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Cost Allocation Les Dillahunty

1. Cost Allocation Les Dillahunty. Presentation for APSC June 3, 2010. RSC Primary Responsibility Determining regional proposals and transition process:. Whether and to what extent participant funding will be used for transmission enhancements

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Cost Allocation Les Dillahunty

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  2. Cost AllocationLes Dillahunty Presentation for APSC June 3, 2010

  3. RSC Primary ResponsibilityDetermining regional proposals and transition process: Whether and to what extent participant funding will be used for transmission enhancements Whether license plate or postage stamp rates will be used for the regional access charge Financial Transmission Rights (FTRs) allocation, where a locational price methodology is used The transition mechanism to be used to assure that existing firm customers receive FTRs equivalent to the customers’ existing firm rights 3 3

  4. RSC & CAWG 4 4

  5. SPP Pricing Zones

  6. SPP Pricing Zone Information

  7. Highway/Byway 7 7

  8. Les Dillahunty Senior Vice President, Engineering & Regulatory Policy 501.614.3215ldillahunty@spp.org

  9. Priority Projects and Integrated Transmission PlanningBruce Rew Presentation for APSC June 3, 2010

  10. February 2010Staff holds stakeholder technical conference and conducts further analysis based on feedback April 2010Staff issues Phase II-Revision 1 Report including new and updated analysisReport recommends that BOD approve Group 2 projectsApril 27, 2010 BOD approve s Priority Projects Priority Projects Timeline January 2009SPPT Created February 2010Staff issues Phase II Report with two project groupsGroup 1 = 6 projects recommended by BOD Group 2 = Alternative 345 kV double circuit construction for Group 1 April 2009SPPT issues report calling for Integrated Transmission Plan, Priority Projects, and new Cost Allocation methodology October 2009Report is updated and discussed at MOPC and SPCWith SPC concurrence, staff recommends 4 projects for approval by BODBOD approves these 4 projects and 2 others for further analysis, with oversight from SPC September 2009 Staff issues Phase I Report that includes analysis of 10 projects, selected by MOPC from list of stakeholder-recommended projectsReport discussed at technical conference

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  12. Total Priority Project Benefits – Group 2 • B/C ratio of 1.78 • No Benefits as a result of renewable resources added • SPPT objectives met • Reduce congestion: Levelization of LMP’s • Avg. LMP price spread reduces from +/- 35% to +/- 28% • Improve the Aggregate Study and GI Study queues • Integrate SPP’s west and east transmission systems

  13. Transmission • Overall job impacts: ~ 7,475 FTE-years • Overall earnings: ~ $368 million • Tax impacts: ~ $34.4 million • Wind Operation • Overall job impacts: ~ 3,275 FTE-years • Overall earnings: ~ $125 million

  14. Integrated Transmission Planning

  15. Integrated Transmission Planning • SPPT recommended ITP • Robust • Flexible • Cost Effective • Integrated Transmission Planning (ITP) process • Integrates three areas of existing SPP transmission expansion • EHV Overlay • Balanced Portfolio • Reliability Assessment (STEP)

  16. Integrated Transmission Planning • Major Objective: Design transmission backbone to connect load centers to low-cost generation • Other Objectives: • Integrate SPP’s east and west regions • Make transmission an enabler rather than constraint • Strengthen ties to Eastern and Western Interconnections

  17. Integrated Transmission Planning

  18. Futures for ITP 20 Year Assessment • Base Case • Renewable Electricity Standard of 20% • Carbon Mandate • Energy Efficiency and Demand Response

  19. Next steps for ITP • 4 futures approved by SPC for 20 yr plan • Develop ITP Manual (process details) through stakeholder process • Tariff updates made and filed with FERC • Scope to begin for 10 yr assessment in June • Analysis of 20 yr plan • 20 yr plan submitted to BOD in January 2011 • 10 yr plan submitted to BOD in January 2012

  20. Bruce RewVice President, Engineering501-614-3214brew@spp.org

  21. Status of SPP Activities Relating to FERC Order 719 Heather Starnes Presentation for APSC June 3, 2010

  22. Order No. 719 and 719-A Activities

  23. Timeline of Order 719 Activities for SPP • October 17, 2008, FERC issued Order 719 • April 28, 2009, SPP submitted a compliance filing to FERC in response to Order 719 proposing Tariff revisions • July 16, 2009, FERC issued Order 719-A • October 27, 2009, SPP submitted additional Tariff revisions to comply with those requirements established in Order 719-A

  24. November 20, 2009, FERC issued an order accepting in part and rejecting in part SPP’s Order 719 Compliance Filing and directed SPP to submit a compliance filing by February 18, 2010, to comply with the November Order December 15, 2009, SPP filed a motion with FERC to request an extension of time to file certain compliance filings related to Order 719 and 719-A Timeline of Order 719 Activities for SPP (continued) 26

  25. December 23, 2009, FERC granted SPP an extension of time up to and including May 19, 2010, to comply with the demand response requirements set forth in section III.B.1 of the November 20 Order and the demand response requirements ordered in Order 719-A and further directed that SPP submit its demand response reports on May 20, 2009, as required by the November 20 Order. Timeline of Order 719 Activities for SPP (continued) 27

  26. February 18, 2010 and May 19, 2010, SPP submitted compliance filings at FERC in response to the November 20 Order May 20, 2010, SPP filed with FERC its Report on Remaining Barriers to Demand Response for the SPP RTO and SPP Market Monitoring Unit As of May 26, 2010, FERC has not issued an order addressing SPP’s compliance filings for Order 719-A and the November 20 Order Timeline of Order 719 Activities for SPP (continued) 28

  27. 09-090-U - Arkansas Public Service Commission 10-GIME-215-GIE – Kansas Corporation Commission EW-2010-0187 – Missouri Public Service Commission PUD201000043 – Oklahoma Corporation Commission State Dockets Open For Order 719 29

  28. Demand Response Activities

  29. Major components of the May 19th Demand Response Compliance Filing as required by the November 20th Order • Establishment of a customer baseline methodology and alternative methodology for demand response resources (“DRR”) • Incorporation of bidding parameters for DRRs that are currently found in the SPP Market Protocols • Elimination of requirement for ARCs to provide a “declaration” from its regulatory body that it can offer DRR into the SPP wholesale market 31

  30. Current Demand Response in SPP Real-time energy imbalance is currently the only SPP market DRRs are recognized as generators, dispatchable every five minutes Current amount of Demand Response is in excess of 1500 MW Majority of the Demand Response is “behind-the-meter” and co-generation Load reduction accounts for approximately 50 MWh 32

  31. Aggregators of Retail Customers (“ARC”) in SPP • ARCs are treated as any other Market Participant • ARCs are able to represent demand response as any other resources that are responsive to dispatch instructions • ARCs must register as any other Market Participant and certify to SPP that the relevant retail regulator does not prohibit participation 33

  32. Issues/Concerns with Demand Response and ARCs The ability of retail providers to invoice a ratepayer for unmetered consumption (amount of DR) for load reduction DRR Without resolution, ratepayer may “double dip” or collect from the wholesale market for performance and not be billed for the retail consumption that would have occurred For ARCs, measurement and validation becomes more difficult as a single interconnection point is divided among many Market Participants since SPP’s Market is settled nodally 34

  33. Summary of Demand Response Activities in SPP SPP Market supports Demand Response and currently 1500 MW participates Additional Tariff revisions were filed on May 19 in compliance with the November 20 Order on demand response and ARCs and are pending approval at FERC Demand response is being incorporated into the Future Market Design in compliance with Order 719 requirements 35

  34. Heather StarnesManager, Regulatory Policy501-614-3380hstarnes@spp.org

  35. Entergy – SPP Seams Agreement UpdateCarl Monroe Presentation for APSC June 3, 2010

  36. SPP Footprints • Regional Entity • SPP members as defined in the SPP Membership Agreement plus SPA via contract • 16 BAs • Reliability Coordinator • 26 BAs - all BAs in SPP RE plus 7 BAs in SERC and 3 BAs in MRO • Reserve Sharing Group • 29 BAs - all BAs with load in the SPP RC footprint plus AECI, EES, SMEPA, and WAPA • Regional Tariff • TOs participating in the SPP OATT • 13 BAs • EIS Market • TOs participating in the SPP OATT with the exception of CUS • Includes all generation and load connected to those TOs • 15 BAs

  37. Seams Agreement Components • Reliability Coordinator • Data Exchange • Operations Coordination Activities • Emergency Procedures • Transmission Provider • Data Exchange • Transmission Service Coordination • Joint/Collaborative Planning • Cost Allocation • Market Operator • Market Flow Calculation • Market-to-Market Congestion Management

  38. Reliability Coordination Seams • Data exchange • Forecast and real-time • Scada data • Model exchange • Transmission Service Reservations • Load forecast • Schedules (Dynamic, Static) • Forced and planned outages • Emergency procedures • Schedule checkout • Voltage/Reactive coordination

  39. Transmission Provider Seams • Joint/Collaborative Planning • Document and synchronize each party’s planning processes • Involve stakeholders • Data exchange • Develop joint plan • Cost allocations • Upgrades to support other party • Upgrades at the seams • Economic analysis • Cost allocation

  40. Transmission Provider Seams (cont) • Coordination of Transmission Service • Long-term • Syncing up processes so Customer gets a timely answer • Different standards of reliability and analysis • Upgrades on other party to support service - Cost Allocation • Parallel Flow compensation • Short-term – use Congestion Management Process (CMP) • Coordinate ATC/AFC through Flowgate allocations • For granting short-term service • Sharing allocations/Compensation • TLR/Market Flow – For curtailments • Redispatch for other party • Redispatch between parties

  41. Transmission Provider Seams (cont) • Coordination of Interconnection Studies • Coordination of Market Operations • Coordination of Schedules/Market Flow • Short-term – Use of CMP • Medium-term – Shared redispatch • Long-term – Joint/Common Markets

  42. Seams Agreement Status Comprehensive Some Elements Missing Update Needed Just Started

  43. Entergy – SPP Seams Agreement • Transmission Provider Seams • Covers • Coordination of Transmission Expansion Planning • Coordination of Transmission Service & Generation Interconnection Studies • Sharing real-time data for AFC/ATC Coordination • Additional discussions • Cost Allocation – Sharing of Costs when both Benefit • Reliability • Economic • One-Stop Shopping – Transmission Service & Generation Interconnections • Near-Term Proactive Transmission Service Coordination • Market to Pseudo Market

  44. SPP Seams Steering Committee • Current Activities • Discussion on COOPER_S flowgate issue - April 1st Conf Call • SPP presentation • Discussions • MISO activities • Wind Impacts • April 23rd Meeting • Discussion of Group Organization • Next meetings • June 15th 10:00 AM – 3:00 PM – Dallas

  45. Carl A. MonroeExecutive Vice President & COO501-614-3218cmonroe@spp.org

  46. SPP Future Markets UpdateDebbie James Presentation for APSC June 3, 2010

  47. Agenda • Overview of Future Markets • Future Markets Updates • Next Steps

  48. Overview of Future Markets

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