Talking Points to Facilitate ATC Discussion by Steve Myers, ERCOT RSC July 29, 2008

1. Talking Points to Facilitate ATC Discussion by Steve Myers, ERCOT RSC July 29, 2008

2. ATC, TTC, TRM, and CBM are parameters and concepts which have been developed relative to the reliable implementation of a transmission service market.  Such a market is active in the Eastern Interconnection, and to some extent (I don’t know to what extent) in the Western Interconnection (WECC). • There is no transmission service market active in the ERCOT Interconnection.

3. The NERC drafting team for the standards revision related to ATC agrees that we don’t need these in ERCOT and has worked with me to word the revisions so that we don’t have to do the functions if we don’t have any of the newly defined “ATC Paths”.  They declined to write in an applicability statement that would make it clear that any Region that did not have an active transmission service market need not comply.

4. I would request that the Texas RE find out from NERC (and FERC, if needed) whether a Regional Variance may be written that effectively establishes an “exemption”.  As I understand it, a Regional Variance must be at least as strict as a NERC Standard Requirement and, preferably, stricter than a NERC Standard Requirement.  I also understand that a Regional Variance may be required by “physical differences” and that “physical differences” may include reasons due to the particular market rules for that Region.  Therefore, if we knew that an “exemption” is possible, we could write a Regional Variance citing “physical difference”.

5. I have heard previously that FERC has said that they would not accept any Regional Variance that establishes an “exemption”.  For that reason, I would like to request that the Texas RE find out for us.

6. I have problems with the concept of a Regional Variance that describes what we do and establishes performance measures and requirements.  The reason I have those problems is that TTC, ATC, TRM, and CBM have been established for the purposes of providing technical parameters by which Interchange Transactions are approved and, when necessary, when and which Interchange Schedules may be curtailed to control transmission loading.  The Eastern Interconnection and WECC use the TLR procedure as part of their processes.

7. Within ERCOT, we use an extensive Congestion Management process, described in the ERCOT Protocols and Operating Guides, to control transmission system loading and we do not curtail interchange schedules.  If any Interchange Schedules across the DC Ties are to be curtailed, it is done by SPP using the SPP side of the DC Ties as the technical reasons for such curtailments.

8. If we describe our Congestion Management process in a Regional Variance, establishing measurements and sanctions for them, we would, in my opinion, effectively be “federalizing” our Market Rules.  As I understand it, that is something we wish to avoid.

9. There are other NERC Reliability Standards which already require that system operating limits and Interconnection reliability operating limits be determined and that operations be planned and implemented to operate within those limits.  There are measures and sanctions already established for those standards.  How you operate within those limits should include how you manage congestion, whether it is by re-dispatch, such as in ERCOT, or a combination of local procedures and interchange schedule curtailments.  Thus, I feel to establish a Regional Variance that includes our congestion management processes would be to establish a “multiple jeopardy” situation.  The concept is already covered by other standards.

10. ERCOT ISO has nominated Bill Blevins to join a NERC project drafting team.  Hopefully he will be able to work with that team to ensure that ERCOT does not have to perform TLR as described for the Eastern Interconnection and WECC