Page 1362 – RTO Insider

December 13, 2016

MISO Board of Directors Briefs

MISO’s Board of Directors last week unanimously passed a $239.1 million operating budget and a $29.9 million capital spending plan for 2017. (See “MISO Predicts Budget Increase in 2017, Introduces 5-Year Business Plan,” MISO Advisory Committee Briefs.)

The RTO had proposed a $238.6 million budget before the board’s Human Resource Committee approved a 3.5% increase in the salary budget, as recommended by human resource consulting firm Mercer.

miso board of directors — Human Resource Committee of the Board of Directors | © *RTO Insider*

The firm’s review of MISO’s compensation recommended a 3% increase in merit-based compensation and a 0.5% increase for employees’ promotional increases.

“We looked at things like GDP and inflation rates; we looked at anecdotal things,” Director Paul Bonavia said at the committee’s Dec. 6 meeting.

MISO CEO John Bear said he consulted with the CEOs of 11 member companies on the proposed increase.

“The range we have in mind is in line with their thinking,” Bear said. He said a key concern among the CEOs was the aging workforce and attracting younger staff.

MISO expects to exceed its $225 million 2016 operating budget by $600,000, resulting in a maximum 0.3% possible overrun.

The RTO has spent $187.9 million of the $188.6 million allowed to date, leaving less than 0.3% of the budget untouched, acting Vice President of Finance Tony Guisinger said at MISO’s Dec. 8 board meeting.

MISO anticipates between $30.5 million and $31.5 million in capital spending for the year, potentially exceeding its $31 million budget.

Guisinger also said MISO hopes to procure financing in 2018 for technology needs and said talks will begin in early 2017 on the amount it will request.

MISO to Welcome 3 New Board Members, Thanks Departing Directors

Board Chair Judy Walsh and Directors Michael Evans and Paul Feldman will exit MISO at year-end, replaced by former ERCOT CEO H.B. “Trip” Doggett, former Calvert Investments CEO Barbara Krumsiek and Todd Raba, who is leaving Twenty First Century Utilities and has served as CEO of both GridPoint and Berkshire Hathaway’s Johns Manville.

During the meeting, Senior Vice President of Compliance Services Steve Kozey confirmed election results and said all three candidates received sufficient votes in the electronic voting process. “No lapse in security; no Russian hackers,” he joked.

Former MISO Director Eugene Zeltmann called in to congratulate the trio of departing board members.

“You certainly presided over an incredible transformation of an extraordinary organization,” said Zeltmann, who left the board a year ago.

“We couldn’t have done this without you,” Walsh replied to Zeltmann.

Organization of MISO States President Sally Talberg called the three directors a “bedrock” for MISO.

“In my first meeting, we had two directors that had been thrown out, we had hostile stakeholders and cost overruns. At that time, it was a dicey deal indeed to see if MISO would succeed in becoming an organization,” Walsh said. She felt the board was being left in “very good hands,” she said.

The board also adopted two motions pertaining to itself — the elimination of post-service restrictions and a pay raise.

MISO will make a FERC filing by the end of the year to eliminate the post-service restriction and trim the pre-service restriction, leaving it with only a one-year pre-service restriction. Directors cannot have served as “a director, officer or employee of a member, user or an affiliate of a member or user engaged in the electric utility industry or participating in wholesale electricity markets” during that period.

“MISO was the only RTO in the nation with a post-service restriction,” Director Tom Rainwater said. Rainwater said MISO was having trouble attracting new board members with its two-year pre- and post-service prohibitions from utility and wholesale energy market participants. (See Board OKs Pay Hike, Change to Independence Rules.)

Rainwater said the board and MISO discovered that the Transmission Owner’s Agreement subjects “key” MISO employees to a 12-month “cooling off” period after leaving the RTO, during which they cannot have “any involvement … on behalf of any parties other than MISO with regard to any matters in which they were substantially involved when serving for, or employed by, MISO.” Bear has agreed to compile a list of employees that would be subject to a restriction for board approval.

The board also adopted a $4,000 annual pay increase for directors. Rainwater said the changes will up the yearly retainer from $55,000 to $89,000 but eliminate meeting fees for the first six scheduled board meetings and two annual strategic retreat meetings. (See Board OKs Pay Hike, Change to Independence Rules.) A typical MISO director who attends those eight meetings and serves on three committees is expected to earn about $116,000 annually.

MISO Still Undergoing FERC Audit

A little over a year later, MISO is still undergoing a FERC compliance audit, Chief Compliance Officer Joseph Gardner told the board. Gardner said it is not unusual for RTO audits to last 18 to 24 months. He said FERC staff has been on-site at MISO headquarters for two visits during the audit.

“No big concerns that I’m aware of have come up,” Gardner added.

— Amanda Durish Cook

December 13, 2016

PJM Board OKs $260M in Tx Projects

The PJM Board of Managers last week approved almost $260 million in transmission reliability projects.

The projects in the 2016 Regional Transmission Expansion Plan include:

New baseline reliability upgrades ($158.1 million);
Changes to previously approved upgrades (net increase of $47.3 million); and
Facilities, network upgrades and withdrawal of canceled facilities related to the interconnection queue (net increase $54 million).

With the board’s action, PJM has approved more than $29 billion in transmission additions and upgrades since the first RTEP in 2000.

PJM transmission projects — Dooms – Valley 500 kV Line Project | *PJM*

The board also approved an installed reserve margin of 16.6% for 2017/18. The IRM approval includes associated parameters for each of the next four delivery years.

The IRM study results were approved by the Markets and Reliability Committee in October. (See “IRM Study Approved but Criticized for Lack of Winter Analysis,” PJM Markets and Reliability and Members Committees Briefs.)

– Rory D. Sweeney

December 13, 2016

FERC Rejects Challenges on Local Tx Cost Allocations

By Rich Heidorn Jr.

FERC last week upheld its February 2016 ruling that projects solely addressing a transmission owner’s local planning criteria are not eligible for regional cost allocation, rejecting rehearing requests from Dominion Resources and others.

“Cost allocation is not an exact science, and there may be ‘multiple just and reasonable rates’ on the same set of facts. Here, whether the allocation proposed by the PJM transmission owners is the best allocation method is not the issue; the issue is whether it is a just and reasonable method, and we find that it [is] just and reasonable based on the supporting data,” the commission said (ER15-1387-002).

The commission directed PJM to make a compliance filing ensuring that the costs incurred after the May 25, 2015, effective date of its February order for projects included in the Regional Transmission Expansion Plan solely to address Form 715 local planning criteria be allocated to the zones of the individual TOs. PJM must also rebill for any costs for such projects allocated incorrectly for the period.

FERC also denied rehearing in two cases applying the 2016 ruling and making Dominion solely responsible for the cost of its 500-kV Cunningham-Elmont (RTEP project b2582) (ER15-1344) and Cunningham-Dooms rebuilds (b2665) (ER16-736, EL16-96-001).

regional cost allocation ferc transmission — Elmont-Cunningham 500kV Rebuild | *PJM*

Dominion argued that the projects have regional benefits, unlike most Form 715 projects, which deliver only local benefits. Old Dominion Electric Cooperative, LSP Transmission Holdings and ITC Mid-Atlantic Development also had sought rehearing. (See Dominion: Tx Project Should be Regionally Allocated.)

Commissioner Cheryl LaFleur repeated her earlier partial dissents in the three dockets, saying that “high-voltage transmission lines in PJM have inherent regional benefits that warrant some measure of regional cost allocation, and those benefits exist regardless of the underlying need that drove the project.”

The commission also denied Public Service Electric and Gas’ request to reconsider an order assigning its zone all of the costs of its Sewaren upgrade to replace aging infrastructure and provide storm hardening (ER14-1485). PSE&G said the Sewaren projects (b2276, b2276.1 and b2276.2) addressed both aging infrastructure and short-circuit issues. It will convert the two 138-kV circuits from Sewaren–Metuchen to 230 kV and make related changes.

December 13, 2016

SPP Briefs

SPP says it has successfully implemented system changes required by FERC Order 809, which ordered RTOs to improve the alignment of their market schedules with those of interstate gas pipelines (RM14-2). SPP’s changes took effect Sept. 30.

“After roughly two months of operational experience, it appears it’s successful so far,” SPP legal counsel Joe Ghormley told a meeting of the Gas Electric Coordination Task Force last week, where he shared the draft of an informational report to be filed with FERC.

The report says “the changes have improved coordination between the SPP markets and natural gas nomination cycles while taking into account stakeholders’ price formation concerns as well as the relative immaturity of SPP’s market and the resulting need for an incremental approach to market system changes.”

SPP described “a year of transition” involving the revised market schedule and the development of system changes for the RTO’s enhanced combined cycle system initiative, the subject of proposed Tariff changes filed with FERC in November (ER17-358). The report also details “extensive efforts” to reach out to and train members and stakeholders. SPP said it is only aware of one resource that has reported potential problems with gas availability, which occurred after a pipeline was taken out of service last December for repairs. When the line was returned to service, it operated below capacity because of reductions mandated by the Pipeline and Hazardous Materials Safety Administration.

“SPP continues to work … to identify cost-effective ways to further compress its market system solve times without jeopardizing the [Integrated Marketplace’s] fundamental functions … or its upcoming enhancements to commitment and dispatch of gas generators utilizing the most efficient configuration of components.”

The report will be filed with FERC on Thursday. The commission required SPP to file an annual report on its compliance with Order 809 for the next three years.

SPP, AECI Narrow Target Areas to Southern Missouri

SPP and Associated Electric Cooperative Inc. have whittled a list of five target areas under consideration for joint transmission projects down to one.

SPP and AECI staff told the Interregional Planning Stakeholder Advisory Committee on Friday that they are still narrowing down different transmission solutions to address high voltages and overloads in the Brookline area of southern Missouri. Planners intend to issue a draft report for the IPSAC’s review early next year.

The two entities currently use an operating guide to manage their seam, but the cost is becoming too big to ignore. Staff said it is considering the use of transmission reactors around Brookline instead of using the operating guide to control voltages. Any final solutions will be coordinated with SPP’s 2017 Integrated Transmission Planning’s 10-year assessment.

SPP and AECI determined three other target areas can be managed without joint projects. The fifth target area, in Northeast Oklahoma, was removed from consideration because a change in transmission ownership shifted facilities to AECI’s management.

Based in Springfield, Mo., AECI is owned by six regional generation and transmission cooperatives.

M2M Payments Flow Back to SPP

Market-to-market payments between SPP and MISO reverted to previous form in October, with MISO paying SPP almost $2.2 million for 871 binding hours on 34 flowgates along the seam.

MISO paid more than $2.2 million for 27 temporary flowgates, while SPP sent about $29,000 to MISO for seven permanent flowgates.

SPP had paid its counterpart for binding flowgates the previous three months, but MISO has sent about $10 million to SPP since the two RTOs began the process last year.

— Tom Kleckner

December 13, 2016

MISO Markets Committee of the Board of Directors Briefs

CARMEL, Ind. — FERC has extended the comment period on MISO’s proposed forward capacity auction to Dec. 14 (ER17-284).

The extension — requested by the Public Utility Commission of Texas and not opposed by MISO — should not affect the RTO’s ability to implement the auction in time for the 2018/19 planning year, said Richard Doying, executive vice president of operations and corporate services.

At the Board of Directors’ Markets Committee meeting on Dec. 6, Independent Market Monitor David Patton told the board he was preparing a filing for next week to express his ongoing concerns with the proposal. (See MISO Files Forward Capacity Auction Plan with FERC.)

Director Phyllis Currie asked if MISO had given thought to a contingency plan if FERC takes longer than expected to decide. Doying said MISO is holding off on releasing alternate plans for now.

MISO Awaits FERC Queue Decision

MISO expects a decision from FERC on its queue reform proposal by year-end, Vice President of System Planning and Seams Coordination Jennifer Curran said.

Curran predicted gradual queue improvement in 2017 as the new rules are phased in.

At the September board meeting in St. Paul, Minn., Curran said MISO is hoping to build more certainty into the process that would reduce restudies and the amount of time it takes for projects to clear the queue. “It’s currently a two- to three-year process and is challenged by restudies,” she said.

FERC rejected MISO’s first proposal in March, saying the RTO improperly assumed the current backlog could be blamed on “speculative” projects and “fail[ed] to consider other potential factors” (ER16-675). (See MISO: Stakeholders Behind 2nd Queue Reform Attempt.)

— Amanda Durish Cook

December 13, 2016

SPP Board of Directors Briefs

LITTLE ROCK, Ark. — SPP’s Board of Directors last week approved a 13.2% increase in the RTO’s administrative fee and a 6.6% boost in its budget for 2017. The approval came Dec. 6 after a unanimous vote by the Members Committee.

The vote means the fee will rise from 37 cents/MWh to 41.9 cents/MWh in 2017, based on a net revenue requirement (NRR) of $160.5 million, a $9.9 million increase over 2016.

The RTO projects annual fee increases for the next five years, reaching 49.9 cents/MWh in 2021.

SPP is projecting an under-recovery of $5.9 million from the 2016 NRR. Other factors contributing to the NRR’s increase are a $3.5 million increase in maintenance expenditures and a $2.7 million increase in personnel costs.

SPP Director Harry Skilton, chair of the Finance Committee, said a decline in load growth led to the administrative fee’s increase. SPP had budgeted 407.2 million MWh in billable energy but revised that down to 393.9 million MWh. It is budgeting 383 million MWh through 2021.

“That reduction in load has set us up for an under-recovery that carries on to the next year,” Skilton said.

SPP budgeted a net loss of $35 million this year but has upped that to a $41.6 million loss given the under-recovery.

The board approved a budget with $194.1 million in income and $196.4 million in expenses for 2017. The 2016 spending plan had $176.2 million in income and $217.8 million in expenses.

The budget sets SPP’s headcount at 610 employees, an increase of one from 2016.

Besides a few questions on SPP’s practice for depreciating expenses, members quickly accepted Skilton’s report and recommendations.

Director Harry Skilton, with CEO Nick Brown and Chairman Jim Eckelberger, delivers the annual budget report | © *RTO Insider*

Stakeholder Surveys Stay Close to Form

Michael Desselle, SPP vice president and chief compliance and administrative officer, told the board and members that the RTO sent out nearly double the usual amount of stakeholder satisfaction surveys, but that the final results were not significantly different than previous years.

Desselle said the annual survey’s average satisfaction scores dropped for every service except one, by a difference of 0.12 points (out of 5) or less. Training was the lone exception, rising by 0.03.

Stakeholders identified the Z2 revenue crediting process as a repeat theme in their comments. One stakeholder said “the ‘Z2 Monster’ has been an unqualified disaster … I tip my hat to SPP management’s ability to skirt their contribution to the situation,” while another dinged SPP staff for “allowing too many years to transpire before implementing Z2.”

“Last year, [the concern] was the transparency of the Z2 process,” Desselle said. “This year, it was the expediency of the Z2 process.”

As in past years, Desselle said staff will prioritize the comments and address them. He said staff has closed 71 of last year’s 76 comments.

Among the positive comments were many praising the staff’s professionalism, responsiveness and communication efforts. Criticisms included the lack of detailed settlement reports in the Integrated Marketplace portal and what one called the “patronizing attitude” of staff and board members. One critic called for an external market monitor, saying there are “way too many conflicts of interest with an internal” monitor. (See FERC Calls for Changes to Protect SPP Market Monitoring Unit Independence.)

December Board/Members Committee meeting | © *RTO Insider*

SPP distributed 4,597 survey invitations to organizational group members, market participants and other individuals who had interacted with the RTO during the previous 12 months, either through meetings, training, customer relations or other exchanges. Staff received 716 responses, for a response rate of 16%, up one percentage point from last year (410 responses) and four points from 2014 (181 responses).

Desselle also said auditing firm KPMG issued an unqualified opinion with no exceptions following its Statement on Standards for Attestation Engagements (SSAE) No. 16 audit. He said auditors found “no disagreements with management” and that “no illegal acts came to their attention.”

Stakeholders Again Give Organizational Groups High Marks

SPP’s annual survey of its organizational groups matched that from 2016, with stakeholders rating groups’ overall effectiveness at 4.2, out of a possible 5.

The scores reflected the average response to “Please rate the overall effectiveness of this group.” The individual group scores ran from 3.5 for the Event Analysis Working Group to 4.8 for the Human Resources and Oversight committees and the System Protection and Control Working Group.

SPP CEO Nick Brown said he was pleased with the survey’s 71% response rate, and he assured the board and members that SPP “is not just gathering this data and doing nothing with it.”

Ciesiel Pleased with RE Survey Results

Regional Entity General Manager Ron Ciesiel said he was happy with the RE’s stakeholder satisfaction survey, which produced scores of 3.9 to 4.4 on a 5-point scale for customer service and responsiveness, and 3.2 to 3.6 for how well the program meets expectations.

Regional Entity Trustees Chair Dave Christiano and GM Ron Ciesiel share stakeholder feedback with the board. | © *RTO Insider*

Ciesiel noted RE staff is seen as responsive, knowledgeable, professional and personable and that members see the RE’s workshops on reliability issues as “valuable.”

“Here’s the good news: We’re not having the events we need to do analysis on. We’re not really getting events,” he said. “I’ll take this every day, because it’s good news across the board, not only here, but in North America.”

Ciesiel said the RE is considering a spring workshop and including sessions on new standards. It will also use the RE’s newsletter to focus on the top 10 violated standards.

Paul Malone, Todd Fridley Approved as MOPC Chairs

The board and members unanimously approved the Nebraska Public Power District’s Paul Malone as the incoming chair of the Markets and Operations Policy Committee. Malone, NPPD’s transmission compliance and planning manager, replaces SouthCentral MCN’s Noman Williams, whose term expired.

Todd Fridley, vice president at Transource Energy, was approved as the committee’s vice chair.

The board and members also approved revisions to the Corporate Governance Committee’s charter to formalize bylaw revisions that added committee seats for federal power marketing agencies and independent transmission companies. Bob Harris (Western Area Power Administration-Upper Great Plains) and Brett Leopold (ITC Great Plains) currently fill those respective seats.

Also approved was a charter change for the Seams Steering Committee. It changes the committee’s scope of review and guidance activities from “existing seams agreements” to “new or existing seams agreements.”

– Tom Kleckner

December 13, 2016

RGGI Carbon Auction Prices Drop 22%

By William Opalka

Carbon dioxide allowance prices dropped 22% at the 34th Regional Greenhouse Gas Initiative auction on Wednesday, renewing calls from environmentalists to tighten emission limits in the nine-state compact.

Nearly 14.8 million allowances were sold at a clearing price of $3.55, down from the $4.54 they netted in September in the last quarterly auction. (See Md. Balks at Proposed Emission Cuts as RGGI States Ponder Future.)

Carbon prices have flattened out as the program’s success in limiting emissions has led to an oversupply of emission credits, advocates say. Prices are 53% lower than they were a year ago. Last week’s clearing price is the lowest since December 2013, when 38.3 million allowances cleared at $3.

rggi auction prices — Brayton Point Power Station | *Wikipedia*

RGGI is now undergoing its quadrennial Program Review, which will map out 2020 and beyond.

“We now have eight years of experience demonstrating that the electric sector can achieve ambitious emissions reductions at low costs; it’s time for that experience to be reflected in ambitious reforms,” Peter Shattuck, director of the Acadia Center’s Clean Energy Initiative, said in a statement. “The states must use the Program Review to establish more stringent cap levels through 2030 and to implement program design elements that account for the continuing decline in emissions.”

Currently, RGGI states have agreed to reduce the cap on emissions by 2.5% annually, with many stakeholders advocating those reductions should be accelerated to 5% annually.

“The elements that made RGGI such a successful program at its inception are just as relevant today,” Katie Dykes, chair of the Connecticut Public Utilities Regulatory Authority and chair of the RGGI Board of Directors, said in a statement. “The use of a market-based system to cap emissions allows for the most cost-effective reductions. And the auctioning of allowances and the reinvestment of auction proceeds provides benefits for consumers while locking in emissions reductions. The program’s flexibility allows it to adapt to changing circumstances and support the goals of nine states across a diverse region.”

The sale netted about $52.5 million for the nine member states’ clean energy and energy efficiency programs. RGGI auctions have raised about $2.6 billion since their inception in 2008.

December 13, 2016

MISO Takes Stakeholders’ Temperature on Redesign

By Amanda Durish Cook

CARMEL, Ind. — A year into MISO’s stakeholder redesign, member leadership says the stakeholder process is more efficient but that discussions at meetings could use more depth.

The redesign “check-in” was the Hot Topic discussion at the Advisory Committee’s Dec. 7 meeting. Executive Director of External Affairs Kari Bennett said the redesign has cut stakeholder meetings by 22% and that staff posted 81% of meeting materials a week prior to meetings in 2016, compared to 71% in 2015. She also said MISO is working to attract more speakers from outside the RTO for presentations at informational forums. (See MISO Redesign Nears Completion.)

MISO’s sectors praised the consolidation of stakeholder groups, a cleaner process for those wishing to raise issues and the reduction in meetings and repetitive presentations.

The Independent Power Producers, Coordinating Members, End Use Customers and Transmission Dependent Utilities sectors said the redesign had made meetings more effective.

Indiana Utility Regulatory Commissioner Angela Weber said she appreciated the issues tracking process, through which stakeholders who introduce topics can trace MISO’s response. Under the new process, the Steering Committee confers with MISO staff and may assign the issue to a senior committee.

Northern Indiana Public Service Co.’s Paul Kelly said the creation of the Resource Adequacy Subcommittee helped to combine several related issues but that the standard six-month life of a task team isn’t always long enough to fully address an issue.

Dynegy’s Mark Volpe commended MISO’s new video conferencing capabilities that help connect stakeholders.

“It’s not mentioned much, but over this past year, MISO did a technology refresh. … It allows stakeholders in Little Rock and Eagan [Minnesota] to go to the nearest MISO facility and attend meetings. It helped a number of members with limited resources. … MISO needs some kudos on that investment,” Volpe said.

Feedback Process Lacking

Multiple sectors said that MISO’s feedback process has fallen short and asked for more formalization and transparency around the comments it receives. MISO staff usually ask for stakeholder feedback via email within about two weeks of a presentation on a proposal. The RTO summarizes the responses and sometimes shares them — identified by sector only — at follow-up presentations. Some stakeholders have commented on the challenge of keeping up with a heavy volume of feedback requests and MISO’s inconsistent record of publishing comments.

MISO Advisory Committee | © *RTO Insider*

NIPSCO’s Kelly said stakeholders sometimes do not understand where MISO stands on issues and that some members are confused about what feedback requests are open because the requests are only documented on the final slide of presentations.

Weber said it’s difficult to locate meeting materials and issues on MISO’s website. She suggested the RTO create a feedback calendar.

Bennett said MISO may be stuck in a “‘do loop’ of chasing the calendar,” referring to a section of computer code in which an instruction is executed repeatedly. But she said MISO has committed to revamping its website in 2017. She said MISO staff could create a feedback request tracking page on its website.

“Even though we’ve created some efficiencies, there’s still a lot of work going on, and it’s hard for any one stakeholder to keep up,” Bennett said.

“It struck me that stakeholders said the website is hard to navigate and it’s hard to find information. In a world where you can Google and find information across the globe,” an easily accessible website should be a goal, Director Baljit Dail said.

The Organization of MISO States said the process has “led to incremental increases in efficiency, but the impact on effectiveness is less certain.” Alcoa Power Generating’s DeWayne Todd agreed and said that although MISO has gained efficiencies, the meetings may not have gained effectiveness, as little deep discussion takes place.

Mitch Myhre of Alliant Energy asked for MISO to facilitate more stakeholder policy discussions with the Board of Directors. For example, he said, the board and stakeholders could discuss the RTO’s multiyear effort to revise its cost allocation.

“We’re wondering if the meetings are as effective as they should be. We’re wondering if MISO is open enough. Sometimes you get better discussion in the hallway. [MISO staff] are more relaxed. Maybe because you’re in front of people, it’s harder to be completely open,” Weber said. She suggested setting aside meeting time for brainstorming sessions.

“We are in a bit of a rut in terms of how we process subject matter,” Volpe said. MISO is in a pattern of presenting on a given topic, requesting feedback and coming back with refinements in a months-long cycle, he said. “There really isn’t an open dialogue among subject matter experts and stakeholders. We’re in this rut of consistent feedback cycles, but we really don’t have that policy debate. I feel bad for the chair of these committees; they have to watch the clock and make sure someone goes through 30 slides in 20 minutes. That’s not possible.”

Chris Plante of Wisconsin Public Service said stakeholders could come to meetings armed with presentations of their own to prompt deeper conversations. He also said MISO should make member responses public by default.

Director Michael Evans said he’s seen nearly 12 years of stakeholder process, from “the food fight era” to the “pitchforks era.”

“I think we’re at a spot where the dialogue is healthy. Now it’s time to improve the content,” he said.

Director Tom Rainwater said the redesign is a “tremendous” effort. “I think what you’re emphasizing today is continuous improvement,” he said. Rainwater suggested MISO identify what improvements it could accomplish in 90, 180 and 365 days.

“This is your process. It’s not our process,” Director Judy Walsh told stakeholders. “I would encourage MISO to understand how it can better facilitate improvements into the process.”

“Anytime we bring a big group together, you can feel stuck and like you’re talking over one another,” Bennett said, before quoting the Beatles: “We can work it out.”

AC Priorities Take Cue from Subcommittee Purposes

During the meeting, the AC also adopted a set of priorities set forward by the Transmission Dependent Utilities sector that borrow from MISO subcommittee mission statements. (See “AC to Approve One of Two Sets of 2017 Priorities,” MISO Advisory Committee Briefs.)

Sectors voted 13-9 for the TDU’s offering over a slight revision of 2016 priorities proposed by AC leadership. The new priorities seek to implement best planning practices; preserve and enhance reliability; improve market efficiency; ensure resource adequacy; and ensure equitable cost allocation.

December 13, 2016

Mass. Considering Storage Mandate

By William Opalka

BOSTON — Massachusetts officials will announce by the end of the month whether to join California in mandating the procurement of energy storage.

For the more than 300 people who attended or live-streamed Raab Associates’ 152nd New England Electricity Restructuring Roundtable last week, however, the only question is how much storage the state is likely to order. The session provided a briefing on both the policies driving the adoption of storage and the companies that are deploying the technologies.

Judith Judson, commissioner of the Massachusetts Department of Energy Resources, said the “State of Charge” study produced a surprising result: Up to 1,766 MW of advanced storage could save ratepayers $2.3 billion. Comments on whether Massachusetts should set targets are due Friday.

“We have reduced average consumption in Massachusetts, but our peak demand continues to grow,” she said. “Our top 1% of the hours accounts for 8% of our electric spend. Our top 10% of hours account for 40% of our electric spend. … So [storage] could be a tremendous savings for ratepayers.”

massachusetts energy storage mandate — | *RTO Insider*

California Leads the Way

California has led the nation in mandating storage, with 1.3 GW to be deployed by 2024. Since 2013, 630 MW in projects have been approved, California Public Utilities Commissioner Carla Peterman said.

“The commission has to determine that these projects are viable and cost-effective. Typically, that requirement has not been placed on emerging technologies. For example, there is not a similar requirement on our solar incentives,” said Peterman, who participated via video.

Jesse Jenkins, of the Massachusetts Institute of Technology Energy Initiative’s Utility of the Future study, said the two-year effort that will be released this week includes an examination of the impact of distributed storage resources.

Locational Value

Jenkins said storage and demand response resources in some locations can have a value three to 10 times greater than a typical distribution node. “They can deliver [cost benefits] to the power system, but only if the incentives are appropriately granular,” Jenkins said.

Roger Lin, senior director of product marketing for NEC Energy Solutions, described the company’s 2-MW, 3.9-MWh battery storage system in Sterling, Mass., which it says will be the first utility-scale project in the state and the largest battery-based system in New England.

The project will provide the town’s municipal utility with a backup during weather-related power outages and a way to save money by shaving its peak usage. He said storage could have saved the town several hundred thousand dollars over a couple hours when the town’s 3-MW solar array became shrouded by clouds at 2 p.m. on a September day and LMPs jumped from less than $100/MWh to more than $500.

“That cloud cover came at the worst possible time, at the system peak, as the pro rata share of transmission charges and forward capacity market charges” is determined, he said.

Demand Reduction

Vic Shao, CEO of Green Charge Networks, said his company focuses on the software and controls that predict when peaks will come.

“In California, we really focus on demand reduction. California is particularly expensive, with demand charges going up by about 10% a year,” he said.

“When it comes to storage, controls are everything,” said Josh Castonguay, chief innovation executive at Green Mountain Power in Vermont, which has added storage to a 2.5-MW solar array on a capped landfill. “Because at the end on the day, that’s what’s going to unlock all the value streams for you.”

Matthew Morrissey, vice president of Deepwater Wind’s operations in Massachusetts, said the company, which built the first offshore wind plant in the U.S. in Rhode Island, is developing storage capabilities so it can bid into capacity auctions and state solicitations. He said the company recently won a solicitation to provide the Long Island Power Authority offshore wind combined with storage — beating out more traditional gas-fired alternatives on price.

“Even with offshore wind, where we have wonderful peak incidences where demand matches our power curve perfectly, we recognize we must have an offset of storage,” he said.

Fouad Dagher, director of new energy solutions at National Grid, also emphasized the need to install storage where it provides the most benefit. “How do we dispatch it? When do we dispatch it? And that’s very important for capturing the value,” he said. “Where is the best location to place something?”

December 13, 2016

FERC OKs Changes to ISO-NE Dispatch Rules

By Rich Heidorn Jr.

FERC last week approved ISO-NE rule changes requiring almost 1,100 MW of non-dispatchable generation to purchase equipment allowing them to receive electronic dispatch instructions from the RTO (ER17-68).

FERC OKs Changes to ISO-NE Dispatch Rules — Utility scale biomass plants in New England | *Innovative Natural Resource Solutions*

The new rules, proposed by ISO-NE and the New England Power Pool in October, apply the dispatchability requirements mostly to municipal solid waste (406 MW) and biomass (263 MW) facilities. Also included are 175 MW of non-intermittent hydro generation and 157 MW of resources that exceed the below-5-MW limitation for settlement-only resources.

They will be required to order remote terminal units — and communication circuits to connect them to the ISO-NE network — by Jan. 15, and to become dispatchable within 12 months afterward. The rules, which will be phased in through June 2020, also require intermittent resources participating in the Forward Capacity Market to offer into the day-ahead energy market.

ISO-NE said the changes will improve reliability by eliminating time-consuming manual dispatch and aid price formation by incorporating additional resources into LMPs. Non-dispatchable generators enter the market as price takers and cannot be marginal.

The RTO said the rules also will aid the participation of storage resources, which both consume and inject energy, in the energy market.

The rules are similar to the “Do Not Exceed” dispatch rules FERC accepted in 2015 for wind and most hydro resources (ER15-1509).

Timber harvesting | *Innovative Natural Resource Solutions*

Going forward, only solar, nuclear, settlement-only and most external resources will remain non-dispatchable. Demand response resources will remain non-dispatchable until they are fully integrated into the energy market in 2018, according to ISO-NE.

The RTO says it will propose changes to make larger solar resources dispatchable once it has developed a way to accurately forecast their output, similar to its short-term wind forecast system.

In approving the rule changes, the commission rejected contentions from Eversource Energy that the changes violated the rights of qualifying facilities under the Public Utility Regulatory Policies Act.

“A QF is not obligated to participate in the ISO-NE administered energy markets and can instead choose to operate exclusively as a behind-the-meter resource on its host utility’s system and not be under ISO-NE’s direct operational control and not be subject to the proposed revisions,” the commission said.