTCs (ER13-1654-001, ER13-1654-002)).

FERC also ruled that PJM must evaluate power flows using a load-weighted reference bus, which PJM already uses to calculate certain components of LMP, instead of the worst-case bus. As a result, the commission said, the 75% trigger should be replaced with one based on a percentage of the total binding megawatt limit of the constraint related to the FTR path.

“Specifically, to trigger a forfeiture, the net flow across a given constraint attributable to a participant’s portfolio of virtual transactions must meet two criteria: (1) The net flow must be in the direction to increase the value of an FTR; and (2) the net flow must exceed a certain percentage of the physical limit of a binding constraint,” the commission explained. “Although any volume can cause congestion, this second condition recognizes that increased volumes relative to the binding limit are more symptomatic of transactions that increase the value of an FTR.”

It noted that CAISO uses a such a method in its congestion revenue rights settlements. The ISO determines that congestion has been significantly impacted if a CRR holder’s entire portfolio exceeds 10% of the constraint’s flow limit.

The commission said eliminating the worst-case bus would increase the transparency of the forfeiture methodology, allowing market participants to monitor their own activity to determine if they are significantly impacting constraints related to their FTRs.

Compliance Filing

FERC ordered PJM to submit a compliance filing within 90 days to modify its Tariff to incorporate the new approach.

It rejected concerns that the portfolio approach would discourage transactions at liquid trading spots such as zones, hubs and interfaces, saying transactions at those locations should be included in the forfeiture evaluation.

It also ruled that counterflow FTRs and virtual transactions that relieve congestion should no longer be exempt from the forfeiture rule. “Holders of counterflow FTRs are able to manipulate congestion to benefit their FTR position,” the commission said.

The commission rejected calls from some trading firms to eliminate the forfeiture rule, saying that the requests were outside the scope of the proceeding and that the rule was necessary to deter cross-product manipulation.

Despite finding the current methodology not just and reasonable, FERC said refunds were “not appropriate.”

“As some parties have indicated, they have based market decisions on the current Tariff rules that cannot now be revisited, and the commission has not always ordered refunds when market decisions are affected. Moreover, while market participants were on notice that the FTR forfeiture rule might change, the nature of any change was uncertain. The bids, offers and decisions market participants made could have been different had they been aware of the nature of the revised FTR forfeiture rule.”

January 23, 2017

FERC Rejects Broader Waiver for Emergency Generators in ISO-NE

By William Opalka

FERC on Thursday denied a request to broaden a waiver providing relief to real-time emergency generation resources in ISO-NE (ER16-1904-001).

ferc transmission roe nypa — Meade and Prettyman DC circuit courthouse | © *RTO Insider*

The RTO had requested the waiver in response to a federal court ruling vacating an EPA rule that would have allowed greater use of emergency generators. FERC granted the waiver in August, effective June 21, 2016.

Real-time emergency generators are distributed generation limited by air quality permits to operating when ISO-NE implements voltage reductions of 5%. They must be able to go into operation within 30 minutes of the RTO’s dispatch instructions.

The waiver was prompted by a May 2015 ruling by the D.C. Circuit Court of Appeals reversing an EPA exemption that allowed the generators to operate 100 hours a year for emergency demand response.

“Because the court vacated the EPA rules that allowed emergency generators to respond to a 5% voltage reduction, [real-time] emergency generation resources can no longer operate when ISO-NE implements voltage reductions and can only operate when their host facilities lose off-site power, unless they are retrofitted to comply with the EPA’s National Emissions Standards,” FERC wrote.

The waiver allowed such generators to change their resource type to real-time DR within a timeframe that otherwise would not be possible, permitting them to participate as DR in the February 2017 Forward Capacity Auction.

Enerwise Global Technologies’ CPower sought rehearing, contending the waiver did not fully address the problems caused by the D.C. Circuit ruling. It sought additional relief, arguing that emergency generator holders of capacity obligations would suffer financial penalties because they would not be able to convert all their assets to DR resources or shed their supply obligations in time for the 2017/18 capacity commitment period that starts in June.

FERC said that CPower’s proposed relief was “in effect, a separate request for waiver of an additional Tariff provision” and thus beyond the scope of ISO-NE’s request. Last week’s order clarifies that it was dismissing CPower’s proposal without prejudice, meaning the company could file a new request under a separate docket.

January 23, 2017

FERC Accepts CAISO Contracts for Imported Frequency Response

By Robert Mullin

FERC on Thursday approved CAISO’s agreements to procure frequency response from the Bonneville Power Administration (ER17-408) and Seattle City Light (ER17-411).

The contracts are intended to help the ISO comply with NERC reliability standard BAL-003-1, which requires each balancing authority area to carry sufficient capability to respond to a frequency event. System operators must maintain the grid at a frequency of 60 Hz or risk instability that could lead to cascading blackouts.

ferc caiso frequency response — The Dalles Dam | © *RTO Insider*

CAISO signed the deals after conducting a competitive solicitation that examined each bidder’s previous frequency response performance as well as comparing the costs of procuring transferred capacity against those for obtaining regulation-up service within the ISO’s market. The commission agreed with the ISO’s finding that transfers represented the lowest-cost option.

Rich in fast-ramping hydroelectric resources, BPA and City Light are both well-positioned to provide frequency response capacity to third parties.

Under the agreements, BPA and City Light will provide CAISO with frequency response and document their performance with NERC for the compliance year beginning Dec. 1, 2016. In the event of nonperformance, either entity will be liable for covering any fines levied against the ISO.

FERC’s acceptance of the agreements is subject to the clarification of a September order in which the commission approved the ISO’s competitive solicitation process.

CAISO sought clarification on whether the commission would recognize contracts that allow a counterparty balancing area to provide transferred frequency response to it based on the ISO’s annual frequency response obligation under the NERC standard (ER16-1438).

Without that clarification, the ISO contended, counterparties could interpret the decision as requiring them to maintain a net actual interchange measure in response to every single frequency disturbance event.

“Such a requirement would make it virtually impossible for the CAISO to contract for transferred frequency response quantities because balancing authorities cannot assure such a measure in response to every disturbance event,” the ISO said in its request for clarification.

January 20, 2017

EIM Sees Sharp Increase in Flexible Ramping Test Failures

By Robert Mullin

The Western Energy Imbalance Market (EIM) experienced a “dramatic uptick” in failed ramping sufficiency tests in November and December, CAISO’s internal Market Monitor reported Wednesday.

ramping capacity eim caiso — | © *RTO Insider*

New EIM participant Arizona Public Service was especially prone to failures during the fourth quarter of last year, but other areas saw increases as well, Keith Collins, manager of market monitoring and reporting with the ISO’s Department of Market Monitoring, said during a Jan. 18 Market Performance and Planning Forum.

Some of the increase could likely be attributed to a flawed ISO calculation that underreported ramping capacity available in the market, Collins said.

But the Monitor is still trying to pinpoint the exact cause for such a significant increase in test failures over the period (see graph).

CAISO performs the sufficiency test ahead of the market run for each operating hour. The test relies on base schedules submitted by each balancing authority area (BAA) participating in the EIM.

The objective: to ensure that each BAA enters the hourly interval with enough upward and downward ramping capability to avoid leaning on the resources of other market participants, similar to the requirement that each EIM participant begin each hour fully balanced.

“When a balancing area doesn’t have sufficient ramping capacity, then there are limitations on the amount of EIM [energy] transfers that are allowed into that region,” Collins said. “For instance, if there’s an upward [ramping] limitation, [then the region’s] imports are limited.”

Similarly, the ISO will restrict exports if it finds a shortfall in a BAA’s hourly downward ramping capability.

Those restrictions are intended to discourage EIM participants from relying on the market as a way to avoid developing their own ramping capacity as growing adoption of renewable resources increases the need for such capability.

Collins noted that the flexible ramping sufficiency test “is playing an increased role in some of the market outcomes we’re seeing,” a finding that the Monitor will elaborate on in its upcoming quarterly report.

The sufficiency test is designed to determine whether each EIM participant has scheduled enough ramping capacity to meet both the expected change in “net load” within its system and the “flexible ramping constraint” at its seams.

“Net load” represents total electricity demand minus the output from variable renewable resources. The ramping constraint indicates the factor by which transmission congestion will restrict a participant’s ability to import or export during a specific interval.

Passing the Test

To pass the sufficiency test, an EIM participant must demonstrate sufficient ramping capacity from the start of an hour through each 15-minute interval of that hour. Failure for just one interval translates into failure for the entire hour. Participants can resubmit schedules up to 40 minutes before the start of the hour.

The test considers each participant’s contribution to uncertainty in EIM’s overall load forecast during an interval, as well as its net import/export capabilities. The participant receives “credit” for its ability to reduce exports or imports in order to increase upward or downward ramping capability during the period.

The EIM’s upward ramping capability exhibited the “dramatic uptick” in test failures late last year, but downward ramping capacity tests, which were just implemented in November, have also seen “a pretty consistent level of failures,” especially in the APS region, according to Collins.

Steve Keehn, associate director at Navigant Consulting, asked whether the test failures were predominantly occurring during certain hours.

“I wouldn’t point to any explicit pattern that came up,” Collins said. “We’ve seen it at the beginning of the day, the middle of the day, the end of the day.”

Justin Thompson, director of resource operations and trading at APS, sought to know why so many of the failures were occurring early in the month and diminishing by mid-month.

One possibility is that the increase coincided with the Nov. 1 implementation of CAISO’s flexible ramping product market, which operated with flawed calculations that shortchanged the amount of available ramping capacity through mid-December, according to Guillermo Bautista Alderete, the ISO’s director of market analysis and forecasting.

“That is only one part,” Bautista Alderete noted.

He said other elements of the issue would be discussed in a monthly report produced by the ISO and distributed to APS and other new EIM participant Puget Sound Energy, which would become publicly available as well.

January 20, 2017

MISO Stakeholders Seek Review of MTEP Futures Under Trump

By Amanda Durish Cook

CARMEL, Ind. — MISO is preparing stakeholders for the first reuse of Transmission Expansion Plan futures, but some stakeholders are asking for a pause to review the scenarios for the 2017 plan because of the uncertainty of carbon-emission policies under the Trump administration.

miso mtep futures trump — Ellis | © *RTO Insider*

MISO policy studies engineer Matt Ellis said “barring any significant change in policy or economic drivers,” the RTO’s 2018 Transmission Expansion Plan (MTEP 18) futures will largely mirror MTEP 17 futures, due to be finalized next month. MISO is not planning a “wholesale redevelopment” of futures as in prior years, he said.

Future development in 2018 will be discussed at a yet-unannounced stakeholder workshop in early April. Ellis said MTEP 17 futures were intended for use in multiple cycles, but MISO will still “review definitions and discuss potential changes to ensure validity.” 2018 futures are to be finalized at the Planning Advisory Committee meeting in August and study results are expected in October.

“Futures haven’t changed much in the last 10 years,” Ellis explained at the Jan. 18 PAC meeting.

Ellis said year-to-year uncertainties such as the rate of fleet change and economic and temperature changes will be examined before reusing 15-year futures. He added that variables such as natural gas prices, topology, siting locations and demand could be adjusted annually. Ellis also said MISO would assess the variety of projects in the interconnection queue and public announcements from developers to inform the futures. Reuse of MTEP futures was recently added to Business Practices Manual 020, which covers long-term planning. (See “MISO to Update Long-Term Planning BPM,” MISO Planning Advisory Committee Briefs.)

Stakeholders have asked what fine-tuning might occur annually and which changes would be considered significant enough to spur futures redevelopment, Ellis said. “Ever since November, I’ve received many questions. Any time there’s a change in presidential leadership, there’s bound to be a change in policy. … All fair questions,” he said.

Ellis said MISO will reweight the scenarios annually because of uncertainty over future carbon regulations. MISO’s futures weighting assigns a probability-based likelihood to each MTEP planning scenario. In MTEP 17, existing trends were given 31% consideration, policy regulations were given 43% and accelerated alternative technologies received 26%. (See “MISO Posts Final MTEP 17 Weighting, Siting and Seeks Scope Feedback,” MISO Planning Advisory Committee Briefs.)

Multiple stakeholders, however, asked for re-evaluation of MTEP 17 weighting considering President-elect Donald Trump’s vow to cancel EPA’s Clean Power Plan. They said less emphasis on policy regulations might be in order.

Steve Leovy of WPPI Energy said he supported the potential revision of MTEP 17 weights. “Four, five, six months from now, we might have a better idea of what regulations might be in place,” he said.

Adam McKinnie, a Missouri Public Service Commission economist representing the state regulatory sector, said it would be useful if MISO staff could explain why changes cannot be made to MTEP 17 weighting.

Ellis said a presentation could be arranged for the February PAC meeting.

January 20, 2017

Perry Regrets Calling for Ending DOE; Says Climate Changing

By Rich Heidorn Jr.

WASHINGTON — Former Texas Gov. Rick Perry said Thursday he regrets calling for an end to the Department of Energy and is now “excited and passionate” about leading the agency as secretary.

rick perry doe climate change — Perry | *Energy and Natural Resource Committee*

Perry — who famously forgot the department’s name when he called for its abolition during a presidential debate five years ago — addressed the issue in his opening remarks during his confirmation hearing before the Senate Energy and Natural Resources Committee.

Perry also joined President-elect Donald Trump’s nominees for the Interior Department and EPA in saying he believes climate change is real and that manmade activity is a contributor — but that the degree of man’s impact and the proper response remain under debate.

Perry’s solicitous, self-deprecating manner occasionally brought laughs from senators and the audience, a contrast to the tense hearing a day before for Oklahoma Attorney General Scott Pruitt, Trump’s nominee for EPA. But Democrats nevertheless pressed Perry on his contention that climate science remains unsettled. (See Dems Unmoved by EPA Pick’s Charm Offensive.)

Budget Cuts?

Perry also appeared caught off guard when Democrats on the panel asked him about a report by The Hill that the Trump transition team plans to eliminate the Energy Department’s offices of Electricity and Energy Efficiency and Renewable Energy (EERE), along with the Office of Fossil Energy, which has overseen research on reducing CO₂ emissions. Funding for nuclear physics and advanced scientific computing research would be reduced to 2008 levels, according to the report.

In his opening statement, Perry said his view on the department’s value had evolved after being briefed on its “vital functions.”

Democrats said the proposed budget cuts would threaten the research programs Perry claimed to now support.

“It’s hard to see how we can pursue an ‘all of the above’ [energy] strategy if so much of the department’s all-of-the-above capabilities are limited,” said Sen. Mazie Hirono (D-Hawaii).

“They’re cutting the legs out from under you,” said Sen. Angus King (I-Maine).

Murkowski | *Energy and Natural Resource Committee*

“I can’t answer whether that’s true or not,” Perry said of the news report. “I will be in the room advocating for [DOE research]. I’m not going to tell you I’m going to be 1,000% successful.”

Later, Perry said he would evaluate the worth of department programs as a “fiscal conservative,” saying “you can’t change the stripes on this zebra.”

Committee Chair Lisa Murkowski (R-Alaska) said in her opening remarks that she was not concerned that Perry, unlike his two immediate predecessors, is not a scientist. “What we need is a good manager,” she said.

‘Climate is Changing’

Franken | *Energy and Natural Resource Committee*

The hearing returned several times to Perry’s new position on climate change. Democrats noted that Perry had previously been dismissive, claiming in 2011 that scientists were manipulating data for financial gain and contending as recently as 2014 that there was no “settled science” on the subject.

“I believe the climate is changing. I believe some of it is naturally occurring, but some of it is also caused by manmade activity,” Perry said in his opening statement. “The question is how do we address it in a thoughtful way that doesn’t compromise economic growth, the affordability of energy or American jobs. … I am committed to making decisions based on sound science and that also take into account the economic impact.”

Hirono asked if his economic analysis would include the costs of not addressing climate change.

“Absolutely,” Perry responded, citing the emission reductions and wind development that occurred in Texas during his 14 years as governor. Perry, however, rejected Hirono’s call for a national renewable portfolio standard, saying he would leave such targets to states.

Sen. Al Franken (D-Minn.) attempted unsuccessfully to pin Perry down on what share of global warming is manmade, noting data released by the National Oceanic and Atmospheric Administration Wednesday that 2016 was the hottest year on record, surpassing records set in 2015 and 2014.

Daines | *Energy and Natural Resource Committee*

“Ninety-seven percent of climate scientists say that this is real,” Franken said. “So it seems to me that the science on climate change is pretty definitive.”

Perry also received pleas for help from coal state Sens. Joe Manchin (D-W.Va.) and Steve Daines (R-Mont.). Daines decried plans to close two of the coal-fired Colstrip plant’s four units by 2022. He said EPA’s Clean Power Plan will eliminate 7,000 jobs in his state and turn it from an energy exporter to an importer.

Perry responded that he is confident that scientists will develop carbon capture technology ensuring the continued use of coal.

WAPA, LNG and Yucca Mountain

Sanders | *Energy and Natural Resource Committee*

Senators sought commitments from Perry on an assortment of other issues during the nearly four-hour hearing.

Sen. Jeff Flake (R-Ariz.) called for more transparency regarding spending by the department’s Western Area Power Administration. The House Committee on Oversight and Government Reform is looking at a $767 million surplus at the power marketing administration to see if it should have been used to reduce rates.

Maine’s King expressed fear that U.S. natural gas prices will increase if the government allows increasing exports of LNG.

Perry said he would commit to not “artificially affecting supply and demand” and suggested EPA and Interior Department regulations were constricting gas supplies. “It makes abundant good sense to me to sell it to the world,” he said.

Sen. Catherine Cortez Masto (D-Nev.) sought assurances that Perry would not back a resumption of plans to create a nuclear waste dump in Yucca Mountain near Las Vegas. Perry pledged to consider alternatives but added: “I will not say absolutely no way is Nevada going to be receiving high-level waste.”