Comments on Draft Tariff Language

2. Include redlined comments in word version of the tariff language posted on the initiative webpage and attach below.

The language below (section v), as drafted, seems to imply that the supporting resource must Self-Schedule.  I do not think that is the intent, hence the suggested modification.  Also, I can see circumstances where the SC for the supporting resource is different than the SS export, hence a couple more suggestions.  

In our comments on policy, btw, we suggest that this attestation is inapt.  

"The Scheduling Coordinator is attesting that its supporting resource is reasonably expected to be available and provide the same MWh quantity for each of four (4) fifteen (15)-minute intervals in the applicable Trading Hour for which it submitted its is used to support an export Self-Schedule based on all information that is known or should have been known to the Scheduling Coordinator at the time of the submission."

2. Include redlined comments in word version of the tariff language posted on the initiative webpage and attach below.

Idaho Power Company does not object to CAISO’s proposal to provide make-whole payments for real-time hourly block imports during tight system conditions.  However, Idaho Power is opposed to CAISO’s proposal to allocate the uplift costs of those payments to EIM transfers out of CAISO.  Idaho Power’s position is described in its comments on the Market Enhancements for Summer 2021 Draft Final Proposal, which were submitted on 2/26/2021 and are incorporated by reference here.  Idaho Power proposes the attached redlines to CAISO’s proposed tariff language to remove EIM transfers out from the allocation of those costs.

2. Include redlined comments in word version of the tariff language posted on the initiative webpage and attach below.

PG&E appreciates the opportunity to provide initial feedback on the draft tariff language for the Market Enhancements for Summer 2021 Readiness initiative.  We note, however, that elements of the draft final proposal and related tariff language are not fully developed at this time.  It is our understanding that the CAISO will soon be announcing revisions to the policy document and tariff language for the exports, load, and wheeling priorities topic.  PG&E looks forward to further stakeholder engagement with the CAISO to clarify the policy proposals before tariff changes are further discussed.   

PG&E is still reviewing the impacts of the proposed tariff language (on the topics other than the export, load, and wheeling topic), but offers the following comments as our initial response.

EIM coordination and Resource Sufficiency Test

1. Adding the Uncertainty Requirement to the Capacity Test

The CAISO proposes to add the Uncertainty Requirement from the flexible ramping product to the supply requirement in the bid-range capacity test.  PG&E notes its concern that the Uncertainty Requirement calculation referenced in the tariff revisions is in the process of being updated due to concerns that it does not consider forecasted loads and conditions affecting variable energy resources on the operating day and may set an inappropriately high requirement.

The Market Surveillance Committee’s (MSC) March 2, 2021 opinion expresses similar concern with implementing the proposed change this summer and the potential for unintended consequences.  The MSC noted that unintended sufficiency test failures could occur  if the current Uncertainty Requirement calculation remains in place and is added to the capacity test requirement.[1]  The MSC further recommended that CAISO “retain the ability to switch this feature off on short notice if it becomes apparent that it is operating in a manner materially different than intended.”  As such, PG&E recommends adding tariff language in Section 29.44(l) to allow the CAISO to suspend this requirement if it produces unintended adverse outcomes.

2. Clarification of the phrase “the CAISO equivalent”

The phrase “or the CAISO equivalent” is added four times in the draft tariff language immediately following the phrases “EIM Resource Plan” and ”EIM Base Schedules.”  The definition of this phrase has not been explained in the draft policy proposal or other policy documents.  PG&E seeks clarification of the meaning of the phrase “or the CAISO equivalent” and requests additional tariff language specifying that this phrase will be further defined in the business practice manuals.    Suggested tariff revisions are included below.

3. Symmetry between the EIM Entity BAAs and the CAISO BAA

The draft tariff language inserts the phrase “the CAISO Balancing Authority Area / BAA” in eight instances immediately following the phrase “EIM Entity BAA” in Sections 29.34(m) and 29.34(n).  It is our understanding from the CAISO stakeholder call that the intent of this language is to create symmetry in the tariff between the CAISO BAA and EIM Entity BAAs.  These new tariff references do not appear to be discussed in the draft final proposal or other policy documents, however.  PG&E requests further explanation of the practical impacts of these changes.

Please see PG&E’s proposed edits in blue font below.

(l) EIM Resource Plan Evaluation

1. The EIM Base Schedules for resources included in the EIM Resource Plan must balance the Demand Forecast for each EIM Entity Balancing Authority Area and the Uncertainty Requirement determined in accordance with Section 44.2.4 and for the CAISO Balancing Authority Area the RUC Schedules, the HASP Advisory Schedules and HASP Intertie Block Schedule or the FMM Schedules, as applicable and as detailed in business practice manuals, must balance the Demand Forecast and Uncertainty Requirement determined in accordance with Section 44.2.4 
2. Insufficient Supply.  An EIM Resource Plan or the CAISO equivalent shall be deemed to have insufficient Supply if the sum of EIM Base Schedules from non-participating resources and the sum of the highest quantity offers in the Energy Bid range from EIM Participating Resources, including Interchange with other Balancing Authority Areas, is less than the total Demand Forecast that the EIM Entity Scheduling Coordinator has decided to use for the associated EIM Entity Balancing Authority Area and the Uncertainty Requirement determined in accordance with Section 44.2.4, and for the CAISO Balancing Authority Area the RUC Schedules, the HASP Advisory Schedules and HASP Intertie Block Schedules or the FMM Schedules, as applicable and as detailed in business practice manuals, are less than the total Demand Forecast and the Uncertainty Requirement determined in accordance with Section 44.2.4.
3. Excess Supply.  An EIM Resource Plan or the CAISO equivalent shall be deemed to have excessive Supply if the sum of EIM Base Schedules from non-participating resources and the sum of the lowest quantity Bids in the Energy Bid range from EIM Participating Resources is greater than the total Demand Forecast that the EIM Entity Scheduling Coordinator has decided to use for the associated EIM Entity Balancing Authority Area plus the Uncertainty Requirement determined in accordance with Section 44.2.4, and for the CAISO Balancing Authority Area the RUC Schedules, the HASP Advisory Schedules and HASP Intertie Block Schedules or the FMM Schedules, as applicable and as detailed in business practice manuals, are greater than the total Demand Forecast and the Uncertainty Requirement determined in accordance with Section 44.2.4.

Reliability Demand Response Dispatch

PG&E does not have specific concerns with the tariff language for RDRR.  However, PG&E continues to be concerned with how the tariff language will be implemented and requests this be clarified before CAISO files its tariff at FERC and prior to the BRS process.  As mentioned in previous comments, the CAISO has not provided enough examples of what limitations might be in place and illustrations of how this will work. Without examples, PG&E’s concern is that pulling RDRR into the RTPD may mean that some designations in the master file (e.g., start up time, ramp rate, long start vs. short start) may not be respected. PG&E is concerned that if there are limitations and parameters are not carried forward in RTPD that infeasible dispatches could occur or that the dispatch would not align with the Base Interruptible Program’s retail tariff requirement for a 30 minute notification time.”

Scarcity pricing enhancements: Energy Bids from Operating Reserves when Arming Load to Meet Reserves

PG&E reiterates the key concerns noted in our comments on the draft final proposal’s real-time scarcity pricing enhancements.  We request the CAISO confirm that our understanding of the policy proposals is correct and consistent with the tariff language.  

1. Difference between current practice and the proposed change

1. In the current practice, the operators will release the contingent non-spin reserve at the maximum bid price and the non-contingent non-spin at the original bid price through RTCD, during load arming.  The proposed enhancement is focused on the non-contingent non-spin and the price at which it will be released would be the maximum bid cap price. 

2. The visibility of bids

1. While not stated in the proposal or the Tariff, the CAISO will release all of its contingent and non-contingent non-spin reserves if arming load during an EEA3 emergency. Releasing the full set of the non-spin reserves will be based on the fact that CAISO has been successful in securing enough load that could be armed, i.e., the total amount of load armed is at least as much as the non-spins released.
2. Assuming the facts in 2(a) above, the proposed enhancement will not change the releasing order of the reserves’ bids.  However, it could change the dispatch order of the released reserves, because a resource of a lower bid price may have a higher or equal bid cap price in the bid stack.
3. During load arming, the reserve resources will be released at their bid cap price in the scheduling run in RTCD, wherein their schedule is determined, and their price is determined in the pricing run if dispatched.  PG&E further requests that CAISO confirm that all the bids will be transparent to market participants.   

3. Impact on price formation

1. Under the proposed enhancement, the real-time price could rise to $2,000/MWh under any of the following conditions once Order 831 becomes effective: (i) the power balance constraint is violated, (ii) contingency only reserves are released under a contingency through RTCD, and (iii) contingent and non-contingent non-spins are dispatched after being released during load arming.

4. Impact on reliability

1. It is possible that a contingency may trigger an EEA3 emergency. In such a case, according to the Tariff, if the CAISO chose to arm load, it would automatically release all the contingent and non-contingent reserve, and the armed load would be called for shedding due to the contingency.  Based on our understanding in 3 above, such a procedure will expose customers to high prices ($2,000/MWh) while simultaneously losing load.  PG&E urges the CAISO to consider such scenarios and design hedges accordingly.

[1] Members of the Market Surveillance Committee of the California ISO.  “Opinion on Market Enhancements for Summer 2021 Readiness.” Published March 3, 2021. http://www.caiso.com/Documents/MSCOpiniononMarketEnhancementsfor2021SummerReadiness-Mar8_2021.pdf

2. Include redlined comments in word version of the tariff language posted on the initiative webpage and attach below.

Salt River Project Agricultural Improvement and Power District (SRP) appreciates the opportunity to comment on the CAISO’s draft tariff language for market enhancements for summer 2021 readiness. Based on information shared verbally by CAISO staff during the February 26 web conference to discuss the draft tariff language, SRP understands there will be a future opportunity to comment on export and load scheduling priorities portions of the tariff language; therefore, the following comments focus only on other sections of the tariff. As described in comments submitted on February 26, SRP has significant concerns with the proposed changes to export and load scheduling priorities articulated in the February 18, 2021 Draft Final Proposal and appreciates CAISO considering those comments and offering a further opportunity to review the export and load scheduling priorities tariff language.

SRP proposes the following changes to ensure additional hourly capacity requirements are applied to the CAISO and EIM Entities.

Proposed Changes to the RSE (Capacity Test)

29.34    EIM Operations

 (l)        EIM Resource Plan Evaluation.

(4)        Additional Hourly Capacity Requirements.

(A)        In General.  If the CAISO determines under the procedures set forth in the Business Practice Manual for the Energy Imbalance Market that a Balancing Authority Area in the EIM Area or the CAISO Balancing Authority Area has historically high import or export schedule changes between thirty minutes and twenty minutes before the start of the Trading Hour, the CAISO will add to the Balancing Authority Area in the EIM or CAISO Area’s capacity requirements an additional requirement.

(B)        Additional Capacity Requirement.  On a monthly basis, according to procedures set forth in the Business Practice Manual for the Energy Imbalance Market, the CAISO will calculate for each Balancing Authority Area in the EIM Area and the CAISO Balancing Authority Area histograms of the percentage of the difference between imports and exports scheduled at thirty minutes before the start of the Trading Hour and the final imports and exports at twenty minutes before the start of the Trading Hour based on the submitted E-Tags at those times and calculate additional upward and downward requirements for the capacity test component of the resource sufficiency evaluation.

2. Include redlined comments in word version of the tariff language posted on the initiative webpage and attach below.

SCE has one proposed change and one clarifying question.

Proposed change –

The calculation stated in Section 11.21.3.1 seems inaccurate or ambiguous. The word “price”, as shown below, seems missing from the draft tariff language. Without specifying bid price, “bid” used in the section could refer to a bid quantity which would be incorrect. Below is a proposed change, shown as bold and underlined .

11.21.3.1 Calculation of Make Whole Payments

The CAISO will calculate an hourly make whole payment for each HASP Block Intertie Schedule based upon the FMM Optimal Energy above a Scheduling Coordinator’s import Day-Ahead Scheduled Energy or as FMM Optimal Energy below a Scheduling Coordinator’s export Day-Ahead Scheduled Energy.  The make-whole payment will equal the positive difference between the Scheduling Coordinator’s HASP Block Intertie Schedule bid price and the relevant hourly average FMM LMPs for the applicable Trading Hour multiplied by the FMM Optimal Energy delivered by the HASP Block Intertie Schedule during that Trading Hour. 

Clarifying question –

Section 34.10 references to Section 39.6.1, which describes the concept of offer cap. The CAISO should consider whether the reference to Section 39.6.1 here is sufficient to address the applicability of different offer caps under Order No. 831 which is covered in a different section (Section 30[1]).

34.10 Dispatch of Energy from Ancillary Services

…If Contingency Only reserves are dispatched through the RTCD, which as described in Section 34.5.2 only Dispatches in the event of a Contingency, such Dispatch and pricing will be based on Energy Bids using maximum Bid prices as provided in Section 39.6.1.

[1] See, e.g., Feb 22, 2021 CAISO Tariff Amendment – Price Parameters – FERC Order No. 831 (ER21-1192), available at, http://www.caiso.com/Documents/Feb22-2021-TariffAmendment-PricingParameters-OrderNo831-ER21-1192.pdf.