[00:00:04]
[*A portion of this meeting is unavailable*]
[12. ERCOT Reports]
SERVICES IN THE ERCOT MARKET.OUR STUDY IS FOCUSING ON THE KIND OF LONGER TIME, UH, RESPONSE PRODUCTS.
SO WE'RE NOT REALLY LOOKING TOO DEEP INTO PFR OR REGULATION, AND RATHER ARE FOCUSING ON THINGS LIKE ECRS NON SPEND AND TRYING TO GET KIND OF A GROUNDWORK LAID FOR WHAT WE THINK DRRS COULD BE AS A PRODUCT.
UH, THE GIST OF THE EXERCISE IS WE HAVE, UH, A YEAR'S WORTH OF HISTORICAL HOURS AND WE TAKE THE CONDITIONS FROM THOSE HISTORICAL HOURS, BUT THEN STOCHASTICALLY INPUT PROBABILITIES FOR OUTAGES OR FORECAST ERROR AND THEN DETERMINE HOW MANY MEGAWATTS COULD HAVE BEEN AT RISK OF AN OUTAGE IF THE OUT, IF THE UNPLANNED OUTAGES OR FORECAST ERROR WERE REALLY SEVERE.
UH, WE ARE USING HISTORIC HOURS FROM LAST JUNE TO, UH, THIS JUNE AS OUR CASES.
AND SO IF WE WANT TO GO TO THE NEXT SLIDE JUST FOR A LITTLE DETAIL ON HOW ALL THIS WORKS.
UH, UNIT TRIPS ARE BASED ON KIND OF HISTORICAL DATA ON UNIT TRIPS ON A RESOURCE BASIS.
SO UNITS KIND OF HAVE, THERE'S DATA ON HOW MANY HOURS A UNIT TENDS TO OPERATE BEFORE IT EXPERIENCES AN UNPLANNED OUTAGE.
SIMILARLY, WE HAVE KIND OF REGRESSION MODELING ON NET LOAD FORECAST ERROR, WHERE THE FORECAST LEVEL FOR WIND, SOLAR, AND LOAD ALL CONTRIBUTE TO A DIFFERENT OUTCOME IN TERMS OF NET LOAD FORECAST ERROR.
WE CAN LOOK AT THESE THINGS ON DIFFERENT TIME HORIZONS.
SO IF WE'RE LOOKING AT A PRODUCT THAT NEEDS TO ACCOUNT FOR 10 MINUTE UNCERTAINTY VERSUS TWO HOUR UNCERTAINTY, YOU'RE GOING TO GET DIFFERENT DISTRIBUTIONS OF THINGS.
UH, AND THEN EACH HOUR IN THE STUDY, WE'RE RUNNING 10,000 ITERATIONS, AND IF WE HAVE GREATER MEGAWATTS AT RISK DUE TO OUTAGES OR NET FOR NET LOAD FORECAST ERROR, THEN WE HAVE RESERVES ABLE TO RESPOND TO THAT RISK.
THAT IS WHERE YOU GET AN OUTAGE.
AND SO OUT OF THOSE 10,000 ITERATIONS, YOU'RE GONNA HAVE SOME NUMBER OF OUTAGES, AND WE'RE TREATING THAT AS THE PROBABILITY OF AN OUTAGE.
SO IF YOU HAD, UH, YOU KNOW, UH, 1000 OUTAGES OUT OF THE 10,000, THAT WOULD BE A 10% PROBABILITY OF OUTAGE IN THAT HOUR.
AND THEN ONCE YOU HAVE, YOU KNOW, A FULL YEAR'S WORTH OF HOURS, YOU CAN ESTIMATE LIKE AN LOLP ON AN ANNUAL BASIS BASED ON THAT INFORMATION.
UH, WE ARE MAKING VERY GOOD PROGRESS.
I'VE GOT A FEW DIFFERENT PEOPLE WORKING ON THIS AND WE'RE DOING A REALLY GOOD JOB SO FAR.
UH, YOU KNOW, SOME OF THE THINGS THAT HAVE BEEN INTERESTING TO WORK WITH ARE HOW WE'RE HANDLING BATTERIES.
UH, THAT HAS BEEN A, A WHOLE UNIQUE THING, HOW WE ARE LOOKING AT DIFFERENT KIND OF TIME HORIZONS WITH THE OFFER STACK AS FAR AS THE LEAD TIME, CERTAIN KIND OF UNITS NEED TO BE COMMITTED, ALL SORTS OF INTERESTING PROBLEMS. AND WE'LL BE LOOKING FORWARD TO PRESENTING MORE INFORMATION ON THIS, I THINK AT THE AUGUST ATTACK OR SOMETIME AROUND THEN.
SO, ANY QUESTIONS? YES, WE HAVE A QUESTION FROM BRIAN STAN.
YEAH, I SEE THAT, UH, TBD WE ARE THINKING ABOUT IT, BUT WE ARE NOT DOING ANYTHING WITH FUTURE LOAD FORECASTS AT THE MOMENT.
UM, MY QUESTION IS MORE PROCEDURAL AND IT'S, UH, HOW CLOSELY ARE YOU WORKING WITH ERCOT AND THE PUC ON THIS ANALYSIS? ARE YOU WORKING HAND IN HAND WITH THEM AS YOU'RE PERFORMING THIS OR ARE YOU KIND OF WORKING ON YOUR OWN TO PROVIDE THAT INFORMATION DOWN THE ROAD? THANKS.
YEAH, I'D, I'D KIND OF SOMEWHERE BETWEEN ON OUR OWN AND HAND IN HAND.
WE ARE COORDINATING WITH THEM PRETTY REGULARLY AND, UH, DISCUSSING OUR METHODOLOGY WITH THEM AND GETTING FEEDBACK ON A, YOU KNOW, MAYBE A MONTHLY BASIS.
AND THEN I'M IN CONTACT WITH PEOPLE AT ARCOT PRETTY REGULARLY EITHER FOR INPUTS, SO THERE'S VARIOUS THINGS WE'RE LOOKING AT WHERE WE'RE TRYING TO FIGURE OUT WHAT KIND OF DATA WE CAN GET OUR HANDS ON, OR JUST MAKING SURE EVERYONE'S COMFORTABLE WITH THE CONCEPTS.
AND SO WE'VE HAD A LOT OF INTERACTIONS WITH ERCOT SO FAR, AND THE POC IS KIND OF COORDINATING A LOT OF THOSE INTERACTIONS.
I, I THINK THAT'S JUST CRITICALLY IMPORTANT THAT WE MAINTAIN UPFRONT
[00:05:01]
COLLABORATION.'CAUSE WE'VE SEEN A LOT OF EXAMPLES RECENTLY WHERE WE DIDN'T, AND THAT MADE ISSUES MUCH MORE DIFFICULT.
AND THIS IS ON SUCH AN EXTRAORDINARILY TIGHT TIMELINE AND ERCOT IN ITS METHODOLOGY IN ITS TRADITIONAL ANNUAL METHODOLOGIES USING A DIFFERENT APPROACH.
AND SO IF WE'RE GONNA BRING THOSE APPROACHES TOGETHER, WE REALLY NEED TO HAVE A LOT OF SHARED INFORMATION UP FRONT.
AND I SEE JEFF, UH, SANCTIONS MY CHARACTERIZATION OF OUR INTERACTION, SO I APPRECIATE THAT.
UH, THE TIMELINE IS DEFINITELY A CHALLENGE AND IF ANYONE HAS THOUGHTS ABOUT MORE WORK WE COULD BE DOING, I WOULD SIMPLY PUSH BACK BASED ON THE TIMELINE.
AND SO WE ARE DOING, WE ARE TRYING TO TRIAGE THIS TO DO THE BEST STUDY THAT WE CAN, GIVEN THE RELATIVELY LIMITED AMOUNT OF TIME WE HAVE TO DO ONE.
AND SO THAT ULTIMATELY MEANS, YOU KNOW, PRIORITIZING WHAT WE CAN, GETTING THE RESULTS THAT WE CAN, AND THEN FIGURING OUT WHAT THINGS HAVE TO BE LEFT FOR FUTURE WORK.
UH, BECAUSE THERE'S A LOT OF INTERESTING THINGS WE COULD LOOK AT THAT THE TIME AVAILABLE TO US DOESN'T NECESSARILY ALLOW.
YEAH, APOLOGIZE, I COULDN'T GET OFF MUTE FAST ENOUGH.
UM, ANDREW, YOU SAID YOU'RE NOT LOOKING, OR YOU'RE NOT TRYING TO INCORPORATE FUTURE LOAD FORECAST INTO THIS ANALYSIS.
UM, I GUESS I, I JUST WOULD APPRECIATE YOUR, YOUR POINT OF VIEW ON, YOU KNOW, CHANGE IN RISK IF THE, UH, TYPE OF LOAD FORECAST THAT, THAT WE'VE SEEN IN SOME OF THE RESOURCE ADEQUACY REPORTS IS, UM, YOU KNOW, COMES TO FRUITION.
YEAH, I MEAN, IT'S A HARD THING TO SAY BECAUSE IF WE WANTED TO LOOK AT FUTURE LOAD FORECASTS GIVEN THIS KIND OF STUDY, WE WOULD ALSO NEED TO HAVE A VIEW ON THE FUTURE SUPPLY STACK.
UM, SO THAT COULD GET PRETTY WEIRD.
AND THEN LIKE WHERE DIFFERENT RESOURCES ARE, I MEAN, THESE ARE, THIS STUDY'S DONE ON A RESOURCE BASIS, AND SO IT COULD GET A LITTLE WEIRD AS FAR AS SOMETIMES THERE'S LOAD FORECASTS, UH, WHAT ARE THEY DOING ON AN HOURLY BASIS, FOR EXAMPLE, LIKE IF WE'RE TALKING ABOUT A LOT OF LFL STUFF, WHAT WOULD WE BE PLUGGING IN AS FAR AS THEIR HOURLY LOAD PROFILE VERSUS JUST SCALING UP THE PEAK LOAD? AND SO THOSE ARE ALL INTERESTING THINGS THAT I DO THINK ULTIMATELY THE AS METHODOLOGY SHOULD ACCOUNT FOR.
BUT GIVEN WHERE WE ARE IN THE PROCESS NOW, IT'S HARD TO SEE HOW WE COULD INCORPORATE THAT INTO THE STUDY WE HAVE, LIKE THE MODEL WE HAVE SO FAR.
I, I, I JUST, UM, YOU KNOW, YOU, YOU SPECIFY THE QUANTITIES IN ADVANCE THAT YOU PLAN TO BUY AND IT JUST FEELS LIKE THE, THE SHOULD TRY AND MATCH THE RISK PROFILE.
UH, BUT I LOOK FORWARD TO, TO SEEING WHAT YOU GUYS COME UP WITH, UM, AND APPRECIATE THE WORK.
YOU KNOW, YOU MENTIONED ANOTHER POINT THAT I DON'T KNOW HOW FAR ALONG WE'RE GONNA GET ON IT BECAUSE IT IS A COMPLICATED THING TO TRY TO SORT OUT, BUT WE ARE INTERESTED IN EVALUATING THE EFFECTIVENESS OR EFFICIENCY GAINS YOU COULD GET FROM HAVING A MORE DYNAMIC AS PLAN.
AND THAT'S SOMETHING WE'VE TALKED ABOUT WITH ERCOT THAT IS VERY BETA LEVEL AS FAR AS WE, WE REALLY JUST IN THE EARLY STAGES OF FIGURING OUT HOW YOU WOULD EVEN CALCULATE SOMETHING LIKE THAT.
BUT THAT IS AN EXAMPLE WHERE CONCEPTUALLY WE THINK THERE'S A LOT OF OPPORTUNITY THERE AND IT WOULD JUST BECOME A FUNCTION OF WHAT ARE THE EFFICIENCY GAINS YOU CAN GET VERSUS THE KIND OF LACK OF CERTAINTY AND LACK OF, UH, HEDGE ABILITY, LACK OF LIQUIDITY THAT LOAD MIGHT BE CONCERNED ABOUT.
AND SO THAT'S SOMETHING WE'RE LOOKING INTO, BUT IT'S, IT'S AT A VERY KINDA LIKE LOOKING CONCEPTUALLY AT IT STAGE RATHER THAN DOING A MORE FULL BLOWN STUDY.
I SAW THAT IN JEFF'S, UH, PRESENTATION AS THE SECOND RECOMMENDATION THAT THEY'RE THINKING THROUGH.
SO I, I, I'LL WAIT FOR JEFF TO TALK ABOUT THAT, BUT UH, I DO WANNA UNDERSTAND THAT BETTER TOO.
ANY MORE QUESTIONS OR COMMENTS? OKAY, I SEE A COUPLE IN THE QUEUE.
UM, BILL BARNES THAN ALICIA, THEN NED I THINK IS THE CORRECT ORDER.
[00:10:01]
AHEAD, BILL.YEAH, ANDREA HAD A QUESTION ON EACH SLIDE.
LET'S START WITH THE SLIDE TWO.
IT'S REALLY MORE ABOUT KIND OF THE GOAL, UH, IN YOUR OBJECTIVE, YOU SAY ESTIMATE THE ROLE RELIABILITY VALUE.
I'M CURIOUS WHAT TYPE OF RELIABILITY YOU'RE FOCUSED ON HERE.
ARE YOU, IS IT OPERATIONAL RELIABILITY AND MEETING REAL TIME NEEDS OR RESOURCE ADEQUACY OR, BUT THEY KIND OF BLEND TOGETHER.
UM, KIND OF TO BRIAN'S POINT, WHEN YOU START ADDING LOAD, RIGHT? YOU'RE, YOU'RE GONNA HAVE AN OPERATIONAL RELIABILITY PROBLEM WAY MORE FREQUENTLY 'CAUSE OF A 'CAUSE OF RESOURCE ADEQUACY.
SO I'M JUST, HOW ARE YOU THINKING ABOUT THE, THE QUOTE RELIABILITY VALUE OF THE STUDY YOU'RE DOING? YEAH, THE RELIABILITY VALUE IS BASICALLY ON THE MARGIN.
HOW MUCH MORE OR LESS LIKELY ARE YOU TO HAVE A PROBABILITY OF OUTAGES GIVEN HOW MUCH CAPACITY YOU HAVE IN RESERVE TO RESPOND TO DIFFERENT TYPE OF EVENTS? AND WHEN I SAY DIFFERENT TYPE OF EVENTS, I SPECIFICALLY MEAN EVENTS THAT HAPPEN IN 10 MINUTES AND NEED TO BE FILLED IN VERY QUICKLY VERSUS EVENTS THAT ARE HAPPENING OVER A TWO HOUR HORIZON OR SOMETHING LIKE THAT.
AND SO THERE ARE HOURS WE LOOK AT WHERE THE AMOUNT OF SAY ECRS WE HAVE IN THE SYSTEM, OR THE AMOUNT OF NONS SPIND WE HAVE IN THE SYSTEM, THERE'S REALLY NO MARGINAL LIABILITY VALUE FOR THE LAST THOUSAND MEGAWATTS OF THAT RESERVE CAPACITY.
AND SO THAT WOULD SUGGEST THAT YOU COULD REDUCE THE AMOUNT OF THAT RESERVE THAT YOU'RE PROCURING FOR A LOT OF SITUATIONS.
SO MORE SPECIFIC, I GUESS IS HOW MUCH OF A COST ELEMENT ARE YOU CONSIDERING HERE? LIKE ARE YOU LOOKING AT EFFICIENCY, LIKE FOR EXAMPLE, THERE'S, THERE'S THE, THE OBJECTIVE OF AVOIDING LOAD SHED, THEN THERE'S THE, THE OBJECTIVE OF ACTUALLY LOWERING SYSTEM COSTS BY HAVING CERTAIN RESOURCES AVAILABLE, UH, FOR, FOR REALTIME DISPATCH VERSUS BEING, YEAH.
YEAH, SO THIS IS ENTIRELY LOOKING AT THE PROBABILITY OF OUTAGES AND WE'RE NOT DOING LIKE PRODUCTION COST MODELING ASPECT TO THIS.
SO THE, THE WAY THE PRICE IS CLEAR AND STUFF LIKE THAT IS NOT INCLUDED IN THIS STUDY.
AND THEN ON THE NEXT SLIDE, I MIGHT AS WELL PLUG ONE OF MY CONCERNS WITH THE EXISTING METHODOLOGY HERE.
UH, YOU NOTE NET LOAD FORECAST ERROR AND OUTAGE RISK, BUT I'M REALLY MORE INTERESTED IN NET LOAD FORECAST OR FUNCTIONS OF TIME HORIZON.
AND I'M WONDERING, UM, IT LOOKS LIKE YOU'RE FOCUSED ON 10 MINUTES AHEAD VERSUS TWO HOURS AHEAD, ONE OF YOUR THERE OR IN BETWEEN.
THAT WAS JUST AN EXAMPLE OF, YOU KNOW, A CRS IS MEANT TO BE LIKE A 10 MINUTE PRODUCT VERSUS SOMETHING LIKE DRS NEEDS TO BE ABLE TO RESPOND WITHIN TWO HOURS OR SOMETHING LIKE THAT.
AND I THINK, UH, ALICIA IS NEXT.
YEAH, CAN YOU HEAR ME OKAY? I CAN.
UM, YEAH, SO YOU KNOW, YOU MENTIONED, UH, THAT THE TIMEFRAME IS NOT ALLOWING YOU ALL TO KIND OF TAKE A LOOK AT A COUPLE OF INTERESTING THINGS.
WHAT, WHAT DO YOU REALLY FEEL LIKE IS BEING LEFT OUT HERE THAT A LITTLE MORE TIME MIGHT GIVE YOU? HOW MUCH TIME MIGHT THAT BE AND WHAT ARE YOUR KIND OF TOP THREE OR SO ITEMS THAT YOU REALLY THINK SHOULD BE INCLUDED HERE? THIS IS DEFINITELY, UH, THE KIND OF QUESTION THAT'S GOING TO GET ME IN TROUBLE IF I ANSWER IT THE WAY THAT I WANT TO ANSWER IT.
AND SO I THINK I'M GONNA NEED TO BE VAGUE AND, YOU KNOW, I MENTIONED THE DYNAMIC AS CONCEPT AND AS FAR AS THINGS THAT, HOW DEVELOPED THE CONCEPT IS VERSUS HOW CONSEQUENTIAL IT COULD BE IS AN EXAMPLE OF SOMETHING THAT HAVING TIME TO DO A STUDY LIKE THAT SPECIFICALLY COULD BE REALLY VALUABLE.
UH, SO THAT IS AN ANSWER THAT I THINK WE'VE TALKED ABOUT WITH ERCOT AND I, I DON'T THINK I'M GOING TOO FAR OUT OF LEFT FIELD BY USING THAT EXAMPLE.
DON'T WANNA GET ANYBODY IN TROUBLE.
NOBODY WANTS TO GET ANYONE IN TROUBLE.
UH, NED AND THEN SEAN, GO AHEAD NED.
THANKS CAITLIN, AND THANKS ANDREW.
UM, I I WANTED TO TRY TO MAKE SURE I WAS UNDERSTANDING THE, THE FRAMING OF THE, UM, THE MONTE CARLO SIMULATION CORRECTLY.
[00:15:01]
87, 80 8 MILLION, UH, ITERATIONS ACROSS THE ENTIRE STUDY PERIOD? AND AND WHAT ARE YOU VARYING WITH THE RANDOM DRAWS BETWEEN? YEAH.IS THAT, IS THAT WEATHER, WIND, SOLAR OUTAGES, ALL ALL OF THOSE THINGS JUST KIND OF COMBINED TOGETHER? CORRECT.
SO EACH HOUR IS TREATED INDEPENDENTLY, UH, AND EACH HOUR HAS 10,000 DRAWS.
AND WITH 87 60 HOURS YOU GET THE NUMBER YOU SAID.
AND WHAT IS VARYING IS WHETHER OR NOT OUTAGES OR FORECAST ERROR OCCURRED DIFFERENTLY THAN IT OCCURRED IN REAL TIME BASED ON THE UNDERLYING PROBABILITIES OF THOSE THINGS.
AND SO, YOU KNOW, YOU HAVE A VERY TIGHT HOUR, FOR EXAMPLE, AND EVERYTHING WAS FINE BECAUSE THERE WEREN'T A LOT OF OUTAGES, BUT THERE WAS SOME PROBABILITY THAT A PLANT COULD HAVE TRIPPED AT THAT TIME.
AND SO THE RESULT YOU'LL SEE IN AN HOUR LIKE THAT IS THERE'S A HIGHER, A HIGHER PROBABILITY THAT AN OUTAGE COULD HAVE OCCURRED EVEN THOUGH OUTAGES DIDN'T MATERIALIZE IN REAL TIME.
AND, YOU KNOW, YOU WOULDN'T EXPECT VERY HIGH PROBABILITIES OF OUTAGES FOR ANY INDIVIDUAL HOUR, EVEN FOR A PRETTY TIGHT HOUR.
BUT YOU DON'T NEED VERY HIGH PROBABILITIES OF AN OUTAGE IN ONE HOUR FOR THE PROBABILITY OF ANY OUTAGES OVER THE WHOLE YEAR TO BE MATERIAL.
WE ARE, ONE THING THAT WE GOT FROM ERCOT THAT WE HAVE MODIFIED, UH, THE NET LOAD FORECAST ERROR, WE ARE TRYING TO ACCOUNT FOR THE FACT THAT LOAD AND SOLAR AND WIND ARE SOMEWHAT CORRELATED AND THAT WEATHER INFLUENCES THEIR FORECAST ERRORS IN A KIND OF, UH, CORRELATED WAY.
SO PARTICULARLY LIKE WITH LOAD AND SOLAR, IF A BUNCH OF CLOUDS ROLL THROUGH THAT REDUCE THE SOLAR OUTPUT, THEY ALSO TEND TO REDUCE THE LOAD.
AND THE WAY WE'RE ACCOUNTING FOR THAT NOW, UH, I THINK GETS PRETTY CLOSE TO ACCOUNTING FOR THAT CORRELATION.
AND SO JUST, UH, SORRY IF I, IF I MISSED THIS, BUT WILL YOU BE, IS IT, ARE YOU EFFECTIVELY JUST USING THE WEATHER FROM 2023, UH, BY USING THOSE HISTORIC HOURS FOR THE, THE RESERVE LEVELS AND THEN JUST VARYING THE, THE, LIKE THE WIND, SOLAR AND OUTAGE? THAT'S A GOOD QUESTION.
UH, THE OUTAGE PROBABILITIES AND THE UNDERLYING SET OF DATA THAT DEFINES THE OUTAGE AND KIND OF WEATHER FORECAST STUFF IS SEVERAL YEARS WORTH OF DATA.
AND I THINK WE HAVE EITHER A THREE OR FIVE YEAR OPTION THAT WE HAVE USED.
AND SO, NO, IT IS NOT JUST THE 2023 WEATHER DATA.
WE HAVE SEVERAL YEARS WORTH OF DATA THAT IS INFORMING THE KIND OF ERROR BARS ON THE FORECAST.
SO, UM, ON THE NET LOAD FORECAST ERROR, UM, SO ASSUMING THAT YOU HAVE A REALLY, UM, YOU KNOW, REALLY SHARP NET LOAD DROP OFF IN THE SOLAR RAM DOWN HOUR, IF THERE'S NO ERROR IN THAT FORECAST, BUT THE RAM DOWN ITSELF WOULD REQUIRE YOU TO RELEASE ERCOT TO RELEASE ECRS, HOW DO YOU ACCOUNT FOR THAT? IS IT JUST, UH, ASSUMES, UH, WHAT DO YOU ASSUME IN THAT CASE? IF THERE'S NO FORECAST ERROR AND THE NET LOAD IS REALLY DRAMATIC, I THINK THAT OUR FUNDAMENTAL ASSUMPTION THERE WOULD BE THAT THE CAPACITY SHOULD ALREADY HAVE BEEN COMMITTED OR AVAILABLE TO BE COMMITTED BY SCAD.
SO YOU'RE NOT COUNTING, SO BASICALLY AIRCRAFT WOULD POTENTIALLY RUCK, UH, IN THOSE INSTANCES, MAKE SURE, WHY WOULD THEY RUCK, IF THE FORECAST IS CORRECT AND THE MARKET IS AWARE OF THE FORECAST, WHY WOULDN'T UNITS ALREADY BE COMMITTED TO BE ABLE TO PRODUCE AT THAT TIME? UH, YOU DON'T ALWAYS GET THE CASE THAT THE MARKET, UH, WILL COMMIT ENOUGH RESOURCES TO MEET THAT RAM, WHICH IS, I, I MEAN, ECRS IS SORT OF PROTECTING THE MARKET OR RAM DEFICIENCY.
SO I THINK THE WAY WE ARE LOOKING AT THE PROBLEM WOULD, IS NOT GOING TO CATCH A SITUATION LIKE THAT 'CAUSE WE'RE LOOKING AT
[00:20:02]
ON AN HOUR TO HOUR BASIS.IT, IT PROBABLY LOSES SOME OF THE TIME SPECIFICITY ABOUT SOMETHING LIKE THAT.
BUT I ALSO, I'M NOT SURE I SEE THAT.
I MEAN, YOU MIGHT, YEAH, I'M NOT SURE I SEE THAT AS BEING REALLY THE, UH, THE POINT WE'RE TRYING TO GET AT IN THIS MODEL.
ANOTHER QUESTION IS, UM, YOU KNOW, SO WITH, UM, ANOTHER FUNCTION OF ECRS IS TO REPLENISH, UM, YOU KNOW, RRS WHEN IT'S DEPLOYED MM-HMM,
UM, SO IS ANY CONSIDERATION, BECAUSE THAT TIMEFRAME IS MUCH SHORTER THAN AN HOUR, AND THIS IS AN HOURLY STUDY, YOU KNOW, UM, RRS HAS TO REST FREQUENCY WITHIN MINUTES.
UM, HOW IS THAT ACCOUNTED FOR IN THE STUDY THAT FUNCTION OF ECRS? IT ISN'T EXPLICITLY ACCOUNTED FOR.
SO WOULD ERCOT LOOK AT A DIFFERENT ANALYSIS, SOME SORT OF A DYNAMIC ANALYSIS TO FIGURE OUT IF ADDITIONAL RE UH, ECRS IS REQUIRED ON TOP OF THIS, WHAT THIS STUDY SHOWS? YEAH, WE HAVE GOTTEN QUESTIONS ABOUT THAT.
AND ONE THING WE'VE CONSIDERED IS IF YOU JUST INCREASE THE PROBABILITIES OF OUTAGES BASED ON LIKE A DIFF A BIGGER TIME HORIZON, BECAUSE YOU COULD HAVE MULTIPLE EVENTS THAT, THAT CAUSE RSS AND ECRS TO BE DEPLOYED.
AND SO SAY YOU USE ALL OF YOUR, YOU KNOW, RSS IN 10 MINUTES, AND THEN YOU'RE USING ECRS TO REPLENISH THE RRS, AND THEN THERE'S A TRIP, THE WAY YOU WOULD MODEL THAT IS JUST CRANK UP THE PROBABILITY OF AN OUTAGE FROM 10 MINUTES TO 30 MINUTES.
AND SO THAT'S AN EXAMPLE OF SOMETHING THAT WE'RE LOOKING AT.
YEAH, EVEN THEN IT MIGHT NOT COMPLETELY, UM, YOU KNOW, CAPTURE THE, THE TIMING, THE ESSENTIAL NATURE OF THE TIMING OF THE TWO, YOU KNOW, GIVEN THAT IT'S SUCH A SHORT TIMEFRAME THAT YOU NEED TO RECOVER.
BUT YEAH,
AND THAT LOOKS LIKE EVERYONE THAT I SEE IN THE CHAT.
[13. Other Business]
I THINK WE CAN GO THROUGH THE ERCOT IN PC PRESENTATION.YEAH, SO YEAH, BEFORE WE GO TOO FAR, JUST WANTED TO LEVEL SET AND MAKE SURE EVERYONE KNOWS WHAT WE'RE TALKING ABOUT HERE, UH, TODAY.
UH, AND, AND ANDREW, I THINK COVERED A LOT OF THIS ALREADY, BUT, UM, IT, IT'S MAINLY THAT THIRD LINE.
UH, SO WE'RE NOT TALKING ABOUT THE ECRS CHANGES, UH, FOR THIS SUMMER OR WHAT I GUESS WAS INITIALLY SUPPOSED TO BE FOR THIS SUMMER.
UH, WE'RE, UH, NOT REALLY TALKING ABOUT THE, UH, 2025, UH, CHANGES WITH THE DEPUY APPROVING, THE AS METHODOLOGY AND, AND ANY AS METHODOLOGY CHANGES THAT MIGHT HAPPEN FOR 2025.
UH, THIS, THIS IS REALLY, UH, THIS, THIS PRESENTATION IN ANDREWS IS REALLY ABOUT THE AS STUDY THAT IS FOR THE PC AND, UH, THAT THEY, THEY HAVE ASKED US TO PERFORM, UH, IN RESPONSE TO THEIR REQUIREMENTS FOR THE LEGISLATURE.
UH, ALSO, AGAIN, THIS IS NOT DRRS, UH, THAT THAT'S A, A SEP SEPARATE, UH, ISSUE.
AND I THINK IKA KIND OF HIT ON THE TIMELINE ON THAT A LITTLE BIT.
SO I WON'T SPEND ANY TIME ON THAT.
WE CAN MOVE ON TO THE NEXT SLIDE.
SO, UH, B BEFORE I GET TOO FAR INTO IT, UH, THERE SEEMS TO BE, UH, A LOT OF QUESTIONS ABOUT THE QUANTITY OF, OF AS THAT WE'RE, UH, GETTING.
AND, AND I, I THINK THAT'S, UH, YOU KNOW, A BIG PART OF THE, THE BACKDROP OF, OF THIS DISCUSSION.
AND SO I WANTED TO, UH, JUST REAL QUICK TAKE A SIDE DETOUR AND, AND TALK ABOUT THE QUANTITY THAT WE'RE GETTING, UH, TODAY AND HOW THAT HAS CHANGED IN RECENT YEARS.
AND, AND, UH, YOU KNOW, IF YOU THINK ABOUT IT, WE HAVE MORE VARIABLE RENEWABLE RESOURCES.
WE HAVE MORE LOAD VARIABILITY.
UH, AND SO THAT IS DRIVING ADDITIONAL, UH, ANCILLARY SERVICES QUANTITIES AND, AND I'LL, I'LL TALK ABOUT MORE OF THAT IN A MINUTE.
UM, AND, AND THEN, UH, I THINK IT WAS ABOUT AL ALMOST THREE YEARS AGO TO THE DAY THAT, UH, I CAME BEFORE, UH, ATTACK AND TOLD YOU THAT WE WERE GOING TO, UH, CHANGE THE WAY THAT WE WERE OPERATING THE SYSTEM, THAT WE WERE GOING TO, UH, NOT WALK UP RIGHT TO THE EDGE OF THE CLIFF, BUT WE WERE GONNA TAKE A FEW STEPS BACK AND WE WERE GONNA OPERATE WITH HIGHER RESERVE
[00:25:01]
MARGINS IN REAL TIME.UH, AND THAT'S, UH, SORT, SORT OF BECOME KNOWN AS CONSERVATIVE OPERATIONS.
BUT THE IDEA THERE IS THAT WE'RE OPERATING WITH A LOWER RISK COMPARED TO HOW WE, UH, HISTORICALLY OPERATED.
UH, AND, AND THAT HAS ALSO DRIVEN A CHANGE IN THE, UH, THE AMOUNT OF, UH, ANSWER SERVICES THAT WE'RE GETTING.
UM, AND, AND THEN OF COURSE, WITH, UH, ECRS IMPLEMENTATION LAST YEAR, UH, WHEN, WHEN WE IMPLEMENTED ECRS, WE, WE DID OF COURSE, UH, LOWER THE AMOUNT OF NONS SPIN THAT WE WERE GETTING.
UH, WE ALSO, UM, UH, UH, NOT INITIALLY, BUT GOING INTO THIS YEAR, WE ALSO, BECAUSE OF ECRS, WE, WE, UH, UH, UH, GOT RID OF THE RRS THAT, THAT ADDITIONAL 500 MEGAWATTS THAT WE STARTED GETTING IN, IN 2021, UH, OVER THE PEAK HOURS, WE, WE ELIMINATED THAT.
UH, AND SO IT, IT'S GONE UP A LITTLE BIT.
UH, THERE MAY BE SOME MISCONCEPTIONS THAT WE JUST ADDED, UH, ECRS ON TOP OF EVERYTHING ELSE AND DIDN'T MAKE ANY CHANGES, BUT WE HAVE, UH, ACTUALLY LOWERED SOME OF THE OTHER ANSWER SERVICES THAT, THAT WE'VE BEEN GETTING, UM, WITH, UH, WHEN WE ADDED THE ECRS.
BUT, YOU KNOW, OF COURSE THAT IS, UH, REALLY TO ADDRESS, UH, ECRS IS, WAS THERE TO ADDRESS THE NET LOAD RAMPS THAT WE'RE SEEING.
AND I THINK TO ASHA'S POINT EARLIER, IT'S, WE'RE NOT, UM, WE'RE, WE'RE NOT BUYING THE AMOUNT OF ECRS THAT WE'RE SEEING, UH, OR, OR I'M SORRY, WE'RE NOT BUYING ECRS TO, TO MEET THE AMOUNT OF NET LOAD RAMP THAT WE'RE SEEING, UH, IS JUST THAT DURING THOSE NET LOAD RAMPS, WE SEE THE, THE GREATER EXPOSURE, UH, WHEN WE HAVE FORECAST MISSES.
AND, AND SO THAT'S WHY YOU'LL SEE DURING, ESPECIALLY THOSE RAMP TIMES WE'RE, WE'RE GETTING, UH, HIGHER AMOUNTS OF ECRS TO, TO COVER THAT KINDA HIGHER EXPOSURE.
UM, AND THEN I THINK WHAT WE'VE SEEN IS IN, IN THE PAST TO RECOVER FREQUENCY, WE'VE, UH, RELIED, WE USED TO RELY ON, UH, SORT OF OTHER RESOURCES BEING AVAILABLE ON ONLINE TO RECOVER FREQUENCY.
SO RS WOULD, WOULD, UH, WOULD HELP US TO, UH, YOU KNOW, KEEP, KEEP THE FREQUENCY FROM, UH, GOING TOO LOW, UH, BUT THEN TO RECOVER THE FREQUENCY.
WE IN THE PAST HAD RELIED ON, ON, UH, OTHER RESOURCES BEING THERE, AND, YOU KNOW, THAT'S NOT NECESSARILY THE CASE ANYMORE.
AND, AND SO THAT WAS ONE OF THE DRIVERS FOR, UH, ADDING ECRS.
SO I JUST WANTED TO, UH, MAYBE SET THAT STAGE A LITTLE BIT.
AND I THINK I'VE GOT A COUPLE OF GRAPHS ON THE NEXT SLIDE TO, UH, ILLUSTRATE, UH, YOU KNOW, THE, THOSE CHANGES IN, UM, IN, IN WHAT WE'RE SEEING IN, IN TERMS OF, YOU KNOW, WE'VE GOT MORE VARIABLE GENERATION, WE'RE SEEING THOSE FORECAST ERRORS OR INCREASING A, AS WE INCREASE THAT THE, UH, AMOUNT OF VARIABLE RESOURCES ON THE SYSTEM.
UH, AND THEN WE'RE ALSO SEEING THOSE, UH, THOSE RAMPS, THOSE NET LOAD RAMPS INCREASING.
UM, SO, UH, WITH THAT, LET, LET'S GO TO THE NEXT SLIDE.
SO WE, UH, GOING INTO THIS STUDY, WE WANTED TO STEP BACK AND THINK ABOUT THE BASICS REGARDING ANCILLARY SERVICES.
AND WHEN YOU THINK ABOUT WHAT, WHY, WHY ARE WE GETTING ANCILLARY SERVICES? IT REALLY COMES DOWN TO, BROADLY SPEAKING, REALLY TWO ISSUES.
SO ONE IS FREQUENCY CONTROL, UH, AND THAT, UH, IS REALLY TO MEET OUR NERC RELIABILITY STANDARDS, UH, IS LAID OUT IN THE BOWEL STANDARDS.
AND FOR THAT FREQUENCY CONTROL, WE'RE GETTING REGULATION, WE'RE GETTING THE RESPONSIVE RESERVES, AND WE'RE GETTING, UH, ECRS.
UH, AND, AND WE, WE HAD A LITTLE DEBATE INTERNALLY ABOUT WHETHER WE SHOULD INCLUDE, UH, NONS SPIN IN THERE BECAUSE, YOU KNOW, NONS SPIN, WE WOULD SAY THAT WE WOULD RELY ON THAT TO, UH, ONE, ONE OF OUR REQUIREMENTS IS TO, WHEN, WHEN WE HAVE AN EVENT TO RESTORE OUR CONTINGENCY RESERVES WITHIN 90 MINUTES, UH, BUT THAT, THAT'S NOT REALLY THE PRIMARY DRIVER FOR THE QUANTITIES WE'RE GETTING 'EM, NONS SPIND, SO LE LEFT NONS SPIN OUT OF THAT.
UM, AND SO, SO THAT'S FREQUENCY CONTROL.
BUT THEN, UH, THE, THE OTHER, UH, REASON THAT WE'RE GETTING AN ANSWER SERVICES IS REALLY THAT OPERATIONAL RISK OF UNDER COMMITMENT OF RESOURCES TO MEET THE DEMAND PLUS UNEXPECTED VARIATIONS.
AND WHEN I, WHEN I SAY UNDER COMMITMENT, I DON'T MEAN ANYTHING, YOU KNOW, SINISTER IN THE MARKET.
IT JUST MEAN THAT, UH, THAT WE NEED TO MAKE SURE THAT WE HAVE THE RIGHT RESOURCES, INCLUDING RAMP CAPABILITY TO MEET UNEXPECTED THINGS THAT, THAT HAPPEN.
UH, AND THOSE UNEXPECTED THINGS ARE REALLY, IT'S, UH, FORECAST AIR.
UH, IT COULD BE LOAD WIND AND OR SOLAR FORECAST AIR.
UH, AND IT'S ALSO THE LOSS OF GENERATION.
UH, AND THAT'S NOT, NOT, AGAIN, NOT FROM A FREQUENCY CONTROL PERSPECTIVE, BUT MORE FROM A COMMITMENT PERSPECTIVE.
UH, AND, AND SO THAT, SO WE'RE, WE'RE TRYING TO MAKE SURE THAT WE HAVE THE, THE, UH, THE COMMITMENT OF RESOURCES THROUGH ANCILLARY SERVICES, UH, TO MEET THOSE, UH, THOSE UNEXPECTED VARIATIONS PLUS THE DEMAND.
UH, AND SO THERE'S A, A PORTION OF ECRS THAT IS FOR FREQUENCY CONTROL, BUT THEN THERE'S A PORTION THAT WE BUY, UH, FOR THAT SORT OF IN INTRA HOUR, UH, UN UNEXPECTED
[00:30:01]
THINGS THAT COULD HAPPEN, UN UNEXPECTED BAD THINGS THAT COULD HAPPEN.UH, AND THEN OF COURSE, WE'RE ALSO GETTING NONS SPIN FOR THAT.
AND IN THE FUTURE WE'LL BE GETTING, UH, DRS, UH, FOR THAT.
AND SO THE REQUIREMENTS, WHEN WE, WE DO THAT, UH, RISK ANALYSIS, THOSE REQUIREMENTS ARE, ARE IN AS METHODOLOGY.
UH, BUT AS, AS YOU'LL HEAR ME TALK ABOUT IN A MINUTE TODAY, THAT THAT'S SORT OF SUBJECTIVE.
UH, WE DON'T HAVE OBJECTIVE REQUIREMENTS, UH, FOR WHAT KIND OF RISK WE'RE WILLING TO ACCEPT.
SO IF YOU THINK ABOUT LIKE THE PLANNING STANDARD, UH, SO, YOU KNOW, WE JUST WENT THROUGH, UH, THIS, THIS PROCESS WHERE WE, UH, SPENT A LOT OF TIME TALKING ABOUT WHAT, WHAT IS AN OBJECTIVE RELIABILITY STANDARD FOR THE, THE, UH, PLANNING RESOURCE ADEQUACY.
THEY DON'T REALLY HAVE ANY SORT OF OBJECTIVE, UH, REQUIREMENTS OR CRITERIA FOR, UH, AN OPERATIONAL RESOURCE ADEQUACY.
UH, AND, AND SO THAT, THAT'S ONE THING THAT WE'RE GONNA, UH, GET INTO HERE IN A LITTLE BIT.
SO WITH THAT, UH, I WOULD GO TO THE NEXT SLIDE.
SO, UH, OUR RECOMMENDATIONS, AND, AND THIS IS, UM, UH, THAT SHOULD CAVEAT THIS IS, THIS IS, UH, WHAT I WOULD SAY IS KIND OF DRAFT RECOMMENDATIONS.
THIS IS OUR, OUR THINKING AS OF TODAY.
SO WE'RE, WE'RE GIVING YOU AN UPDATE ON WHERE WE'RE AT, BUT, UH, WE'RE, WE'RE STILL THINKING THROUGH THIS, STILL RUNNING THE ANALYSIS.
UH, BUT, UH, WE'RE, WHERE WE'RE AT TODAY IS, UH, WE HAVE A PRELIMINARY, PRELIMINARY RECOMMENDATION.
AND, AND THAT IS FOR THAT FREQUENCY CONTROL PORTION OF THE ANCILLARY SERVICES.
WE, WE REALLY THINK THAT WE HAVE THE RIGHT, UH, SERVICES AND THE RIGHT METHODOLOGY FOR QUANTIFYING THOSE SERVICES TODAY.
AND SO WE'RE NOT, UH, WE'RE NOT PROPOSING TO MAKE ANY CHANGES TO HOW WE'RE, HOW WE'RE GETTING, OR WHAT PRODUCTS WE'RE GETTING TO, TO MEET THOSE, UH, THOSE NERC REQUIREMENTS TODAY.
UH, BUT THE SECOND PART OF THAT IS, UH, I THINK FROM A CONCEPTUAL STANDPOINT, WE AGREE WITH THE IMM THAT THE, THEIR PROPOSED METHODOLOGY TO CALCULATE THAT, THAT OPERATIONAL RISK, UH, USING A MORE PROBABILISTIC UH, ANALYSIS TO, TO QUANTIFY, UH, THAT, THAT, UH, OPERATIONAL RISK PORTION OF ECRS AND NONS SPIN, UH, AND POTENTIALLY, UH, DRS IN THE FUTURE.
UH, WE, WE THINK THAT THERE'S A LOT OF MERIT TO WHAT THEY'RE PROPOSING AND THINK THAT THAT'S PROBABLY A, A BETTER METHODOLOGY THAN TODAY, UH, TO TODAY WE'RE, UH, WE'RE USING, SO, SO IF YOU GO TO THE WORKING GROUP MEETINGS IN JULY AND, AND, AND TALK ABOUT THE, UH, OR LISTEN TO THE PRESENTATIONS ABOUT THE 2025 AS METHODOLOGY, UH, UH, WE'RE WE, YOU, YOU WILL SEE THAT WE WILL USE A STATISTICAL APPROACH, UH, BUT IT, IT'S NOT AN APPROACH THAT TAKES INTO ACCOUNT ALL OF THE, UH, THE POSSIBLE, UH, RISKS THAT, UH, IN, IN A, IN A SINGLE, IT DOESN'T QUANTIFY ALL OF THOSE, THOSE RISKS IN, IN A SINGLE PROBABILITY.
UH, AND SO YOU'LL HEAR US SAY, HEY, WE'RE, WE'RE GONNA GET NI WE'RE, WE'RE GONNA COVER 90 PER 90TH PERCENTILE OF THIS RISK AND 75TH PERCENTILE OF THAT RISK.
UH, BUT WE'RE NOT PUTTING THEM TOGETHER IN, IN A SINGLE, UH, PROBABILISTIC, UH, UH, METRIC, IF YOU WILL, FOR E EACH OF THOSE AS.
AND, AND SO WE THINK THAT THAT'S A, UM, YOU KNOW, LIKE I THINK GOING FORWARD THAT THAT'S PROBABLY A, A BETTER WAY TO DO THINGS.
AND IT'S SOMETHING WHERE, UH, MAY MAYBE IN THE PAST WE DIDN'T HAVE THE, THE TECHNIQUES OR THE TOOLS, UH, TO BE ABLE TO DO THAT.
BUT, YOU KNOW, AS WE'RE IN 2024 NOW, UH, AS OUR TOOLS AND, AND OUR, UH, TECHNIQUES AND METHODOLOGIES HAVE IMPROVED, WE, WE THINK THAT WE CAN, UH, MAKE THIS CHANGE.
AND SO, AGAIN, I THINK CONCEPTUALLY, I THINK WE AGREE WITH THE IMM AND, AND I, THE, I THINK THE NEXT SLIDE, UH, SORT OF ILLUSTRATES, UH, REALLY KIND OF HIGH LEVEL PUT, PUTTING ALL THAT TOGETHER AND, UH, COMING UP WITH A, A SINGLE, UM, UH, SORT OF, UH, METRIC THAT, THAT YOU COULD, UH, YOU COULD, YOU COULD, UH, MEASURE TO, TO SEE WHAT, WHAT YOUR ERROR, UH, OR, OR WHAT YOUR, UM, WHAT, WHAT YOUR RISK IS, UH, DOING A MONTE CARLO ANALYSIS AND THINK ANDREW SORT OF COVERED THIS.
I'M, I'M NOT GONNA SPEND A LOT MORE TIME ON THIS, UH, BUT THE NEXT SLIDE, UM, I THINK GOES INTO KIND OF THE, I'M, I'M NOT GONNA READ ALL OF THE WORDS ON THIS SLIDE, BUT, YOU KNOW, WE, WE THINK THAT, UH, THERE'S STILL A LOT OF DETAILS TO WORK OUT.
UM, AND WE'VE HAD A LOT OF REALLY GOOD CONVERSATIONS WITH THE IMM.
UH, I, I DON'T KNOW IF, IF, WE'LL BY THE, BY SEPTEMBER, THAT WE'LL AGREE ON ALL OF THE DETAILS.
UH, BUT I WOULD SAY CONCEPTUALLY, I, I THINK WE AGREE ON THE, THE FRAMEWORK, BUT THERE'S STILL A LOT OF DETAILS TO WORK OUT.
AND I'M NOT GONNA READ ALL THESE WORDS, UH, BUT I, I THINK SOME OF THE THINGS WE STILL NEED TO THINK THROUGH ARE AROUND, UH, DATA AND WHAT, WHAT DATA DO YOU USE? YOU KNOW, HOW, HOW MUCH HISTORY, OBVIOUSLY WITH, UH, FORECAST DATA, IT'D BE BE GREAT IF I USED 10 YEARS OF, OF DATA, BUT, UM, YOU KNOW, THE
[00:35:01]
FORECAST HAVE IMPROVED.AND, AND SO IF I'M TRYING TO QUANTIFY WHAT MY RISK IS OF A FORECAST ERROR, I, I REALLY DON'T WANT TO USE FORECAST DATA FROM 10 YEARS AGO.
UH, I REALLY WANNA LIMIT THAT TO MORE RECENT HISTORY BECAUSE THE FORECASTS ARE MUCH BETTER THAN THEY WERE, UH, 10 YEARS AGO.
UM, YOU KNOW, THE, UH, ONE OF THE OTHER I THINK, INTERESTING PIECES HERE IS, UH, HOW DO YOU COUNT THE HEADROOM, UH, CAPACITY? UH, SO RIGHT NOW, UH, AT, AT ANY GIVEN TIME ON THE SYSTEM, THERE IS HEADROOM THAT IS AVAILABLE ON RESOURCES THAT, UH, IS NOT PROVIDING ANCILLARY SERVICES THAT IS THERE SORT OF FOR FREE, YOU COULD SAY.
AND WE'VE HISTORICALLY, WE'VE RELIED ON THAT HEADROOM.
UH, YOU KNOW, HOW, HOW MUCH DO YOU COUNT ON THAT HEADROOM WHEN YOU'RE QUANTIFYING WHAT YOUR ANCILLARY SERVICES NEEDS ARE? I THINK THESE ARE THINGS THAT WE'RE GOING TO NEED TO, UH, THINK THROUGH.
UH, THE, THE SECOND QUESTION THERE IS REALLY ABOUT, UH, YOU KNOW, HOW HOW DO YOU ADJUST YOUR, UM, UH, YOUR, YOUR QUANTITIES BASED ON, UH, CHANGES IN YOUR SYSTEM? UH, SO I THINK BRIAN MENTIONED, HEY, THE, THE LOADS ARE, ARE CHANGING THAT THAT LOAD FORECAST IS CHANGING.
UH, WE'RE GETTING ADDITIONAL WIND AND SOLAR ON THE SYSTEM THAT'S, UH, PERHAPS INCREASING VARIABILITY.
UH, YEAH, HOW, HOW DO YOU ACCOUNT FOR THOSE CHANGES? AND, AND SO WE NEED TO, I THINK, THINK THROUGH THAT A LITTLE BIT MORE.
UM, AND THEN THE, THE THIRD QUESTION IS REALLY ABOUT CRITERIA.
UH, IT, IT IS, YOU KNOW, AGAIN, WE, TODAY WE DON'T HAVE A SINGLE METRIC FOR, UH, YOU KNOW, MEASURING.
UH, AND, UM, YOU KNOW, SO, SO I MENTIONED THE PLANNING STANDARD AS AN EXAMPLE.
UH, YOU KNOW, SO, SO WITH THE PLANNING STANDARD, YOU CAN SAY, I, I, I DON'T WANT TO, UH, SHED LOAD FOR, UH, BECAUSE OF RESOURCE ADEQUACY, ADEQUACY ISSUE MORE THAN ONE IN, IN X YEARS, MORE THAN ONE IN 10 YEARS, OR I DON'T WANNA HAVE MORE THAN, UH, A, A DURATION THAT'S LONGER THAN X HOURS OR SHED MORE THAN, UH, Y MEGAWATTS.
UH, WE, WE DON'T REALLY HAVE THAT SORT OF CRITERIA IN, UM, IN, IN, UH, OPERATIONS.
AND, AND SO WE NEED TO THINK THROUGH THAT.
UH, AND, AND ALSO THINK THROUGH, I I, I THINK THAT THE CONSERVATIVE OPERATIONS, YOU KNOW, IF, IF YOU REALLY THINK ABOUT WHAT THAT IS, IT, IT'S REALLY, UH, IT, IT'S, IT'S SORT OF MOVING FROM A, HEY, WE, WE DON'T WANT TO SHED LOAD TO, MAYBE WE DON'T EVEN WANNA GO INTO AN EEA OR WATCH BECAUSE WE DIDN'T HAVE ENOUGH RESERVES.
AND I THINK THAT'S SORT OF A POLICY QUESTION.
AND SO MAYBE THAT'S NOT FOR
UH, ANDREW MENTIONED THOSE SORT OF TEMPORAL CONSTRAINTS, UH, AND, UM, THINKING THROUGH HOW, HOW DO YOU TAKE INTO ACCOUNT THE LIMITED DURATION RESOURCES THAT THE BATTERIES AND, AND HOW THOSE, UH, IMPACT THE, YOUR, YOUR ADEQUACY OF RESERVES.
UH, THERE, THERE'S ALSO THE, WHAT I'M CALLING CUMULATIVE FACTORS, WHICH, WHICH AN EXAMPLE IS THE MAY 13TH, 2022 EVENT WHERE WE HAD, I THINK THERE WERE SIX GENERATORS ACROSS THE, UH, SEVERAL HOURS THAT, UH, TRIPPED OFF INDEPENDENTLY.
UM, YOU KNOW, HOW DO YOU TAKE INTO ACCOUNT THOSE DAYS? UH, SO WE NEED TO THINK THROUGH THAT.
UM, WE ALSO NEED TO THINK THROUGH HOW, HOW DO, HOW MUCH DO WE COUNT ON OTHER AS TYPES IN, IN OUR RESERVES? SO IF WE'RE THINKING ABOUT NONS SPIN, DO WE ASSUME THAT WE CAN USE ALL OF THE ECRS OR PORTION OF THE ECRS TOWARDS MEETING THE RESERVE NEEDS THAT, THAT WE'RE TRYING TO COVER WITH NONS SPIN? SO WE NEED TO THINK THROUGH THAT.
AND OF COURSE, THE HARDWARE AND, AND, UH, SOFTWARE IMPLICATIONS AS WELL.
WE NEED TO MAKE, MAKE SURE THAT WE CAN PERFORM THIS, UH, AND, YOU KNOW, DOES, DOES IT TAKE A YEAR TO, TO PERFORM, UM, YOU KNOW, A, A STUDY THAT'S, UH, SHOULD BE DONE PRETTY QUICKLY.
SO, UH, SO JUST KNOW, I'M GONNA GIVE YOU SORT OF A HIGH LEVEL OVERVIEW OF, HEY, THESE ARE A LOT OF DETAILS THAT WE STILL NEED TO THINK THROUGH.
UH, I, I DON'T THINK THAT WE'LL HAVE ALL OF THESE ANSWERED BY SEPTEMBER.
AND, AND SO WHAT YOU'LL SEE, I THINK COMING FROM ERCOT ON THIS IS, UH, A RECOMMENDATION AROUND THE FRAMEWORK.
BUT, UH, I, I THINK THAT WE NEED TO HAVE A LOT OF DISCUSSION WITH STAKEHOLDERS, UH, AND POTENTIALLY WITH THE, THE POLICYMAKERS ON SOME OF THE, THE, THE DETAILS, UH, AROUND THIS, THIS CHANGE IN THE METHODOLOGY.
UH, THIS IS, UH, BROUGHT UP BEFORE.
HEY, JEFF, WE DID HAVE, YEAH, WE DO HAVE ONE QUESTION.
DO YOU WANNA WAIT UNTIL YOU'RE DONE WITH THIS SLIDE, OR DO YOU WANNA TAKE THEM AS YOU GO ALONG? UH, YEAH, I CAN TAKE IT AS WE GO.
ERIC, DID YOU HAVE A QUESTION? YEAH, I, UH, COMMENT, THINK AS A VERY THOUGHT, YOU'VE MADE A VERY THOUGHTFUL, UM, LIST
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OF CONCERNS HERE.I'D JUST BE CAREFUL ABOUT ONE CHARACTERIZATION.
UM, WE'VE BEEN IN ENERGY ONLY MARKET FOR EXPLICIT ENERGY ONLY MARKET FOR 20 YEARS.
IT WAS NEVER REALLY THE INTENT TO GET UP TO THE EDGE AND PUSH THAT.
I THINK THE WAY I WOULD FRAME IT DIFFERENTLY IS JUST THAT THERE IS SO MUCH MORE INTERMITTENT, INTERMITTENT RENEWABLES IN THE SYSTEM THAT IS LESS PREDICTABLE WHEN THAT IS GOING TO HAPPEN, IF IT'S GONNA HAPPEN, IF IN THE OLD WORLD, IF IT WAS GONNA HAPPEN, UH, BASICALLY TWO OR THREE TIMES UNDER TWO OR THREE SCENARIOS, AN EXTREME WINTER EVENT, EXTREME SUMMER EVENT, OR AN UNEXPECTED HEAT WAVE IN THE SPRING, UH, THOSE WERE FAIRLY REASONABLE AND SIMPLE, UM, TIMES TO BE MORE CAUTIOUS ABOUT PROCURING ANCILLARY RESOURCES.
UH, BUT YOU KNOW, IF YOU'RE IN A WORLD WHERE YOU'VE GOT NEARLY 40 GIG OF WIND AND PUSHING 20 GIG OF SOLAR, IT'S NOT BECAUSE WE NO LONGER WANNA PUSH IT TO THE EDGE, IT'S JUST THAT WE CAN'T TELL WHEN THE EDGE IS GOING TO COME ANYMORE.
RIGHT? IT'S NOT JUST DEPENDENT ON TEMPERATURE AND FORCE OUTAGE IS, IS SITUATION WHERE THE SUPPLY IS UNCERTAIN.
SO PLEASE, I WOULD SUGGEST BE CAREFUL HOW YOU, HOW YOU FRAME THAT.
IT'S MORE THE UNCERTAINTY THAT YOU'RE MORE, THAT YOU'RE CONCERNED ABOUT RATHER THAN, HEY, THE OLD WORLD, WE PUSHED TO THE EDGE.
THAT WAS NEVER THE INTENT TO SAY THAT WE GET TO THE EDGE ON AN UNPREDICTABLE BASIS, BUT WE DO UNDERSTAND, UH, AS, AS LOADS THAT YOU HAVE TO BE CAUTIOUS BECAUSE IT IS HARDER TO MANAGE A SYSTEM THAN IT WAS 15 YEARS AGO BECAUSE OF ALL THE INTERM INVOLVED IN IT.
YEAH, ERIC, APPRECIATE THE COMMENT.
I, I ACTUALLY THOUGH, I, I THINK IT'S BOTH.
UH, AND I THINK THE, THE REASON I SAY THAT IS, UH, YOU KNOW, I, I THINK THAT PRIOR TO WINTER STORM URI, UH, I THINK THAT THERE WERE LOTS OF TIMES WHERE WE HAD WATCHES, WE WENT INTO EEA, AND, UM, UH, I, I THINK, UH, I'LL SAY THAT THE PUBLIC, YOU KNOW, DIDN'T REALLY NOTICE, DIDN'T REALLY CARE, UH, AT, AT LEAST THAT, THAT'S MY PERCEPTION.
UM, I, I THINK POST URI, I, I THINK AS WE SAW IN 2021, THERE WERE TIMES WHERE WE, UH, YOU KNOW, WOULD, WOULD GO INTO A WATCH AND, YOU KNOW, THAT THAT WOULD BE, UM, UH, THERE'D BE A LOT OF ATTENTION ON THAT FROM THE, THE PUBLIC, BUT ALSO FROM, UH, STATE LEADERSHIP.
AND I THINK THE MESSAGE THAT WE GOT, UH, WHICH IS WHAT CAUSED US TO GO INTO QUOTE UNQUOTE CONSERVATIVE OPERATIONS IN SUMMER OF 2021, WAS, OR WE DON'T WANT YOU TO, WE, WE DON'T WANT YOU TO GO INTO WATCH AN EEA AS MUCH AS YOU HAVE IN THE PAST.
AND, AND IN MY MIND THAT THAT IS A CRITERIA CHANGE FOR HOW WE OPERATE THE SYSTEM AND WHAT AMOUNT OF RESERVES WE'RE PROCURING.
WELL, I THINK THEN, FAIR ENOUGH, I THINK THE WAY TO CHARACTERIZE IT THEN IS THAT, THAT YOU HAVE HEARD FROM LEADERSHIP IN AUSTIN THAT YOU WANT TO RUN THINGS MORE CONSERVATIVELY.
I MEAN, YOU ALWAYS HAD RUCK AVAILABLE IF YOU NEEDED IT.
YOU HAD EMERGENCY RE UH, RESERVE SERVICE AND THE LIKE, SO THE TOOLS HAVE ALWAYS BEEN THERE.
IT'S JUST YOU'RE TALKING MORE ABOUT A DIFFERENCE IN ATTITUDE, UH, OR CONCERN THAT THEY WANNA RUN THINGS MORE CAUTIOUSLY.
AND THEN OBVIOUSLY WE, THE STAKEHOLDERS HAVE HAD DIFFERENT OPINIONS ON WHAT THAT MEANS, BUT, UH, IT WAS NEVER THE INTENT TO MAKE RELIABILITY AT RISK.
AND SO, BE CAREFUL PLEASE ABOUT CHARACTERIZING IT THAT WAY.
IF YOU WANNA SAY YOU WANNA BE MORE CONSERVATIVE IN TERMS OF WHETHER IT'S PUBLIC NOTIFICATIONS, THE, LIKE, THAT'S FINE, BUT, UH, IT WAS NEVER THE INTENT OF THE COMMISSION TO PUT RELIABILITY AT RISK UNDER THE SYSTEM WHEN THEY, UH, MADE THE CHOICES THEY DID OVER THE YEARS.
THANKS, CALIN, AND THANKS JEFF.
UM, JEFF, I, I, I HEAR, UH, BOTH IN, IN SOME OF THE QUESTIONS THAT YOU'VE TEED UP ON THIS SLIDE AS WELL AS JUST SOME OF THE DISCUSSION YOU WERE JUST HAVING WITH ERIC THAT, UM, YOU KNOW, IT, IT SEEMS LIKE, UH, OTHER QUESTIONS THAT SHOULD BE BAKED INTO THIS ARE, YOU KNOW, HOW HOW DOES THE, UH, THE ANSWER SERVICE SUITE SUPPORT THE, UH, SOME OF THE STATUTORY POLICY OBJECTIVES AND SAY P 39, 1 59 AND, UM, CHAPTER 35, UH, SECTION 35 0 0 4,
[00:45:02]
WHERE THERE IS SOME CONTEMPLATION OF ANCILLARY SERVICES ALSO, UH, SUPPORTING RESOURCE ADEQUACY.AND, YOU KNOW, UH, ERIC'S POINT WITH THE INCREASE IN INTERMITTENT ON THE SYSTEM, YOU DON'T ALWAYS KNOW WHEN THE, UH, YOU KNOW, WHEN THOSE LOW RESERVE PERIODS WILL BE.
AND SO WHAT, HOW DOES IT PLAY INTO, UM, YOU KNOW, INTO MEETING THAT OVERALL RESOURCE MIX THAT YOU NEED, UM, OR SUPPORTING THE RELIABILITY STANDARD THAT, UM, YOU KNOW, THE COMMISSION'S CONSIDERING NOW, UM, AND OBVIOUSLY WE STILL HAVE THE, THE PCM UNDER DEVELOPMENT, BUT IN, YOU KNOW, JUST IN READING THE COMMENTS THAT WERE FILED LAST WEEK, YOU KNOW, IT LOOKED LIKE MORE THAN HALF OF THE FOLKS ALSO, YOU SEEM TO HAVE SOME, SOME INCLINATION TOWARDS, YOU KNOW, USING ANCILLARY SERVICES MORE TO, UH, YOU KNOW, TO MEET THE RELIABILITY STANDARD.
SO, UM, JUST DON'T WANT TO BE, I, I THINK AS WE LOOK AT THIS, IT'S IMPORTANT TO KEEP THOSE OBJECTIVES IN MIND AS WELL.
AND THEN, UH, APPRECIATE THE COMMENT.
UM, I, I, I UNDERSTAND WHAT YOU'RE SAYING.
I, I THINK THE WAY THAT WE ARE PROCURING ARY SERVICES TODAY, UH, WE, WE DO NOT TAKE INTO ACCOUNT ANY RESOURCE ADEQUACY OBJECTIVES.
IT, THE, THE CALCULATIONS THAT THE METHODOLOGY IS, UH, PURELY AROUND THE OPERATIONAL RISKS AND, UM, YOU KNOW, SO, SO I, I THINK THAT THAT, YOU KNOW, I WOULD SAY THAT'S HOW WE'RE DOING IT TODAY.
UH, YOU KNOW, OF COURSE AS WE GO THROUGH THIS PROCESS, UM, THE, THE PC OR THE LEGISLATURE MAY TELL US TO DO SOMETHING DIFFERENT, BUT YOU KNOW, THAT, THAT THAT'S HOW WE'RE DOING IT TODAY, AT LEAST.
ERIC, DID YOU HAVE AN ADDITIONAL QUESTION OR COMMENT, OR DID WE GET IT ALREADY? UH, I THINK I WOULD JUST, I THINK I WOULD JUST RESPOND TO THE PREVIOUS COMMENT THAT, UM, ANCILLARY SERVICES REALLY ARE NEVER INTENDED FOR RESOURCE ADEQUACY BECAUSE THE, UNLESS YOU'RE LOOKING AT A SPECIAL PRODUCT FOR WINTER PEAK THAT ISN'T COVERED CURRENTLY, BECAUSE IF YOU'RE TALKING ABOUT SUMMER PEAK, EVERYBODY IS LINED UP FOR THAT, BOTH IN TERMS OF, UH, UNIT COMMITMENT AND ALSO BILATERAL CONTRACTING TO MAKE SURE THAT YOU'RE NOT EXPOSED TO HIGH PRICES.
SO THE MARKET DESIGN IS SET UP TO DEAL WITH RESOURCE ADEQUACY.
I THINK A UNIT COMMITMENT MIGHT BE A BETTER, BETTER CONCERN OR MORE OF A FOCUS CONCERN, BECAUSE IF YOU HAVE INTERMITTENCY, YOU WANNA MAKE SURE YOU HAVE ENOUGH DISPATCHABLE RESOURCES, BOTH THERMAL AND ALSO DEMAND RESPONSE TO MEET REAL TIME NEEDS.
SO I'M HAVING TROUBLE SEEING HOW ANCILLARY SERVICES DIRECTLY SUPPORT, UH, RESOURCE ADEQUACY WHEN IT MAY BE MORE ISSUE OF UNIT COMMITMENT AND UNCERTAINTY.
BUT, UH, I'VE SPLIT ENOUGH HAIRS HERE.
I'LL, I'LL MOVE ON TO THE NEXT PERSON.
UM, I THINK WE ARE TO SEAN, AND THEN I THINK AN ADDITIONAL QUESTION FROM NED, SO LET'S GO TO SEAN.
ON YOUR, UM, ISTIC ANALYSIS, UM, HOW DO YOU TREAT, UM, LIKE ONLINE NONS SPIN, AND NOW WE ARE ALSO THINKING ABOUT MAKING PCRS, UH, YOU KNOW, SORT OF ONLINE AVAILABLE INSTEAD OF HOLDING IT BACK BEHIND HASSLE.
SO HOW DO YOU TREAT THOSE ANSLEY SERVICES, UM, WHEN YOU'RE LOOKING AT THE RISK OF OUTAGE? WELL, SO I, I THINK YOU'RE LOOKING AT WHAT, WHATEVER YOU'RE PROCURING, UH, WHETHER IT'S ON ONLINE OR OFFLINE, AS BEING ABLE TO MEET YOUR, YOUR, YOUR, UM, YOUR RESERVE NEEDS.
YOU, YOU'RE, YOU'RE USING THAT TO ADDRESS THE RISK.
SO I, I THINK WHAT WHATEVER YOU'RE PROCURING, YOU'RE, YOU'RE TRYING TO SET THOSE QUANTITIES SO THAT YOU CAN MEET THAT, THAT RISK LEVEL.
I THINK THAT MIGHT BE SOMETHING WE NEED TO REEXAMINE, BECAUSE JUST AS A HYPOTHETICAL, LET'S SAY YOU RELEASED ALL NONS SPIN AND ECRS ALL THE TIME, THEN YOUR MARKET PRICE WOULD BE SUPPRESSED AND PEOPLE WOULDN'T COMMIT AS MUCH.
SO THERE IS DEFINITELY A RELATIONSHIP BETWEEN HOW MUCH THE MARKET COMMITS AND WHAT YOU HAVE AVAILABLE FOR THOSE, UM, YOU KNOW, THE UNCERTAINTY MEETING, THE LOAD RAMP AND, AND THE NET LOAD RAMP AND STUFF.
SO THERE IS DEFINITELY A RELATIONSHIP BETWEEN THE TWO.
AND JUST ASSUMING THAT ALL THE STUFF THAT'S ONLINE ALREADY IN SC WOULD BE JUST AS GOOD AS OFFLINE, YOU KNOW, TO MEET THAT UNCERTAINTY MIGHT BE, UH,
[00:50:01]
MIGHT NOT BE A GOOD WAY TO LOOK AT IT.WELL, WE'LL HAVE TO THINK THROUGH THAT, JOHNS.
AND, AND OF COURSE THAT THAT GETS, UM, YOU KNOW, MORE COMPLEX WITH, UH, RTC WHERE EVERY, EVERYTHING IS AVAILABLE ALL THE TIME.
YEAH, THAT, THAT WAS ACTUALLY MY FOLLOW UP TO THAT IS HOW ARE WE LOOKING, BECAUSE THIS SEEMS TO BE MORE, YOU ARE LOOKING AT 2023 AND YOU KNOW, I'M, I'M WONDERING HOW WE DO THIS ANALYSIS FOR R TC ANYWAY, WE CAN PROBABLY HAVE THAT DISCUSSION LATER.
I JUST WANTED TO CLARIFY IN CASE IT WASN'T CLEAR, AND ERIC, I APOLOGIZE IF, IF I HAD, UH, IMPLIED OTHERWISE, I, I WASN'T ASSERTING THAT ANSARY SERVICES HAVE HISTORICALLY BEEN USED FOR RESOURCE ADEQUACY.
IT WAS JUST NOTING THAT THERE HAS BEEN A, A CONNECTION MADE AT, AT THE POLICY LEVEL.
AND SO, UM, THAT THAT IS SOMETHING TO BE COGNIZANT OF AS, AS WE, UH, AS WE STUDIED THAT THE OUTCOMES.
I JUST WANNA QUICKLY TAG UP ON, UH, COMMENTS FROM SHAMS AND JEFF, UH, THAT WE ARE ALSO THINKING ABOUT THIS STUFF AND DOING OUR ANALYSIS FROM THE PRISM OF HOW WOULD THIS STUFF WORK UNDER RTC RATHER THAN SPECIFICALLY FOCUSING ON THE CURRENT MARKET DESIGN.
AND THAT'S ANDREW FROM THE IMM, CORRECT? YEP.
SORRY, SORRY, WE'RE NOT IN PERSON AND WE'RE STILL GETTING USED TO YOUR VOICE.
AND ANY OTHER QUESTIONS OR COMMENTS FOR JEFF? ALL RIGHT, JEFF, I THINK YOU CAN GO AHEAD.
I, I DON'T KNOW IF YOU HAVE MORE SLIDES, SO I THINK YOU HAVE A COUPLE.
SO THE, UH, THIS, THIS WAS ALLUDED TO EARLIER, UM, BUT YOU KNOW, I, I, I MENTIONED THAT AS THE VARIABILITY ON THE SYSTEM IS INCREASING, UH, I THINK NATURALLY THAT THAT'S GOING TO LEAD TO AN INCREASING AMOUNT OF ANCILLARY SERVICES.
UH, AND, UH, I THINK IN PARTICULAR, SO, SO TODAY WE'RE, WE'RE TRYING TO COVER WORST CASE MA MAKING SURE THAT WE ARE PROCURING ENOUGH SERVICES TO COVER SOME OF THOSE WORST CASE CONDITIONS.
THE, THE, THE REALLY BAD DAYS WHERE WE HAVE REALLY BAD NET LOAD FORECAST ERRORS, UM, AND WE'VE GOT GENERATION THAT IS TRIPPING OFF.
UH, AND, AND I SAY WORST CASE, IT'S, IT'S NOT ACTUALLY WORST CASE, WORST CASE, BUT IT'S NEAR WORST CASE CONDITIONS.
UM, AND, AND SO THAT, THAT'S HOW WE'RE SETTING THE ANSWER SERVICES QUANTITIES TODAY.
UM, BUT IF, IF YOU, YOU KNOW, THINK ABOUT THE DAY TO DAY THE, THE, THE WEATHER PATTERNS, YOU KNOW, THERE ARE SOME DAYS WHERE THERE IS MORE RISK THAN THERE ARE OTHER DAYS.
SO, SO ON A DAY WHERE THE WIND IS, YOU KNOW, 3000 MEGAWATTS, YOU KNOW, THE, THE, THE MOST FORECASTER YOU CAN HAVE ON THE WIND IS 3000 MEGAWATTS.
UM, BUT WE STILL BUY THE ANSWER SERVICE QUANTITIES AS AS IF, UM, BECAUSE WE'RE SETTING THEM ON AN ANNUAL BASIS, YOU KNOW, WE, WE DON'T KNOW THAT AHEAD OF TIME AND, AND SO WE'RE STILL BUYING THAT QUANTITY A AS IF IT, THE, THE WIND FORECAST COULD BE, YOU KNOW, MU MUCH, UH, THE AIR COULD BE MUCH LARGER, RIGHT? SO, UM, UH, SO, YOU KNOW, I THINK WE'VE UN WE UNDERSTAND THAT THERE IS THIS TRADE OFF IN THE MARKET TODAY WHERE, UH, THERE, THERE'S THE, THE, THE, THE REPS THEN THE LOAD THAT THEY HAVE CERTAINTY WHEN WE SET THAT, THOSE QUANTITIES IN DECEMBER.
UH, THERE, THERE'S THE TRADE OFF BETWEEN THAT AND, UH, A POTENTIAL EFFICIENCY GAIN IF WE BOUGHT ANS ANSWER SERVICES CLOSER TO REAL TIME.
UH, IF, IF WE, UH, CALCULATED THOSE QUANTITIES CLOSER TO REAL TIME, YOU KNOW, THERE MAY BE DAYS WHERE WE SEE THAT WE NEED MUCH LESS THAN WHAT WE BOUGHT ON AN ANNUAL BASIS.
UH, SO, UM, I, I THINK BASED ON THAT, WE, WE THINK IT'S WORTH REEXAMINING THAT TRADE OFF AND WORKING WITH, UH, STAKEHOLDERS THROUGH THAT.
I, I, UM, WANT TO BE CAREFUL HERE AND SAY THAT THIS IS NOT SOMETHING WHERE WE THINK THAT, UH, YOU KNOW, THIS IS SOMETHING THAT WE'RE GONNA, YOU KNOW, PUSH HARD AND, AND, YOU KNOW, KIND OF RAMP RAM THROUGH THE, YOU KNOW, RAM DOWN THE MARKET'S THROAT.
UH, THAT, THAT'S NOT THE INTENTION HERE.
IT'S, IT'S, IT'S REALLY JUST, UH, YOU KNOW, ARE ARE THERE POTENTIAL COST SAVINGS AND ARE THOSE COST SAVINGS OR ARE THEY WORTH THAT, THAT, UM, YOU KNOW, KINDA THAT HEDGING TRADE OFF.
UH, WE, WE THINK THAT, THAT IT'S WORTH REEXAMINING THAT AND, AND WORKING WITH STAKEHOLDERS ON THAT.
[00:55:01]
RECOMMENDATION.UH, I WOULD SAY NOT, NOT IS, UH, YOU KNOW, I THINK THE FIRST RECOMMENDATION IS YEAH, WE, WE THINK THAT WE NEED TO, TO DO THIS AND, AND START WORKING ON THIS.
THE SECOND ONE IS MORE OF A, IT, IT, WE, WE THINK THAT IT'S THE RIGHT TIME TO REEXAMINE THAT AND, UH, HAVE THAT CONVERSATION AGAIN.
UM, I'LL, I'LL PAUSE THERE AND SEE IF THERE ARE ANY QUESTIONS ABOUT THAT.
WE HAVE A QUESTION FROM BILL BARNES.
I DON'T KNOW IF IT'S ABOUT THAT, BUT LET'S GO TO BILL.
IT IS, UH, AND THIS MAY BE MORE OF A SUGGESTION, JEFF, I LIKE WE'RE HEADED ON THIS, I THINK RIGHT NOW THE, WHAT YOU GUYS POST, ALRIGHT.
WHAT YOU GUYS POST IN DECEMBER IS A MINIMUM AMOUNT.
SO THE, YOU KNOW, THE PROCUREMENT ADJUSTMENTS ARE ONLY TO THE UPSIDE.
I'M WONDERING IF IT'S MIGHT BE POSSIBLE FOR ERCOT TO CALCULATE A MAXIMUM OR HAVE A RANGE SO THAT REPS WOULD KNOW THAT THERE'S SOME AMOUNT OF PROCUREMENT THAT'S GONNA HAPPEN BETWEEN X AND Y AND WE CAN KIND OF GAUGE THAT RISK, BUT WE KNOW THAT YOU'RE NOT GONNA BUY MORE.
I THINK THAT'S WOULD BE THE ASK IF WE ENTERTAIN THIS PROSPECT IS IF ERCOT WOULD BE WILLING TO LOCK IN A CERTAIN PROCUREMENT AMOUNT SO THAT WE, WE KNOW THAT OUR RISK IS CAPPED, ESSENTIALLY.
UM, JUST YEAH, SOME THOUGHTS ON IF WE, YOU KNOW, END UP GOING THIS DIRECTION.
YEAH, LIKE, BECAUSE THE, THE, THE RISK RIGHT NOW IS LIKE THE OPPOSITE IS WE, WE KNOW THE MINIMUM AMOUNT, BUT YOU CAN LIKE INCREASE IT SUBSTANTIALLY IN THE DAY AHEAD.
AND THEN IT'S LIKE WE, OUR HEDGES ARE NO GOOD OR DON'T COVER WHAT WE THOUGHT THEY WOULD.
SO IT IT, TO MEET THE DUAL OBJECTIVES OF GIVING YOU GUYS FLEXIBILITY BUT ALSO GIVING, UH, RETAILERS CERTAINTY ON WHAT OUR COSTS ARE GONNA BE.
IT MIGHT BE BETTER TO HAVE A RANGE OR SOMETHING THAT WE KNOW THAT THERE'S MORE CERTAINTY IN THE PRODUCT IN TERMS OF THE AMOUNT.
YEAH, BILL, I APPRECIATE THAT COMMENT.
YEAH, I, I THINK THAT'S, YOU KNOW, SOMETHING THAT WE CAN TALK THROUGH, UM, AT, AT, AT NOW.
IT'S MAYBE NOT THE RIGHT TIME, UH, BUT WHEN WE, UH, GET INTO THE DETAILS DOWN THE ROAD, I, I THINK THAT'S CERTAINLY SOMETHING WORTH EXPLORING.
THE LAST SLIDE I HAD IS JUST WHAT OUR NEXT STEPS ARE.
UM, SO WE'RE LOOKING FOR FEEDBACK, SO IF ANYONE WANTS TO SEND ME FEEDBACK, UH, FEEL FREE TO DO THAT.
UM, AND THEN WE, UH, ARE PLANNING ON GIVING A PRESENTATION TO THE BOARD, JUST AN UP UPDATE ON WHERE WE'RE AT WITH THE STUDY IN AUGUST.
AND THEN I BELIEVE WE'VE SCHEDULED AFTER THE AUGUST TAC MEETING, A WORKSHOP TO WORK THROUGH, UH, THE DETAILS, UH, MAYBE A LITTLE BIT MORE THAN WHAT WE SHARED TODAY.
UH, AND THEN WE WILL, UH, FROM THERE, WE'LL, WE'LL FINALIZE OUR REPORT AND POST THAT WITH THE PEC BY THE END OF SEPTEMBER.
UH, I DID ALSO WANT TO NOTE, UH, MI MENTIONED IT EARLIER, BUT, UH, WE, WE THINK THAT THE CHANGES THAT WE'RE PROPOSING THAT ANY OF THESE CHANGES, THAT THERE ARE NUMBER OF OPEN QUESTIONS AND, UH, OBVIOUSLY WE'D HAVE TO DEVELOP SOME SOFTWARE TOOLS TO, TO BE ABLE TO, UH, RUN THOSE CHANGES, UH, THAT, THAT, THAT THOSE WILL NOT MAKE IT INTO THE 2025 AS METHODOLOGY JUST DUE TO THE TIMING.
UM, WE, WE HAVE HAD A, A, UH, SOME CONVERSATIONS ON, UH, YOU KNOW, ARE, ARE THERE SOME THINGS THAT WE COULD TO COULD, UH, TRY TO WORK INTO THE 2025 AS METHODOLOGY, BUT I THINK FOR THE MOST PART, YOU, YOU, THE 25 METHODOLOGY IS GONNA LOOK, UH, SIMILAR, UH, VERY SIMILAR TO THE 24 METHODOLOGY.
UM, BUT, UH, YOU KNOW, AS WE WORK THROUGH THIS PROCESS THAN, YOU KNOW, WE WILL HAVE A BETTER SENSE OF WHAT THE TIMING IS TO IMPLEMENT THE, THE CHANGES GOING FORWARD.
AND THEN I THINK THAT PUCI THINK IKA HAD A FEW COMMENTS TO MAKE ON, UM, THE NEXT COUPLE SLIDES.
SO I WILL TURN IT OVER TO IKA.
HOW DID WE GET HERE? I JUST WANNA REMIND EVERYBODY THAT'S OUR MANDATE.
WE ARE TRYING TO MEET THAT LEGISLATIVE MANDATE.
THAT'S THE PURPOSE OF THIS STUDY.
AND WE HAVE THE PROJECT 5, 5, 8, 4 5 OPEN FOR THAT.
AND YOU CAN SEE UNDER THAT PROJECT THE ORIGINAL SCOPE, BUT THE COMMISSION APPROVED AS A SCOPE AND INITIAL TIMELINES.
UH, SO THAT'S REALLY OUR GOAL TO BE RESPONSIVE TO THIS MANDATE.
AND HIGH LEVEL, WHAT HAPPENED? UH, JUNE 13, OPEN MEETING COMMISSIONERS AGREED TO GIVE US ONE MORE MONTH BECAUSE I, MM AND ERCOT, THEY ARE WORKING VERY CLOSELY WITH STAFF
[01:00:01]
AND THERE'S LOTS OF STUFF GOING ON AS YOU KNOW.UH, JUNE 24, OPEN MEETING THIS, OPEN, THIS TECH MEETING.
THIS IS, I KNOW THIS A HIGH LEVEL UPDATE THE DIRECTION OF THE STUDY.
AND DURING NEXT THREE MONTHS, WE WILL CONTINUE TO WORK VERY CLOSELY.
AND AUGUST 28, WE ARE GONNA HAVE THE TECH WORKSHOP WHERE IMM AND ERCOT WILL PRESENT.
AND SEPTEMBER 30TH, HOPEFULLY, UH, WE WILL, PUC STAFF WILL BE ASSIGNED TO DEVELOP THAT DOCUMENT AND WE WILL INCORPORATE I'S PIECES IN IT AND ERCOT PIECES IN IT.
SO WE WILL HAVE THE DOCUMENT CONTROL HERE.
AND THEN AFTER THAT STUDY, THAT'S REALLY, WE NEED THE MOST FEEDBACK FROM YOU GUYS.
WE ARE GONNA HAVE STAKEHOLDER COMMENTS TOO.
AND SECOND HALF OF OCTOBER, WE ARE GONNA, UH, HOLD A WORKSHOP HERE AT THE PUC.
AND AFTER THE COMMENTS END THE WORKSHOP, NOVEMBER, DECEMBER, PUC IS GONNA EVALUATE.
AND WE ARE GONNA, YOU KNOW, THE COMMISSIONERS WILL APPROVE THE FINAL STUDY AND RECOMMENDATIONS.
AND THEN THIS WILL BE PART OF, IS AN APPENDIX OR, UH, UH, BIENNIAL AGENCY REPORT.
SO WHAT REALLY MOST HELPFUL TO US IS THE NEXT STEP IS THE, UH, AUGUST WORKSHOP.
WHAT WILL BE MOST HELPFUL TO YOU GUYS? WHAT DO YOU WANT TO BE ON THAT, UH, WORKSHOP AGENDA? WHAT DO YOU WANNA SEE THAT WILL BE VERY HELPFUL TO IMM, TO US AND
SO THAT'S, AND BECAUSE THAT'S GONNA REALLY ALSO INFORM US WHAT QUESTION SHOULD WE ASK AT THE COMMISSION ONCE THE FINAL STUDY IS FILED.
WE WANNA REALLY NARROW DOWN THE SCOPE SO WE DON'T ASK EVERYTHING.
IF THERE ARE TOPICS, IMM,
BUT WHAT OTHER ASPECTS WILL BE HELPFUL TO US IF YOU TELL US, UH, TO FOCUS OUR QUESTIONS FOR THE STAKEHOLDERS COMMENTS.
AND, AND THANKS FOR COMING TO SPEAK TO T.
DO I SEE, I DON'T SEE ANY QUESTIONS OR COMMENTS IN THE QUEUE.
UM, BUT LOOKS LIKE STAFF IS, IS LOOKING FOR FEEDBACK.
IKA, SHOULD THAT GO TO YOU SINCE ABSOLUTELY.
WELL THANK YOU, UH, SO MUCH FOR THE TIME TO, TO BEING HERE TODAY.
I THINK WE ARE CLOSE TO BEING FINISHED.
UM, ANY OTHER BUSINESS BEFORE WE GET TO THE COMBO BALLOT? RICHARD ROTH, DO YOU HAVE A RICHARD ROTH GOLD STAR TO GIVE OUT FOR TODAY? ALRIGHT, I WON'T PUT HIM ON THE SPOT.
[14. Combo Ballot (Vote)]
SO COREY HAS THE, UM, ITEMS ON THE COMBO BALLOT ON THE SCREEN.UM, DO, CAN WE GET A MOTION AND A SECOND FOR THE COMBO BALLOT MOTION FROM NED? SECOND? LET'S TAKE THE SECOND FROM BLAKE.
ON THE MOTION TO APPROVE THE COMBO BALLOT, WE WILL START UP WITH THE CONSUMERS, WITH ERIC O.
ERIC SCHUBERT? YES, THANK YOU.
YOU STILL WITH US? I'LL LOOP BACK TO JOHN.
LET'S TALK TO OUR INDEPENDENT GENERATORS.
[01:05:02]
YES.THANK YOU TWICE ONTO OUR IOUS.
RUSSELL, YOU STILL WITH US? HOW ABOUT JOSE? YES, THANK YOU, DAVID.
AND THEN ONE LAST CALL FOR RUSSELL OR JOHN PACKARD.
UM, ANY, ANY FINAL THOUGHTS OR COMMENTS BEFORE WE ADJOURN? ALL RIGHT, WELL, WE WILL ADJOURN.
UM, OUR NEXT MEETING, I BELIEVE IS JULY 31ST, AND WE WILL BE IN PERSON.
UM, I BELIEVE THERE WILL BE, UH, A SPECIAL BOARD MEETING SCHEDULED IN BETWEEN THAT, BUT I DON'T THINK THAT'S CONFIRMED YET.
AND I BELIEVE THAT THAT WILL BE MOSTLY, UH, WEBEX PARTICIPATION.
SEE YOU GUYS IN PERSON ON JULY 31ST.