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Transmission Congestion Management – IDC Granularity Option 3A

Transmission Congestion Management – IDC Granularity Option 3A. Larry Kezele and Jeff Norman June 28, 2005 NERC/NAESB TLR Subcommittee. Summary of Responses to NERC’s Request for Information (RFI) ---- Selection of a Next Generation Transmission Congestion Management Tool

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Transmission Congestion Management – IDC Granularity Option 3A

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  1. Transmission Congestion Management – IDC Granularity Option 3A Larry Kezele and Jeff Norman June 28, 2005 NERC/NAESB TLR Subcommittee

  2. Summary of Responses to NERC’s Request for Information (RFI) ---- Selection of a Next Generation Transmission Congestion Management Tool (IDC Granularity Option 3)

  3. ABB AREVA T&D ICF Consulting MCG (Minneapolis Consulting Group) Nexant – Energy Solutions Division OATI (Open Access Technology International) PowerWorld SunGard Enform Consulting Respondents

  4. Overview of Responses • Submitted as confidential and contain proprietary information • Implementation of Granularity Option 3A is technically feasible – (i.e. similar technology implemented in RTO/ISO market areas) • Phased implementation is possible, minimizing resource commitment • Respondents have a variety of experience in the electric industry, and most have experience in financial markets

  5. Projected Cost and Development Time • $ 2 – 10 Million • Clear definition of project scope and requirements impacts projected cost • Multi-year service agreement acceptable • “Forklift” IDC replacement project • One to two year implementation time line • Customized development, or • Customized development of Application Program Interface modules to commercially available systems

  6. System Security • Digital Certificates required • User names and passwords • Adherence to NERC cyber security standards

  7. Data Requirements • Common practice among vendors is to accept third party data • Near real time data to support security constrained economic dispatch (5-minute intervals) • System flow and loads • Generator outputs, ramp rates, capacity limits • Existing data structures may be adequate • Create data dependency that doesn’t exist today • Acquisition and definition of financial data?

  8. Implementation Concerns • Staffing and training • Paradigm shift in transmission congestion management • Risk related to resolution of congestion management process issues in parallel with tool implementation • Critical project success factor – Controlled scope

  9. Definition - Project Scope and Requirements • Implementation of supporting Business Practices • Option 3 provides for socialization of congestion costs to balancing authorities • Option 3A assigns congestion costs to contributing transactions and balancing authority load • PSEs may chose to curtail based on assignment of redispatch costs • Reservation and scheduling of redispatch energy

  10. Definition - Project Scope and Requirements • Implementation of supporting Reliability Standards • Inclusion of counterflows • Potential re-definition of the role of the NERC Reliability Coordinator • Reliability Coordinator Standards of Conduct (i.e. independence from market participants)

  11. Definition - Project Scope and Requirements • Definition of Financial Model(s) • Generator bid/offer system (i.e. bidding rules) • Settlements • Dispute resolution • Compliance with redispatch directives • Financial requirements for redispatch providers

  12. Definition - Project Scope and Requirements • Potential impacts to System Reliability • Delays in redispatch implementation (e.g., by allowing a PSE to decide at what financial threshold it is willing to accept redispatch costs) may actually compromise reliability.

  13. Definition - Project Scope and Requirements • Potential impacts to other NERC tools • E-tag specification • OASIS (redispatch transaction transmission service) • System Data Exchange • BA, TOP, PSE back end settlement systems

  14. Definition - Project Scope and Requirements • Potential impacts to non-NERC tools • BA, TOP, PSE back end settlement systems • Provision of supporting data • RTO/ISO market flow calculators

  15. Definition - Project Scope and Requirements • Regulatory Obstacles • Potential transmission tariff changes • State and Federal approvals required to allow participation in regional redispatch tariffs

  16. Definition - Project Scope and Requirements • Sarbanes-Oxley Compliance • Market participants subject to SAS 70 auditing requirements. • Extensive data retention requirements

  17. Questions?

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