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PRR 525 Update

PRR 525 Update. Prepared by ERCOT Compliance December 2005. ERCOT’s CPS1 12 Mo. Rolling Average. QSE Regulation 10-Min Performance. Regulation 10-Minute Interval Trend. PRR525 Background.

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PRR 525 Update

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  1. PRR 525 Update Prepared by ERCOT Compliance December 2005

  2. ERCOT’s CPS1 12 Mo. Rolling Average

  3. QSE Regulation 10-Min Performance

  4. Regulation 10-Minute Interval Trend

  5. PRR525 Background • PRR525 Was Introduced to Apply “Regulation Like” Performance Monitoring Criteria to All QSEs for All Intervals • PRR525 is the Next Logical Step in the Effort to Improve Frequency Control • PRR525 Was Considered a Viable Alternative to Doubling Regulation

  6. PRR525 Stakeholder Process • Submitted – June 2004 • Three Measuring Methods Analyzed • PRR525 • Approved by WMS – December 2004 • 6.33 for, 1.17 opposed • Approved by PRS – January 2005 • 2 abstentions • Approved by TAC – March 2005 • 1 abstention • Approved by BOD – April 2005 • unanimous

  7. PRR525 Scoring • Simulated Scores & Data Have Been Provided to All QSEs Since September 2004 • Signals For Independent Verification Provided in Late October to: • Each QSE • A Third Party Provider • The Third Party Provider Serves 8 QSEs

  8. QSE PRR525 10-Minute Performance

  9. PRR525 10-Min Interval Trend

  10. Approved PRR525 Exemptions • 2 Hours After A Unit Trip • Portfolio Balancing Ramp Rate Violations • Verbal Dispatch Instructions (VDI) • Non-Spin Ramping Periods • RRS Ramping Periods • Other Abnormal Periods

  11. Action Items • Who Passes / Who Fails • Dynamic Schedule Impact • Disqualification Process • Disqualification Analysis (Backcast)

  12. Pass / Fail • Passing Characteristics • Close relationship between QSE & Generators • Proactive efforts to meet obligations • Diverse portfolios • Responsibility transfer agreements • Failing Characteristics • Wind Only QSEs (2) • Block Schedule Operation • Small Portfolio

  13. Dynamic Schedules • Typically Regulation Providers • Experience adhering to strict Regulation standard • Consistently meet PRR525 measure

  14. Disqualification • A/S Disqualification Conditions • Continued underperformance after all other efforts have been exhausted • Non-Compliance Actions of ERCOT • Protocols 6.10.12

  15. Disqualification Backcast Analysis • Unpredictable Market Reaction • Minimize Market Impact • Enforcement Stimulates Improved Performance • Disqualification Analysis Can Produce Drastic Cost Variations • Assumption Dependent

  16. Compliance Enforcement Plan For PRR525 • Patterned after NERC Enforcement Matrix • Increasing Levels of Severity • All QSEs Receive Their Monthly Scores • QSEs have 10 business days to respond

  17. Levels of Non-Compliance • Level 1 • First Violation • Phone Call & Letter to QSE Representative of Record • Copy to PUCT Staff • Posting on NERC & ERCOT Public Web Sites

  18. Levels of Non-Compliance(Cont) • Level 2 • Second Violation within six (6) months • Or Inadequate Response to Level 1 • Phone Call & Letter to QSE Sr. Management • Copy to PUCT Staff • Failing QSE Presentation (or report) to ROS • Posting on NERC & ERCOT Public Web Sites

  19. Levels of Non-Compliance(Cont) • Level 3 • Third Violation Within Six (6) Months • Or Inadequate Response to Level 2 • Phone Call & Letter to QSE Sr. Management • Copy to PUCT Staff • Failing QSE Presentation (or report) to TAC • Posting on NERC & ERCOT Public Web Sites • Compliance Notifies Board

  20. Proposed Future Action Plan • If Satisfactory Results Have Not Been Achieved Within The First Six Months: • Return to BOD in July 2006 With Recommendation on Next Steps • Additional Performance Criteria • (PRR 586?) • Any Others ?

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