Comments on Straw proposal and July 11, 2022 stakeholder call discussion

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

APS is supportive of multiple aspects contained in the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal that were discussed on the July 11, 2022 stakeholder call. APS supports removal of the inter-tie uncertainty requirement.  APS also is obliged to await the results of the FRP Refinements Phase 2 implementation to review its impact on reducing the amount of load conformance before advocating for further consideration of load conformance within the RSE based on the results of the analysis results in Phase 1B.

APS also believes further refinement is required on the LPT export and the emergency assistance/surplus to best position the WEIM and WEIM Entities for success.  

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

APS does not believe that the proposal is aligning with current EIM Entity practices regarding counting of interchange between EIM Entities and the firmness of that interchange. Today, EIM Entities do not differentiate energy on an implemented e-tag for purposes of resource sufficiency evaluation. The exporting EIM Entity would account for this energy in their obligation in the tests and the importing EIM Entity would account for the energy it is receiving via e-tag in submission of schedules on base ETSR’s. CAISO’s implementation of LPT exports not being counted in RSE would differ from EIM Entities, since EIM Entities utilize any tagged interchange energy for purposes of WEIM RSE today regardless of the confidence in delivery.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

APS seeks clarity on how these LPT should be accounted for in each aspect of the RSE test proposed by CAISO. It appears to be inaccurate to not count an e-tagged energy schedule (LPT or otherwise) in a balancing test, since the resulting base schedules from the EIM Entity would not result in a balanced schedule to e-tagged interchange. If the proposal is to not count the LPT exports for flex and capacity purposes would CAISO propose adding these amounts to the uncertainty component of those tests? APS believes that it may be best accounted through uncertainty regarding the likelihood that the CAISO will hold the LPT schedules to the awarded amount through real-time because at many times there is likely to be internal supply or other mechanisms to support the exports even if WEIM advisory schedules are reduced in subsequent binding market runs. Since these LPT exports are likely to flow many hours of the day it would seem to be overly conservative to discount their delivery completely in the RSE. APS also believes that it may be appropriate to consider reduction in LPT exports to non-WEIM entities ahead of the reductions to WEIM Entities in the calculation of this uncertainty.  

APS believes that blanket removal of transactions exporting from CAISO BAA with LPT status to count for EIM Entity BAA will result in decreased transactions with CAISO markets ahead of the EIM. Similar to the reliability concerns regarding curtailment of schedules from the IFM/RUC with LPT status in Real-Time, external BAA’s will seek certainty around delivery and ability to count energy transactions for RSE through bilateral market transactions.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

Theoretically, EIM Entities systems could update in the timeframe between T-40 and if the new deadline of T-30 is implemented. However, this is not adequate time to respond to the unilateral change in base schedule because of the CAISO not receiving an import schedule. If the CAISO as a market operator awards schedule as exports, it should stand behind the promise to deliver upon that award without being contingent on another market participants delivery. If the CAISO as BAA has a reliability reason to curtail the e-tag associated with the export, the schedule would be updated in RTSI, but would not be updated in the base schedule submission by an EIM Entity as base schedules are not traditionally updated between EIM entities after the T-55 RSE test. 

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

Like the comments on question #2 this proposal to change the generation firmness to firm provisional or non-firm is not something currently seen in consideration of base schedules between EIM entities. If energy sourcing from CAISO is non-firm and not eligible for counting towards an importing EIM entities RSE, it will disincentivize participation by EIM Entities in the CAISO’s pre-EIM markets. Any sourcing of imports in these markets will need to be matched with increased reserves in the EIM Entities BAA and will provide little to no value to incentivize a transaction to occur.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

APS believes that the CAISO as the market operator should curtail tags it does not reasonably expect to deliver upon ahead of the market clearing for HASP. EIM Entities have adjusted real-time bilateral procurement activities ahead of the RSE evaluation timelines, with the vast amount of activity occurring ahead of the first advisory RSE test at T-75. It is unreasonable for the CAISO to take the results of the HASP that occurs after the T-55 submission and ask EIM Entities to cover any discounted interchange before the binding T-40 RSE submission. The CAISO should evaluate alternatives that would allow for notification of discounted schedules closer to around T-120 if feasible to allow for alternative arrangements to be considered by impacted market participants.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

APS supports the use of the quantile regression methodology for uncertainty regarding net load uncertainty.  

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

APS supports the removal of the intertie uncertainty from the RSE obligation of WEIM Entities. APS appreciates the analysis of this uncertainty component from Phase 1B, and agrees that there is likely no correlation between past occurrences of NSI changes between T-40 and T-20 with future occurrences. This component does not improve the RSE accuracy in our opinion and at worst can reduce the accuracy depending on the uncertainty assigned to a WEIM Entity. APS would also like to not the shift in business practice regarding tagging as the WEIM grows in participants, more e-tags are created well in advance of the T-40 RSE deadline and are not further modified ahead of the operating hour post T-40 RSE evaluation.  

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

APS believes this question was intended to ask about implementation prior to summer 2023, if that’s the case then APS supports implementation ahead of Summer 2023, if the appropriate safeguards and market changes approved through this initiative can be developed and tested satisfactory ahead of go-live. WEIM Entities will need time to update and test internal systems to account for new energy assistance revenue allocation verification and associated administrative penalties.  

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

APS recognizes the support for a solution through the WEIM in these instances from stakeholders and is supportive of exploration into enhancements that broaden the benefits of WEIM to participants after appropriate consideration is taken to minimize unintended consequences of such changes.

APS would like to better understand the reasoning for the election to cure these instances being reflected in the master file and subject to the master file process update timeline. A WEIM Entity may find it beneficial to have a more real-time election based on each failure of the RSE to request that the WEIM attempt to achieve a solution through setting of the administrative hurdle rates.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

APS believes that the hurdle rate at the bid cap should be the minimum financial impact to cure undersupply through the WEIM. It is important to APS if approved, the ability to cure undersupply through WEIM is not an economic decision to forego forward procurement of resources ahead of the WEIM RSE. APS would support higher hurdle rates or rates that which increase with utilization of the energy assistance through WEIM, along with monitoring of the usage after the fact by DMM. In the straw proposal CAISO asks for consideration of monitoring and misuse, APS thinks it is a difficult question to answer but would put forward that the total magnitude of MWh transferred to a BAA through energy assistance, and a count of times per BAA would be a good starting point for later reference on determining the threshold for over reliance (leaning) on the WEIM.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

APS at this point thinks the energy pro-rata to residual supply above the binding WEIM RSE for purposes of revenue allocation seems best. This would incentivize bids which are due at T-75 to be made available to WEIM and be available to cure undersupply in other BAAs. In the alternative option of pro-rata based on net WEIM export, a WEIM Entity could be supporting the deficient BAA by having their imports reduced so the deficient BAA can import while still being a net importer which they would not be allocated any revenue for. The pro-rata based on residual capacity also would recognize those BAAs that pass the RSE, but whose supply may not be economic in the solution though it was made available to cure the undersupply in support of reliability.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

APS seeks clarification in over-supply conditions when the hurdle rate is set at $0, if the LMP would still be allowed to reflect over-supply resulting in negative prices. APS does not support the ability to export in EIM when failing flex down in tandem with effectively raising the floor price to $0. The region will continue to deploy resources that generate during times of over-supply and accurate pricing signals are required to incentivize resources that are flexible to absorb the over-supply and the resources contributing to oversupply need to be disincentivized through LMP’s that are allowed to reach the bid floor. APS would like to better understand the market solution if there was multiple BAA’s failing for over supply conditions and what the market solution would do in this situation if all excess generation could not be exported from failing BAA’s, how would the market decide who can export and who must own the reality of over-supply within their BAA from a balancing perspective.

APS also seeks clarification if there is a similar market constraint that limits imports into an WEIM BAA if the BAA cannot satisfy its power balance equations. As the constraint to not allow exports if an WEIM Entity is deficient is a safeguard to allowing WEIM Entities to cure an undersupply condition the inverse constraint could provide a safeguard to not allow socialization of an over-supply condition when a WEIM Entity cannot decrement internal generation to allow imports from a WEIM Entity in oversupply condition.  

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

No comment we do not understand the question. Question 8 asks about the removal of inter-tie uncertainty from the RSE.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

No additional comments.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Bonneville appreciates the ISO launching Phase 2 quickly after Phase 1 to expedite adoption of proposed changes. Bonneville offers comments below on the specific questions. Overall, Bonneville has some remaining questions regarding a number of Phase 2 changes.

Regarding Load conformance, Bonneville appreciates the analysis conducted as part of Phase 1B to evaluate the impacts of load conformance in the CAISO. Bonneville recognizes the potential for the FRP enhancements to address some of the ISO’s need for load conformance and looks forward to future analysis on long-term solutions for efficient market outcomes.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

Bonneville appreciates the CAISO’s efforts to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAAs. However, Bonneville would like to confirm that the CAISO will only be discounting those exports that are assumed to be dependent on advisory imports. Bonneville seeks clarity on how CAISO will identify which and what volume of exports to discount. Bonneville is concerned with how the ISO will ensure there is a matching import upon which the export  is dependent, and whether the matching import would also be discounted.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

Bonneville is supportive of aligning the treatment of low priority exports across WEIM entities. However, Bonneville is concerned that this devalues the LPT exports and raises concerns about deliverability/resources sufficiency if WEIM entities cannot count on these exports . Bonneville is concerned that this change in policy reduces the ISO’s obligation to meet LPT exports, which could lead to curtailment of LPT exports to a BAA in an EEA2. Bonneville seeks analysis of how this could impact other WEIM BAA’s resources and their ability to pass the RS tests. For example, would a WEIM BAA be subject to the under scheduling penalty if the WEIM BAA failed the Balancing Test because an LPT export was discounted? If the interchange uncertainty adder is included again in the Capacity Test, will the interchange uncertainty adder increase if LPT exports are discounted? How would this impact the need for a WEIM BAA to DEC if it has a lot of non-firm imports coming?

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

Based on an initial assessment of this timeline, Bonneville believes that this window does not provide sufficient time to procure additional resources as it would provide less than 10 minutes for a process that requires a number of steps and could not be completed in such a short timeframe. Bonneville requests a timeline of the process before determining the impact of this timing.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

Bonneville requests clarification on how the ISO intends for the tags to convey that it is a firm provisional transaction.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

Bonneville requests clarification of how the ISO would implement this. Bonneville is concerned about the ISO making changes to another WEIM BAA’s base schedule without WEIM BAA involvement and without adequate notification time for the impacted BAA to cover any discounted interchange.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

Bonneville continues to review the overall quantile regression methodology. In response to the ISO’s request for feedback on whether uncertainty procured to the existing requirements (95% upwards and 2.5% downwards) is appropriate, Bonneville seeks additional information before responding. Specifically, analysis of how much more likely the footprint would be to running out of deliverable capacity under these requirements versus other requirements.  

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

Bonneville supports the ISO’s proposal to permanently remove the adder for intertie uncertainty.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

Bonneville supports implementing energy assistance when an entity is short for reliability and supports the use of the market optimization mechanisms to administer this new functionality rather than using out of market processes. Establishing appropriate rules/hurdles will be important to the success of the approach, as discussed in the following questions.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

Bonneville is interested in the concepts of modifying the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM. Bonneville believes that more details are needed to fully evaluate the proposed approaches.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

Assuming this option is voluntary in nature, Bonneville is interested in the concept of leveraging the WEIM for energy assistance to replace transfers limited by RSE failures during undersupply conditions.  Bonneville continues to believe that the EIM RSE needs to accurately reflect the operating capabilities and obligations of a BAA and that further enhancements are needed to ensure  accuracy, including the BA failing the RSE when in an EEA2 or greater. WEIM curing of resource undersupply issues should be utilized only on an emergency basis to ensure WEIM BAAs continue to have incentives for forward contracting to meet RS.  Bonneville encourages the ISO to consider tiered failure consequences both on persistent small failures and on infrequent large failures when emergency assistance is utilized.  If a hurdle rate is used, Bonneville also recommends that the hurdle rate be set such that it is more penal than penalties that may be applied earlier in the process to incentivize WEIM BAAs to take action earlier to cure undersupply issues. Bonneville requests clarification of how this hurdle rate would be set and implemented in relation to the power balance constraint relaxation penalty.

Bonneville requests clarification regarding elements of the hurdle rate concept. Will the hurdle rate be applied to all WEIM transfers to the BAA utilizing energy assistance or only to the incremental transfers above the previous internal import amount (the current level that EIM transfers are limited to under failure)? Are dispatched BAAs actually compensated at this level, or does market power mitigation or other administrative action reduce either compensation or actual cost to the deficient BAA?

Bonneville requests a numerical example to illustrate the concept described in section 5.1.2, specifically to demonstrate sufficient compensation under conditions that would be most adverse to the assisting BAA.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

In response to the ISO’s request for feedback regarding section 5.1.3, Allocating Insufficiency Revenue, Bonneville requests that the ISO further investigate alternative approaches to the two options proposed. Bonneville also requests that the ISO provide a numerical example to illustrate the different approaches to allocating revenue.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

Bonneville assumes this question should read “for an EIM BAA”, rather than “for an EDAM BAA” and is responding as if it refers to EIM instead of EDAM. Bonneville requests additional information on this concept and how the $0 hurdle rate would be implemented, including treatment of participating and non-participating resources and a numeric example. Bonneville also requests clarification on whether the $0 hurdle rate would be used under conditions when prices are negative, or if the negative price would prevail. Further, Bonneville recommends that the hurdle rate be set such that it maintains incentives to pass the flex down test.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

Bonneville is responding to this question assuming that “question 8” refers instead to question 13. Bonneville requests clarification on whether a hurdle rate would apply to any additional WEIM Transfers that result from relaxing import limitations for a WEIM BAA that failed the WEIM RSE in the upwards direction. Bonneville also requests clarification that the import limits would be relaxed in the expected amount of oversupply to ensure the upward failing BAA is accessing only the excess of the failing BAA that is in oversupply, not market INCs.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

No additional comments

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

The California Community Choice Association (CalCCA) appreciates the opportunity to submit comments on the California Independent System Operator Corporation’s (CAISO’s) WEIM Resource Sufficiency Evaluation Enhancements Phase 2 Straw Proposal, dated July 1, 2022 (Straw Proposal), and the July 11, 2022 stakeholder call. The enhancements to the resource sufficiency evaluation (RSE) adopted in Phase 1, and the proposed accuracy enhancements proposed in the Straw Proposal Section 4, demonstrate the CAISO’s commitment to increasing accuracy of the RSE by reducing failures based on false indicators. CalCCA supports the CAISO’s proposed accuracy enhancements set forth in the Straw Proposal.

In addition, CalCCA supports the CAISO’s proposal to allow balancing authority areas (BAA) to elect to utilize energy assistance through the Western Energy Imbalance Market (WEIM) to cure resource insufficiencies. CalCCA’s concern with this proposal lies with ensuring appropriate consequences faced by a BAA for misuse of the energy assistance option. The following provides CalCCA’s comments on (1) consequences for misuse of the energy assistance option; (2) allocation of assistance energy revenue; and (3) oversupply failure consequences.

1. Consequences for Misuse of Energy Assistance Option

The Straw Proposal poses two questions in section 5.1.1 to gauge what constitutes “misuse” and how to construct appropriate consequences for such misuse. First, the Straw Proposal asks about the relationship between many small failures (i.e., a 1 megawatt (MW) failure for 3 straight hours) and fewer large failures (a 40 MW failure during a single interval). While both failures are potentially significant, CalCCA views a larger failure during a single interval to be an immediate and significant risk indicating a substantial failure of a BAA. Consequences are necessary to deter such failures. Smaller failures indicate a higher risk tolerance than the CAISO should accept, demonstrating that they frequently secure just enough (and in some instances, not enough) supplies. Such failures should face consequences given the likelihood of (and to prevent) additional failures and to incentivize a change in practices.

Second, the Straw Proposal asks whether failures during varying system conditions represent the same level of functionality, and if not, is weighting the impact of failures during varying conditions appropriate. Failures during tight conditions immediately place the system in jeopardy, and therefore failures during different system conditions do not represent the same level of functionality and should face different consequences.

2. Allocation of Assistance Energy Revenue

Section 5.1.3 of the Straw Proposal requests feedback on two proposed methods for allocating the energy assistance revenue – i.e., revenue separate from the conventional congestion revenue and collected only after the activation of the hurdle rate. The two proposals are to allocate the revenue: (1) pro rata by net WEIM export to entities that have passed the RSE; or (2) pro rata to entities that have passed the RSE (whether dispatched or not). While the CAISO is leaning towards the first option, CalCCA supports allocating revenue to all entities that have passed the RSE, including those not dispatched. Entities passing the RSE, and whose capacity is available to cure resource insufficiencies, should be rewarded for bidding their capacity into the WEIM.  Conceptually, the CAISO should encourage all capacity to be made available to the market. Awarding energy assistance revenue based upon all capacity available to the WEIM from entities passing the RSE is more effective in this regard than just the select entities that clear the energy market since this would be energy based rather than capacity based.

3. Oversupply Failure Consequences

The CAISO proposes that during oversupply conditions, a failure of the ramping sufficiency test allows incremental additional export transfers at a hurdle rate of $0/megawatt-hour. CalCCA supports the CAISO’s proposal, which introduces an economic solution to discourage curtailment of low-cost supply in the WEIM.

Finally, CalCCA supports the CAISO’s characterization of the proposed changes (excluding the CAISO export tagging rules) to the RSE as under the joint authority of the WEIM Governing Body and the Board of Governors. 

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

No comments at this time.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

No comments at this time.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

No comments at this time.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

No comments at this time.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

No comments at this time.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

No comments at this time.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

No comments at this time.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

No comments at this time.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

No comments at this time.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

No comments at this time.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

No comments at this time.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

No comments at this time.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

No comments at this time.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

No comments at this time.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Please see PDF attachment for DMM's complete set of comments.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

Please see PDF attachment for DMM's complete set of comments.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

Please see PDF attachment for DMM's complete set of comments.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

Please see PDF attachment for DMM's complete set of comments.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

Please see PDF attachment for DMM's complete set of comments.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

Please see PDF attachment for DMM's complete set of comments.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

Please see PDF attachment for DMM's complete set of comments.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

Please see PDF attachment for DMM's complete set of comments.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

Please see PDF attachment for DMM's complete set of comments.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

Please see PDF attachment for DMM's complete set of comments.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

Please see PDF attachment for DMM's complete set of comments.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

Please see PDF attachment for DMM's complete set of comments.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

Please see PDF attachment for DMM's complete set of comments.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

Please see PDF attachment for DMM's complete set of comments.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

Please see PDF attachment for DMM's complete set of comments.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

The purpose of the resource sufficiency evaluation (RSE) test is to ensure that CAISO and other Western Energy Imbalance Market (WEIM) participants have sufficient resources to meet load before the transfers occur in the energy imbalance market itself – that is, among other reasons, that no entity is leaning.

In the past year, the CAISO has identified and discussed a number of issues associated with the RSE, two of which are critically important to CPUC jurisdictional load serving entities and their customers.  First, CAISO has identified that CAISO’s markets clear exports based on advisory WEIM transfers, but that these advisory WEIM transfers are not included in the RSE test itself, even though the exports that cleared the market as a result of the advisory WEIM transfers are included in the test.  Thus, CAISO’s markets could clear exports based on the expected WEIM transfers and then fail the RSE when these WEIM transfers are not included in the test itself.[1]  Second, CAISO has identified that it clears exports in the hour ahead scheduling process (HASP), based on imports that are bid into the HASP process, but that these HASP imports are not financially binding.  This presents a reliability issue to CAISO customers if CAISO supports these cleared exports and the non-financially binding HASP imports do not materialize.

In its issue paper, CAISO proposes to address these two issues in the following manner. First, CAISO proposes that it will include in the RSE only those exports that are identified as high priority exports or that CAISO has a reasonable expectation can be supported by resources internal to CAISO.[2]  Second, CAISO proposes that HASP exports with high priority will be given priority equal to load, but that low priority exports will be tagged as “firm-provisional” and that it would curtail these exports, if necessary, to maintain reliability.  However, CAISO indicates that it would “only look to curtail these LPT exports to the extent contingency reserves have been deployed and were unable to be recovered, or an event outside of existing planning criteria occurs wherein the CAISO is unable to meet its internal demand through the exercise of its reserves.” Further, CAISO clarifies that its default would be to not curtail exports to a BAA in an EEA-2 (“with the default being to exclude curtailments into BAAs that have entered into an EEA-2”).

Separate from these issues and CAISO’s proposed solutions, stakeholders requested CAISO consider financial penalties for RSE failures, rather than limiting transfers to the last feasible schedule.  In this issue paper, CAISO proposes to allow WEIM entities that fail the RSE, to cure the resource insufficiency through a hurdle rate priced at the bid cap (i.e., either $1,000/MWh or $2,000/MWh, depending on cost verified bids above the soft bid cap). 

CPUC staff broadly supports CAISO’s efforts to address these issues and appreciates CAISO explanations, proposed solutions, and creative thinking, but CPUC staff has a number of questions about how CAISO proposals will work in practice, which are discussed in further detail below.

• CPUC staff supports CAISO’s proposal to include in the RSE only those exports that are identified as high priority exports or that CAISO has a reasonable expectation can be supported by resources internal to CAISO, but staff has number of questions about how this will work in practice.

CPUC staff would appreciate it if CAISO staff could walk through numerical examples of how this would work and how this will be shown in OASIS.  For example, if CAISO has 45,000 MW of load and 45,000 MW of resources, but then has 1,000 MW of HASP imports and 1,000 MW of anticipated WEIM transfers, and as a result clears 2,000 MW of exports, CPUC staff assumes that the CAISO footprint would pass the RSE (45,000 MW of resources and 45,000 MW of load and no exports would be included in the test). It would be helpful if CAISO could clarify that this understanding is correct.

A more complicated example might include consideration of resource adequacy imports. Assuming the same fact set above, but CAISO had 1,000 MW of RA imports rather than HASP imports, is CPUC staff’s understanding correct that as with the previous example, the CAISO footprint would pass the RSE and the exports would not be counted in the RSE since they are not supported by “resources internal to the CAISO”?

In addition, would CAISO’s OASIS show the net interchange with or without the non-supported exports?  Or would both be included in the OASIS functionality?

Finally, it would be helpful if CAISO could confirm that failure of imports to tag at T-40 would likely have no effect on whether the CAISO footprint passes or fails the RSE, primarily because during stressed system conditions (which is when CAISO might fail to pass the RSE), any unsupported exports would not be included in the test to begin with. 

Using the same example as above to clarify CPUC staff’s understanding of this scenario, with 45,000 MW of load and resources, 1,000 MW of HASP imports and 1,000 MW of WEIM transfers supporting 2,000 MW of exports, is staff’s understanding correct that it would likely be irrelevant whether the HASP imports failed to tag at T-40 for purposes of the RSE? If this is not correct, it would be helpful if CAISO could explain why this would not be the case. The only circumstance that CPUC staff could see it mattering for the CAISO footprint itself is if the HASP/other imports were necessary to support CAISO load and these imports failed to tag at T-40. 

• CPUC staff has a number of questions about CAISO’s proposal to create a new category of “firm-provisional” imports that would be curtailed to ensure reliability, if necessary.

First, in the issue paper, CAISO indicates that it currently has tariff authority to curtail low priority exports (“under its existing tariff authority retains the ability to curtail lower priority exports to maintain its own load serving obligations as a balancing authority”).  However, in its Business Practice Manual for Operations, the penalty parameter for the “Tagged Quantity for exports” is 3100, whereas load is 1450. Further, per the excerpt from CAISO’s BPM for Market Operations shown below, it appears that tagged exports have higher priority than load in real time. It would be helpful for CAISO to explain this potential discrepancy, and how CAISO’s proposal to cut firm-provisional exports in real-time will work in conjunction with real time market penalty parameters in its software.

Real Time Market Parameters

Second, in its straw proposal, CAISO indicates that it plans to support firm-provisional exports “to the extent contingency reserves have been deployed and were unable to be recovered, or an event outside of existing planning criteria occurs wherein the CAISO is unable to meet its internal demand through the exercise of its reserves.”  It would be helpful for CAISO to provide more detail on what resources it is referring to, which would be supporting these lower priority “firm-provisional” exports before curtailing them, since there are a variety of different contingencies and reserves that can be called in different time horizons.  One example is that it is CPUC staff’s understanding that if CAISO were using its reserves, this would mean that it would be calling on its RDRR and arming load, and that this would be done to support these firm-provisional exports. It would be helpful for CAISO to clarify if this understanding is correct and, if not, the order of operations that CAISO expects that it will deploy during these types of stressed system conditions.

Third, CAISO also indicates that its default would be to not curtail exports to a BAA in an EEA-2 (“with the default being to exclude curtailments into BAAs that have entered into an EEA-2”).  On the other hand, the only time CAISO will cut exports appears to be only after it has deploying RDRR and armed load in order to support exports, which suggests that the only circumstances under which CAISO will cut exports is when CAISO itself is in an EEA-2. It would be helpful for CAISO to clarify if this is correct and if not, why not.  In addition, this raises the question – would CAISO curtail exports to a BAA that is in an EEA-2 if the CAISO BAA itself is also in an EEA-2, which seems inevitable if CAISO is at the point of cutting exports in the first place? 

Further, during the last EDAM RSE stakeholder meeting, one EIM entity clarified that it has agreements with other Western BAAs to provide assistance for forced outages, but it would not provide this assistance to a BAA for imports that failed to deliver. It would be helpful for CAISO to clarify why it should, as a BAA, support exports when the underlying imports that cleared exports for that transaction failed to deliver, if other EIM entities are indicating they would not do the equivalent, and why California customers should bear this potential reliability risk (e.g., potentially driving itself into an EEA-2 by deploying RDRR and arming load to support provisionally firm exports, with the attendant scarcity pricing and reliability risks associated with such actions) if other EIM entities are not prepared to do so as well.

• CPUC staff is interested in learning more about CAISO’s proposal to allow WEIM entities that fail the RSE, to cure the resource insufficiency through a hurdle rate priced at the bid cap (i.e., either $1,000/MWh or $2,000/MWh, depending on cost verified bids above the soft bid cap).

First, CPUC staff requests that CAISO clarify if RDRR will be activated and deployed (and counted in the RSE) before relying on this type of emergency assistance and strongly urges CAISO to ensure that RDRR (and BIP in particular) are counted in the RSE to ensure that CAISO does not fail the RSE and that RDRR is in fact deployed before using such emergency assistance.

CPUC staff’s understanding of how RDRR (and BIP in particular) rests on language in the settlement agreement, signed by parties and approved by the CPUC in D.10-06-034,[3] which explicitly indicates that RDRR is to be deployed to “help mitigate, or limit the duration of, [s]carcity [p]ricing events” and “immediately prior to the CAISO need to canvas neighboring balancing authorities and other entities for available exceptional dispatch energy/capacity” (see language below). 

Thus, to the extent that the CAISO’s proposal is a form of scarcity pricing and emergency assistance from other BAAs at the bid cap, it follows that the RDRR programs should be activated to be included in the RSE and called before using emergency assistance from neighboring balancing authorities.  Since this was not discussed in the issue paper, CPUC staff request clarification on how CAISO proposes to incorporate the RDRR program to ensure that CAISO does not unnecessarily fail the RSE, effectuate scarcity pricing and rely on other balancing authorities for power at the bid cap before activating and dispatching the RDRR programs.

In addition, CPUC staff requests clarification on how this program would work in practice.  Would the scarcity prices clear the entire FMM and RTD or would these prices apply just to the EIM transfers necessary for emergency assistance?

• CPUC staff continues to believe that the T-40 transmission tagging requirement imposed on CAISO alone (in the RSE) is discriminatory and recommends that either CAISO remove it, impose it on all WEIM entities, or develop an intertie uncertainty adder applicable to CAISO and other WEIM entities on non-discriminatory basis.

In its straw proposal, CAISO proposes to permanently remove the intertie uncertainty adder from the capacity test.  In addition, CAISO indicates that “given the recent changes to require the transmission profile of an e-tag for an import to the CAISO BAA to count in the WEIM RSE, all intertie transactions used to pass the WEIM RSE have similar expectations of delivery, equally situating all parties regarding potential for intertie uncertainty to arise.”

CPUC staff requests that CAISO explain how all intertie transactions used to pass the WEIM RSE have similar expectations of delivery and how all parties are equally situated. From CPUC staff’s perspective, the T-40 transmission tagging requirement is included in the RSE only for the CAISO balancing authority and not for the other BAAs. Further, CPUC staff request that CAISO explain how the other balancing authorities are situated – do they have a T-40 transmission tagging requirement, and if not, what requirement do they have that is similar?

Further, CPUC staff still do not understand how this does not treat similarly situated entities differently. For example, assume that the CAISO and another CA EIM entity have an import contract with the same entity in the NW, but the transmission line fails at T-45. In this case, the CAISO imports would be removed from the RSE if load serving entity was not able to obtain a transmission tag by T-40 (a CAISO-specific requirement), but the other California entity would not need to show the import failure because e-tags are only required at T-20 (which we understand to be a WECC requirement).  CPUC staff would appreciate CAISO staff explaining how these entities are not being treated differently for purposes of the RSE.

In addition, CPUC staff agrees with CAISO that it should develop a more granular process to allocate the costs associated with RSE failure and emergency assistance, and staff encourages CAISO to address this in this stakeholder process.

Finally, it would be helpful for CAISO to provide further data on historic CAISO T-40 transmission tagging failures.  What portion of these failures are for RA resources? What portion of these failures are for day-ahead cleared imports? What portion of these failures are for HASP cleared imports? If the failure is primarily for HASP cleared imports that are clearing export transfers, how would the transmission tag failures affect the RSE (given that non-supported exports are no longer going to be included). and how will these HASP transmission tag failures affect reliability for CAISO customers (given that they would need to support firm-provisional exports up until deployment of RDRR and arming load)?

In addition, information on the extent to which imports fail to tag by T-40 – and under what conditions –  will also allow CAISO and parties to determine whether CAISO needs to consider changes to its penalty for intertie deviations and whether this issue should be further examined as part of this initiative.

[1] For example, assume CAISO has balanced load and resources at 40,000 MW (excluding consideration of reserve requirements), and 1,000 MW of expected WEIM transfers and, as a result, clears 1,000 MW of exports.  While CAISO is resource sufficient in this instance, with 40,000 MW of load and 40,000 MW of resources, it would fail the RSE because it would have only 40,000 MW of resources but 41,000 MW of load and exports to support.

[2] “The CAISO proposes to only count high priority block hourly export transfers and lower priority block hourly transfers that it has a reasonable expectation were sourced from its control area in the net scheduled interchange that is used to inform its WEIM RSE obligation.”

[3] In addition, D.18-11-029, clarified that RDRR was supposed to be called at a warning, not during an emergency, but before, which argues for inclusion in the RSE test itself, should CAISO anticipate failing the test.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

Please see response above.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

Please see response above.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

Please see response above.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

Please see response above.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

Please see response above.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

Please see response above.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

Please see response above.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

Please see response above.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

Please see response above.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

Please see response above.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

Please see response above.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

Please see response above.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

Please see response above.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

Please see response above.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Calpine, as owner and operator of generation resources outside the CAISO, supports the proposal to impose financial penalties as a consequence of RSE failure.  The financial penalty can be an adder or a stand-alone administrative price.

Further, we believe that the current physical limitations can create reliability concerns, particularly for generation-rich (exporting) BAA’s customers. As such, physical limits on Net Interchange (NI) should be eliminated.

In order to meet our contingency reserve obligations, Calpine participates in reserve-sharing groups (RSG) in the Northwest and Southwest. Through joint-action, those RSGs will re-supply (outside the EIM) schedules that are affected by contingencies, such as a generation outage.  The re-supply will last 60 minutes.

If a BAA has exports that are negatively affected by a generation outage, the RSG will resupply to maintain the exports for the first 60 minutes after the outage. However, if the EIM blocks market resupply longer than the 60 minute RSG response, sending BAA exports will be cut leaving the receiving BAA short in real time, exposing the receiving BAA to load curtailment.  This unreasonably exports a reliability risk to a receiving BAA.

Finally, it is probable that a contingency would result in an EIM restriction for more than 60 minutes.  That is, in the first run after the generation outage occurs, the sending BAA could or would fail the RSE.  That failure could result in an NI restriction for as long as two hours (until market resupply can be arranged for the next base schedule submission). 

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

No Comment

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

No Comment

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

No Comment

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

No Comment

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

No Comment

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

No Comment

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

No Comment

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

No Comment

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

See Above Summary

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

No Comment

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

No Comment

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

No Comment

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

No Comment

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

No Comment

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

NV Energy appreciates the opportunity to comment on the phase 2 straw proposal. In particular, we support the inclusion of financial consequences for failure of the resource sufficiency evaluation (“RSE”) in this phase of the resource sufficiency (“RS”) enhancements for a proposed implementation date of June 1, 2023.   

FERC has stated that a tariff provision implementing a particular rate or practice that was found reasonable at one time does not preclude later reviewing the provision to determine whether it continues to be just and reasonable.¹  At the time Section 29.34(m) of the CAISO Tariff was adopted, establishing the freeze as a consequence for failing the RSE, PacifiCorp was the only participating EIM Entity. With the tremendous success of the EIM, currently 79% of the Western Interconnection load is now participating in the market. The expansion of the EIM has had a significant effect on the liquidity of the intra-day bilateral market as participating EIM Entities utilize excess capacity to participate within the EIM. This restricts the ability of a distressed EIM Entity to respond to a reliability challenge as available capacity in the bilateral market has been greatly reduced or taken to zero on the most critical of days.

In addition, events such as the 2021 Bootleg fire have demonstrated that an EIM Entity can go into a day expecting it is fully capable of meeting its forecasted load and passing the RSE only to have an event, or a series of events, pose a sudden and severe reliability challenge. As recognized by the Market Surveillance Committee (“MSC”), “the Western EIM FMM and RTD are potentially powerful tools for balancing load across the WECC to maintain reliability in uncertain operating conditions. In contrast, placing restrictions on the use of EIM transfers during unexpected operating conditions has the potential for problematic outcomes.”²  We agree with the MSC. 

Having identified a significant reliability concern with the current CAISO Tariff and the failure consequences of the RSE, it is incumbent on the CAISO, the EIM Entities, and other stakeholders to implement a solution at the earliest possible date. If an EIM Entity has an EEA event and any resulting rolling blackouts could have been prevented by allowing access to available EIM supply at a scarcity price, our customers will have been greatly disserved.  

CAISO has proposed to implement changes to the resource sufficiency test consequences on June 1, 2023. The implementation date is of paramount importance to NV Energy and should be extremely important to all other EIM Entities in the West considering the implications that locked transfers could have on the reliability of the grid. Therefore, NV Energy proposes that the financial consequences proposals be the focus for this phase of the RS enhancements. Meaning that other potential controversial topics like the HASP export proposal should not deter or derail the much-needed enhancements to the test consequences. The CAISO can phase implementation, if necessary to implement the financial consequence reliability enhancement by June 1, 2023. 

[1]              See e.g., Maryland PSC v. PJM Interconnection, L.L.C., 123 FERC ¶ 61,169 at P 31 (2008), citing Ameren Services Co. v. Midwest Indep. Transmission Sys. Operator, Inc., 121 FERC ¶ 61,205 at P 33 (2007).

[2]               See, Opinion on Energy Imbalance Market (EIM Resource Sufficiency Enhancements dated February 2, 2022 at 29. The report can be found at:  MSCFinalOpiniononEIMResourceSufficiencyEvaluationEnhancements-Phase1.pdf (caiso.com).

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

Currently, the HASP market awards exports based on supply bids and advisory EIM market transfers. The resource sufficiency test does not count the advisory EIM market transfers that the HASP run utilizes to award market exports but does count the awarded exports against the CAISO BAA. Therefore, CAISO has proposed that all exports that are awarded in HASP and exports that do not have a designated non-RA resource internal to CAISO be treated as firm-provisional energy or LPT exports. Additionally, CAISO proposes to not count the LPT HASP awarded exports in the resource sufficiency test and pro rata derate the LPT import that the neighboring BAA has been awarded in the resource sufficiency tests. CAISO has indicated that this proposal provides equivalent treatment to how interchange schedules are made and represented by the EIM Entities. From NV Energy’s perspective this proposal does not provide equivalent treatment, because EIM Entities do not have a HASP market that clears exports from advisory transfers. In general, exports should not be awarded if they cannot be supported. This is a CAISO specific issue. Nevertheless, we understand the complicated issue that arises for the CAISO BAA. Therefore, NV Energy supports the proposal to exclude the exports that are awarded from the HASP market when backed by EIM advisory transfers. However, NV Energy does not support the proposal to derate the LPT imports that result from HASP. The resource sufficiency tests count all import capacity whether it is on firm or non-firm transmission. Therefore, the proposed LPT import derate is not an equivalent proposal. This proposal would make the ability to pass the resource sufficiency tests more difficult and confusing for the EIM Entity to determine what is needed in order to meet the resource sufficiency requirements. Essentially, this proposal would make meeting the requirement more of a moving target if a customer or load serving entity purchased supply that originated from CAISO within the EIM Entities Balancing Authority Area. This resource sufficiency test proposal potentially jeopardizes reliability due to the increased uncertainty that is shifted onto neighboring EIM Entities. Therefore, NV Energy proposes that the LPT derate proposal be removed from scope. 

CAISO has proposed to differentiate and provide priority to LPT exports that have cleared the day ahead process over LPT exports that are awarded in real-time. NV Energy needs more information about how this differentiation would occur in order to provide an opinion on this proposal. The day ahead awarded exports should have a higher priority; however, more information is needed to understand what level of priority these day-ahead LPT exports would receive and how this would be implemented.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

NV Energy does not support the proposal to adjust the capacity that is counted in the resource sufficiency tests from the low priority exports and requests that this be removed from scope. Currently, the test will count all import capacity whether it is on firm or non-firm transmission. Therefore, this proposal would differentiate the imports that are awarded in HASP from other non-firm purchases right before a resource sufficiency test. This would leave an EIM Entity no time to true up any deficiencies in order to pass the tests.    

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

NV Energy does not believe there is enough time to do update the base schedules within the T-40 and T-30 tests in order to attempt to pass a RS test. This is not enough time to react to last minute derated changes that occur within the test.   

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

Please see comment under question number 2, NV Energy requests more information regarding this proposal.   

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

Please see comment under question number 2.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

NV Energy supports CAISO's proposal to utilize the quantile regression methodology to determine the uncertainty requirement. 

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

CAISO proposes to permanently remove the intertie uncertainty adder from the capacity test because analysis showed that this uncertainty component was not a good predictor of future intertie uncertainty. Additionally, recent changes to the resource sufficiency test require an e-tag to incorporate an import into the CAISO Balancing Authority Area (“BAA”) towards counting as supply in the resource sufficiency tests which places CAISO on more of an equal playing field as other EIM BAAs. NV Energy appreciates the analysis that CAISO performed to gain a better understanding of the intertie uncertainty component and supports CAISO’s proposal to permanently remove the intertie uncertainty component from the capacity test. 

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

Having identified a significant reliability concern with the current CAISO Tariff and the failure consequences of the RSE, it is incumbent on the CAISO, the EIM Entities, and other stakeholders to implement a solution at the earliest possible date. If an EIM Entity has an EEA event and any resulting rolling blackouts could have been prevented by allowing access to available EIM supply at a scarcity price, our customers will have been greatly disserved.  

CAISO has proposed to implement changes to the resource sufficiency test consequences on June 1, 2023. The implementation date is of paramount importance to NV Energy and should be extremely important to all other EIM Entities in the West considering the implications that locked transfers could have on the reliability of the grid.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

NV Energy strongly supports CAISO's proposal to modify the consequences of failing the EIM RSE to provide the opportunity to cure over and undersupply conditions through the EIM. 

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

CAISO proposes to give a BAA the optionality to import in additional EIM transfers during intervals that the BAA failed a resource sufficiency up test at a hurdle rate that is at the current bid caps. This proposal would ensure that all supply within the BAA has been exhausted prior to receiving any additional imports at the bid cap. Additionally, CAISO has explained that there is a current market constraint that protects EIM Entities from exporting when a power balance constraint has been relaxed or if that Entity is dispatching available balancing capacity. This market constraint would protect EIM Entities from cascading reliability issues that could have otherwise resulted from other EIM Entities receiving additional market transfers. NV Energy strongly supports CAISO’s proposal to enhance the markets RS failure consequences during undersupply conditions and appreciates the additional information that CAISO provided to explain market protections that already exist. Furthermore, NV Energy supports the proposal to settle any imbalance charges through the BAA’s OATT.  

The optionality that CAISO proposed would be available to market participants through the Masterfile process. NV Energy supports the proposal to provide EIM Entities the option to elect financial consequences and supports the proposal to utilize the Masterfile to make this election. However, NV Energy also proposes that a flag be enabled in BAAOP for an EIM Entity to select or deselect this financial consequence prior to each operating hour. This would provide additional flexibility to allow an EIM Entity to maintain the physical consequences during situations where additional transfers may not be needed.   

CAISO has not provided any proposal to penalize EIM Entities that frequently fail the RS tests, but requests feedback from stakeholders. NV Energy would support additional financial consequences if an EIM Entity consistently failed the RS test for under-supply, however, NV Energy does not believe it is necessary to develop either the metrics for what constitutes frequent failure or the additional consequences at this time. Instead, this is something that could be monitored and reported by the Department of Market Monitor to determine if penalties or additional measures are needed.  

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

CAISO has proposed two options for allocating the revenue. The first proposal allocates the revenue pro-rata by net export to the EIM Entities that have passed the RS test. While the second proposal allocates the revenue pro-rata to all EIM Entities that have passed the RS test. NV Energy is supportive of the first proposal because it incentives EIM Entities to pass the RS tests by bidding in additional supply at the marginal cost of energy.  

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

CAISO proposes to utilize the EIM to cure over supply conditions at a proposed hurdle rate of $0 to relax the export transfer limitation. NV Energy appreciates CAISO for teeing up this concept and proposal for discussion in this phase of the resource sufficiency enhancements. As long as the market has the proper protections in place to shut down or curtail resources when conditions warrant shut down in the BAA that is experiencing the oversupply conditions, then the EIM should be able to realize the benefits of VER generation. This proposal should have a significant impact to the benefits of the EIM and NV Energy supports this proposal. To take this even further, NV Energy strongly supports removing the resource sufficiency down test altogether. It is unclear what this test is really protecting.  

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

NV Energy strongly supports CAISO's proposal to modify the consequences of failing the EIM RSE to provide the opportunity to cure over and undersupply conditions through the EIM. 

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

a. Adjustments for Load Conformance 

During the resource sufficiency enhancements phase 1 and phase 1B, CAISO conducted analysis on the relationship between the CAISO load conformance and the EIM transfers to determine if the load conformance increased the EIM imports into the CAISO BAA. The results of this analysis found that there was not a 1-to-1 relationship between the use of the load conformance and the EIM transfers. Therefore, CAISO does not propose any changes to the resource sufficiency test to incorporate the load conformance adjustments. NV Energy agrees with CAISO’s determination that the load conformance may increase internal generation along with increasing EIM imports and supports the proposal to not make any adjustments to the resource sufficiency tests.   

b. RSE Measures of Uncertainty 

Currently, the CAISO tests and procures for a 95% confidence level of uncertainty in the resource sufficiency tests and the flexible ramping product. This was the level of uncertainty that was originally proposed without any supporting analysis. During this phase 2 straw proposal, CAISO is requesting feedback from stakeholders on whether this level of uncertainty is the correct level. NV Energy proposes that CAISO perform an annual review to determine the level of uncertainty for the market procurement and requirements. This process should look back historically at the seasonal and quarterly uncertainty that was required and procured compared to how much was actually needed and used by the market. During this process, stakeholders and participants would have to opportunity to participate to gain a better understanding of the major outliers that the uncertainty component captured to determine if that level of uncertainty should be included for future years.  

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

PG&E appreciates CAISO’s objectives in the Phase 2 straw proposal to increase the accuracy of the RSE and introduce modifications to the consequences of failing the RSE.  A key issue in the straw proposal addresses the treatment of CAISO BAA low priority exports in both the RSE counting rules and market priorities.  The CAISO’s proposal addresses a distinct problem related to the misalignment of the HASP design and the EIM RSE design that results in unique disadvantages for the CAISO BAA.  CAISO’s proposals take appropriate steps to bring the CAISO BAA into better alignment with the practices and RSE requirements of other EIM BAAs in the operationally binding real-time intervals. 

PG&E also notes that the counting of intertie schedules in the EDAM RSE discussion addresses issues that are similar to, but distinct from, the issues being considered in this proposal.  The significant differences between the EIM RSE and EDAM RSE and the dynamics in the Day-Ahead and Real-Time Markets make it difficult to apply common and consistent principles to the two RSE designs.  PG&E would appreciate further discussion on how CAISO and stakeholders view the need for consistency and symmetry between the two RSE designs.    

A summary of PG&E’s key comments is provided below.

1. Discounting low priority exports in the EIM RSE: The CAISO proposal appropriately seeks to correct a RSE inaccuracy caused by the misalignment between the HASP design and the EIM RSE design.  PG&E agrees with the intent of CAISO’s proposal to create better alignment between CAISO and other EIM BAAs by excluding low priority exports not supported by internal supply from the EIM RSE calculations.  PG&E encourages CAISO to implement this counting rule uniformly and consistently, rather than only when the CAISO BAA fails the EIM RSE. 

2. Firm-provisional tag for low priority exports: PG&E requests further elaboration on the order of curtailment of LPT exports in the hierarchy of other market and operator actions during tight conditions, such as the activation of demand response or any EEA stages.

3. Energy assistance through the EIM to cure undersupply: PG&E appreciates the concept of a market option to provide energy assistance through the EIM when excess supply is available, but raises several questions regarding the design and implementation of this market feature.   

4. Curing oversupply by relaxing export limitations and implementing a $0 hurdle rate: PG&E questions whether a $0 hurdle rate will weaken the important incentives to discourage overgeneration and provide downward flexibility, and believes CAISO should consider a hurdle rate with a negative price.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

CAISO’s proposal to exclude from the EIM RSE the portion of low priority exports that are not supported by internal supply corrects an asymmetry and inaccuracy in the RSE design

PG&E understands the intent of CAISO’s proposal is to exclude from the RSE calculation any low priority exports not supported by internal supply, which will better align how exports are counted in CAISO and EIM base schedules.  This proposal responds to a clear asymmetry and inaccuracy in the EIM RSE design that results from the HASP optimization, which uses advisory EIM import transfers to support binding hourly block exports in real-time. In the EIM RSE, the HASP hourly exports are counted as additional obligations for the CAISO BAA, but the advisory EIM transfers supporting those hourly exports are not counted as additional supply.  This dynamic can result in “hundreds to thousands of additional MWs”[1] added to the CAISO BAA’s RSE obligation.  At the same time, EIM BAAs are able to count those CAISO BAA hourly block exports as part of their base schedule supply.  This misalignment puts the California Balancing Area at a higher risk of failing the EIM RSE. 

In the context of the EIM RSE and the real-time market, excluding the portion of low priority exports that only cleared because of the impact of advisory EIM supply is appropriate.  Beyond skewing the RSE results, unsupported HASP exports can put additional pressure on the CAISO BAA during tight conditions.  CAISO’s analysis has found a consistent pattern of WEIM transfers being unrealized between HASP and the subsequent markets, which can ultimately require the CAISO BAA to support those exports with its internal supply or curtail the exports if no supply is available.  The impact of HASP-cleared exports can be problematic to CAISO reliability in real-time when there is less time to dispatch internal resources or internal supply is no longer available. 

PG&E supports the direction of the straw proposal, but would appreciate further clarification of 1) how the CAISO proposes to calculate the quantity of low priority exports that will be discounted, and 2) under what circumstances the discounting process will occur.

The counting rules should be applied consistently and not depend on whether the CAISO BAA fails the real-time RSE.

CAISO’s presentation seems to suggest that unsupported LPT exports would be discounted from the RSE only when those exports cause the CAISO BAA to fail the RSE.[2]  This approach seems to create two separate metrics and processes to determine what counts in the RSE – one for when the CAISO BAA passes the RSE, the other for when it does not.  A process that establishes two different counting rules could have potential pitfalls, such as a lack of certainty for EIM BAAs scheduling LPT exports, greater complexity in implementation, and inconsistent reporting of RSE performance data.  

PG&E encourages CAISO to implement clear and transparent counting rules that are applied uniformly and consistently, rather than only when the CAISO BAA fails the RSE.  The counting of LPT exports not supported by internal supply should not depend on whether CAISO passes the EIM RSE.  They should simply not count in either the CAISO BAA’s RSE obligations or EIM BAAs’ base schedules.     

[1] WEIM Resource Sufficiency Evaluation Enhancements– Phase 2. Straw Proposal presentation.  Market Infrastructure Policy. July 11, 2022.  Pg. 14 at http://www.caiso.com/InitiativeDocuments/Presentation-WEIMResouceSufficiencyEvaluationEnhancementsPhase2-Jul11-2022.pdf

[2] WEIM Resource Sufficiency Evaluation Enhancements– Phase 2. Straw Proposal presentation.  Market Infrastructure Policy. July 11, 2022.  Pg. 16 at http://www.caiso.com/InitiativeDocuments/Presentation-WEIMResouceSufficiencyEvaluationEnhancementsPhase2-Jul11-2022.pdf

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

Reductions to LPT exports counted in the CAISO BAA’s RSE requirements should be mirrored by equal adjustments to EIM BAA base schedules

PG&E agrees with CAISO that the discounting of low priority exports from the CAISO BAA’s RSE obligations should be mirrored by discounts in the base schedules of the sink EIM BAAs.  Symmetrical application of the RSE requires such an approach. 

As stated in response to question 2, PG&E believes that the counting rules should follow a clear and transparent process that is applied consistently.  PG&E would appreciate further clarification of CAISO’s intent and implementation options it may consider.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

No comment.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

PG&E requests clarification on the proposed order of curtailment of LPT exports in the hierarchy of other market and operator actions to ensure reliability

PG&E appreciates CAISO’s efforts to address the potential adverse reliability impacts of low priority exports that are not supported by firm supply.  PG&E’s understanding of CAISO’s intent is to clarify that it will honor low priority exports to the greatest extent possible, but not at the risk of its own reliability.  To achieve that goal, CAISO proposes to apply a “firm provisional” tag to LPT exports to clarify their status as subordinate to CAISO load and high priority exports.  CAISO also proposes that all low priority export curtailments would be done with CAISO BAA system operator supervision. 

While this tagging rule is a step in the right direction, PG&E would like to better understand the proposed timing of adjustments to LPT export schedules relative to other market and operator actions.  The straw proposal[1] suggests the CAISO BAA would need to have utilized contingency reserves, and presumably be in an EEA3[2], before LPT exports would be curtailed.  PG&E is concerned that the protection of low priority exports could be problematic to CAISO reliability in real-time when there is less time to dispatch internal resources or internal supply is no longer available.  PG&E would appreciate clarification on the order of curtailment of LPT exports in the hierarchy of other market operations during tight conditions, such as the activation of demand response or any EEA stages. 

[1] EIM Resource Sufficiency Evaluation Enhancements Phase 2 Straw Proposal. July 1, 2022. Pg. 12 at http://www.caiso.com/InitiativeDocuments/StrawProposal-WEIMResourceSufficiencyEvaluationEnhancementsPhase2.pdf

“The CAISO BAA would only look to curtail these LPT exports to the extent contingency reserves had been deployed and were unable to be recovered, or an event outside of existing planning criteria occurs wherein the CAISO is unable to meet its internal demand through the exercise of its Reserves.”

[2] CAISO System Emergency Operating Procedure. Pg. 12 at https://www.caiso.com/Documents/4420.pdf

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

PG&E supports more transparency and comparable treatment of all EIM BAAs to ensure the RSE’s accurate counting of imports and exports

CAISO has previously supported limiting the current RSE tagging requirements for interchange schedules by T-40 to only the CAISO BAA.  CAISO has acknowledged that there is “some asymmetry” in this approach, but believes it is justified because non-CAISO EIM BAAs are not similarly situated to the CAISO with respect to their different tariff rules and tagging requirements that assure delivery of interchange sources of supply.[1] 

CAISO has also acknowledged that “significant amount of base schedule imports into WEIM entity BAAs do not deliver,” as pointed out by the DMM and CPUC.[2]  Given that CAISO is now proposing to permanently eliminate the intertie deviation adder that accounts for undelivered imports, PG&E believes it would be helpful to better understand any impediments to CAISO implementing RSE tagging rules for non-CAISO EIM BAAs that are comparable to those that currently apply to the CAISO BAA. 

[1] CAISO Tariff Amendment to Implement Resource Sufficiency Evaluation Enhancements.  ER22-1278.  March 11, 2022.  Pg. 20-21 at http://www.caiso.com/Documents/Mar11-2022-TariffAmendment-ResourceSufficiencyEvaluationEnhancements-ER22-1278.pdf

[2] Motion for Leave to File Answer of the California Independent System Operator

Corporation to Comments and Limited Protest.  ER22-1278.  April 15, 2022.  Pg. 7 at http://www.caiso.com/Documents/Apr15-2022-MotiontoLeaveAnswerandAnswer-ResourceSufficiencyEvaluation-ER22-1278.pdf

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

PG&E supports CAISO’s proposal to utilize the quantile regression methodology

PG&E accepts CAISO’s analysis that using the quantile regression methodology generally results in improved accuracy for net load uncertainty, primarily due to incorporating weather forecast data in addition to historical observations.  PG&E also supports CAISO’s proposal to only activate this new methodology after assessing its performance and accuracy.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

PG&E supports removing the intertie adder but encourages further discussion on creating comparable tagging requirements for all EIM BAAs

PG&E appreciates CAISO’s analysis finding that the intertie uncertainty adder can be grossly inaccurate and have an outsized impact on RSE failures.  PG&E supports the proposal to remove this adder from the RSE calculation. 

A related but distinct issue to the intertie deviation adder is the RSE tagging requirement at T-40 for interchange schedules.  PG&E believes that there should be consistent and symmetrical RSE requirements for interchange transactions, but it is not clear to PG&E that this is currently the case.  As stated in question 6, PG&E supports further discussion of whether a comparable tagging requirement that applies to CAISO interchange schedules at T-40 should be extended to other EIM BAAs. 

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

PG&E does not support implementing these changes in summer 2022. 

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

PG&E supports modifying the EIM RSE failure consequences.  The current RSE failure consequences to restrict incremental transactions may be necessary to deter leaning, but can result in lost market efficiency when there is excess capacity available between willing buyers and sellers.   Modifications to the failure consequences can improve overall market efficiency without undermining the incentive the RSE provides against capacity shortfalls. 

PG&E supports the following high-level principles to consider:

• Curing undersupply in one area should not lead to cascading reliability issues or price increases to customers in EIM BAAs which pass the RSE
• Misuse of the market should be monitored and penalized to maintain forward procurement incentives
• Penalties for misuse should be scaled by the magnitude of the failures and based on system conditions

PG&E offers further comments in subsequent questions to CAISO’s proposed modifications to 1) facilitate energy assistance through the EIM during undersupply conditions and 2) reduce export limitations on EIM BAAs during oversupply conditions. 

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

PG&E appreciates the concept of a market option to provide energy assistance through the EIM when excess supply is available, but raises several questions regarding the design and implementation of this market feature.  

Trigger for activating EIM energy assistance

• PG&E notes that an RSE failure for undersupply may not always occur during an emergency.  PG&E would appreciate further discussion on whether the proposal is intended to apply during declared emergency conditions or following any RSE undersupply failures.

Hurdle rate set at the bid cap

• Can CAISO provide examples and a formulation of how the hurdle rate would be incorporated into the marginal cost of congestion (MCC)? 
• Would CAISO consider scaling the hurdle rate based on the severity of the shortage?

Quantity of emergency assistance provided through the EIM

• If there is not enough emergency assistance available through the EIM to cure the insufficiency, how should EIM BAAs plan to use existing emergency assistance practices?    
• The straw proposal does not specify the quantity or duration of emergency assistance that may be available.  Would emergency assistance be provided until the interval for which the EIM BAA passes the RSE?

Overlapping rules and programs

• This new market features introduces potential overlap and impact on other CAISO market operations and instruments that should be considered:
  • The impact on convergence bids
  • Scarcity pricing enhancements
  • FERC Order 831 bid caps

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

PG&E supports CAISO’s preferred method of pro rata revenue allocation to net EIM exporters

The straw proposal offers two options to allocate the energy assistance revenue that will be collected after the activation of the hurdle rate.  PG&E supports CAISO’s preferred method to distribute revenue pro rata to net WEIM exporters who passed the RSE.  This option creates better incentives for EIM BAAs to offer excess supply to the market and receive appropriate compensation.   

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

PG&E questions whether the proposed $0 hurdle rate weakens the incentive for downward flexibility

PG&E questions whether a $0 hurdle rate could remove an important incentive to discourage overgeneration and maintain adequate resource flexibility.  PG&E would appreciate further discussion of using a hurdle rate with a negative price.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

No comment.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

No additional comments.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Portland General Electric Company (PGE) appreciates the CAISO’s continued efforts in preparing and presenting the additional analyses that have informed (and supplemented) the various phases of this initiative and offers the following summary comments: 

PGE supports with caveats (as noted below) many of the RSE-E Phase 2 proposal elements and will review the impacts associated with the FRP Refinements Phase 2 implementation on load conformance before continuing to advocate for its consideration in the RSE.  PGE does not support the CAISO’s proposal to only account for a portion of the LPT exports that the HASP process clears from the CAISO BAA in its WEIM RSE obligations.  This element of the proposal requires further refinement.   

While PGE recognizes the inherent difficulty the CAISO BAA has experienced in clearing non-firm WEIM imports and allowing them to support firm exports in real-time, the proposal that CAISO has put forward has the potential to introduce cascading reliability and financial risks to other WEIM BAAs that are relying on those exports for the purposes of passing their own RSE.  Moreover, the distinction between what constitutes “firm” and “non-firm” is made on a pro-rata basis after the HASP process has run and CAISO software has identified unrealized transfers (with no distinction in pricing between those exports that are treated as firm and those that are ultimately identified as non-firm).  The result is a proposal that does not “more closely” align the CAISO BAA with other WEIM BAAs, but, rather, extends the risks and costs associated with awarding exports that (ultimately) could not be counted on as firm in the first place. Given the complex issues associated with the LPT export element of the proposal, PGE recommends continuing to explore solutions but removing it from consideration as part of Phase 2 of the RSE-E to ensure that the other elements of the proposal can move forward as planned and on target for a Summer 2023 implementation.     

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

Please see PGE’s responses under Questions 3-5.   

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

PGE has several concerns with this element of the CAISO’s proposal (as further detailed below), but in general PGE is concerned with the potential impact this would have to the ability of EIM entities to account for and/or rely upon CAISO exports in their own RSE, the unknown impacts to HASP and RPTD price convergence, and the likelihood for this element of the proposal to delay the CAISO’s overall objective of meeting a Summer 2023 implementation target for Phase 2. 

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

While PGE recognizes that the CAISO intends to differentiate and provide priority to LPT exports that have cleared the DA process over LPT exports that are made in RT only, little detail has been provided in the straw proposal regarding how this will be ensured/validated.   Additionally, this element of the straw proposal introduces increased uncertainty surrounding whether an entity who is relying on CAISO supply will pass the RSE, or, whether they will be forced to over-procure resources and/or commit units to avoid potential failures.  Moreover, if the CAISO intends to make a distinction between LPT exports that are non-firm, then there should be a non-firm price associated with that energy.   Finally, determining whether a WEIM BAA has sufficient time to rebalance their base schedules after the HASP is highly dependent upon the volume of energy they are forced to rebalance and the liquidity of the bilateral market.   

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

The tagging rules associated with these exports should be consistent with NERC e-tagging priorities, as there appears to be no distinction between the CAISO’s “provisional firm” proposal and the more universally recognized and accepted “non-firm” tagging priority.  But more importantly, the proposal to change firmness to “firm” or “non-firm” is inconsistent with what is seen in the consideration of base scheduled between other WEIM Entities and will impact how importing EIM Entities participate in CAISO’s markets if CAISO delivery is contingent upon another market participants delivery (and may not be eligible for counting toward the importing EIM Entities RSE).   

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

No additional comment at this time.  

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

PGE supports the CAISO’s proposal to utilize the quantile regression methodology in the RSE but recognizes that the expected improvement in accuracy that this methodology represents is largely theoretical at this point.  As such, PGE appreciates the CAISO’s willingness to work offline with entities to prepare for and shadow its functionality and looks forward to reviewing additional analysis regarding test performance.  

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

Given the results of the CAISO’s analysis (which highlighted the challenges associated with the methodology that produces the intertie uncertainty requirement) PGE supports the CAISO’s proposal to permanently remove the adder for intertie uncertainty.   

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

PGE supports the proposal to leverage the WEIM for energy assistance during the Summer of 2023 but additional details regarding how an entity would elect to opt-in and opt-out of this functionality are needed.  For instance, it is unclear to PGE why CAISO prefers utilizing the existing Masterfile process (which would require a seven-day lead time for election) over an election that leverages the BAOOP tool?  More discussion around the actual mechanics of this election would be appreciated.  While PGE recognizes that there may be challenges associated with an hourly election, the inherent value (and usefulness) of this optionality would only increase if entities were able to elect energy assistance on a more dynamic basis. 

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

PGE is supportive of exploring the CAISO’s proposal, subject to the questions previously identified regarding the mechanism used to cure over and under supply conditions through the WEIM.   

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

PGE supports the CAISO’s proposal but would highlight as a general principle that the cost of procuring emergency assistance energy should always exceed the cost of procuring supply in the bilateral market in order to provide the correct market incentives against leaning. To this end, PGE further supports ongoing after-the-fact monitoring by the Department of Market Monitoring of emergency energy assistance usage to ensure that the bid cap continues to align with this principle.   

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

PGE supports the option to allocate assistance energy revenue pro-rata by net WEIM export to entities that have passed the WEIM RSE as this proposal is similar to existing settlements and carries the least implementation burden.  However, including the assistance energy revenue in existing charge codes would add an unnecessary level of complexity from a settlement standpoint.  As such, PGE requests that the CAISO add a separate charge code to allow entities to more easily evaluate the data related to this allocation and increase overall transparency. 

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

PGE is supportive of the CAISO’s proposal.   

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

PGE does not understand the question as the conditions referenced are not specified in question 8.  Question 8 relates to the removal of the intertie uncertainty adder.  

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

It remains unclear to PGE why CAISO staff believe that the proposed tagging change is severable from the remaining elements of the WEIM RSE proposed changes and does not require joint authority approval of the WEIM Governing Body and the CAISO Board of Governors? As noted above, there are potential downstream impacts to other WEIM BAAs associated with these tagging changes that should require joint authority approval. 

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

Please see Powerex’s comments available at CAISO RSE Enhancements Phase 2 Comments.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

The Public Generating Pool (PGP¹) appreciates the opportunity to comment on the EIM RSE Enhancements Phase 2 straw proposal. PGP takes great interest in this initiative as there are PGP members who are EIM participants that will be directly impacted by the outcome of this initiative. PGP is very supportive of this initiative and looks forward to helping make this effort a success.

PGP supports symmetric treatment of the CAISO in relation to other entities in the WEIM RSE, including appropriately sourcing and tagging resources that may be used in the RSE. To better understand the proposal and highlight potential issues, PGP would appreciate further examples of prioritization of schedules in adverse conditions under the proposed methodology. Also in alignment with the objective of symmetric treatment, PGP recommends further tracking and analysis of the use of load conformance by system operators, such that potential remedies for the consistent need for this tool may be further investigated.

PGP further supports the voluntary use of the EIM for energy assistance both in times of undersupply and surplus energy and appreciates the accelerated timeline associated with this initiative. Given participant concerns regarding the potential to abuse this program, PGP recommends the market administrator begin monitoring and reporting of the use of this assistance so that participants may better understand the conditions and eventual remedies for any perceived over-use.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

PGP supports the goal of alignment of the ISO BAA’s RSE obligations with those of other EIM BAA’s, including the tagging enhancements to prioritize DA and firm transfers over LPT exports.  While PGP recognizes that CAISO will attempt to honor LPT exports and will further incentivize DA market participation through prioritization of DA LPT exports over RT LPT exports, the “pro-rata” curtailments that may be anticipated in some conditions need further examples and analysis as to the frequency with which this may occur. What does “pro-rata” mean in this context?  PGP requests additional examples regarding potential “adjustment” situations involving varying levels of EEA and any impacts to importing entities.  

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

In general, PGP supports symmetric treatment of WEIM entities for the purposes of the RSE, and further supports structures that incentivize firm sourcing and clear tagging of resources for the purposes of RSE. While the intent is reasonable, the language is unclear.  “Pro-rata adjustments to block hourly LPT schedules in an equal amount to the discount applied to the CAISO’s BAA’s RSE obligation (Sec. 4.2.3)” needs further examples to elaborate on the prioritization of the LPT schedules and adjustments in these conditions.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

PGP conceptually supports the objective of discounting low priority exports by the amount of untagged imports. T-30 should provide scheduling certainty the vast majority of the time, but CAISO should track the frequency and magnitude of untagged imports that were used to discount low priority exports in order to determine if any parties are being impacted by the new tagging requirements.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

PGP supports tagging LPT exports as “firm-provisional” to better align with the approach in bilateral markets and improve transparency on the priority of these transactions in the case that they cannot be fully honored.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

For the WEIM to function, it is appropriate that base scheduling aligns with verifiable transactions. As such, PGP supports CAISO’s role as the market operator to validate and potentially adjust base schedules based upon the e-tags.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

PGP appreciates the efforts to formulate a more accurate test and the further commitment from the CAISO to continue to assess the performance of this methodology. PGP has previously commented on problems inherent to the existing methodology and looks forward to seeing whether this new method truly improves the accuracy of the measure of uncertainty.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

The challenge in finding a statistically valid data set to incorporate the intertie uncertainty into the methodology is clear, but it is unclear if removal of this component altogether warrants a higher confidence threshold for the remainder of the test parameters.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

PGP broadly supports the potential to implement energy assistance through the WEIM as soon as it is feasible.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

PGP supports the use of WEIM to provide energy assistance and the voluntary nature of this program. Given concerns of over-use of this program, careful tracking of how often parties use energy assistance is recommended.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

PGP supports finding the right administrative and financial consequences to avoid over-use of energy assistance and believes that the ISO’s proposal is a good first step. However, given other market initiatives in process, PGP acknowledges that it is difficult to evaluate if the hurdle rate is sufficient deter such over-use. To the extent that other market initiatives further incentivize resource sufficiency before the arrival in the EIM, and the energy assistance program is voluntary, the draft provisions seem meaningful. Regarding concerns of over-use, PGP recommends that the market administrator tracks and reports use of the assistance program in a transparent manner to highlight persistent use of the program if it should occur, and to better understand the conditions that may drive it.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

PGP supports the revenue allocation based on demonstrated net exports during the assistance period as opposed to the residual capacity. The residual capacity, while potentially aligning with a capacity construct, leaves room for windfalls to entities that did not actually contribute to the assistance during the event. It may also serve to dilute the benefits to participants who responded during these adverse conditions, reducing the effectiveness of the program.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

PGP supports the use of energy assistance during oversupply conditions as outlined in the proposal. Relaxation of export limitations under these conditions is preferable to the current approach of freezing EIM transfers.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

PGP supports the use of energy assistance during oversupply conditions as outlined in the proposal in section 5.2, example 2. Relaxation of import limitations under these conditions is preferable to the current approach of freezing EIM transfers.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

PGP recognizes the role of load conformance as an important tool for the CAISO operators, but also acknowledges that non-CAISO WEIM entities use other means such as the bilateral market to manage short-term concerns about positioning of resources in tight conditions. The counterfactual analysis regarding the load conformance seemed to indicate trend of significant use of this tool by market operators. CAISO should prioritize the development of tools and market products such as those being developed as part of DAME that should result in less of a need for CAISO operators to use load conformance. PGP continues to recommend that CAISO continue to monitor and analyze the use of load conformance and how to reduce its usage as a supply management tool.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

PPC appreciates CAISO staff’s work to improve the Resource Sufficiency Evaluation in the EIM.  Having a resource sufficiency test that is accurate, transparent, and consistently applied is critical to ensuring that entities participating in the EIM are equitably contributing to create the regional benefits experienced through the EIM.  Because there is not a consistent resource adequacy program across the EIM footprint the RS test is critical to ensure that EIM participants are not “leaning” on the energy only EIM to solve their capacity shortages.  While not all of PPC’s concerns are fully addressed in the current CAISO straw proposal, the proposal does improve the EIM RSE and provides additional optionality for EIM participants to utilize the EIM as a tool to help them at times where they are resource deficient.  PPC would like to stress that while we support the concept of taking advantage of regional diversity to help meet individual participants’ needs on an infrequent basis, this reliance should not become a regular occurrence and should be utilized in rare instances.  We discuss this in more detail below.

We would also like to note, that while these comments are focused on the EIM RSE proposal, the need to have a well-designed RSE take on even more urgency in the EDAM context.  It will be critical that the market design is able to strike a balance which ensures that all participants are incentivized to contribute their share of the regional energy, capacity, and transmission required to ensure that the market provides reliable service, meaningful economic benefits, and equitably allocates those benefits across the region.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

As a general matter, PPC supports aligning the treatment of WEIM RSE obligations between the CAISO BAA and other EIM participants to the greatest extent possible.  In regard to CAISO’s specific proposal on how export schedules are treated in the RSE, we would like to better understand how the CAISO’s “confidence” that it could support exports will be communicated to entities receiving those exports.  Would exports occurring on non-firm transmission service in EIM BAAs be treated in the same manner in the RSE as exports that the CAISO could not “confidently support?”

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

PPC would like to better understand the potential impacts of this proposal, particularly the mechanism for making these adjustments and how those adjustments are communicated.  We are concerned that depending on how these adjustments are implemented, it could not allow WEIM BAAs sufficient opportunity to cure any shortages caused by these adjustments and thus may cause them to unexpectedly fail the RS test.  We would appreciate more clarity on CAISO’s proposal.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

PPC is unclear on how this discounting would occur and would like to further discuss the proposal to ensure there is not the potential to create significant uncertainty for other EIM participants regarding whether imports into their BAA from the CAISO BAA would be discounted.  We appreciate additional discussion on this issue in future workshops.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

PPC would appreciate additional details on the specific mechanics of the tagging rules for low priority exports including more discussion on the potential uncertainty created for entities receiving those exports.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

PPC would appreciate additional details on the mechanics of how this validation, review, and potential discounting would occur.  As a general matter, CAISO needs to respect the rights of the EIM BAAs to operate their own systems.  Further discussion of this topic could help inform whether those rights are impacted by this proposal.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

PPC supports the use of the quantile regression methodology to inform uncertainty requirements as an incremental improvement from CAISO’s current uncertainty calculation methodology.  We request additional evaluation of whatever methodology is adopted to calculate the uncertainty requirement to help identify potential future improvements.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

PPC does not have concerns with this approach at this time.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

PPC could support adoption of an energy assistance policy given that:

- CAISO adopts a pricing policy that incents limited use of energy assistance;

- Participants are assured that they will not be required to provide emergency assistance if they are unwilling to do so; and

- Data regarding the use of energy assistance and the availability of energy assistance supply should be made publicly available after the first summer the program is established and that data should be used to reevaluate the program prior to the following summer.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

PPC generally supports the proposed approach. 

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

CAISO’s proposal to allow entities to cure their failure of the RSE by essentially purchasing imports from the EIM at the bid-cap is likely sufficient to deter entities regularly relying on WEIM imports to meet their supply short falls.  PPC supports applying the bid-cap to all imports during the interval for which the participant is utilizing the energy assistance.  Exploring the potential for escalating these charges based on frequency of use could further deter regular reliance on EIM capacity.

We also support the CAISO proposed concept of identifying those “misusing” the service, or frequently relying on energy assistance.  CAISO requested feedback on how to identify misuse of the service – frequency of use or magnitude.  The best approach is probably a combination of the two.  Entities regularly using the service should be flagged, even if it is in small amounts.  Entities relying on the service for larger amount of supply may need to be flagged after fewer instances.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

Providing compensation to those entities actually dispatched to provide the energy assistance (as proposed in option 1) is likely the most appropriate approach.  We appreciate additional discussion with CAISO and other stakeholders on this issue to hear additional perspectives.  If CAISO did adopt option 1, this decision may be worth revisiting at a later date to determine whether additional incentives are required to make a larger pool of capacity available to provide energy assistance.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

At this time PPC supports this approach, to be revisited after the first summer it takes effect to ensure there are not unintended consequences.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

PPC supports relaxing import limitations to a BAA if doing so aids a neighboring BAA in an oversupply event.  We would like to see additional information from the CAISO on how this would be implemented, including how this would be communicated to both BAAs.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

Not at this time.  Thanks for the opportunity to comment.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Salt River Project Agricultural Improvement and Power District (SRP) appreciates the CAISO’s efforts to enhance the WEIM resource sufficiency evaluation (RSE). The CAISO WEIM RSE Enhancements Phase 2 straw proposal and stakeholder call captured key issues pertaining to the accuracy of the RSE.

SRP supports the exclusion of the load conformance in the Balancing Authority Area (BAA) RSE test, and the CAISO’s decision to not propose changes in the WEIM RSE to account for load conformance.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

No comments at this time.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

SRP requests the CAISO further define “firm-provisional” Lower Price Taker (LPT) export. This term is not commonly used in the current tagging process.

SRP also requests that the CAISO clarify the methodology it will use to determine exclusion of an LPT export in the RSE and how it will communicate that decision to the WEIM BAA to ensure it is captured correctly in the WEIM BAA’s RSE. SRP is concerned that this action would impose risk to the WEIM BAA that would need to displace the excluded LPT export in its base schedule with commitment of the non-economic resource for the RSE. If the LPT curtailment need does not materialize, the market would still commit the non-economic resource as it was self-scheduled by WEIM BAA, or the burden lies on the WEIM BAA to take out-of-market action to ensure such commitment does not occur.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

SRP generally supports the analysis shown on the topic of the interaction between advisory WEIM transfer and the Hour Ahead Scheduling Process (HASP). The CAISO’s proposed approach of identification of the LPT exports to not be included in the RSE will also require the WEIM BAA to not include such LPT imports for the RSE. This will require coordination between the CAISO BAA and the WEIM BAA exercising such trades. It is unclear from the proposal if such LPT exports need to be removed from the RSE base schedule only during certain conditions or at all times. Removing such LPT exports from the BAA base schedules may deficit the ability of the BAA to balance its load. SRP requests clarification on this topic.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

SRP requests the CAISO further define “firm -provisional” Lower Price Taker (LPT) export. This term is not commonly used in the current tagging process.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

SRP does not support the CAISO as the market operator validating, reviewing, and potentially discounting interchange supply shown within a WEIM BAA’s base schedule based on the e-tags that support the shown interchange. These actions should only be taken in coordination with and with acknowledgement of the WEIM BAA that would have impacted schedules. Discounting without communication could create a reliability risk for the affected WEIM BAA.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

SRP supports the CAISO’s approach to using the quantile regression to incorporate weather information in estimating flexible ramping product for a BAA. The analysis showed that SRP is one of the WEIM BAAs that will have an average increase in net load uncertainty requirement leading to more flex up failure with the new methodology. SRP would like to better understand what is leading to the increase in net load uncertainty in comparison with neighboring BAAs that are similarly situated.

SRP supports the current proposal for net uncertainty to be procured at a 95% confidence interval that translates to a 97.5% upward uncertainty requirement and 2.5% downward uncertainty requirement for both capacity and flexible ramping sufficiency test.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

SRP supports permanent removal of the intertie uncertainty adder from the capacity test.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

SRP assumes this is referring to summer 2023. 

SRP continues to have concerns that a WEIM energy assistance program is inconsistent with the WEIM market principle that each entity must come to the market fully prepared to serve its own load. However, SRP recognizes that there is strong support for this type of program. If the CAISO implements a WEIM energy assistance program, it is very important to SRP that participation in such a program be voluntary. It is still unclear if the CAISO will have a mechanism for BAAs to elect in real time to allow the market to cure the under/over supply conditions. SRP would prefer for a BAA to have the option to elect to use the market to cure insufficiency at certain times and elect to fail the RSE with transfer limitations at other times. SRP requests further detail on the proposed WEIM energy assistance program.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

SRP seeks clarity on the CAISO’s proposal for revenue calculation for the assistance energy. With the current design of RSE, if the WEIM BAA fails RSE, the WEIM transfers are limited to the maximum of zero or the previous optimal WEIM transfers. The proposal does not clearly explain how the hurdle rate will be applied if a WEIM BAA fails RSE and utilizes energy assistance. Will the hurdle rate be applied to any incremental WEIM transfer above the base transfer limit or any transfer above the previous optimal WEIM transfers? SRP requests that the CAISO clarify the application of the hurdle rate.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

SRP supports the CAISO’s proposal to allow a BAA to cure a resource undersupply insufficiency by implementing a hurdle rate priced at the bid cap of either $1000/MWh or $2000/MWh, depending on cost verified bids above the soft bid cap. However, SRP believes such a program would need to be monitored because an entity could use it to lean on the market during emergency conditions and to offset forward procurement. SRP requests the CAISO define a threshold, for both frequency and magnitude, for failures due to insufficiency and report misuse of such assistance.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

SRP supports pro-rata allocation of revenue by net WEIM export to entities that passed the WEIM RSE. This methodology allocates the revenue to the entities that provided the excess capacity to cure the insufficiency and creates an incentive for entities to make additional capacity available to the WEIM.  

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

SRP supports the CAISO’s proposal to relax export limitations for a BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0. This will provide a mechanism for a BAA with oversupply to deliver such energy and incentivize the market to use economic resources.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

No comment at this time.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

SRP requests clarification on the relationship between WEIM energy assistance and EDAM RSE. Specifically, what would be the result if an EDAM entity is part of the pooled entities for WEIM RSE but opts out of WEIM energy assistance?

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Recent analyses and discussions regarding Resource Sufficiency Evaluation (“RSE”) performance highlight the importance of consistency and symmetry in defining and applying RSE requirements.  The Six Cities believe that, in general, the CAISO’s Straw Proposal includes measures that are likely to enhance the value and fairness of RSE testing.  Implementation of additional revisions and clarifications may be necessary, however, to maximize the likelihood that RSE test results fairly and consistently reflect the contribution of each BAA participating in the Western Energy Imbalance Market (“WEIM”) to the pool of resources available for reliable service to the overall market footprint prior to optimization of economic transfers.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

The Six Cities appreciate and strongly support the CAISO’s effort to address the asymmetry that occurs when HASP exports are supported by advisory WEIM HASP imports but only the export schedules are counted (as CAISO obligations) in the RSE.  Conceptually, the Six Cities support the CAISO’s proposal to count for RSE purposes only such export schedules as the CAISO has confidence it can support and urge the CAISO to implement that concept as promptly as possible. 

However, the detailed approach for implementing this concept remains unclear, potentially giving rise to continuing controversy and unfairness.  It appears, for example, that the CAISO proposes to count as CAISO obligations for RSE purposes exports that satisfy the criteria for High Priority exports (including support from a non-Resource Adequacy resource within the CAISO).  But the CAISO’s proposed treatment of Low Priority (“LPT”) exports is not entirely clear to the Six Cities.  Does the CAISO anticipate a process for classifying individual export schedules and, if so, on what basis?  Or does the CAISO simply propose a volumetric reduction of LPT export schedules equal to advisory WEIM HASP imports?  Such an approach at minimum would appear to address the existing asymmetry in the treatment of exports supported by WEIM HASP advisory imports for RSE purposes and seems straightforward to apply as an interim enhancement to the RSE. 

The timing and triggering conditions for the discounting of LPT exports also is unclear.  Slide 16 in the presentation for the July 11, 2022 stakeholder discussion references discounting of “LPT exports that would cause the CAISO BAA to fail the WEIM RSE.”  It is not clear whether the CAISO plans to discount LPT exports only when it appears that the CAISO BAA is in danger of failing the RSE and, if so, when and how that determination would be made.  The Six Cities request further clarification regarding the process for removing LPT exports from CAISO obligations for RSE purposes.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

Conceptually, it seems clear that a WEIM BAA should not count as a resource available to satisfy its RSE requirements an LPT export schedule from the CAISO that the CAISO does not count as an obligation for RSE purposes.  Symmetrical treatment of export/import schedules for RSE purposes appears essential if RSE results are to provide valid information on overall reliability in the WEIM footprint.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

As noted in response to question 3 above, it seems clear that reliability for the entire WEIM footprint may be reduced if a WEIM entity includes in its base schedule an import from the CAISO or any other BAA that the exporting BAA does not count as an obligation for RSE purposes.  However, based on review of the Energy Imbalance Market Business Practice Manual, it does not appear that the current application of the RSE includes any mechanism to ensure consistency or symmetry in the treatment of imports and exports for RSE purposes.  The evaluation of base schedules appears to be based on internal resource schedules plus net scheduled interchange.  The Six Cities were not able to locate any provision specifying criteria for imports or exports to be counted for RSE purposes or any mechanism for differentiating among interchange schedules.  It is therefore unclear to the Six Cities how the CAISO would plan to discount a base schedule for an importing BAA based on a failure to tag a supporting schedule into a different BAA.  As discussed in response to question 15 below, the Six Cities encourage the CAISO and market participants to focus on developing rules and processes to ensure greater consistency, symmetry, and transparency with respect to resources counted for RSE purposes, but work on such further improvements should not delay implementation of enhancements that can be adopted more quickly, such as symmetrical treatment of export schedules supported by WEIM advisory imports in the HASP.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

The Six Cities do not oppose the CAISO’s proposal to tag LPT exports as firm-provisional energy on an interim basis.  The appropriate treatment of LPT exports should be subject to re-evaluation as part of the comprehensive review of RSE rules recommended in response to question 15 below.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

As discussed above, application of consistent and symmetrical RSE requirements is necessary both to support reliability for the entire WEIM footprint and as a matter of fundamental fairness.  As the market operator, the CAISO should be responsible for reviewing, validating, and potentially discounting interchange supply shown within WEIM entities’ base schedules.  Such responsibility, however, should be exercised in the context of a framework of clearly defined, just and reasonable, and FERC-approved principles generally applicable to all WEIM participants.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

Based on the CAISO’s description of the quantile regression methodology and alternatives, the Six Cities at this time support the CAISO’s recommendation to utilize the mosaic quantile regression method to establish uncertainty requirements for the capacity and flexible ramping RSE tests.  The uncertainty outcomes produced by application of the mosaic quantile regression methodology should be evaluated on a periodic basis to assess the appropriateness of continuing to apply the methodology versus available alternative approaches.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

The Six Cities support the CAISO’s proposal to permanently remove the adder for intertie uncertainty.  As the Six Cities noted in their May 3, 2022 comments in this initiative, the absence of any trends or correlations with overall market conditions or other types of uncertainties demonstrated by the CAISO’s analyses of intertie deviations indicates that an intertie deviation adder is unlikely to contribute meaningfully to improving the accuracy of uncertainty requirements calculations.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

Considering that we are now in the middle of the summer of 2022, the question plainly has been answered by the passage of time.  Nonetheless, it is not unusual to experience stressed system conditions in August, September, and early October.  In light of that potential, the Six Cities support efforts to expedite implementation of energy assistance through the WEIM to the extent possible.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

The Six Cities generally support the proposal to provide an option to cure RSE over and undersupply conditions through the WEIM.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

The Six Cities would support the concept of allowing a BAA to cure undersupply conditions using a hurdle rate set at the bid cap provided that the hurdle rate is applied to the volume of incremental transfers necessary to cure the RSE deficiency and not to all energy supply within the deficient BAA or even all energy transfers into the BAA.  The discussion of the cure option in the Straw Proposal is somewhat ambiguous regarding the volume of energy that would be subject to the hurdle rate.  The Straw Proposal refers to “incremental transfers” (e.g., at the bottom of page 16 and in the first paragraph under Section 5.1.4 on page 19), but the description of the “Insufficiency Energy Revenue Calculation” in Section 5.1.2 refers to application of the hurdle rate “on the transfers into the BAA.”  It is unclear whether that reference to “transfers” means the incremental transfers necessary to cure the BAA’s RSE deficiency or all transfers into the BAA during the period when the hurdle rate has been activated. 

The discussion of the cure option in the July 11, 2022 stakeholder conference, however, indicated that the CAISO plans to apply the proposed hurdle rate not only to all transfers into the deficient BAA but also (at least in the CAISO’s case) to all real-time energy transactions.  The Six Cities strongly oppose applying the hurdle rate to any transfers or real-time energy transactions other than the volume of incremental transfers required to cure an RSE deficiency.  Applying the hurdle rate beyond the volume of incremental transfers necessary to cure an RSE deficiency could result in a minor deficiency imposing astronomical costs on the deficient BAA completely out of proportion to the cost of curing the deficiency.  Such a potential outcome is particularly inappropriate in the absence of clearly defined criteria for counting import and export transactions for RSE purposes and analyses demonstrating that interchange transactions are treated consistently and symmetrically by all WEIM BAAs, as discussed in response to questions 4 and 15. 

Moreover, it appears that the CAISO’s proposed application of the hurdle rate would have a disproportionately adverse impact on the CAISO BAA.  Other WEIM BAAs submit base schedules, and WEIM settlements apply to imbalance energy measured against the base schedules.  As the Six Cities understand the current practice, the CAISO is treated as having zero base schedules, which would suggest that, only for the CAISO BAA, the hurdle rate would be applied to all Real-Time energy. 

Finally, Section 5.1.4 of the Straw Proposal states that the CAISO plans to rely on the bid cap hurdle rate cure option to address RSE failures by the CAISO BAA as a default selection.  The Six Cities strongly oppose that aspect of the Straw Proposal in light of the concerns described above.  Based on those concerns, it is not at all clear to the Six Cities that the bid cap hurdle rate cure option would result in better outcomes for the CAISO BAA than the alternative of limiting WEIM import transfers at the level for the last interval in which the CAISO passed the RSE.  In the absence of a demonstration that the “cure” would not be worse for CAISO customers (and perhaps substantially worse) than the consequences of limiting WEIM import volumes, the Six Cities object to the CAISO’s proposal to embrace the cure by default.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

On a preliminary basis, the Six Cities support Alternative 2 as described at page 19 of the Straw Proposal.  The approach in Alternative 2 appears to appropriately allocate assistance energy revenues to all BAAs that have identified surplus capacity in the WEIM.  The Six Cities do not support the Alternative 1 methodology, because it fails to allocate assistance energy revenues to BAAs that may assist in addressing resource insufficiency by reducing imports.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

The Six Cities do not oppose the CAISO’s proposal to relax export limitations for a BAA that has failed the downward flexible ramping sufficiency test using a hurdle rate set to $0.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

There are no conditions identified in question 8 that appear relevant to the basic question.  Assuming that the reference is to system oversupply conditions discussed in question 13, the Six Cities have reservations about applying different consequences for failure of the upward flexibility test depending on the status of other WEIM BAAs.  Recognizing the potential desirability of allowing a deficiency in downward flexibility in one BAA to offset a deficiency in upward flexibility in another BAA, it is not clear that such an approach necessarily would produce intended beneficial consequences since the RSE does not test for deliverability.  It would appear that deliverability constraints could lead to an outcome of simultaneous undersupply in one BAA and oversupply in a different BAA.  The Six Cities also are concerned about adverse incentives arising from inconsistent treatment of deficiencies in upward flexibility.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

As a result of recent focus on the treatment of interchange transactions for RSE purposes, both in this initiative and in workshops in the Extended Day-Ahead Market (“EDAM”) initiative, the Six Cities are persuaded that elements of the current WEIM RSE process are unclear and potentially unreasonable.  Utilization of net scheduled interchange for evaluation of WEIM entity base schedules, as described in response to question 4, provides no information on the nature of the imports and exports that comprise the net schedules and, therefore, no basis for assessing the probability that the net interchange amounts would be available to serve load in real time.  Moreover, in the absence of clear criteria for determining whether to include or exclude interchange transactions for RSE purposes, figures for net scheduled interchange likewise provide no assurance that base schedules submitted by WEIM entities provide comparable assurance of resource sufficiency. 

Discussions in workshops concerning RSE design for the EDAM have addressed proposed criteria for the types of interchange transactions that should be reflected in the RSE evaluation, although the Six Cities do not believe that a consensus regarding appropriate criteria has yet emerged.  Although implementation details may vary to adapt to different market or business models, principles for assessing RSE performance should be applied consistently and symmetrically.  The Six Cities urge the CAISO to implement the WEIM RSE enhancements identified in this initiative as promptly as possible (subject to appropriate application of the hurdle rate as discussed in response to question 11) but also continue efforts in the EDAM initiative to improve consistency and transparency.

1. Please provide a summary of your organization’s comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal and July 11, 2022 stakeholder call discussion:

Please see attachment.

2. Provide your organization’s comments on the proposal to align the ISO BAA WEIM RSE obligations with those of other EIM participating BAA’s, specifically the ISO’s proposal to only count export schedules it can confidently support:

Please see attachment.

3. Provide your organization’s comments on the proposal to adjust a WEIM BAA’s ability to show low priority exports on a base schedule; if the ISO BAA has the low priority exports removed from its WEIM RSE obligation:

Please see attachment.

4. As discussed on the stakeholder call, the ISO would look to discount from its WEIM RSE obligations low priority exports that may have been supported by an import schedule that was ultimately not tagged. The tag information is not known until T-40. Do WEIM entities believe that discounting the ability to count these low priority exports in their base schedules is appropriate? Does the window between the existing T-40 RSE and the proposed binding T-30 RSE provide sufficient time to update base schedules?

Please see attachment.

5. Provide your organization’s comments on the ISO’s proposal to change the tagging rules for low priority exports:

Please see attachment.

6. Provide your organization’s comments on whether it is it appropriate for the ISO as the market operator to validate, review and potentially discount interchange supply shown within an WEIM BAA’s base schedule based upon the e-tags that support the shown interchange:

Please see attachment.

7. Provide your organization’s comments on the ISO’s proposal to utilize the quantile regression methodology to inform the uncertainty requirement that is tested for in the WEIM RSE’s capacity and flexible ramping sufficiency tests:

Please see attachment.

8. Please provide your organization’s input on the ISO's proposal to permanently remove the adder for intertie uncertainty:

Please see attachment.

9. Please provide your organization’s input the potential to implement energy assistance through the WEIM prior to summer 2022:

Please see attachment.

10. Please provide your organization’s input on the ISO’s proposal to modify the consequences of failing the WEIM RSE to provide the opportunity to cure over and undersupply conditions through the WEIM:

Please see attachment.

11. Provide your organization’s comments on the ISO’s proposal to cure undersupply conditions using a hurdle rate set at the bid cap:

Please see attachment.

12. Provide your organization’s comments on the ISO’s proposed revenue allocation for assistance energy revenue:

Please see attachment.

13. Provide your organization’s comments on the ISO’s proposal to relax export limitations for an EDAM BAA that has failed the flexible ramping sufficiency test using a hurdle rate set to $0:

Please see attachment.

14. Provide your organization’s comments on relaxing import limitations to a BAA that has failed the WEIM RSE in the upwards direction while the conditions in question 8 have been met:

Please see attachment.

15. Provide any additional comments on the WEIM Resource Sufficiency Evaluation Enhancements Phase 2 straw proposal or July 11, 2022 stakeholder call discussion:

Please see attachment.