Dec 02, 2024 Reliability and Markets Committee Meeting

UP FOR A VOTE IS AGENDA ITEM 5.1 NPRR 1247 TITLED, INCORPORATION OF CONGESTION COST SAVINGS TEST.

UH, ANY OTHER REFLECTIONS ON THAT? OTHER THAN THAT, NO, THIS IS WHERE A LOT OF THE OPERATIONS OF THE GRID OCCUR.

WE SHOULD HAVE A FULL COMMITTEE AS SOON AS POSSIBLE.

TOTALLY AGREE.

OKAY, NEXT

[5.1 NPRR1247, Incorporation of Congestion Cost Savings Test in Economic Evaluation of Transmission Projects – URGENT]

IN ECONOMIC EVALUATION OF TRANSMISSION PROJECTS URGENT, CAITLYN SMITH WILL PRESENT THE TAC REPORT FOR NPRR 1247.

I'M, YOU KNOW, ALWAYS SHORTER THAN THE LAST PERSON UP HERE.

UH, GOOD, GOOD AFTERNOON.

I'M KAITLIN SMITH, CHAIR OF THE TECHNICAL ADVISORY COMMITTEE, AND THANK YOU FOR THE OPPORTUNITY TO PRESENT.

IT'S GREAT TO SEE YOU IN YOUR, UH, NEW, HOPEFULLY PERMANENT ROLE AT RELIABILITY AND MARKETS COMMITTEE.

WE, WE'VE APPRECIATED WORKING WITH YOU AND LOOK FORWARD TO WORKING WITH YOU FURTHER.

UH, SINCE THE OCTOBER MEETING, WE HAVE MET TWICE ON OCTOBER 30TH AND NOVEMBER 20TH, AND THE, THE CURRENT PRESENTATIONS WE DO HERE AT RELIABILITY IN MARKETS ARE FOCUSED JUST ON THOSE VOTING ITEMS WITH, UM, OPPOSING VOTES.

UH OH.

OPPOSING VOTES AND ONE ABSTENTION.

UM, SO AT THE NOVEMBER 20TH TAC MEETING, NPRR 1247, INCORPORATION OF CONGESTION COST SAVINGS TEST IN ECONOMIC EVALUATION OF TRANSMISSION PROJECTS WAS RECOMMENDED BY TAC FOR BOARD APPROVAL.

IT DID RECEIVE THREE

[00:05:01]

THIS NPRR INCORPORATES THE CONSUMER ENERGY COST REDUCTION TEST AS THE CONGESTION COST SAVINGS TEST IN ECONOMIC PROJECT EVALUATION.

THIS NPRR WAS, UM, IN ORDER TO ADDRESS AMENDMENTS BY THE, THE PUC TO 16, TEXAS' ADMINISTRATIVE CODE 25.101, AND THIS WAS AMENDED IN THE PUC PROJECT, UH, 5 3 4 0 3.

THAT FINAL RULE WAS PUBLISHED IN DECEMBER OF, UH, 2022.

ABOUT TWO YEARS AGO, THE PRIMARY AIM OF THE PUC RULEMAKING WAS TO IMPLEMENT SB 1281 FROM THE 87TH LEGISLATIVE SESSION.

SO IT WAS LEGISLATION TO THE PUC, UH, TO, TO ERCOT.

WE SEE THAT A LOT OF TIMES, AND THAT, THAT PUC RULEMAKING WENT THROUGH A NORMAL ROBUST RULEMAKING PROCESS WITH, WITH COMMENT PROPOSAL FOR PUBLICATION, PROPOSAL FOR ADOPTION.

BUT WHAT CAME OUT OF THAT RULE WAS A REQUIREMENT THAT ERCOT DEVELOP A CONGESTION COST SAVINGS TEST TO BE USED IN ECONOMIC PROJECT EVALUATION.

AND SO ERCOT TOOK THE BALL AND IN THAT PROCESS, UH, RETAINED E THREE TO IDENTIFY A SET OF OPTIONS AND PROVIDE RECOMMENDATIONS OF THE MOST SUITABLE CONGESTION COST SAVINGS TEST BASED ON ERCOT PARTICULAR MARKET STRUCTURE THAT ERCOT WORKED WITH PUCE THREE AND STAKEHOLDER FEEDBACK.

THEY WORKED WITH THE PLANNING WORKING GROUP IN 2023, UM, AND THEN THEY RECOMMENDED, UH, WHAT E THREE REFERRED TO AS THE SYSTEMWIDE GROSS LOAD COST TEST.

UH, THIS NPRR INCLUDES THE RECOMMENDED CONGESTION COST SAVINGS TEST AND, AND ERCOT ECONOMIC PROJECT EVALUATION.

BUT CONSISTENT WITH THE PUC RULE, IT ALSO PRESERVES THE PRODUCTION COST SAVINGS TEST AS ANOTHER STANDALONE MEANS TO ESTABLISH ECONOMIC NEED FOR A TRANSMISSION PROJECT.

UH, WE SPOKE BRIEFLY ABOUT THIS NPR AT THE LAST MEETING.

IT, IT WAS A BIT OF A CHALLENGE, I THINK, BOTH SUBSTANTIVELY AND PROCEDURALLY FOR, FOR STAKEHOLDERS.

IT WAS FILED IN AUGUST OF THIS YEAR.

IT WENT TO SEPTEMBER PROTOCOL REVISION, UH, SUBCOMMITTEE, AND THEN THE OCTOBER RELIABILITY AND OPERATIONS SUBCOMMITTEE.

UH, A LOT OF THE WORK GOT DONE AT, AT ROSS, THE RELIABILITY AND OPERATIONS SUBCOMMITTEE, AND AT THE PLANNING WORKING GROUP, THEY HAD A SPECIAL MEETING OF THE PLANNING WORKING GROUP IN ORDER TO GET IT BACK TO, TO ROSS AND THEN BACK TO PRS AND HERE, UM, I, I WOULD NOTE THAT WE DID VOTE IT WITH URGENCY AT THE PROTOCOL REVISION SUBCOMMITTEE, UH, MEETING.

SO, SO USUALLY YOU HAVE A TWO MONTH PROCESS THERE FOR, FOR LANGUAGE AND THEN THE IMPACT ANALYSIS, AND WE DID IN ONE MONTH THERE TO, TO GET IT TO YOU BY THE END OF THE YEAR.

IT WAS KIND OF A, A LOT OF HARD WORK AND A PAINSTAKING PROCESS, ESPECIALLY BY THAT PLANNING WORKING GROUP.

AND THE WORKING GROUP.

THEY LITERALLY WENT LINE BY LINE THROUGH THIS MP OR THROUGH THE NPRR IN ORDER TO HAVE SOMETHING, MAYBE NOT GROUP ENDORSED, BUT TO HAVE A GROUP BASE TO, TO WORK ON FOR THE VOTING GROUPS TO WORK ON THEN.

AND SO, UH, ROSS AND PLWG LEADERSHIP DID, DID REALLY GREAT WORK ON THIS.

UH, THE, THE LEADERSHIP OF THOSE GROUPS ARE, ARE KATIE RICH, ALEX MILLER, AND THEN PLWG IS DYLAN PRIEST AND MINA TURNER.

AND SO IT WAS AN INTERESTING JOURNEY VOTE WISE AT THE FIRST VOTING MEETING, WHICH WAS RELIABILITY AND OPERATIONS SUBCOMMITTEE.

THERE, THERE WERE THREE NOS, BUT 11 ABSTENTIONS, AND THOSE ABSTENTIONS SORT OF GOT WHITTLED DOWN UNTIL TAC, WHERE WE HAD THREE NOS AND ONE ABSTENTION.

UM, TWO NOS FROM THE INDEPENDENT GENERATOR SEGMENT, ONE FROM THE INDEPENDENT POWER MARKETER SEGMENT, AND ONE ABSTENTION FROM THE INDEPENDENT RETAILER SEGMENT.

UH, AT THE, I BELIEVE THIS SHOWS NO EXPLANATION FROM CALPINE, WE DID GET AN EXPLANATION FROM THEM.

THEIR NOTE WAS REALLY ON THE BASIS OF, OF OBJECTING TO THE URGENCY AND TO THE INCOMPLETENESS OF THE NPRR, THE NPRR OR, OR THE LANGUAGE AHEAD OF IT REFERENCES WHITE PAPERS THAT STAKEHOLDERS FEEL ARE NOT COMPLETE YET.

UM, AND THE PROCESSES IN WHITE PAPERS DON'T NECESSARILY NEED STAKEHOLDER REVIEW.

THIS WAS A, A RECURRING REASON AND THE NO VOTES AND A RECURRING REASON THAT CAME UP IN DISCUSSION.

UM, WHITE PAPERS CAN BE UPDATED WITH WITHOUT A STAKEHOLDER PROCESS.

THERE'S NO WHITE PAPER REVISION REQUEST.

UM, SO, SO THAT CAME UP A LOT.

BUT THE OTHER INDEPENDENT GENERATOR SEGMENT FROM LUMINANT NOVO WAS CONSISTENT WITH THEIR WRITTEN COMMENTS.

UM, SO I DO WANNA THANK THEM FOR PUTTING THOSE COMMENTS IN WRITING.

THEY FILED COMMENTS OCTOBER 28TH AND NOVEMBER 15TH.

THEY BELIEVE THAT THE GROSS LOAD COST TEST CHOSEN OVERSTATES THE ACTUAL NET BENEFITS ASSOCIATED

[00:10:01]

WITH THE TEST, AND THAT THERE ARE IMPORTANT TEST PARAMETERS THAT ARE LEFT TO WHITE PAPERS, AGAIN, OUTSIDE OF THE STAKEHOLDER REVIEW PROCESS.

AND THEY ULTIMATELY SEE THIS AS A TRADE OFF BETWEEN CONGESTION COSTS, WHICH ARE HEDGEABLE AND RETURNABLE FOR LOADS AND TRADING THAT FOR TRANSMISSION COSTS.

THE LAST OPPOSING VOTE WAS THE INDEPENDENT POWER MARKETERS IN THE INDEPENDENT POWER MARKETER SEGMENT FROM SHE ENERGY NORTH AMERICA, UM, LARGELY BASED ON CONCERNS WITH THE, THE LACK OF TRANSPARENCY AND CONTROL OVER THE METHODOLOGY.

UM, THEY, THEY REFERRED TO INCORPORATION OF FICTITIOUS GENERATION ON THE ERCOT SYSTEM TO SOLVE POWER FLOW ISSUES WITH THE PROJECTED LOAD GROWTH.

AND SO THEY VIEWED THAT THIS WOULD CREATE, UH, YOU KNOW, CONGESTION, COST SAVING TEST RESULTS THAT DO NOT PRODUCE OUTCOMES CONSISTENT WITH THE INTENT OF THE METHODOLOGY.

AND THEY ALSO BELIEVE THAT THERE IS A BENEFIT AND ADDITIONAL DISCUSSION TO DETERMINE HOW GROSS LOAD COST TESTS CAN BE MODIFIED TO BETTER REFLECT ACTUAL NET BENEFITS.

SO I WILL PAUSE HERE OR I CAN END HERE UNLESS THERE ARE ANY QUESTIONS, ANY QUESTIONS.

IF NOT, THANK YOU KAITLYN.

AND WE'RE GONNA TURN IT OVER TO CHRISTIE HOBBS AND HAVE ERICA STAFF PROVIDE ANY COMMENTS ON THIS NPRR.

ALL RIGHT, GOOD AFTERNOON.

SO KAITLYN DID A GREAT JOB OF, OF TEEING IT UP.

SO I'M GONNA SKIP THROUGH, UM, KIND OF TO THE, THE HEART OF WHAT I WANTED TO MAKE SURE WE WALK THROUGH TODAY.

UM, AS WE WALK THROUGH THE BACKGROUND, KAITLIN DID A GOOD, GOOD JOB OF SETTING UP WHY OR HOW WE GOT TO TODAY.

UM, THE THING THAT I WOULD RECOGNIZE IS, YES, THE REVISION REQUEST WAS FILED THIS YEAR, UM, BUT THIS HAS BEEN AN ONGOING DISCUSSION WITH STAKEHOLDERS, WITH THE COMMISSION APPROVING THEIR RULE, WHERE THERE WAS A VERY ROBUST DISCUSSION AS THEY CAME TO THEIR ORDER ON WHAT THEY WANTED US TO DO GOING FORWARD.

WE THEN ENGAGED E THREE, WHICH CONTINUED A LOT OF STAKEHOLDER DISCUSSIONS.

UM, WE PRESENTED, OR EXCUSE ME, E THREE PRESENTED THEIR RECOMMENDATIONS BACK IN SEPTEMBER OF LAST YEAR.

AND THEN THE REVISION REQUEST THAT WE ULTIMATELY CAME FORWARD WITH WAS A REFLECTION OF THAT.

THERE HAD BEEN A LOT OF STAKEHOLDER FEEDBACK AND ENGAGEMENT ALONG THE WAY, UH, BUT RECOGNIZING UNTIL YOU ACTUALLY SEE THE, THE WORDS ON PAPER, UH, THAT'S WHEN ADDITIONAL DISCUSSION, UH, CAN TAKE US FORWARD.

A PICTURE IS OFTEN VERY HELPFUL, UH, TO, TO UNDERSTAND WHAT THE RECOMMENDATION IS.

SO IF YOU THINK ABOUT OUR PLANNING CRITERIA, WHICH IS PUT IN THE PROTOCOLS, WE'VE GOT A RELIABILITY CRITERIA.

SO THOSE ARE THINGS FROM THERMAL OVERLOADS VOLTAGE VIOLATIONS THAT ARE BOTH THE ERCOT PLANNING RULES AS WELL AS THE NERC STANDARDS.

SO THAT'S ONE SET OF CRITERIA WE USE AS TO WHETHER OR NOT WE RECOMMEND A PROJECT GOING FORWARD.

AND THEN WE HAVE ECONOMIC CRITERIA.

WE'VE CURRENTLY GOT IN PLACE A PRODUCTION COST SAVINGS TEST, AND THAT WILL REMAIN EVEN AFTER THE APPROVAL OF NPR 1247.

AND WHAT THAT IS, IS LOOKING AT, UM, COST.

YOU'RE COMPARING THE FUEL COST OF THE GENERATORS TO, WITH THEIR STARTUP COST, THEIR VARIABLE O AND M, AND IT'S LOOKING AT THE MEGAWATTS PRODUCED, AND IT'S KIND OF AN OVERALL SOCIETAL ECONOMIC BENEFIT.

THEN THERE'S ADDITIONAL ECONOMIC CRITERIA.

AND WHAT THE COMMISSION TOLD US TO DO IS UPON PASSING OF THEIR THEIR RULE, WE COULD START USING AN OLD TEST THAT WE PREVIOUSLY HAD USED BECAUSE WE HAD THAT AVAILABLE TO US, A GENERATOR REVENUE REDUCTION TEST.

SO THAT'S IN PLACE TODAY.

WE'RE USING THAT SECOND CRITERIA, BUT WHAT NPR 1247 WOULD DO IS REPLACE THAT WITH A CONGESTION COST SAVINGS TEST.

AND IT BASICALLY IS LOOKING AT THE IMPACT TO END USE CONSUMERS COMPARING THE LMP TIMES, THE MEGAWATTS THAT ARE CONSUMED.

AND SO THAT'S THE PIECE THAT'S BEING DISCUSSED HERE TODAY.

AND HOW DO WE MOVE THAT FORWARD? I LIKE TO THINK OF IT AS, AS A SCALE, AS YOU THINK ABOUT THE CONGESTION COST SAVINGS TEST, WE'RE LOOKING AT THE PROPOSED PROJECT.

DOES IT REDUCE CONGESTION COSTS ON THE SYSTEM? LOOKING AT THAT THROUGH THE LENS OF THE EXPECTED SYSTEM-WIDE CONSUMER ENERGY COSTS THAT THEY PAY, THAT'S THE BENEFIT SIDE.

YOU'RE COMPARING THAT TO THE COST OF DOING THE PROJECT.

AND DO YOU HAVE THAT BALANCE OR ADDITIONAL BENEFIT TO ENDORSE THAT PROJECT MOVING FORWARD? AS KAITLYN SAID, THERE WAS A LOT OF STAKEHOLDER DISCUSSION.

WE APPRECIATE THE STAKEHOLDERS ENGAGING WITH US,

[00:15:01]

GIVING US THAT FEEDBACK.

A LOT OF EDITS AND CHANGES WERE MADE TO CONTINUE TO IMPROVE THE REVISION REQUEST.

THEN THERE WAS THOSE FEW OBJECTIONS AT THE END, UM, THAT KAITLYN WENT THROUGH, JUST FROM ERCOT PERSPECTIVE.

WHAT I'D KIND OF LIKE TO HIGHLIGHT, UM, AS FAR AS THE LUMINANT COMMENTS REGARDING, UM, TAKING IN THAT, UH, CONSIDERATION THAT THEY CAN BE HEDGED, WE DON'T HAVE GOOD INFORMATION TO BE ABLE TO TAKE THAT INTO THE PLANNING CASES TODAY.

AND THAT WAS SOMETHING THAT WAS ALSO HIGHLIGHTED DURING THE E THREE STUDY.

IF WE CAN GET BETTER INFORMATION ON THAT GOING FORWARD AND MAKE SURE WE'RE NOT OVERSTATING OR UNDERSTATING ANY OF THOSE BENEFITS, THEN WE COULD TAKE THAT INTO ACCOUNT IN THE FUTURE.

BUT WE DON'T HAVE GOOD DATA ON THAT TODAY.

FROM THE RELIANT COMMENTS, WE ARE COMMITTED.

IN FACT, IF YOU'VE LOOKED AT SOME OF OUR DRAFT GOALS FOR NEXT YEAR, THAT'S ONE OF OUR GOALS.

WE'LL BE HAVING A REVISION REQUEST COME OUT EARLY NEXT YEAR THAT LOOKS AT, IF WE DO NOT HAVE SUFFICIENT GENERATION TO BALANCE OUR TRANSMISSION PLANNING CASE, HOW WE WILL GO ABOUT ADDING THAT INTO OUR PLANNING CASES.

SO THAT REVISION REQUEST IS COMING FORWARD EARLY NEXT YEAR FOR YOUR CONSIDERATION, UM, WHICH WAS ALSO PART OF THE SHELL COMMENTS AS WELL.

SO AT THE END OF THE DAY, OUR RECOMMENDATION IS THAT YOU ENDORSE AND OR RECOMMEND APPROVAL TO MOVE THIS FORWARD TO THE BOARD AND THEN ULTIMATELY TO THE COMMISSION.

BECAUSE OF OUR STATUTORY REGULATORY REQUIREMENTS TO PUT THIS TEST IN PLACE, IT UTILIZES A METHODOLOGY THAT HAS BEEN STUDIED BY OUR OUTSIDE CONSULTANT AND CONSULTATION WITH COMMISSION STAFF, AS WELL AS THROUGH STAKEHOLDER ENGAGEMENT ALONG THE WAY.

IT GIVES A LEVEL OF DETAIL WITHIN THE PROTOCOLS COMPARED TO WHAT'S HISTORICALLY THERE AND WHAT'S THERE TODAY FOR THE PRODUCTION COST SAVINGS TEST AND THAT WE CAN CONTINUE JUST LIKE, I THINK I HEARD SOMEONE SAY TAC THIS IS 1247.

WE'VE HAD A LOT OF REVISIONS TO THE PROTOCOLS OVER THE YEARS.

AS WE CONTINUE TO GET BETTER INFORMATION, ADDITIONAL ANALYSIS AND TOOLS, WE CAN ALWAYS COME BACK AND REVISE THIS AS ADDITIONAL INFORMATION IS AVAILABLE.

CARLOS, CHRISTIE, THANK YOU.

UM, COULD YOU GO BACK TO PAGE FOUR AND, UH, I MEAN, MULTI-VARIABLE OPTIMIZATION IS USUALLY VERY DIFFICULT.

UM, AND COULD YOU PLEASE GO MAYBE THROUGH THE SEQUENCE OF HOW THIS WORKS OR THIS FORMULA WORKS? SO WHAT'S FIRST, WHAT'S SECOND AND WHAT'S THIRD TEST? SO I WOULD SAY RELIABILITY IS YOUR FIRST TEST.

UM, THAT'S AN EASY WAY TO MAKE A RECOMMENDATION ON A PROJECT MOVING FORWARD.

THEN YOU RUN YOUR ECONOMIC ANALYSIS AND THE WAY THE COMMISSION RULE IS SET, WE CAN APPROVE IT IF IT SHOWS PRODUCTION COST BENEFIT OR CONGESTION, COST SAVINGS BENEFIT.

SO WE'LL BE RUNNING THOSE CON CURRENTLY, IF THE PROJECT PASSES EITHER ONE OF THOSE, THEN IT SHOULD BE RECOMMENDED.

BUT I THINK THE COMMISSION, IF YOU GO BACK AND READ THEIR ORDER, THEY NOTE THAT IT SAYS ERCOT, YOU KNOW, MAY RECOMMEND, AND THAT THEY ARE THE ULTIMATE APPROVER OF ALL PROJECTS.

SO IT'S OUR RECOMMENDATION ON THE ECONOMIC BENEFIT.

SO IT'S EITHER OR PRODUCTION OR CONGESTION, COST SAVINGS.

ANY OTHER QUESTIONS OR COMMENTS FROM THE COMMISSIONERS? I, I HAVE A QUESTION.

UH, IT SEEMS LIKE SOME OF THE FEEDBACK IS ABOUT THE CORRECTNESS OF SOME OF THE VARIABLES THAT ARE, OR QUANTITIES THAT ARE TAKEN INTO CONSIDERATION.

AT WHAT FREQUENCY WOULD YOU SEE UPDATING THE ECONOMIC CRITERIA FORMULA? I THINK IT WOULD BE AS NEEDED.

SO AS WE'RE RUNNING, AS WE SEE DIFFERENT VARIABLES CHANGING, UM, IN THE ENVIRONMENT AROUND US, I THINK WHAT WE CAN COMMIT TO DO, AND WE'RE VERY ACTIVE IN THE THE P-L-D-W-G PROCESS, THAT AS WE'RE SEEING THOSE, WE WOULD CONTINUE TO WORK WITH THE STAKEHOLDERS AND LET THEM KNOW AND GIVE THEM THAT HEADS UP THAT WE'RE CHANGING THESE PARAMETERS.

AND WHAT'S THE FIRST TIME, WE'LL, IF WE PASS THIS NPRR TODAY, WHAT'S THE FIRST TIME WE WOULD BE ABLE TO USE IT AFTER PUC APPROVAL? SO I THINK WE WOULDN'T SEE THIS IN EFFECT, IT PROBABLY BASED OFF OF TODAY, THE TIMELINE THAT THE COMMISSION REQUIRES BEFORE THEY WOULD TAKE IT UP, THEY WOULD PROBABLY TAKE IT UP IN ONE OF THEIR JANUARY OPEN MEETINGS, WHICH WOULD THEN MEAN WE COULD START USING THAT BEGINNING FEBRUARY 1ST.

I WILL SAY AS WE'VE BEEN GOING THROUGH OUR ANALYSIS FOR THIS YEAR'S REGIONAL TRANSMISSION

[00:20:01]

PLAN, WE HAVE BEEN APPLYING THIS NEW CRITERIA.

WHAT THAT MEANS THOUGH, IS WE CAN'T BRING IT FORWARD TO YOU OR AS A RECOMMENDATION UNTIL THAT APPROVAL IS IS IN PLACE.

BUT WE HAVE BEEN UTILIZING THAT AS WE GAIN EXPERIENCE, UM, WITH USING OUR TOOLS FOR THIS CRITERIA.

AND CHRISTY, JUST A QUESTION FOR BACKGROUND PURPOSES.

SO AS YOU'RE LOOKING AT THE REGIONAL TRANSMISSION PLAN, HOW ARE THESE RELIABILITY AND ECONOMIC TESTS BEING APPLIED? I THINK YOU KIND OF MENTIONED IT, BUT I'M JUST TRYING TO UNDERSTAND LIKE, LIKE YOU'RE LOOKING AT EHB, RIGHT? SO LIKE WHAT, HOW DO YOU APPLY THESE TESTS IN THAT CONTEXT? SURE.

SO ABSOLUTELY, YOU'RE LOOKING AT IT FROM RELIABILITY.

FIRST, YOU'RE LOOKING TO SEE RECOMMENDATIONS ON PROJECTS BECAUSE WE SEE THERMAL OVERLOADS ON THE SYSTEM, VOLTAGE VIOLATIONS.

SO THOSE YOU WOULD MOVE FORWARD AS A RECOMMENDATION FROM A RELIABILITY PROJECT.

THEN WE'RE ALSO LOOKING AT IMPACTS TO THE SYSTEM FROM AN ECONOMIC PERSPECTIVE.

AND IF WE SEE POTENTIAL SOLUTIONS THAT COULD, UM, IMPROVE THE ECONOMIC BENEFIT, THEN THOSE WOULD BE RECOMMENDED AS WELL.

SO THEN THOSE, UM, HIGH VOLTAGE LINES COULD BE EITHER RELIABILITY OR ECONOMIC.

I DON'T SEE ANY OTHER COMMENTS OR QUESTIONS HEARING NO OTHER COMMENTS.

I'LL NOW ENTERTAIN A MOTION TO RECOMMEND THAT THE BOARD APPROVE NPRR 1247 INCORPORATION OF CONGESTION, COST SAVINGS TEST AND ECONOMIC EVALUATION OF TRANSMISSION PROJECTS.

AND SO MOVED WITH THE COMMENT OF CONTINUOUSLY REVISING HOW THIS IS APPLIED MOST EFFICIENTLY.

I SECOND THAT MOTION.

ALRIGHT, ALL IN FAVOR? ALL OPPOSED? ANY OPPOSED, ANY ABSTENTIONS? NO.

AGENDA ITEM SIX, RECOMMENDATIONS REGARDING REGIONAL PLANNING GROUP TIER ONE TRANSMISSION PROJECTS.

THAT MOTION PASSES AND I'VE GOT SOME, SOME FRIENDS AT HOME THAT ARE LISTENING AND THEY WANTED ME TO THAT POINT THAT WE WILL BE LOOKING AT THAT REVENUE REQUIREMENT FOR PROJECT JUSTIFICATIONS AT LEAST ANNUALLY.

SO WE WILL CONTINUE TO BE LOOKING AT THOSE PARAMETERS, BUT AT LEAST ANNUALLY, THAT'S TERRIFIC TO HEAR REGULAR UPDATES.

NEXT UP IS

[6.1 AEPSC Brownsville Area Improvements Transmission Project]

THERE ARE TWO REGIONAL PLANNING GROUP PROJECTS UNDER THIS ITEM, AMERICAN ELECTRIC POWER SERVICE CORPORATION, BROWNSVILLE AREA IMPROVEMENTS TRANSMISSION PROJECT, AND ON CORD DELAWARE BASIN STAGES THREE AND FOUR PROJECT CHRISTIE HOBBS WILL PRESENT THE RECOMMENDATIONS AFTER WHICH TODAY'S AGENDA NOTICES THE RECOMMENDATIONS FOR A VOTE.

CHRISTIE.

ALL RIGHT, SO, UH, GOT TWO PROJECTS HERE FOR YOU.

UM, MUCH LIKE PREVIOUS PROJECTS THAT WE BRING FORWARD, THEY'VE MET A CRITERIA THAT RISES TO THE LEVEL OF BOARD CONSIDERATION.

THE FIRST ONE, AS YOU MENTIONED, THE A EP BROWNSVILLE AREA IMPROVEMENTS PROJECT, WHICH IS A $423 MILLION PROJECT.

AS A REMINDER, THESE TYPES OF PROJECTS, BECAUSE OF THEIR SIZE AND SCOPE, MUST GO THROUGH THE TIER ONE APPROVAL PROCESS, WHICH MEANS A STOP OF THE BOARD BEFORE A TRANSMISSION SERVICE PROVIDER CAN TAKE THEM TO THE COMMISSION.

WE RECEIVED THIS PROJECT TO START REVIEWING BACK IN MARCH OF THIS YEAR, UM, AND IT WAS REALLY TO LOOK AT SOME SPECIFIC NEEDS IN THE BROWNSVILLE AREA, AND WE PERFORMED OUR INDEPENDENT REVIEW, AND AS WE WE LOOKED THROUGH, WE SAW, UM, SEVERAL OPTIONS THAT WE COULD ANALYZE TO LOOK AT RELIEVING THERMAL OVERLOADS AS WELL AS VOLTAGE VIOLATIONS ON THE SYSTEM.

WE WENT THROUGH OUR NORMAL STAKEHOLDER REVIEW PROCESS.

THE TECHNICAL ADVISORY COMMITTEE REVIEWED THIS PROJECT BACK AT THE END OF OCTOBER, AND THEY UNANIMOUSLY ENDORSED MOVING THE ERCOT RECOMMENDATION FORWARD AS WELL.

SO, AS I STATED, THIS REALLY LOOKED AT SEVERAL DIFFERENT, UM, THERMAL OVERLOADS AND VOLTAGE VIOLATIONS FROM A NERC AND ERCOT PLANNING CRITERIA.

ALSO, AS I NOTED, WE LOOKED AT 10 DIFFERENT OPTIONS.

THE OPTIONS THAT WE BROUGHT FORWARD TO YOU, THEY HAD TO MEET A FEASIBILITY TEST AS WELL AS THE, THE RECOMMENDATION THAT WE ENDED UP BRINGING FORWARD IS THE LEASE COST OF ALL THE OPTIONS THAT WE REVIEWED.

UM, IT TOOK LESS CCN RIGHT AWAY MILES COMPARED TO THE OTHER OPTIONS.

UM, IT GAVE US ADDITIONAL OPERATIONAL FLEXIBILITY IN THE FUTURE AS WELL AS IMPROVED LONG-TERM, UH, LOAD SERVING CAPABILITY.

AND THAT WAS THE BASIS FOR BRINGING THIS RECOMMENDATION

[00:25:01]

FORWARD.

SO WITH THAT, I'LL PAUSE HERE.

WE WOULD RECOMMEND, UH, YOUR ENDORSEMENT, UH, MOVING IT FORWARD TO THE BOARD.

CHRISTIE.

DOES THE COMMITTEE MEMBERS HAVE ANY QUESTIONS, COMMENTS? NONE ON THIS ONE.

AND IT'S TWO A, RIGHT? YOU'RE RECOMMENDING TWO A? THAT'S CORRECT.

YEP.

WE'RE GONNA TAKE EACH PROJECT SEPARATELY.

I'LL ENTERTAIN A MOTION TO RECOMMEND THAT THE BOARD ENDORSE THE NEED FOR THE TIER ONE A-E-P-S-C BROWNSVILLE AREA IMPROVEMENTS TRANSMISSION REGIONAL PLANNING GROUP PROJECT OPTION TWO A.

[6.2 Oncor Delaware Basin Stages 3 and 4 Project]

THE ENCORE PROJECT.

ALL RIGHT, SO THIS IS ONE THAT WAS SUBMITTED TO US BY ENCORE.

IT'S A DELAWARE BASIN PROJECT.

IT'S $202 MILLION.

UM, JUST A LITTLE BIT OF HISTORY, WE'LL SKIP OVER THE REASON WHY IT'S HERE.

WE'VE ALREADY COVERED THAT.

UM, WE DID A STUDY BACK IN 2019 WHERE WE LOOKED AT FUTURE OIL AND GAS LOAD GROWTH AND THE NEEDS FOR LONG-TERM PLANS TO BE ABLE TO MEET THOSE NEEDS.

UM, THESE PROJECTS THAT ENCORE SUBMITTED WERE A PART OF THAT STUDY AS A PART OF OUR RECOMMENDATION ON HOW WE CONTINUE TO MEET THAT OIL AND GAS LOAD GROWTH IN THE DELAWARE BASIN AREA.

IT HAD SOME, UM, SOME POINTS IN THERE WHERE LOADS MET CERTAIN LEVELS.

UM, THAT'S WHY YOU'RE SEEING THAT BROUGHT FORWARD.

NOW.

THE RECOMMENDATION LOOKS AT RESOLVING 20 VOL VOLTAGE VIOLATIONS AS WELL AS FOUR UNSOLVED POWER FLOWS IN THAT REGION.

I WOULD ALSO NOTE, UM, WE'VE HAD A LOT OF DISCUSSION ABOUT THE PERMIAN BASIN RELIABILITY PLAN THIS YEAR, WHICH THE COMMISSION ULTIMATELY APPROVED.

THIS WAS ASSUMED AS PART OF THE BASE CASE, UM, ASSUMPTIONS THAT SUPPORTED THAT STUDY AS WELL.

SO BECAUSE OF THE, UM, REVIEW WE'VE PREVIOUSLY STUDIED, UH, THIS, IT MET THOSE STUDY CRITERIA, WE'D RECOMMEND ENDORSING MOVING THIS ENCORE DELAWARE BASE IN STAGE THREE AND FOUR PROJECT BASED OFF OF OUR NERC INTER COT PLANNING CRITERIA TO MOVE IT FORWARD TO THE BOARD.

ANY QUESTIONS ABOUT THIS PROJECT? YEAH, ON, ON THIS ONE, IT'S THE QUESTIONS ABOUT THAT LAG OF FIVE YEARS AND WHETHER THE DATA FROM FIVE YEARS AGO IS STILL RELEVANT OR THE SAME, OR WHETHER THIS REQUIRES MORE ANALYSIS.

SO WE DID DO ADDITIONAL ANALYSIS WHEN WE RECEIVED IT BACK, UM, EARLIER THIS YEAR BECAUSE OF THE TIME THAT HAS GONE THROUGH AND WE LOOKED, UM, IT STILL MET THE CRITERIA EVEN WITH OUR UPDATED INFORMATION THAT WE HAVE FOR TODAY AND WITH THE PERMIAN STUDY AS WELL.

CORRECT.

AND CHRISTIE, IN YOUR ONGOING PRESENTATIONS, WE'LL BE TRACKING THE PROGRESS OF THESE TIER ONE PROJECTS.

SURE.

AND SO WE'LL TAKE A LOOK AT WHAT INFORMATION WE CAN PROVIDE YOU.

I KNOW WE'D HAD SOME OFFLINE DISCUSSIONS.

MM-HMM.

UM, ONE THING THAT I WANNA MAKE SURE THAT THE COMMITTEE IS AWARE OF, WE DO HAVE A, I CAN'T RECALL IF IT'S A PLANNING GUIDE OR OR PROTOCOL REQUIREMENT, BUT THAT WE PUT OUT A REPORT, IT'S CALLED TIP IT, I THINK IT'S TRANSMISSION PROJECT, UH, INFORMATION, INFORMATION TRACKING, , UH, DON'T QUOTE ME ON THAT, BUT WE'LL GO BACK AND, BUT THERE'S SOMETHING THAT WE PROVIDE.

WE TAKE THAT INFORMATION THAT WE GET ON THESE, UH, ENDORSED PROJECTS AND WE PUT THAT INFORMATION OUT THERE.

NOW, THE ONE THING THAT I'VE GOT THE TEAM LOOKING AT IS THEY DON'T THINK IT SHOWS.

I KNOW ONE OF THE QUESTIONS YOU HAD IS ABOUT WHEN ARE THEY GOING TO THE COMMISSION FOR CCN STATUS? WHAT'S THE STATUS OF THAT AS A PART OF THAT CURRENT REPORT? THEY'RE NOT REPORTING THAT.

UM, AND SO WE COULD LOOK AT HOW WE GET, WE COULD DEFINITELY BE, WE'RE FOLLOWING THESE PROJECTS, WE COULD PULL THAT INFORMATION IN, BUT IT MAY BE BETTER TO, UM, MAKE UPDATES TO THAT PROJECT.

SO WE'RE GETTING THAT INFORMATION FROM THE TSPS, BUT ONCE THEY START THAT BUILDING PROCESS, ONCE THEY'VE GOT A CCN, WE'RE GETTING UPDATED PROJECT STATUS ON WHERE THOSE PROJECTS ARE.

WHEN WE UPDATE OUR CASES FOR STUDYING, WE LOOKED AT THINGS THAT HAD ALREADY BEEN IMPROVED OR ENDORSED.

THANK YOU JULIE.

UM, KRISTA, YOU MADE A COMMENT THAT I THINK IS VERY IMPORTANT TO, TO REALLY LET SINK IN.

AND THAT'S THAT THIS DELAWARE BASIN STAGE THREE AND FOUR TRANSMISSION INFRASTRUCTURE SERVES AS A BASE, A KEY BASE POINT FOR THE PERMIAN BASIN RELIABILITY PLAN.

IN OTHER WORDS, THAT HAS TO BE BUILT IN ORDER TO, UM, SERVE AS THE UNDERPINNING FOUNDATION FOR THE RELIABILITY PLAN FOR THE PERMIAN BASIN REGION.

RIGHT.

SO THAT HAS TO STAY ON TRACK.

IS THAT THAT'S CORRECT.

SO WHEN WE DO A NEW STUDY,

[00:30:01]

AND EVEN THOUGH THEY MIGHT NOT BE BUILT YET, WE PUT THOSE INTO OUR CASES AND USE THOSE AS OUR UPDATED PLANNING ASSUMPTIONS.

WE PUT IN, UM, UP TO A CERTAIN CRITERIA, THE GENERATION THAT'S CHANGED, UM, INTO OUR MODELS SO THAT WE'RE DOING THE ANALYSIS ON THE BEST INFORMATION ON THE TOPOLOGY AT THE TIME.

AND SO WHEN WE DID THE RELIABILITY STUDY FOR THE PERMIAN BASIN, THIS WAS ASSUMED AS BEING ALREADY IN PLACE.

AND I'M JUST WONDERING, AND THIS IS PROBABLY A DISCUSSION THE COMMISSION NEEDS TO HAVE, BUT AS THE COMMISSION, UM, HIRES A PERMIAN BASIN RELIABILITY OR PERMIAN BASIN MONITOR TO ENSURE THAT THOSE PROJECTS ARE ALSO TRACKED, BECAUSE AS YOU JUST SAID, IT'S CRITICALLY IMPORTANT THAT THEY ARE PART, THEY'RE BUILT BECAUSE YOU ASSUME THEM AS BEING PART OF THE PLAN.

SO I THINK THESE PROJECTS NEED TO BE TRACKED WITH THE PERMIAN BASIN MONITOR AS WELL, TO MAKE SURE THAT'S STAYING ON TIME SO THAT THE REST OF THE PLAN CAN BE DELIVERED.

ITEM SEVEN RECOMMENDATION REGARDING REALTIME MARKET PRICE CORRECTION AND INCOMPLETE WEEKLY DATABASE LOAD.

IF THERE ARE NO FURTHER COMMENTS, I'LL ENTERTAIN A MOTION TO RECOMMEND THAT THE BOARD ENDORSE THE NEED FOR THE TIER ONE ENCORE DELAWARE BASIN STAGES THREE AND FOUR REGIONAL PLANNING GROUP PROJECT, WHICH ERCOT STAFF HAS INDEPENDENTLY REVIEWED, AND WHICH THE TECHNICAL ADVISORY COMMITTEE HAS VOTED TO ENDORSE BASED ON ERCOT RELIABILITY PLANNING CRITERIA.

ANY ABSTENTIONS? THE MOTION CARRIES.

THANK YOU, CHRISTIE.

NEXT AGENDA,

[7. Recommendation regarding Real-Time Market Price Correction – Incomplete Weekly Database Load]

GORDON DRAKE WILL PRESENT THE ERCOT STAFF'S RECOMMENDATION.

GORDON, PLEASE PROCEED AT YOUR OWN PACE.

THANK YOU VERY MUCH.

UM, GORDON DRAKE, DIRECTOR OF MARKET DESIGN ANALYSIS, AND PLEASE TO PRESENT A RECOMMENDATION FROM ERCOT REGARDING, UH, PRICE CORRECTIONS ON NOVEMBER 1ST.

UM, WE SEEK THE RECOMMENDATION OF THE COMMITTEE TODAY, UH, FOR THE FULL BOARD APPROVAL AT THE, THE MEETING TOMORROW.

UH, AND THE, UH, ATTACHMENTS SUPPORTING THE, UH, PRICE CORRECTION MATERIALS HAVE BEEN INCLUDED IN THE PACKAGE.

THIS EVENT RELATES TO AN INCIDENT THAT TOOK PLACE ON NOVEMBER 1ST OF THIS YEAR, UM, DURING A, A ROUTINE DATA TRANSFER PROCESS AS PART OF OUR WEEKLY, UH, DATABASE LOAD UPDATE.

UM, ONE OF THE DATA PROCESSES FAILED TO COMPLETE ITS TRANSFER SUCCESSFULLY.

AND AS A RESULT, SOME OF THE ELEMENTS THAT WERE INTENDED TO BE TRANSFERRED INTO THE MODEL WERE NOT INCLUDED IN, UH, IN THAT MODEL, UM, AND THEREFORE NOT REFLECTED IN THE MARKET SYSTEM.

THE ISSUE WAS IDENTIFIED LATER THAT DAY.

SO AT, AT 12 O'CLOCK WAS WHEN? AT 12 O'CLOCK MIDNIGHT.

SO OVERNIGHT ON NOVEMBER 1ST IS WHEN THE, UH, THE TRANSFER WAS TO TAKE PLACE.

UH, THE INCOMPLETE, UH, TRANSFER WAS NOTICED AND THE ISSUE IDENTIFIED, UH, JUST AFTER NOON ON THAT DAY.

UM, AND SO WE HAD AN IMPACT TO REALTIME SETTLEMENT INTERVALS BETWEEN MIDNIGHT AND 12:30 PM ON NOVEMBER 1ST.

ON NOVEMBER 8TH, UH, WE ISSUED, UH, A MARKET NOTICE NOTIFYING THE MARKET OF OUR, UH, DISCOVERY OF THE ISSUE AND OUR INTENT TO CON COMPLETE ANALYSIS AROUND ITS IMPACT AND, UH, TO, TO BRING IT TO THE BOARD, UH, IF THE SIGNIFICANT SIGNIFICANCE CRITERIA FOR A PRICE CORRECTION WERE MET.

UM, FOLLOWING OUR INTERNAL ANALYSIS, WE DETERMINED THAT THOSE CRITERIA WERE MET.

AND SO ISSUED A MARKET NOTICE ON NOVEMBER 12TH NOTIFYING THE MARKET OF OUR INTENTION TO SEEK, UH, BOARD APPROVAL TO CORRECT PRICES FOR, UH, THOSE IMPACTED SETTLEMENT INTERVALS.

WE HAVE TWO, UH, SETS OF CRITERIA THAT, UH, THAT WE TEST THOSE, UH, PRICE IMPACTS AGAINST BEFORE BRINGING THEM TO THE BOARD FOR APPROVAL.

UM, AND IF EITHER ONE OF THESE CRITERIA ARE MET, THEN WE WILL BRING THE, THE, THE PRICE CORRECTION FORWARD, UH, EITHER AN IMPACT TO A SINGLE COUNTERPARTY OF 2% OR, UH, AND ALSO GREATER THAN $20,000 IN THEIR, UH, THEIR NET OVERALL SETTLEMENT.

OR, UH, AN IMPACT OF 20% TO A SINGLE COUNTERPARTY OR, UH, SORRY, AND, UH, GREATER THAN $2,000.

AND SO IT IS UNDER THAT SECOND CRITERIA THAT WE HAD TWO COUNTERPARTIES MEET THE CRITERIA OF A 20% IMPACT, AND ALSO GREATER THAN A, AN ABSOLUTE DOLLAR IMPACT OF GREATER THAN $2,000.

THE MAXIMUM IMPACT TO A SINGLE COUNTERPARTY FOR THAT DAY WAS, UH, JUST SHORT OF $3,000.

UM, UH, THOUGH THE MAXIMUM PERCENTAGE FOR CRITERIA WAS, UH, NEARLY 45%.

AND SO THAT IS THE, THAT'S THE LARGEST, UH, ABSOLUTE VALUE IMPACT TO, TO THOSE COUNTERPARTIES.

UM, AND AS YOU CAN SEE, BECAUSE IT

[00:35:01]

EXCEEDS THE, THE $2,000 AND EXCEEDS THAT 20% SATISFIED THAT CRITERIA.

NUMBER TWO, THE, UH, OVERALL IMPACT TO ERCOT SETTLEMENT WAS, UH, JUST SHORT OF $2,000.

AND YOU'LL SEE, UH, IN AS A PROPORTION OF THE OVERALL AMOUNTS SETTLED FOR THAT DAY BY ERCOT, UH, IT IS APPROXIMATELY 0.01% IN TERMS OF ITS, ITS OVERALL IMPACT.

SO THIS IS A RELATIVELY, UH, RELATIVELY MILD EVENT, UM, THOUGH IT DID HAVE IMPACT THAT, UH, THAT MET OUR CRITERIA THAT COVERS THIS PRICE IMPACT, UH, THIS PRICE CORRECTION AND THE, UM, UH, AND THE, THE RECOMMENDATION, UM, HAPPY TO, UH, BRING THAT TO A VOTE.

I DO HAVE ONE MORE ITEM THAT I JUST WANTED TO BRING TO THE COMMITTEE'S ATTENTION AROUND A FORTHCOMING PRICE CORRECTION THAT IS NOTED IN THE APPENDIX TO THE RELIABILITY MARKETS COMMITTEE.

SO, MADAM CHAIR, AS AS YOU WANT TO, UH, IF, IF YOU WANT TO PROCEED WITH THE VOTE ON THIS ITEM, THEN I CAN, UH, I CAN ADD THAT, UH, ADDITIONAL COMMENTARY OR I CAN PROCEED WITH THE COMMENTARY NOW AND YOU CAN PROCEED WITH THE VOTE.

WHY DON'T YOU GO AHEAD AND TELL US WHAT'S IN THE APPENDIX THAT WE MIGHT NOT HAVE FOCUSED ON? FAIR ENOUGH.

SO IN THE APPENDIX TO THE COMMERCIAL MARKETS UPDATE, UM, WE WILL ALWAYS INCLUDE, UH, STA STATISTICS ABOUT, UH, PRICE CORRECTIONS THAT HAVE BEEN COMPLETED, THOSE THAT HAVE MET CRITERIA.

UM, IN THE, IN THE BAR CHART, YOU'LL, YOU WILL NOTICE THAT THERE ARE, UH, A NUMBER OF DAYS THAT ARE CURRENTLY UNDER INVESTIGATION.

UH, WE HAVE BEEN, UM, INVESTIGATING, UH, AN ISSUE, THE, THE HISTORY OF WHICH GOES BACK TO NOVEMBER OF 2023.

UM, AND SO PER OUR PROTOCOLS, WE ARE EVALUATING UP TO 30 DAYS, UH, FOR POTENTIAL, UH, IMPACT, UH, FROM MIDDLE OF AUGUST TO TO EARLY SEPTEMBER, EARLY AUGUST TO EARLY SEPTEMBER.

UM, THAT ANALYSIS IS UNDERWAY, UM, BUT WE EXPECT THAT THERE WILL BE AT LEAST SOME OF THOSE DAYS THAT WILL MEET THE BOARD CRITERIA AND WE WILL BRING THAT FORWARD.

THAT IS EXPECTED TO BE MORE SIGNIFICANT THAN THE VOLUMES THAT WE'RE TALKING ABOUT TODAY, JUST BECAUSE OF THE NUMBER OF DAYS THAT ARE POTENTIALLY IMPACTED.

UM, BUT DID WANT TO, TO SIGNAL THAT, AS YOU SEE THAT IN THE APPENDIX, THAT WE'VE NOTED THAT THERE ARE DAYS UNDER INVESTIGATION, UM, AND INCLUDED THAT IN THE, THE BAR CHART.

WHEREAS TYPICALLY WE WOULD HAVE JUST THE, UH, THOSE THAT HAVE BEEN, UH, ALREADY ANALYZED.

SO FRANKLY, I DON'T SEE THE APPENDIX YOU'RE REFERRING TO.

SO MAYBE SOMEONE CAN POINT THAT OUT LATER TO US.

BUT WHAT I'D LIKE TO HAVE IS A COMMENT FROM OUR CUT STAFF ABOUT THE ROOT CAUSE AND CORRECTIVE ACTION SO THAT WE CAN START NOT HAVING THESE EVENTS.

JP OR WOODY? YEAH, I'LL, THIS IS KEITH COLLINS.

I'M GONNA PROVIDE A LITTLE COLOR HERE.

IN TERMS OF, UM, EXPERIENCE WITH SOME OF THE OTHER RTO REGIONS.

UM, I THINK WHAT'S, WHAT'S INTERESTING AS, AS GORD HAD ON, UM, A PREVIOUS SLIDE IS THE SORT OF THE IMPACT LEVEL THAT YOU'RE SEEING HERE, UM, COMPARED TO WHAT SOME OF THE OTHER RTOS USE.

THAT'S, THAT'S PRETTY LOW.

UM, SOME OTHER RTOS DON'T EVEN HAVE A VERY DEFINED REQUIREMENT, AND IT'S AS DETERMINED BY MATERIAL IMPACT DETERMINED BY STAFF.

AND SO MY EXPERIENCE IS THAT THOSE REGIONS TEND TO OPERATE UNDER A HIGHER REQUIREMENT.

UM, IT COULD BE HUNDREDS OF THOUSANDS OR MILLIONS OF DOLLARS BEFORE THEY, THEY SEE AN IMPACT THAT'S WORTH CORRECTING OUT OF CYCLE.

SO, UM, UH, ALL, ALL RTO REGIONS, ISO REGIONS DO EXPERIENCE, UH, A LOT OF THE SAME TYPES OF ISSUES, DATA TRANSFER ISSUES, UH, CORRUPTION ISSUES THAT, THAT CAUSE PRICE ISSUES.

SO IT'S NOT UNUSUAL, UM, BUT I DO THINK THE FACT THAT, UM, IT DOES COME TO THE BOARD AS FREQUENTLY AS IT DOES THAT, THAT TO ME STRIKES ME AS A BEING A BIT UNUSUAL.

UM, IN, IN OTHER REGIONS LIKE SPP OR CAL IO, VERY RARELY DO YOU SEE IT ELEVATE TO THE BOARD, WHICH CREATES THIS SORT OF VISIBILITY OF, OF THE ISSUE, UM, AND SEEMS LIKE IT'S A MUCH MORE POTENTIALLY IMPACTFUL THING.

BUT, BUT AGAIN, SOME OF THE OTHER REGIONS, UM, UH, DON'T GO TO THE SAME LEVEL OF GRANULARITY TO MAKE CORRECTIONS AS WE DO HERE.

SO THAT'S JUST SOME CONTEXT FOR YOU.

I, I KNOW JP MAY HAVE SOME OF THE SAY AND, UH, TO ANSWER SPECIFIC QUESTIONS, JULIE.

UM, SO WE HAD A PERMISSION ISSUE ON ANOTHER, THE TABLE.

SO WE TEST THOSE CHANGES ON OUR EYE TEST OR ENVIRONMENT WHERE WE TEST SOFTWARE CHANGES, BUT THAT'S NOT THE ENVIRONMENT WHERE WE ALSO DO MODEL PROMOTION.

NOW, THE MODEL PROMOTION ENVIRONMENT IS A DIFFERENT ENVIRONMENT WHERE IT DIDN'T HAVE THESE CHANGES.

SO IT'S A CHANGE THAT WE DETECTED ONLY IN PRODUCTION.

SO YES, WE CAUGHT IT, UH, IN A FEW HOURS, BUT NEVERTHELESS, IT DID DETECT, IT DID RESULT IN A PRICE CORRECTION.

SO THE CHANGES WE HAVE MADE IS THAT WHEN WE LOAD THE MODEL, IF IT RUNS INTO AN ERROR, IT DOES LOG IT SO THAT IT IS CAUGHT RIGHT AWAY AT THE MODEL LOAD TIME SO THAT THERE IS AN ACTION RIGHT AWAY INSTEAD OF HAVING SOMEBODY ELSE DETECTED DOWN THE DAY.

SO, SO TO ANSWER YOUR QUESTION, WE DO HAVE CHANGES IN THERE SO THAT THIS WON'T HAPPEN IN THE FUTURE, THIS PARTICULAR THING.

[00:40:01]

SO, TO THE POINT OF VISIBILITY, I'M FINE WITH THE VISIBILITY.

WE ARE EXPECTED TO OPERATE WITH AS CLOSE TO FIVE NIGHTS, YOU KNOW, UPTIME AND RELIABILITY AS POSSIBLE.

SO WHETHER IT'S ELECTRICITY OR TRANSFER MONEY AND PRICING, I THINK THIS QUALITY LEVEL IS IMPORTANT TO, TO EVERYONE, EVERY STAKEHOLDER.

SO I, I WOULD LIKE TO FOCUS ON ROOT CAUSES AND FIND THEM, YOU KNOW, CORRECTIVE ACTIONS THAT, UH, SOLVE THIS PROBLEM.

CARLOS? YEAH, JUST A, A COUPLE OF COMMENTS ON THE THRESHOLDS.

I MEAN, ONE IS QUANTUM, WHICH OF COURSE WE AGREE WITH, BUT THE SECOND IS CAUSE 'CAUSE IT COULD BE REPEATED.

AND AGAIN, THIS ITEM OF, UH, CATCHING IT WHEN IT HAPPENS IS REALLY THE ANSWER.

I MEAN THAT A DATABASE DOESN'T LOAD ANY COME OUT WITH RESULTS, THAT'S NOT A GOOD OUTCOME.

SO, UH, WITH THAT UNDERSTANDING, YEAH, I, I MOVE IT FOR APPROVAL.

MARKET MONITOR DIRECTOR JEFF MCDONALD, WHO WILL PRESENT AGENDA ITEM EIGHT, THE IMM REPORT.

ANY OTHER COMMENTS? IF, IF THERE ARE NO FURTHER COMMENTS, I'LL ENTERTAIN A MOTION TO RECOMMEND THE BOARD.

ONE, DETERMINE THAT THE REALTIME LOCATIONAL MARGINAL PRICES, REAL TIME SETTLEMENT POINT PRICES, REALTIME PRICE FOR ENERGY, METERED FOR RESOURCES AND REALTIME PRICE FOR ENERGY METERED FOR SETTLEMENT ONLY GENERATORS FOR OUR OPERATING DAY, NOVEMBER 1ST, 2024, WERE AFFECTED BY THE INCOMPLETE WEEKLY DATABASE LOAD UPDATE AND TWO DIRECT STAFF TO IMPLEMENT THE APPROPRIATE PRICE CORRECTIONS PURSUANT TO PROTOCOL SECTION 6.3.

NEXT UP IS THE INDEPENDENT

[8. Independent Market Monitor (IMM) Report]

OKAY, THANKS.

GOOD AFTERNOON.

SO I WILL, UH, I'M JEFF MCDONALD, DIRECTOR OF IMM, AND, UH, I'LL ROLL THROUGH A COUPLE OF, UH, MARKET PERFORMANCE SLIDES, AND THEN I'LL COVER AN UPDATE ON WHERE WE STAND REGARDING, UM, OUR CONCERNS ABOUT THE A SDC CURVES OR THE SHORTAGE PRICING CURVES, UH, UNDER THE RTC CONSTRUCT.

SO FIRST UP, UM, AND I'LL, I'LL, I SHOULD, UM, PREEMPT THE MARKET PERFORMANCE SLIDES BY SAYING, UH, IT WAS ACTUALLY A FAIRLY MILD MARKET ACTIVITY PERIOD SINCE MY LAST REPORT TO THE BOARD.

SO THERE ISN'T AN AWFUL LOT THAT'S SHOCKING.

UM, SOME STUFF THAT'S INTERESTING, BUT, BUT OTHERWISE IT WAS, MOST EVERYTHING WAS AS IT SHOULD BE, WHICH IS FANTASTIC.

SO JUST HAVING A LOOK AT WHOLESALE ENERGY PRICES FOR AUGUST THROUGH OCTOBER, AND OH, GREAT, IT, IT DOES REFLECT AUGUST THROUGH OCTOBER.

THERE, I MISLABELED ONE OF MY SLIDES, UH, FOR THE DATE, SO IT LOOKS LIKE IT WASN'T THIS ONE.

SO, UH, WE DID SEE LOWER ENERGY PRICES THIS LAST AUGUST THROUGH OCTOBER, UH, THAN A YEAR AGO.

UH, A LOT OF THAT WAS DUE TO A MILDER SUMMER, UM, FOR AUGUST AND SEPTEMBER.

ALSO, UH, I, I WOULD SUPPOSE, UH, BUT ONE OF THE INTERESTING, UH, OUTCOMES FROM THIS PAST THREE YEAR PERIOD WAS WE HAD A, ACTUALLY SOMEWHAT OF A WARM OCTOBER RELATIVE TO USUAL.

AND SO WHILE WE SAW PRICES LOWER ACROSS THE THREE MONTH PERIOD, UM, WE DID HAVE HIGHER PRICES IN OCTOBER, AND WE HAD HIGHER, HIGHER LOAD THAN NORMAL IN OCTOBER BECAUSE OF HIGHER TEMPERATURES.

UM, THIS WAS MY FIRST OCTOBER IN TEXAS, AND IT FELT LIKE JUNE IN A LOT OF OTHER PLACES.

SO, SO, UH, MUCH MILDER THERE.

UH, WE DID SEE LOWER, UH, NATURAL GAS PRICES, UH, DURING THIS PERIOD THAN A YEAR AGO.

SO, UH, THAT CONTRIBUTED ALSO TO THE OVERALL, UH, LOWER PRICES THAT WE SAW.

AND, UH, I SHOULD KNOW, WE HAD A VERY LOW INS INCIDENCE OF SHORTAGE PRICING, WHICH ALSO CONTRIBUTED TO THE LOWER OVERALL, YOU KNOW, MEASURED PRICE.

OH, HERE'S MY MISLABELED SLIDE.

SO, UM, SO WE DID SEE SLIGHTLY LOWER LOADS IN AUGUST AND SEPTEMBER.

UM, AND YOU KNOW, I TRY TO HIGHLIGHT OR, OR INDICATE WHERE YOU CAN SEE, UH, THE, THE MONTHS I'M SPEAKING TO ON HERE.

UH, SO AS YOU CAN SEE, WE HAD SLIGHTLY LOWER LOADS.

AND HERE'S WHERE YOU CAN SEE THAT THE OCTOBER LOAD WAS CONSIDERABLY HIGHER OR, OR AT LEAST NOTICEABLY HIGHER COMPARED TO THE PRIOR TWO YEARS, REFLECTING

[00:45:01]

THE MUCH WARMER TEMPERATURES THAT WE HAD.

UM, ANCILLARY SERVICE COSTS ARE, ARE GENERALLY, UH, UNEVENTFUL.

UH, IN MOST RTOS, THEY, THEY COMPRISE 1% OR LESS OF THE TOTAL WHOLESALE COSTS.

UH, AND SO WE LIKE TO SEE ANCILLARY SERVICE COSTS REFLECTIVE OF, UH, THE OPPORTUNITY COST TO HOLD YOUR CAPACITY AND RESERVE, UH, AND REFLECTIVE OF THE, UM, RELIABILITY BENEFIT OF PROVIDING THOSE ANCILLARY SERVICES.

BUT THOSE SHOULD BE EXPECTED TO BE FAIRLY CONSISTENT OVER TIME, UH, UNDER MOST CIRCUMSTANCES.

AND THAT'S WHAT WE SAW DURING THE THREE WEEK OR THREE MONTH PERIOD, UM, THAT, THAT WE'RE TALKING ABOUT TODAY.

WE ALSO GENERALLY TEND TO SEE, AND I'VE MENTIONED THIS BEFORE, I'LL PROBABLY MENTION IT A BUNCH OF TIMES, BUT, UH, TO THE EXTENT THAT NATURAL GAS PRICES AFFECT WHOLESALE ENERGY, PRICE, AND WHOLESALE ENERGY, PRICE IS A DRIVER OF OPPORTUNITY COST FOR, UH, ANCILLARY SERVICES, WE'LL SEE LOWER NATURAL GAS PRICES REFLECTED IN LOWER, UH, ANCILLARY SERVICE COSTS.

AND IT SEEMS ACTUALLY TRUE FOR CONGESTION COSTS WHEN WE GET TO THAT SLIDE AS WELL.

SO, UH, ON RESOURCE MIX, SO WE DO LIKE TO REPORT ON THIS, THIS IS SOMETHING THAT YOU WOULD EXPECT TO SEE CHANGE SLOWLY OVER TIME.

UM, AND SO IT IS NOT A TERRIBLY EVENTFUL CHART, BUT, UM, AND SO I, I'VE LED OFF FOR THE LAST SEVERAL MEETINGS WITH THE RESOURCE MIXES LARGELY, UH, UNCHANGED.

BUT HERE I CAVEAT THIS WITH AUGUST AND SEPTEMBER, UM, BECAUSE ONE OF THE THINGS YOU NOTE FROM THIS CHART IS THAT, UH, THE RESOURCE MIX DID, UH, CHANGE A BIT, UH, IN OCTOBER WHERE WE SAW A CONSIDERABLE INCREASE IN ENERGY PRODUCTION FROM, UH, BOTH WIND AND SOLAR.

SO THAT WAS, UM, AN SOMEWHAT OF A UNUSUAL OUTCOME.

AND, UM, I DON'T HAVE A POINTER, BUT IF YOU LOOK AT OCTOBER UP THERE, YOU CAN SEE IN THE FAR RIGHT SET OF BARS IN THE OCTOBER BUCKET, UM, WE, WE'VE SEEN WIND AND SOLAR INCREASE, UH, YEAR OVER YEAR.

SO, UM, ONE OF THE DRIVERS OF THAT, UH, IS OF COURSE, UH, GREATER INSTALLATION OF WIND AND SOLAR.

IT'S ALSO GREATLY AFFECTED BY CLOUD COVER AND WIND.

BUT WE'VE SEEN INCREASES IN WIND AND SOLAR INSTALLATIONS OVER THE LAST THREE YEARS.

AND I, AND I BELIEVE THAT'S LARGELY WHAT YOU'RE SEEING, UH, IN THIS CHART.

I DID WANNA NOTE, BECAUSE IT CAME UP AT THE LAST BOARD MEETING, YOU KNOW, WHERE'S BATTERY STORAGE IN THIS? AND, UH, SO IT TURNS OUT, AND SOMEONE HAD COMMENTED THAT THIS WAS LIKELY THE CASE, UM, BATTERY STORAGE IS ACTUALLY A NET LOAD.

SO BATTERIES, UM, CONSUME MORE ELECTRICITY THAN THEY PRODUCE, AND SO THEY DON'T WIND UP IN OUR METRIC AS SUPPLY.

UM, AND THEY'RE ODD, UH, BECAUSE THEY DO, UH, TAKE ON THE ROLE OF BOTH LOAD, UH, AND GENERATION SO THEY DON'T SHOW UP AS SUPPLY.

I HAVE INCLUDED A COUPLE OF BATTERY CHARTS, AND WE WILL EXPAND ON THIS BECAUSE I THINK THIS IS, UH, ONE OF THE MORE, ONE OF THE MORE INTERESTING ASPECTS OF TEXAS ENERGY FUTURE IS THE EXTENT TO WHICH BATTERY STORAGE PLAYS A ROLE.

SO WE HAVE A COUPLE SLIDES THIS TIME, AND WE'LL HAVE A FEW MORE SLIDES, UM, AT THE NEXT, UH, BOARD MEETING ON THE ROLE OF BATTERY STORAGE.

SO, UH, BATTERY STORAGE IS NEXT, ACTUALLY.

UH, CONGESTION COSTS WERE, WERE UNEVENTFUL, UM, FOR THE AUGUST, SEPTEMBER, OCTOBER PERIOD.

SO, SO THIS, THIS CHART SHOWS YOU THE AMOUNT OF BATTERY STORAGE CAPACITY ON AVERAGE OFFERED IN, IN, IN THE HOURS, UH, FOR EACH OF THESE THREE YEARS BY THE PRICE RANGE AT WHICH THEY OFFERED IN.

SO ONE, ONE OF THE THINGS YOU CAN SEE, IF YOU FOCUS ON 2024, YOU CAN SEE THERE'S A LITTLE BIT OF CAPACITY.

IT'S A LITTLE BIT LESS THAN A HUNDRED MEGAWATTS, UM, THAT'S OFFERED IN ON AVERAGE AT LESS THAN $0 PER MEGAWATT HOUR.

UH, AND I WON'T WALK THROUGH ALL THE STEPS, BUT, BUT, BUT ONE OF THE INTERESTING THINGS THAT POPPED OUT WHEN, WHEN WE DID THIS WAS THE LARGER AMOUNT OF CAPACITY THAT WAS ACTUALLY OFFERED IN, IN WHAT YOU MIGHT CONSIDER TO BE A NORMAL RANGE OR A COMPETI OR A, A COMPETITIVE OR COMMERCIAL RANGE OF PRICES.

THAT'S THE GRAY, UH, BOX SEGMENT THERE.

SO AS YOU CAN SEE, THAT'S, UM, YOU KNOW, THAT'S ALMOST 2000, WELL, MAYBE, MAYBE 1,250 MEGAWATTS.

UM, OUT OF THE, OUT OF THE TOTAL 27 50 THAT'S OFFERED IN AT A PRICE BETWEEN ZERO AND A HUNDRED DOLLARS OR YEAH, ZERO AND A HUNDRED DOLLARS.

THAT'S, THAT'S A VERY COMPETITIVE RANGE TO OFFER IN.

AND I'LL COVER IN A MINUTE WHY THAT WAS A LITTLE SURPRISING TO ME, UH, THAT JUST ON AVERAGE, AND THIS IS JUST OFFERS, THIS ISN'T THE AMOUNT OF ENERGY THAT WAS DISPATCHED.

SO IT WAS A LITTLE BIT INTERESTING TO ME.

UM,

[00:50:01]

AND YOU ALSO SEE IN THAT GREEN BAR SEGMENT THAT THERE'S A LARGE AMOUNT OF CAPACITY THAT'S OFFERED IN A VERY HIGH PRICE, YOU KNOW, AT THE, AT THE CAP OF 5,000, THAT WAS, THAT WAS NOT SURPRISING TO ME, AND I'LL EXPLAIN WHY IN JUST A SECOND.

UM, LET'S GET TO THE NEXT CHART HERE.

SO THIS CHART SHOWS THE AMOUNT OF ENERGY THAT WAS DISPATCHED FROM THE SAME ASSETS IN THE PRIOR SLIDE.

UM, AND AS YOU CAN SEE FROM THE AXIS ON THE LEFT SIDE, THIS ONLY GOES FROM ZERO TO 700.

SO THE BULK OF OFFERED ENERGY STORAGE IS NOT DISPATCHED, BUT QUITE A BIT OF IT IS, IT TURNS OUT.

AND HERE AGAIN, WE SEE, AND THIS, THIS IS NOT SURPRISING IN THE DISPATCHED CHART, THAT A LARGE PORTION OF THE AMOUNT OF ENERGY STORAGE THAT IS DISPATCHED IS DISPATCHED IN WHAT WE WOULD CONSIDER TO BE SORT OF A COMPETITIVE COMPETITIVE COM COMMERCIAL PRICE RANGE, THUS THE GRAY BOX SEGMENT.

SO, UM, LET ME JUMP BACK TO WHY I THOUGHT IT WAS A LITTLE SURPRISING TO SEE A, A LARGE PROPORTION OF CAPACITY OFFERED IN AT ZERO TO A HUNDRED DOLLARS.

SO IT IS, UM, SO, SO EVERYONE KNOWS, UH, BATTERY STORAGE RESOURCES, UM, COMMERCIALIZED ON THE DIFFERENCE IN, IN PRICE BETWEEN WHEN THEY CONSUME ELECTRICITY OR OUR LOAD AND CHARGING VERSUS WHEN THEY DISCHARGE.

SO THEY WANT A LOWER PRICE WHEN THEY'RE CHARGING AND A HIGHER PRICE WHEN THEY DISCHARGE.

IT'S, UM, IT'S DIFFICULT FOR A REAL TIME ENERGY MARKET TO ADEQUATELY FACTOR IN THE OPPORTUNITY COST FOR A BATTERY STORAGE RESOURCE.

IT HAS TO ACCOUNT FOR A STATE OF CHARGE OF THE BATTERY STORAGE RESOURCE, AND IT ALSO HAS TO BE ABLE TO SEE FAR ENOUGH OUT INTO THE FUTURE TO KNOW WHEN PRICE WILL BE HIGH ENOUGH OR HIGHEST FOR THAT BATTERY STORAGE RESOURCE TO MAXIMIZE ITS OPPORTUNITY TO DISCHARGE AT A HIGHER PRICE.

AND FIVE MINUTE, YOU KNOW, REAL TIME ENERGY MARKETS ACROSS RTOS, UM, ONLY OPTIMIZE OUT, YOU KNOW, ANYWHERE FROM 15 MINUTES TO MAYBE THE CURRENT PLUS THE BALANCE OF THE NEXT HOUR.

AND FOR A LARGE PORTION OF THE DAY, THAT'S NOT FAR ENOUGH OUT FOR THE MARKET TO SEE THE HIGHER PRICES THAT THESE BATTERY STORAGE RESOURCES MAY BE LOOKING TO, UH, CAPITALIZE ON.

SO, SO ACCOUNTING FOR THAT OPPORTUNITY, COST FOR BATTERY STORAGE RESOURCES IN A REAL TIME MARKET'S A CHALLENGE.

AND YOU EXPECT TO SEE, UH, THE OPERATORS OF BANNER BATTERY STORAGE RESOURCES USE THEIR BIDS TO REFLECT THE OPPORTUNITY COST SO THAT THEY AREN'T DISPATCHED AT LOWER PRICES AND THEY'RE, THEY MAINTAIN THEIR STATE OF CHARGE AND ARE ABLE TO DISPATCH, UH, OR DISCHARGE AT HIGHER PRICES, AND THEREFORE NOT ONLY MAXIMIZE THEIR PROFIT, BUT ALSO PROVIDE THE MOST VALUE TO THE SYSTEM, BECAUSE THAT'S WHEN ENERGY IS VALUED THE MOST WHEN THE PRICE IS HIGHER.

SO I ACTUALLY EXPECTED TO SEE A LOT MORE, LET ME, LET ME BOUNCE BACK TO THE QUANTITY AND PRICE BEING OFFERED.

I ACTUALLY EXPECTED TO SEE A LOT LARGER PROPORTION OF THE BATTERY STORAGE RESOURCE OFFERS IN THIS VERY HIGH PRICE RANGE BECAUSE THAT'S, THAT'S WHERE IT'S SAFEST FOR THEM TO MANAGE THEIR, OR PROTECT THEIR STATE OF CHARGE WHEN PRICES ARE LOWER.

UM, YOU KNOW, FOLKS WHO COMMERCIALIZE ENERGY STORAGE RESOURCES HAVE A VERY GOOD SENSE OF WHEN PRICES ARE LIKELY TO SPIKE OR WHEN SHORTAGE PERIODS ARE LIKELY TO HAPPEN.

AND SO WHILE IN A, IN SORT OF A MORE TECHY DATA SCIENCEY SPACE, YOU MIGHT HAVE, YOU MIGHT EXPECT TO SEE AN OPTIMIZATION PROVIDING DIFFERENT PRICES THROUGHOUT THE DAY THAT WOULD BE REFLECTIVE OF, UH, OPPORTUNITY COSTS FOR THESE ENERGY STORAGE RESOURCES.

A LOT OF TIMES THESE DECISIONS BOIL DOWN TO A RULE OF THUMB.

AND SO IF BATTERY STORAGE RESOURCES SEE IN CERTAIN PERIODS OF THE DAY, AND IN CERTAIN SEASONS THAT, UH, A TWO OR FOUR HOUR PERIOD PROVIDES THE MOST LIKELIHOOD OF HIGHER PRICES, THEY'LL PROTECT THEIR STATE OF CHARGE FOR THE OTHER PARTS OF THE DAY THROUGH AN EXCEPTIONALLY HIGH, UH, OFFER PRICE SO THAT THEY DON'T GET DISPATCHED AND DISCHARGED, UH, UNTIL IT'S TIME FOR THEM TO, UH, YOU KNOW, BE IN A POSITION TO RECEIVE THE HIGHEST PRICE POSSIBLE.

SO ANYWAY, THAT'S, THAT WAS A SURPRISING OUTCOME.

UH, ONE OF THE THINGS THAT WE DID SEE WHEN WE LOOKED AT THESE, YOU, YOU, YOU CAN'T SEE THIS IN IN A CHART LIKE THIS, BUT ONE OF THE OTHER THINGS THAT WE SAW WITH BATTERY STORAGE RESOURCES THAT WAS INTERESTING BUT NOT EXPECT UNEXPECTED IS THERE'S A LOT OF MOVEMENT, UM, IN OFFER PRICE AS, AS THESE BATTERY STORAGE RESOURCES MOVE THROUGHOUT THE DAY, AND THEY WILL MOVE THEIR PRICE DOWN FROM 5,000 INTO THAT GRAY, UH, COMPETITIVE COMMERCIAL RANGE IN ORDER TO TAKE ADVANTAGE OF HIGHER PRICES, PRICES THAT WERE HIGHER THAN WHEN THEY, WHEN THEY WERE CHARGING.

SO ANYWAY, I JUST WANTED TO SHARE

[00:55:01]

THAT WITH YOU.

WE'LL HAVE MORE, AND I THINK ON A CONTINUING BASIS, WE'LL, WE'LL HAVE A MORE OF A SPECIAL SECTION ON BATTERY STORAGE RESOURCES AND THEIR INTERACTION IN THE ERCOT MARKET, UM, AS WE GO FORWARD.

I'M HAPPY TO TAKE ANY QUESTIONS IF, UM, I GUESS A COUPLE QUESTIONS.

ONE IS THIS IS SORT OF TRADING ON MARGIN AND OPTIMIZING, IS THAT WHAT YOU'RE SAYING? UH, I'M SORRY, COULD YOU REPEAT THAT? IT'S LIKE TRADING ON MARGIN, WHEN TO CHARGE, WHEN TO DISPATCH YES.

OPTIMIZING FOR THAT.

YES, EXACTLY.

AND, AND WHEN I MENTIONED SORT OF THE MORE TECHIE OR, OR DATA SCIENCEY APPROACH TO THAT, YOU KNOW, IF, IF YOU'RE A TECHNICAL PERSON, YOU COULD IMAGINE YOU'D HAVE SOME SIMULATIONS THAT WOULD GIVE YOU SOME FORMULAS THAT WOULD PRESCRIBE DIFFERENT PRICES THROUGHOUT THE DAY.

AND SO YOU MIGHT EXPECT TO SEE A, A MORE DYNAMIC NATURE IN THEIR PROTECTION PRICE WHERE THEY'RE PROTECTING THEIR STATE OF CHARGE FOR A HIGHER PRICE.

WE'RE SEEING LESS OF THAT, OR, OR THAT MIGHT BE LESS VISIBLE TO US THE WAY WE'RE LOOKING AT THE DATA, BUT WHAT WE ARE SEEING IS MORE OF A RULE OF THUMB APPLIED, WHICH IS, I'D LIKE TO BE AVAILABLE TO BE DISCHARGED DURING THESE FOUR HOURS IN THE DAY.

MM-HMM, .

SO DURING THE OTHER 20 HOURS OF THE DAY, I'M GONNA OFFER A 5,000.

SO YOU JUST DON'T DISPATCH ME AT ALL.

I'M, I'M, I'M WILLING TO GIVE UP A, A, UM, SPURIOUS OR RANDOM OR UNEXPECTED PRICE SPIKE IN THOSE OFF HOURS TO MAINTAIN MY CHARGE SO THAT I, I'M FULLY AVAILABLE IN THE HOURS WHERE I BELIEVE THE PRICE IS GOING TO BE SIGNIFICANTLY HIGHER WITH A HIGHER LIKELIHOOD.

AND, UH, DID YOU ASSUME ALL ON GRID CHARGING OR RECHARGING OR SOME, UM, OFF GRID LIKE SOLAR OR THINGS LIKE THAT? UM, I THINK THIS IS ALL ON GRID FOR US.

I, I BELIEVE THAT'S CORRECT.

IN THIS SPACE IS THERE WAS A LETTER FROM THE PUC INDICATING THAT THE A SDC CURVES NEEDED TO MATCH THE EXISTING ORDC CURVE.

OVER, OVER TIME, AS THE ESR FLEET GETS DIVERSIFIED WITH DIFFERENT DURATIONS AND MAYBE EVEN DIFFERENT LOCATIONS, WHETHER IT'S ON THE DISTRIBUTION SIDE OR THE TRANSMISSION SIDE, WILL YOU BE LOOKING AT THOSE OTHER VARIABLES? WE ARE, UH, WE, WE DEFINITELY ARE.

SO WE'VE BEEN TRYING TO BUILD OUT OUR, OUR ANALYSIS OF ENERGY STORAGE RESOURCES BECAUSE WE BELIEVE THEY'RE GONNA BE A BIG FACTOR IN TEXAS'S FUTURE, IN TEXAS'S ENERGY FUTURE.

SO WE'LL BE LOOKING AT ALL THAT.

UM, IN FACT, THE DURATION ASPECT IS INTERESTING.

UM, IT'S COME UP IN OUR WORK EVALUATING, UM, THE ANCILLARY SERVICES AND THE PRICE FORMATION BETWEEN SERVICES AND WHAT THE SERVICES ARE INTENDED TO PROVIDE THE DEFINITION OF THE SERVICES.

SO IT'S COME UP THERE.

UM, ANOTHER ASPECT, AND SOMEBODY CAN CORRECT ME, BUT MY UNDERSTANDING IS A TWO HOUR BATTERY IS ALSO A FOUR HOUR BATTERY IS ALSO A ONE HOUR BATTERY BECAUSE THEY CAN DISCHARGE OVER THAT PERIOD OF TIME.

IT'S JUST THE AMOUNT OF CAPACITY YOU GET TO COUNT, UH, AS YOU SPREAD YOUR, YOUR ENERGY DISCHARGE OUT OVER TIME OR NOT.

SO, BUT YEAH, WE SHOULD, UH, YOU KNOW, MY, MY MY EXPECTATION IS PROBABLY BY MIDYEAR, WE SHOULD HAVE BY MIDYEAR NEXT YEAR, WE SHOULD HAVE A PRETTY COMPREHENSIVE PACKAGE THAT WE CAN TALK ABOUT REGARDING HOW, HOW ESR IS EXPANDING AND HOW IT'S BEHAVING AND INTERACTING WITH, WITH THE ERCOT MARKET.

SOUNDS GOOD.

SO, UM, SO I'D LIKE TO MOVE ON TO, I JUST WANNA GIVE A, A BRIEF UPDATE ON THE, UH, REALTIME CO OPTIMIZATION, ANCILLARY SERVICE DEMAND CURVE, UH, UPDATE.

SO WE HAD, AND I'LL MOVE THROUGH THIS SLIDE VERY QUICKLY.

WE, WE HAD IDENTIFIED TWO ISSUES, UM, A FEW MONTHS AGO THAT WE HAD WITH THE SET OF ADCS THAT ARE CURRENTLY ON THE BOOKS.

UM, AND, AND I THINK I'D HIGHLIGHTED IN THIS MEETING, UH, TWO MONTHS AGO THAT, THAT, YOU KNOW, OTHER RTOS DO HAVE A DIFFERENT WAY OF REFLECTING THE RELATIVE VALUE OF DIFFERENT SERVICES THROUGH THEIR ANCILLARY SERVICE PROCUREMENT AND THROUGH THEIR, UM, SHORTAGE PRICING CURVES LIKE THE A SDC CURVES.

AND THAT'S, THAT'S CALLED A, THAT'S CALLED A NESTED CURVE APPROACH.

UM, THE SOFTWARE HERE THAT'S BEING DEVELOPED FOR RTC IS NOT SET UP TO ACCOMMODATE A NESTED APPROACH.

AND THERE ARE SOME OTHER ISSUES WITH, UH, APPLYING AN, A PURELY NESTED APPROACH, UH, IN THE ERCOT SPACE AS WELL.

AND SO, YOU KNOW, IN ORDER TO ADDRESS THE TWO CONCERNS THAT WE HAD, UM, WE, WE WENT OFF AND, AND, UH, TRIED TO DEVELOP A SET OF CURVES THAT WOULD FIT INTO THE RTC SOFTWARE, THE WAY IT'S BEEN DEVELOPED, AND ALSO ADDRESS THE TWO CONCERNS THAT WE HAVE.

SO, UM, SO WE WERE SUCCESSFUL, UH, IN, IN OUR VIEW, UH, IN THAT SPACE.

UH, UH, SO WE DEVELOPED A SET OF CURVES.

ONE OF THE CONSTRAINTS, UH, IN, IN THE,

[01:00:01]

SO THAT WAS A CONSTRAINT THAT WE HAD TO WORK IN.

WE HAD TO CONSTRUCT SOME A SDC CURVES THAT ADDRESSED THE TWO CONCERNS WE HIGHLIGHTED, BUT ALSO WHEN AGGREGATED UP, UH, MATCHED THE EXISTING ORDC CURVE.

SO, UM, WE HAVE DONE SIMULATIONS, UH, TO SHOW THE PRICE FORMATION QUALITIES OF THESE CURVES.

UH, AND I THINK THE, THE, UH, UH, RELATIVE VALUE WITH RESPECT TO THE MARGINAL RELIABILITY PROVIDED BY THE DIFFERENT SERVICES, UH, POPS OUT OF THAT AS WELL.

SO THAT ADDRESSED BOTH OF OUR CONCERNS.

UM, WE'VE PROVIDED, UH, A MEMO TO, AND, AND WE'D BEEN ACTUALLY WORKING, UM, BEHIND THE SCENES WITH ERCOT STAFF AS WE DEVELOPED THESE CURVES AND HAD BEEN TALKING WITH THEM, WE'VE PROVIDED A MEMO TO ERCOT AND THE PUC ON THIS, UH, AND OUR CURVES AND THE SIMULATION RESULTS INDICATING THE PRICE FORMATION QUALITIES HAVE BEEN PRESENTED AT, I THINK, TWO BOARD, UH, TWO, UM, UH, STAKEHOLDER MEETINGS TO DATE AS WELL.

SO, SO, UH, SO WHERE ARE WE THEN? UH, NOW, NOW THAT WE HAVE SOME CURVES THAT AT LEAST WE FEEL ADDRESS THESE CONCERNS AND WE ALSO FEEL ARE COMPATIBLE WITH HOW THE RTC SOFTWARE'S BEEN DEVELOPED.

UM, SO WE HAVE A COUPLE OF RECOMMENDATIONS, UH, THAT ERCOT FURTHER EVALUATE THE CURVES.

THESE WERE CURVES THAT WE DEVELOPED.

YOU KNOW, THIS WAS OUR, I WOULDN'T CALL IT A FIRST DRAFT, IT WAS A NEAR FINAL DRAFT OF THE CURVES, BUT WE WERE TIME CONSTRAINED.

SO, SO AS SOON AS WE FELT THAT THE CURVES, UH, HAD THE PROPERTIES THAT ADDRESSED OUR CONCERNS, UM, YOU KNOW, WE, WE WENT FORWARD AND, AND SHARED THAT WITH ERCOT AND PC, WE STILL THINK THAT THERE'S PROBABLY A LITTLE BIT MORE EXPLORATION TO DO TO FINE TUNE THOSE CURVES.

UM, WE WOULD LOVE TO SEE, UH, ERCOT ASSESS THEIR LEVEL OF SUPPORT FOR THESE CURVES AND WORK WITH US, UH, YOU KNOW, TO THE EXTENT THAT THEY WOULD LIKE SOME, SOME ADDITIONAL HELP TO REFINE OR ATUNE THEM.

UM, AND ULTIMATELY WE WOULD LIKE TO SEE ERCOT IF THEY, IF THEY LIKE THE CURBS, UM, THAT WE'VE PRODUCED AND FIND THEM COMPATIBLE WITH THE RTC SOFTWARE, TAKE THAT FORWARD THROUGH THE NPRR PROCESS.

I UNDERSTAND THE TIMING TO BE THAT A-N-P-R-R NEEDS TO BE SUBMITTED BY JANUARY IN ORDER TO GO THROUGH THE PROCESS SUFFICIENTLY FAST ENOUGH TO BE APPROVED IN ORDER TO BE ABLE TO BE IMPLEMENTED IN THE RTC SOFTWARE ON DAY ONE.

SO, SO, SO THAT IS OUR HOPE AT THIS POINT, UM, OR OUR RECOMMENDATION.

UH, ONE LAST THING IS, IS WE WOULD LIKE TO, AND I'M NOT SURE WHO IS APPROPRIATE TO DO THIS, BUT WE WOULD LOVE TO SEE, UM, THE CRITERIA THAT THE AGGREGATE A SDC CURVE EXACTLY MATCH THE EXISTING OR DC CURVE.

WE WOULD, WE WOULD LOVE TO SEE A DIFFERENT EYE OR EYES APPLIED TO THAT TO SEE IF PERHAPS THERE'S A DIFFERENT WAY TO INTERPRET THAT, BECAUSE IT FREES UP HOW YOU CAN CONSTRUCT THESE ALTERNATE A SDC CURVES AND OUR READING OF IT, I MEAN, THE, THE ORDC HAS PROPERTIES, IT HAS CERTAIN PROPERTIES, MARGINAL RELIABILITY PROPERTIES, UM, PRICE FORMATION BETWEEN, UH, SERVICES PROPERTIES AND HAVING THOSE PROPERTIES CARRY OVER TO THE A SDC CURVES WITHOUT HAVING THE A SDC CURVES THEMSELVES HAVE TO EXACTLY AGGREGATE TO THE ORDC BUYS A LITTLE BIT OF FLEXIBILITY IN HOW YOU CAN CONSTRUCT AND TUNE THE, THE CURVES WHICH WOULD PRODUCE A BETTER OUTCOME.

SO, UH, THAT'S MY UPDATE ON AT LEAST THE IMS UH, ACTIVITY IN THE A SDC SPACE.

I'M HAPPY TO TAKE ANY QUESTIONS.

THANK YOU, JEFF.

ANY COMMENTS, WOODY? NO COMMENTS.

AND CHRISTIE HOBBS PRESENTATION OF THE SYSTEM PLANNING AND WEATHERIZATION UPDATE.

OKAY, CARLOS.

ALRIGHT, HEARING NO OTHER COMMENTS, APPRECIATE YOUR REPORT, KIM.

WE'LL JUST PROCEED WITH THE, THE NORMAL NEXT AGENDA ITEMS, WHICH ARE COMMITTEE BRIEFS

[9.1 System Planning and Weatherization Update]

THIS IS AGENDA ITEM 9.1, CHRISTIE.

ALL RIGHT.

HOPEFULLY THE LAST TIME I HAVE TO BE HERE TODAY.

SO, WITH DECEMBER 1ST HAPPENING YESTERDAY, THAT MARKS THE BEGINNING OF WHAT WE CONSIDER THE WINTER'S SEASON.

UH, AT ERCOT.

A LOT OF WORK HAS BEEN GOING ON WITH OUR WEATHERIZATION INSPECTION TEAM GETTING READY FOR THIS WINTER SEASON.

WE CONTINUE TO UTILIZE AS WE'RE PREPARING FOR THE SEASON AHEAD, IN WHICH RESOURCES, WHICH TRANSMISSION SERVICE PROVIDERS WE'RE GOING

[01:05:01]

TO VISIT AS A PART OF OUR INSPECTION PROGRAM.

WE USE A RISK-BASED APPROACH AS WE WORK THROUGH OVER A THREE YEAR PERIOD TO MAKE SURE THAT WE SEE ALL OF THE RESOURCES AND AT LEAST 10% OF THE TRANSMISSION FACILITIES.

BUT WE APPLY THAT RISK-BASED APPROACH AS WE GO INTO THE SEASON, UM, TO MAKE SURE THAT WE'RE LOOKING AT THOSE UNITS POTENTIALLY THAT HAD ISSUES DURING A PREVIOUS EVENT, UH, LOOKING AT FACILITIES WHERE THEY'RE CRITICAL TO THE SYSTEM SO THAT WE ENSURE WE GET A SET OF EYES, A REVIEW ON THOSE ELEMENTS.

TO PREPARE SPECIFICALLY FOR THE SEASON, WE'VE DONE A COUPLE OF THINGS THAT I WANTED TO HIGHLIGHT FOR YOU.

SO WE HAD TWO WEATHERIZATION INSPECTION WORKSHOPS WITH THE GENERATORS, AND THEN ONE WITH THE TRANSMISSION SERVICE PROVIDERS, WHERE WE INVITE DIFFERENT, UM, MARKET PARTICIPANTS TO COME IN, SHARE THOSE BEST PRACTICES SO THEY CAN BE MORE OF INFORMATION SHARING ACROSS THE MARKET PARTICIPANTS OF LESSONS LEARNED FROM PREVIOUS SEASONS.

WE ALSO, AS A PART OF OUR PARTICIPATION IN THE NERC PROCESS, HOSTED A NERC COLD WEATHER PROJECT, TECHNICAL CONFERENCE, UM, WHERE WE HAD OVER 300 PEOPLE, EITHER IN PERSON OR ONLINE PARTICIPATING, AGAIN, GETTING BEST PRACTICES FROM ACROSS THE US.

A COUPLE OF OTHER THINGS, UM, THAT HAVE SINCE OCCURRED SINCE, UH, WE SUBMITTED OUR SLIDES JUST WANTED TO HIGHLIGHT.

WE, UM, AS A PARTNERSHIP WITH THE SETTLEMENTS TEAM VISITED ALL OF THE FACILITIES THAT HAD BEEN SELECTED FOR THE FIRM FUEL SUPPLY SERVICE TO MAKE SURE THAT THEY DO HAVE THE ONSITE FUEL CAPABILITY, UM, THAT THEY HAVE COMMITTED TO IN THEIR, AS WE WENT THROUGH THAT RFP PROCESS.

UH, SO THAT WAS COMPLETED TO ENSURE WE HAVE THAT ONSITE FUEL SUPPLIES, THAT BACKUP SERVICE WITH DECEMBER 1ST FALLING ON A SUNDAY.

THAT MEANT WE HAVE UNTIL TODAY AT MIDNIGHT FOR ALL THE MARKET PARTICIPANTS TO GET THEIR WINTER DECLARATIONS IN.

AS OF ALMOST MIDNIGHT LAST NIGHT, WE HAD ABOUT 90% OF WHAT WE WERE EXPECTING TO GET INTO.

A FEW STRAGGLERS THAT WILL BE COMING IN TODAY, BUT OVERALL, A GOOD RESPONSE, UH, FROM MARKET PARTICIPANTS.

COUPLE OF SLIDES THAT WE'VE SHARED WITH YOU IN, IN DIFFERENT TIMES BEFORE, BUT JUST AS WE CONTINUE TO EVOLVE THE PROCESS, UH, CONTINUE TO WORK WITH THE STAKEHOLDERS.

AS WE'VE SEEN SOME RECENT STORM EVENTS THAT HAVE COME PAST SINCE WINTER STORM ING, WE'VE HAD A COUPLE THAT HAVE BEEN, THANKFULLY NOT AS LONG OR SEVERE IN NATURE, BUT HAVE BEEN STRONG AND COLD.

AS WE LOOK AT THE STORMS WE'VE BEEN TRACKING, AND YOU CAN SEE ON THE, THE GRAPH ON THE RIGHT, UM, WE CONTINUE TO SEE IMPROVED PERFORMANCE FROM OUR THERMAL GENERATION FLEET, UM, AND HOW THEY'VE RESPONDED.

THE TOP LINE WAS THE OUTAGES THAT WERE TRACKED DURING WINTER STORM URI FOLLOWED BY THE NEXT LINE I THINK WAS FROM ONE WAS FROM HEATHER AND WHEN WAS FROM WINTER STORM ELLIOT.

SO YOU CAN SEE CONTINUED IMPROVEMENT ACROSS THE FLEET.

WE'VE ALSO PUT OUT, UH, IN THE PAST TWO MONTHS, LOOKAHEADS.

NOW, AGAIN, THESE AREN'T FORECAST, THESE ARE SIMULATIONS THAT WE DO IN OUR MONTHLY OUTLOOK FOR RESOURCE ADEQUACY WOULD FOCUS IN ON BOTH DECEMBER AND JANUARY.

FOR THE DECEMBER, UH, WE SHOW THAT THE CHANCE OF GOING INTO EA IS A HIGHER CHANCE IN THE EVENING HOURS AFTER THE SUN GOES DOWN IN THE 8:00 PM HOUR, WHICH IS ABOUT 4.9% RISK OF GOING INTO AN EEA UNDER NORMAL CONDITIONS IN JANUARY, WE SEE THAT RISK REALLY SHIFT TO THE MORNING HOURS BEFORE THE SUN COMES UP.

AND SO THAT HOUR ENDING 8:00 PM WHICH IS EIGHT 5%, I WOULD HIGHLIGHT THAT IT'S PRETTY CONSISTENT WITH WHAT WE SAW LAST JANUARY.

UM, AND IF YOU RECALL, WE DID HAVE, UM, WINTER STORM HEATHER THAT CAME OVER THE MARTIN LUTHER KING HOLIDAY WHERE WE SAW A VERY, A STRONG EVENT.

UH, BUT BECAUSE OF THE, THE OPERATIONS OF THE FLEET, BECAUSE OF THE PRICE RESPONSIVE DEMAND THAT WE SAW ON THAT DAY AND JUST GENERAL CONSERVATION BY TEXANS, WE DID NOT GET INTO AN EMERGENCY ALERT.

SO AGAIN, THIS ISN'T A FORECAST.

THIS IS THE RUN OF THOUSANDS OF SIMULATIONS THAT TAKES PROBABILITIES FROM NORMAL WEATHER TO THE MOST EXTREME WEATHER, THE MOST EXTREME CONDITIONS.

UM, AND THIS IS WHAT OUR, OUR RISK PERCENTAGE IS.

ALL RIGHT, SO LET'S SHIFT GEARS.

UH, TALK ABOUT TRANSMISSION PLANNING TEAM CONTINUES TO WORK.

UM, I KNOW GOT REPORTS THEY WERE, THEY WERE WORKING OVER THE THANKSGIVING HOLIDAY.

WHAT THEY'RE WORKING THROUGH IS TWO REGIONAL TRANSMISSION PLANS THAT WE WILL POST BEFORE THE END OF THE YEAR.

ONE THAT LOOKS AT OUR

[01:10:01]

2030 FORECASTED LOAD, USING THE SAME, UH, TRANSMISSION LEVELS THAT WE USE TODAY UP TO THE 3 45 LEVEL, WE'LL HAVE A COMPARABLE PLAN THAT PUTS AN OVERLAY FOR A 7 65 CORE NETWORK AND THE SUPPORTING 3 45 THAT WOULD BE NEEDED TO SUPPORT THAT SYSTEM.

AND WHAT YOU SEE ON THE RIGHT IS WHAT WE'VE SHARED WITH THE STAKEHOLDERS IS WHAT WE'RE CALLING OUR CORE PLAN FOR THE SEVEN SIXTY FIVE.

UH, IF YOU RECALL FROM SOME OF OUR PREVIOUS DISCUSSIONS, WE ACTUALLY HAD SOME ADDITIONAL CROSS LINES IN THIS, BUT AS WE WENT THROUGH AND STUDIED WHAT IS THAT NEED FOR 2030, THIS IS WHAT OUR RECOMMENDATION WILL LOOK LIKE.

THE THE LINES IN YELLOW ON THE LEFT ARE WHAT HAVE ALREADY BEEN APPROVED BY THE COMMISSION AS A PART OF THE PERMIAN BASIN RELIABILITY PLAN.

THEN WE'D HAVE THE ADDITION OF A COUPLE OF ADDITIONAL SUBSTATIONS TO CONNECT THE GRID FROM NORTH TEXAS DOWN, UH, INTO SOUTH AND CENTRAL TEXAS.

SO NEXT STEPS ARE WE WILL HAVE THOSE, THOSE PLANS COMPETING PLANS OUT BY THE END OF THE YEAR.

WE'VE GOT SOME ADDITIONAL BENEFIT WORK THAT WE'RE WORKING TO PUT TOGETHER TO SHOW THE COMPARISON BETWEEN THE TWO PLANS, AND WE'LL HAVE HAVE THAT OUT IN JANUARY.

AND THE REASON FOR THAT IS WE'VE GOTTA DO, ONCE WE'VE GOT OUR PLAN COMPLETE, THEN THERE'S SOME ADDITIONAL STUDIES THAT WE'LL BE DOING TO SUPPORT THAT BENEFIT ANALYSIS WITH THOSE FINALIZED RECOMMENDATION PLANS.

ALL RIGHT, GENERATION INTERCONNECTION REQUEST.

UH, WE ACTUALLY GOT SOME UPDATED NUMBERS AS OF THIS MORNING.

SO ALL THE WAY THROUGH NOVEMBER, WE'RE NOW TRACKING OVER 1900 ACTIVE GENERATION INTERCONNECTION REQUESTS INTO THE ERCOT PROCESS.

UM, THE TOTAL GIGAWATTS WENT UP TO 378 AS COMPARED TO WHAT WE'RE REPORTING AT THE END OF OCTOBER.

UH, WE SAW AN ADDITIONAL GIGAWATT OF SOLAR, 30 OR TWO ADDITIONAL GIGAWATTS OF WIND, AN ADDITIONAL GIGAWATT OF NATURAL GAS AND AN ADDITIONAL FOUR GIGAWATTS OF BATTERY ENTERED THE QUEUE.

UM, IN THAT PERIOD OF TIME.

AGAIN, WE CONTINUE TO SEE THE MAJORITY OF THE QUEUE IS SOLAR AND BATTERY ENERGY STORAGE, WHICH IS OVER WELL OVER 80% OF WHAT WE'RE TRACKING.

WANTED TO GIVE YOU A QUICK UPDATE ON SOME OF THE PROJECTS FOR THE TEXAS ENERGY FUND.

I WILL WORK TO GET YOU SOME BETTER GRAPHICS AS THEY CONTINUE MOVING THROUGH THE PROCESS AND WHERE THEY'RE AT.

BUT OF THOSE 16 PROJECTS THAT THE PUC RECOMMENDED FOR DUE DILIGENCE, WE HAVE SEEN THEM ALL REGISTER AT ERCOT THROUGH THE INTERCONNECTION PROCESS.

THEY'RE IN VARIOUS STAGES.

UM, WE DO HAVE A COUPLE THAT ARE A LITTLE BIT FURTHER ALONG.

THERE ARE FOUR THAT HAVE ALREADY COMPLETED THEIR FULL INTERCONNECTION STUDIES, UM, AND TWO THAT HAVE THEIR SIGNED GENERATION INTERCONNECTION AGREEMENTS.

SO WE'LL CONTINUE TO SHARE THESE PROJECTS AND THEIR STATUS AS WE'RE TRACKING, UM, AND WORKING WITH THOSE, UH, MARKET PARTICIPANTS, TRANSMISSION SERVICE PROVIDERS AND GENERATORS ON THEIR STATUS OF MOVING THROUGH THE, THE INTERCONNECTION QUEUE.

FROM A LARGE LOAD PERSPECTIVE, UH, THESE NUMBERS HAVE REALLY INCREASED, UM, SINCE THE LAST TIME WE REPORTED TO YOU, WE'RE NOW TRACKING OVER 63,000 MEGAWATTS OF LARGE LOADS THAT ARE SEEKING INTERCONNECTION INTO THE ERCOT GRID.

AND SINCE WE PUT IN THE LARGE LOAD INTERCONNECTION PROCESS, WE HAVE REVIEWED AND APPROVED PLANNING STUDIES FOR OVER 17,000 MEGAWATTS OF NEW LARGE LOADS ONTO THE SYSTEM.

UM, OF THAT 17,000 62 97 HAVE BEEN APPROVED TO ENERGIZED.

NOW WE HAVEN'T OBSERVED THAT THEY'RE ALL, UH, ACTUALLY TAKING POWER YET.

UM, BUT THEY COULD, THAT ADDITIONAL 2,600 THAT WE HAVEN'T SEEN YET AS OPERATIONAL, UM, COULD BECOME OPERATIONAL ANY POINT WITHOUT FURTHER NOTIFICATION TO ERCOT BECAUSE THEY'VE BEEN APPROVED TO ENERGIZE.

UM, THIS JUST BREAKS THAT DOWN A LITTLE BIT MORE.

UM, OF NOTE HERE YOU CAN SEE SOME OF THOSE ARE STANDALONE LARGE LOADS, UM, BUT WE'RE TRACKING JUST OVER A THOUSAND AT THIS POINT THAT ARE CO-LOCATED, UH, WITH GENERATION RESOURCES ALREADY ON THE GRID.

WANTED TO GIVE YOU AN UPDATE ON THE RELIABILITY STANDARD.

UH, WE CONTINUE WORKING, UH, WITH THE TRANSMISSION SERVICE PROVIDERS AND WITH THE COMMISSION STAFF TO DEFINE WHAT A RECOMMENDED MAGNITUDE NUMBER THAT CAN BE SAFELY ROTATED IN THE EVENT OF A LOAD CHAT EVENT.

UM, WE HAD ORIGINALLY IN THE COMMISSION ROLE, UM, WE HAD THOUGHT WE COULD MAKE THE DECEMBER 1ST DATE TO GET THAT INFORMATION, BUT BECAUSE THIS IS A NEW PROCESS, UM, WORKING WITH THE TSPS DIFFERENT UNDERSTANDINGS OF THE TYPES OF INFORMATION, HOW WE WANTED TO RECEIVE THAT, WE DID ASK THE COMMISSION AT ONE OF THEIR LAST OPEN MEETINGS FOR A GOOD CAUSE EXCEPTION.

UM, AND SO WE NOW

[01:15:01]

HAVE COMMITTED TO GET THAT BY THE BEGINNING OF FEBRUARY, UM, TO GET THAT NUMBER THAT THEY WERE REQUESTING, THAT COMPLETES THE THIRD LEG OF THE STOOL FOR THE RELIABILITY STANDARD.

DO YOU HAVE LIKE AN ORDER OF MAGNITUDE YOU COULD SHARE WITH US, UH, THAT YOU'RE OR ARRANGE THAT YOU'RE ZEROING IN ON? NOT AT THIS TIME BECAUSE WE WANNA MAKE SURE THERE'S BEEN SOME DIFFERENT INTERPRETATIONS OF WHAT, HOW WE WERE LOOKING TO GET THE DATA.

AND SO WE WANT THAT TO BE CONSISTENT ACROSS THE TSP.

SO I'D HATE TO PUT OUT A NUMBER THAT'S INACCURATE AT THIS TIME.

WE'RE ALSO INTERNALLY WORKING ON OUR PLANS.

UM, THE NEXT YEAR, WE'LL GO BY VERY FAST.

UM, AND STARTING IN JANUARY OF 2026, WE WILL START THAT NEXT THREE YEAR RELIABILITY ASSESSMENT.

SO MAKING SURE WE'VE GOT PLANS IN PLACE OF THE INFORMATION WE NEED, UM, THE VARIABLES THAT WE'LL USE, THE RECOMMENDATIONS THAT WE'LL FILE AT THE COMMISSION THAT WE HAVE TO GET APPROVAL BEFORE WE CAN START CONDUCTING THE NEXT RELIABILITY ASSESSMENT.

SO THAT'S KIND OF THE FOCUS OF THE TEAM RIGHT NOW TO GET PREPARED FOR THAT WORK.

AND THAT WRAPS UP MY REPORT.

I THINK ONE THING, UM, I DID WANNA POINT OUT FOR YOU, JULIE, IS THIS TRANSMISSION PLANNING SUMMARY.

NOW, IT DOESN'T GO PROJECT SPECIFIC, BUT IT IS SOMETHING THAT WE'RE CURRENTLY REPORTING ON A MONTHLY BASIS OF OVERALL PROJECTS THAT HAVE BEEN ENDORSED BY THE BOARD OF THOSE THAT ARE IN STATUS WITH THE, THE TRANSMISSION SERVICE PROVIDERS, UM, OF THOSE THAT HAVE BEEN ENERGIZED, THE CONSTRUCTION IN PLACE.

UM, AND AS YOU CAN SEE, UH, WE'VE ALREADY IN, IN 2024 AS OF OCTOBER 4TH, UM, MORE PROJECTS, WELL OVER A MILLION, ALMOST A MILLION MORE ENERGIZER BILLION, EXCUSE ME, ENERGIZED IN 2024 THAN WAS IN ALL OF 2023.

SO A LOT OF WORK IS BEING DONE.

THANK YOU FOR PUTTING THAT IN THERE.

ANY OTHER COMMENTS? NOPE.

NINE, ITEM 9.2 SYSTEMS OPERATIONS UPDATE, DAN WOODFIN.

NEXT UP AGENDA

[9.2 System Operations Update]

ALL RIGHT, GOOD AFTERNOON.

I'VE GOT, UH, A COUPLE OF ITEMS THAT I WANNA TALK TO YOU ABOUT RELATED TO SOME UPCOMING REVISION REQUESTS THAT ARE IN THE PROCESS TO KIND OF DO SOME ADVANCE DISCUSSION ABOUT THOSE BEFORE AND AS THEY'RE WORKING THROUGH THE PROCESS SO THAT WHEN THEY GET HERE, WE'RE NOT STARTING FROM SCRATCH.

UM, AND THEN WE'VE GOT SEVERAL OTHER KIND OF JUST INTERESTING, UH, THINGS THAT HAVE BEEN GOING ON THAT I WANTED TO SHARE WITH YOU.

SO, LARGE LOADS, UH, CHRISTIE TALKED ABOUT HOW THIS IS CONTINUING TO GROW, BUT ONE OF THE THINGS WE'VE BEEN SEEING IS THAT WHEN THERE'S A, A FAULT ON THE SYSTEM THAT'S NEARBY TO A, UH, ONE OF THESE LARGE LOADS AND AND WE'RE TALKING ABOUT DATA CENTERS, AI DATA CENTERS, CRYPTO MINERS, UM, WHAT HAPPENS IS THAT THE, THE VOLTAGE IN THAT AREA GETS DEPRESSED AROUND IT.

AND, UM, WHAT WE'RE DISCOVERING IS THOSE HAVEN'T AREN'T CURRENTLY SET TO, UH, RIDE THROUGH THOSE VOLTAGE EVENTS.

IT'S KIND OF A SIMILAR SITUATION TO THE IBR THAT WE'VE BEEN TALKING ABOUT, EXCEPT IN THIS CASE, WHAT HAPPENS IS THAT THE, UH, THE LOAD, MAYBE NOT ALL OF THE LOAD AT A LOCATION OR LOCATIONS IN THAT AREA WILL STOP CONSUMING POWER.

SO IT'S KIND OF THE OPPOSITE OF, OF, OF, OF WHAT HAPPENS WITH THE IBR WHERE THEY START TO STOP PRODUCING POWER.

AND IT'S NOT NECESSARILY ALL OF IT.

SO WHAT'S SHOWN IN THESE BAR CHARTS ON HERE IS IF YOU LOOK AT THE ONE ON THE FAR, UH, RIGHT THERE, UH, THAT'S ABOUT A, A LITTLE LESS THAN A 400 MEGAWATT TOTAL LOAD IN THE AREA THAT WAS AFFECTED BY THIS, UH, FAULT ON THE SYSTEM.

UH, AND ABOUT 241 MEGAWATTS OF THAT THREE 80 SAY, STOPPED PRODUCING, STOPPED CONSUMING FOR A WHILE.

NOW THAT MAY BE THAT THE, FROM, IF YOU LOOK AT IT FROM THE LOADS PERSPECTIVE, THEY SEE A VOLTAGE DIP ON THE SYSTEM.

THEY WANT TO PROTECT THEIR EQUIPMENT, AND SO MAYBE THEIR UPS KICKS IN OR SOMETHING LIKE THAT IN ORDER FOR THEM TO CONTINUE TO BE ABLE TO PROCESS.

BUT FROM A SYSTEM PERSPECTIVE, WHAT THAT LOOKS LIKE IS THAT LOAD JUST GOES AWAY FOR SOME SHORT PERIOD OF TIME.

AND IN THIS CASE, 241 MEGAWATTS WENT AWAY.

WELL, IS, UH, AND WE'VE SEEN,

[01:20:01]

THIS IS JUST LAST YEAR, WE'VE SEEN THAT MANY, UH, EACH ONE OF THOSE IS A SEPARATE EVENT.

IT'S NOT AT ONE LOCA.

IT'S NOT NECESSARILY ONE BITCOIN MINER SAY IT MAY BE MULTIPLE IN AN AREA THAT MAKE UP THE MEGAWATTS THERE.

BUT WE'VE SEEN THAT MANY DIFFERENT EVENTS IN THE COURSE OF THE LAST YEAR.

AND OF COURSE, CHRISTY HAD THIS SLIDE IN HER PRESENTATION AS THE NUMBER AND AND MAGNITUDE OF THESE KIND OF LOADS CONTINUES TO GROW, IF YOU'VE GOT NOT JUST ONE BIG ONE, BUT MAYBE MULTIPLE MEDIUM SIZED ONES IN AN AREA AND THEY ALL STOP PRODUCING POWER FOR A FEW SECONDS, UH, THAT THAT COULD BE A PROBLEM.

AND ACTUALLY THE PROBLEM IS SHOWN ON THAT LINE CHART AT THE TOP THERE, WHICH SHOWS THAT IN THE SAME WAY THAT WHEN A UNIT TRIPS FREQUENCY ON THE SYSTEM GOES DOWN, IF THE LOAD GOES AWAY FOR SOME SHORT PERIOD OF TIME, THEN THE FREQUENCY ACTUALLY GOES UP.

AND THAT'S ALMOST AS BIG A PROBLEM AS THE FREQUENCY GOING DOWN FOR ANY SYNCHRONOUS GENERATORS ON THE SYSTEM, OTHER TYPE OF TYPES OF DEVICES LIKE THAT.

SO WE NEED TO KEEP THAT IN A TIGHT RANGE.

AND SO THE REASON I'M, UM, GOING THROUGH THIS IS THAT ERCOT HAS PROPOSED A, UM, A PLANNING GUIDE, REVISION REQUEST, BIGGER 1 22 THAT'S WORKING THROUGH THE STAKEHOLDER PROCESS THAT WILL, UH, REQUIRE, UM, REALLY SAY THAT SOME AMOUNT THAT FOR ANY FAULT ON THE SYSTEM, WE DON'T WANT MORE THAN A CERTAIN NUMBER OF MEGAWATTS.

AND WE'VE PROPOSED A THOUSAND MEGAWATTS TO, TO STOP CONSUMING FOR ANY SINGLE FAULT ON THE SYSTEM.

AND SO THAT MAY MEAN THAT DOESN'T NECESSARILY MEAN THAT NO LOAD WILL BE ALLOWED TO BE OVER A THOUSAND MEGAWATTS.

IT'S JUST THAT WE'RE GONNA HAVE TO REINFORCE THE SYSTEM OR THE, THAT, UH, PLANT WILL HAVE TO DO SOMETHING TO, SO THAT IT, SO THAT WE DON'T LOSE MORE THAN THAT THOUSAND MEGAWATTS FROM ANY SINGLE UH, FAULT.

AND OF COURSE, THAT THE, THE, THE EXACT WHAT, WHAT THAT FIGURE WINDS UP LOOKING LIKE BY THE TIME IT GETS TO THE BOARD WILL BE SUBJECT TO ADDITIONAL DISCUSSION IN THE STAKEHOLDER PROCESS.

BUT BASICALLY THE, THE CONCEPT I WANTED TO SHARE WITH YOU TODAY IS JUST THAT THERE'S, THERE'S A PROBLEM AND WE NEED, WE'RE WORKING ON HOW TO FIX THAT AND WE NEED TO FIX IT BEFORE THESE THINGS CONTINUE TO GROW IN MAGNITUDE.

AND THEN JUST ONE QUESTION ON THAT 14% OR 8,800 MEGAWATTS THAT ARE NOT, UH, DON'T HAVE STUDIES SUBMITTED FOR 28, UH, WHAT'S THE TIMELINE TO GET THOSE, UH, STUDIES IN PLACE AND DONE SO THAT IT'S NOT AN ISSUE? ACTUALLY, I'LL, UH, PHONE A FRIEND IN PLANNING TO ANSWER THAT QUESTION.

SORRY, .

SORRY, CARLOS.

COULD YOU REPEAT THAT? I WAS MULTITASKING BACK HERE.

I DIDN'T HEAR YOUR QUESTION.

UH, THE 8,800 MEGAWATTS THAT YOU DON'T HAVE STUDIES FOR, HOW LONG IS THE LEAD TIME TO GET THOSE STUDIES DONE? SO IT'S NOT AN ISSUE ALL RIGHT THERE.

RIGHT.

AND SO THAT, THAT IS DEPENDENT ON GETTING THOSE STUDIES FROM THE TRANSMISSION SERVICE PROVIDER.

SO I THINK DEPENDING ON, UH, WHAT WE'VE SEEN FROM VARIOUS, UM, LARGE LOADS IN THE PROCESS, THE THE ONES THAT ARE SERIOUS ABOUT MOVING FORWARD VERY QUICKLY, THEY'RE PROVIDING THE INFORMATION TO THE TSPS, THEY'RE WORKING TO GET THOSE STUDIES AND MOVING THOSE FORWARD VERY QUICKLY.

THOSE THAT MAY STILL, UM, BE CONSIDERING WHETHER OR NOT THEY WANT TO COME MAY TAKE A LITTLE BIT LONGER.

UM, IT, IT REALLY IS, IT'S DEPENDENT ON BOTH THE CUSTOMER GETTING THE INFORMATION AND WORKING WITH THE TSP TO GET US THOSE STUDIES SO IT, IT CAN VARY.

YEAH, I WOULD SAY THAT THAT TOP THAT 8,800 IS PROBABLY YOUR MOST SPECULATIVE GROUP.

AND SOME OF THOSE MAY NEVER ACTUALLY MAKE IT.

'CAUSE MOST PEOPLE THAT ARE SERIOUS ABOUT IT HAVE WORKED WITH THEIR TSPS TO GET THE MODELS AND DO THE THINGS NECESSARY TO MOVE IN A DIFFERENT PART OF THE CHART THERE.

ESPECIALLY WITH THEM BEING OUT IN, UH, 2028, I GUESS.

UM, BUT CERTAINLY WITH, YOU KNOW, 63,000 UNDER CONSIDERATION, WE'VE GOTTA SOLVE THIS OTHER PROBLEM THAT I WAS TALKING ABOUT.

UH, ITS GOING TO BE PROACTIVE ABOUT THIS.

RENEWABLE ENERGY ZONE CREST LINES TO HELP THEY HELP, UH, YOU TRANSFER MORE POWER OVER, UH, EXISTING LINE OR OVER NEW LINES IN A WAY THAT DOES, UM, YEAH, I GUESS THAT'S REALLY THE SUMMARY.

SO THE, THE SECOND ISSUE THAT HAS AN NPRR THAT'S THAT'S COMING IS REALLY THE SERIES CAPACITORS.

AND I THINK WE'VE TALKED ABOUT THESE BEFORE, THAT, THAT THERE WERE A NUMBER OF SERIES CAPACITORS THAT WERE ADDED TO SOME OF THE COMPETITIVE

[01:25:01]

THEY HELP YOU TRANSFORM MORE POWER.

AND SO THERE WERE SOME ADDED AS A RESULT OF CREZ, AND YOU CAN KIND OF SEE THESE ON THE WEST TEXAS ONE ON THE MAP.

AND THERE WERE SOME IN SOUTH TEXAS THAT WERE, UH, THAT A COUPLE OF 'EM HAVE BEEN THERE FOR A WHILE, AND A COUPLE WERE ADDED TO, UM, HELP SERVE LOAD IN THE VALLEY.

SO INCREASE THE TRANSFER CAPABILITY INTO THE VALLEY.

UM, AND SO THAT, THOSE ARE REALLY HELPFUL.

UH, BUT, UM, WHAT HAPPENS IS THAT IF A RESOURCE IS HOOKED DIRECTLY INTO THAT SERIES CAPACITOR, SO MAYBE THERE'S A LINE THAT HAS A SERIES CAPACITOR ON IT, AND ONE END OF THE LINE TRIPS, AND THERE'S A, THERE'S A, THAT ISOLATES A, A GENERATOR ONTO THE, DIRECTLY ONTO THE SERIES CAP.

IT HAS A PROBLEM THAT'S CALLED, CALLED SUB SYNCHRONOUS RESONANCE.

POTENTIALLY.

YOU CAN KIND OF SEE THIS ON THIS VERY COLORFUL CHART THERE, THAT RED AND THE GREEN LINES ARE SOLID, AND THEN THEY, THE, THE RESONANCE STARTS AND THE MAGNITUDE OF THAT IS SOMETHING LIKE 1200 MEGAWATTS ON THIS PARTICULAR CASE.

SO IT, IT'S, IT'S, IT'S A PROBLEM.

IT'S A PROBLEM THAT NEEDS TO BE SOLVED.

UM, THERE WAS, IT APPEARED TO BE PROMISING FOR ESPECIALLY INVERTER BASED RESOURCES TO, UH, BE ABLE TO TUNE THEIR CONTROLS IN SUCH A WAY THAT IT COULD MITIGATE THE, THESE, UH, SUBSEQUENT RESONANCES.

UM, AND SO, YOU KNOW, IF YOU'VE GOT A-A-A-I-B-R OR SOMETHING LIKE THAT, THAT'S SOMEWHAT REMOTE FROM THE SERIES CAPACITOR, YOU CAN TUNE THE, THE, THE, THE TUNE THE CONTROLS SUCH THAT IT'S NOT A PROBLEM OR DOES, AT LEAST IN THEORY.

BUT WHAT WE'VE SEEN IS THAT, UH, SOME, SOME GENERATORS AREN'T HOOKING IN KIND OF SOMEWHAT NEARBY TO THE SERIES CAPACITORS, BUT DIRECTLY ONTO THE SERIES CAPACITOR COMPENSATED LINES, SO THAT ANYTIME ONE END OF THE LINE TRIPS, THAT GENERATOR IS DIRECTLY CONNECTED INTO THE SERIES CAPACITOR.

AND WHILE IN THEORY, IT'S POSSIBLE TO MITIGATE THAT SUBSEQUENT RESONANCE, IN THAT CASE, WHAT WE'VE ACTUALLY SEEN IS NUMEROUS EVENTS WHERE EITHER BECAUSE ADDITIONAL GENERATION'S BEEN ADDED THERE, OR THE TUNING HAS CHANGED OVER TIME, THAT WE SEE SOMETHING LIKE THE COLORFUL CHART ON THE OTHER SIDE THERE.

THAT, THAT WE SEE SUBS RESONANCE.

WE HAD ONE EVENT, UH, IN 2009 THAT ACTUALLY DAMAGED A WIND FARM AS A RESULT OF THIS.

UM, AND SO WE'VE PROPOSED A NEW PLANNING GUIDE REVISION REQUEST THAT SAYS BASICALLY YOU CAN'T HOOK UP WHERE YOU WOULD BE DIRECTLY CONNECTED INTO A SERIOUS COMPENSATED LINE.

UM, PROBABLY SHOULD HAVE PASSED THIS A LONG TIME AGO.

UM, BUT YOU KNOW, THE PROMISE WAS THAT THESE THINGS COULD BE MITIGATED, BUT IN ACTUAL FACT, WHAT WE'RE SEEING IS THAT'S NOT THE CASE.

AND SO THAT THAT WILL BE COMING BEFORE YOU, UH, ONCE IT GETS THROUGH THE STAKEHOLDER PROCESS.

A FEW OTHER INTERESTING THINGS, UM, UNRELATED TO, TO REVISION REQUESTS.

UM, THIS IS, OF COURSE, WE'RE KIND OF COMING TO THE END OF FALL OUTAGE SEASON, AS CHRISTIE TALKED ABOUT.

WE'RE, UM, NOW STARTING WINTER INSPECTIONS.

WELL, THE OUTAGE SEASON WAS, UM, UH, IS ALMOST FINISHED NOW.

IN FACT, I'VE NOTICED THIS MORNING WE'RE DOWN TO LIKE 6,900 MEGAWATTS OF PLANNED OUTAGES, WHEREAS MID, UH, NOVEMBER WE WERE UP AT ALMOST, UH, I DON'T KNOW, 12,000, SOMETHING LIKE THAT.

SO IT'S COME DOWN A LOT JUST, YOU KNOW, FOR THANKSGIVING, THAT TIMEFRAME.

UM, BUT ONE OF THE QUESTIONS THAT WE ALWAYS TRY TO ILLUSTRATE IS THE, THE DARK LINES ON THE TOP CHART SHOW THE MAXIMUM DAILY OUTAGES THAT CAN, THAT ARE ALLOWED UNDER THE PROCESS THAT WE APPROVED SEVERAL YEARS AGO.

UM, THE DOTTED LINES ARE FOR THE LAST TWO YEARS WHAT THE ACTUAL OUTAGES ARE.

AND YOU SEE THERE, THERE ACTUALLY, THERE'S SPACE LEFT BETWEEN THE, THE MAXIMUM DAILY OUTAGES AND THEN THOSE, WHAT'S ACTUALLY BEING TAKEN.

AND WE'VE POKED AT THAT A LITTLE BIT AND COME UP WITH WHAT'S AT THE, ON THE BOTTOM CHART THERE.

SO THE, THE SOLID LINES ARE THE, AND, AND ALL OF THIS IS FOR, FOR THE NON-RENEWABLE OUTAGES.

UM, THE SOLID LINES ARE THE, UH, FORCED OUTAGES IN TOTAL, UM, FOR INCLUDING PLANNED OUTAGES THAT WERE EXTENDED BEYOND THEIR EXPECTED TIME.

AND THE DOTTED LINES ON THE BOTTOM CHART ARE THE, UM, THE PLANNED OUTAGES THAT WERE EXTENDED

[01:30:01]

OUT BEYOND THEIR TIME.

SO THEY, THEY, THEY REALLY BECOME A FORCED OUTAGE WHEN THEY'RE EXTENDED BEYOND THEIR, THEIR, THEIR PLANNED OR, AND THE MAGNITUDE OF THAT, UM, THAT FORCED EXTENSION, THOSE FORCED EXTENSIONS IS VERY CLOSE TO MAKING UP THE GAP BETWEEN THE ACTUAL OUTAGES IN THE M-D-R-P-O-C.

AND SO ESSENTIALLY WHAT WE'RE, WHAT IT LOOKS LIKE IS THAT THOSE EXTENDED PLANNED OUTAGES ARE, ARE REALLY MAKING UP MOST OF THE DIFFERENCE THERE AND WHY FOLKS AREN'T TAKING THE, UH, THE FULL AMOUNT OF THE M-D-R-P-O-C, ESPECIALLY TOWARD THE END OF THE OUTAGE SEASON.

UM, SO DAN, YEAH.

UM, SO ANY OUTAGE, WHETHER IT'S PLANNED OR FORCED, HAS AN END DATE THAT GETS FACTORED INTO THE M-D-R-P-O-C.

ANY OUTAGE, ANY, ANY, ANY OUTAGE THAT WE HAVE IN THE OUTAGE SCHEDULER HAS AN END DATE ON IT BASED ON THE HISTORY.

AND THOSE ALL GET FACTORED INTO THE M-D-R-P-O-C, AND THAT'S WHY WHEN THEY HAVE 'EM EXTEND LIKE THAT, THAT'S ASKING FOR ROOM THAT ISN'T THERE, BASICALLY.

UM, CHRIS COLEMAN IS GONNA TALK ABOUT, AT THE BOARD TOMORROW, IS GONNA TALK ABOUT KIND OF THE WEATHER, UH, WEATHER REVIEW OF 2024 IN TERMS OF WEATHER, AND THEN A LOOK AHEAD, BUT TO COUPLE WITH, WITH CHRISTIE'S KIND OF GOING INTO WINTER, UH, MORE OF, WE ADDED ONE SLIDE IN HERE TO TALK ABOUT, UH, KINDA THE WINTER WEATHER OUTLOOK.

UM, SO ELECTRIC VEHICLES, UH, EMBEDDED IN THE LOAD FORECAST IS AS A FORECAST THAT WE, WE'VE TALKED TO YOU ABOUT BEFORE ABOUT ELECTRIC VEHICLE USE.

I THINK JEFF CAME AND TALKED TO YOU ABOUT THIS.

UM, AND WHAT, AND JUST KIND OF THE NEWS HERE IS THAT AS WE'VE UPDATED THIS, WE'VE SEEN KIND OF SLOWER, UM, SLOWER GROWTH IN SALES OF, OF ELECTRIC VEHICLES AND WORKING THROUGH THAT PROCESS.

AND THAT'S SLOWED DOWN SOMEWHAT THE, UM, UM, OUT INTO THE FUTURE, THE, THE EXTENDED FORECAST OF ELECTRIC VEHICLES.

UM, AND SO THERE'S NOT A LOT OF NEWS HERE.

I JUST, WE WANTED TO SHARE THAT BECAUSE WE HAVE SEEN KIND OF THAT SLOWING.

UM, AND THEN FINALLY, UH, WELL, I, I THINK THERE'S TWO MORE.

UH, THE, UH, INERTIA.

INERTIA IS ALWAYS A DISCUSSION.

WE'VE HAD DISCUSSIONS WITH SOME OF YOU ABOUT, ABOUT INERTIA.

UM, WE PERIODICALLY HA WE HAVE A WHITE PAPER THAT'S BEEN PUT OUT THAT KIND OF GIVES THE STATE OF THE SYSTEM IN TERMS OF INERTIA, WHAT WE'VE SEEN HISTORICALLY, WHERE WE THINK WE'RE GOING AND THOSE KIND OF THINGS.

AND WE'VE UPDATED THAT WHITE PAPER.

UM, IT'S ACTUALLY WRITTEN IN SUCH A WAY THAT, YOU KNOW, YOU DON'T HAVE TO HAVE A PHD IN PHYSICS NECESSARILY TO UNDERSTAND IT.

AND, UH, SO IT, IT'S, UH, WE JUST HAVE UPDATED THAT WITH THE LATEST INFORMATION AND SO FORTH.

UH, THE ONE TIDBIT I I'LL SHARE WITH YOU IS THAT OVERALL, UM, WHILE YOU SEE, UM, KIND OF THE, THE, UM, THE, THE LINES HERE ARE THE AVERAGE, UH, INERTIA.

SO THIS IS KIND OF THE, THE, THE YEARLY AVERAGE.

AND THEN THIS IS THE AVERAGE FROM PEOPLE THAT ARE CARRYING ANCILLARY SERVICES.

SO AS OUR, OUR ANCILLARY, THE ANCILLARY SERVICES ARE BEING MORE AND MORE CARRIED BY BATTERIES.

THEY DON'T PROVIDE INERTIA.

SO WE'RE NOT GETTING AS MUCH FROM THE ANCILLARY SERVICES.

BUT OVERALL, THE INERTIA IS ACTUALLY ON AVERAGE GOING UP A LITTLE ON OVER THE COURSE OF THE YEAR.

AND WHEN WE LOOK AT WHAT, BUT WHAT'S REALLY MORE OF A CONCERN IS THE MINIMUM INERTIA TIMES.

AND YOU CAN SEE ON THE, THE, THE, THE RIGHTMOST CHART HERE, WE SAW SOME PRETTY SIGNIFICANT LOW INERTIA PERIODS BACK IN 21, 22, BUT THAT'S ACTUALLY GONE BACK UP.

THE MINIMUM INERTIA THAT WE SEE IN THE LAST COUPLE OF YEARS HAS GONE BACK UP.

AND YOU'D EXPECT THAT AS POTENTIALLY YOU'VE GOT LOWER GAS PRICES, YOU'VE GOT, UM, UH, WHICH KEEP UNITS IN GENERAL, MAYBE MORE THERMAL UNITS ARE STAYING COMMITTED.

UM, AND YOU'VE GOT TRANSMISSION CONSTRAINTS THAT LIMIT THE, THE RENEWABLE OUTPUT.

AND SO YOU'VE GOTTA SERVE MORE OF THE LOAD WITH, WITH THERMAL GENERATION.

AND THEN ALSO, BUT PROBABLY THE BIGGEST FACTOR IS THE FACT THAT THE MINIMAL LOAD ON THE SYSTEM IS GROWING.

AND SO THESE SAME DATA CENTERS AND OTHER TYPES OF LOADS THAT, THAT CONSUME AT NIGHT, AS WELL AS DURING THE DAYTIME, AS THOSE CONTINUE TO GROW, WE'RE GENERALLY GONNA HAVE MORE LOAD IN THOSE OFF PEAK LOW INERTIA TYPE CONDITIONS.

SO YOU SEE THAT STARTING TO TURN BACK AROUND.

SO ANYWAY, IT, IT'S, IT'S A INTERESTING PAPER IF YOU, UH, ARE INTERESTED IN THAT.

AND IS THAT SOMETHING YOU WOULD UPDATE EVERY YEAR? UM, SO WE CAN LOOK AT THEM, WE'VE BEENING IT ROUGHLY EVERY YEAR.

UH, WE'RE UPDATING THE NUMBERS ALL THE TIME.

BUT AS FAR AS MM-HMM, , UH, UH, POSTING IT, WE, WE HAVEN'T BEEN NECESSARILY DOING THAT EVERY YEAR, BUT AS, AS THERE'S SOME SIGNIFICANT CHANGE.

UM, AND IT'S POSTED ON ERCOT.COM IN THE TRENDING TOPIC SECTION.

[01:35:03]

AND IN GENERAL, IT'S ON AVERAGE OVER THE COURSE OF THE WINTER, IT'S LOOKING LIKE IT'S GONNA BE WARMER THAN NORMAL AND DRIER THAN NORMAL.

BUT AS WE ALWAYS DISCUSS, IT'S ALWAYS POSSIBLE EVEN DURING AN AVERAGE, WARMER THAN NORMAL WINTER TO GET A SIGNIFICANT COLD OUTBREAK.

AND IN FACT, AS, AS CHRIS HAS LOOKED AT THIS, UH, BASED ON SOME RECENT YEAR ANALOGS, IT'S ACTUALLY MAYBE MORE LIKELY TO HAVE COLD OUTBREAKS DURING A YEAR WHERE IT'S IN ON AVERAGE WARMER.

AND THERE'S SOME METEOROLOGICAL REASONS FOR THAT.

BUT, UM, THAT, THAT'S IT, IT'S CERTAINLY POSSIBLE FOR THAT TO HAPPEN.

AND AS FAR AS THE NORMAL, UH, NORMAL, UH, THINGS THERE, THERE'S REALLY NOTHING THAT I WANTED TO POINT OUT THIS MONTH.

SO ONE, ONE REMARK ABOUT THE WINTER WEATHER IS BASICALLY THE REPORTS YOU'RE COMMUNICATING WITH US IS THAT THE VARIABILITY IS GOING UP ON THE TEMPERATURE, EVEN THOUGH THE MEAN MIGHT BE GOING TO A MILD AREA, IT'D BE REALLY GREAT TO SEE THAT VARIABILITY MM-HMM.

IT'S SPECIFICALLY EXPRESSED, UM, WHETHER IT'S SIGMA STANDARD DEVIATION OR JUST THE SHAPE OF THE CURVE CHANGING.

SO WE CAN SEE THOSE EXTREMES.

'CAUSE BASICALLY WE'RE TALKING ABOUT THE FIVE AND SIX SIGMA OF BEHAVIOR OF WHETHER OR NOT THE AVERAGE OF THE WEATHER.

SO MORE EXPLANATION OF WHAT'S HAPPENING AT THE TAILS OF THE WEATHER DISTRIBUTION IS WHAT'S IMPORTANT TO THIS TOPIC.

YEP.

IT'D BE GREAT TO SEE THAT.

I GET THAT.

YEP.

UH, WE'LL SEE WHAT WE CAN DO WITH THAT FOR, ESPECIALLY FOR NEXT WINTER.

MM-HMM.

, ANYTHING IN THE APPENDIX YOU WANNA POINT OUT? NOTHING I WANT TO POINT OUT IN THE APPENDIX.

KEITH COLLINS WILL PRESENT COMMERCIAL MARKETS UPDATE.

, ANY QUESTIONS FOR DAN? THANK YOU, DAN.

OKAY, NEXT AGENDA, ITEM 9.3.

[9.3 Commercial Markets Update]

STILL LOWER THAN WE SAW THERE, BUT, BUT A CHANGE IN TREND.

GOOD AFTERNOON.

I'M KEITH COLLINS COVERING THE COMMERCIAL MARKETS UPDATE.

WE'VE GOT A FEW KEY TAKEAWAYS THAT I WANT TO COVER TODAY.

UH, THE FIRST ONE IS A BRIEF DISCUSSION ON RELIABILITY UNIT COMMITMENT AND AN UPTICK WE'VE SEEN THERE.

UH, THE SECOND ITEM HAS TO DO WITH, UH, WE RECENTLY PUBLISHED OUR 2024 OPERATING RESERVE DEMAND CURVE UAL REPORT.

AND SO WE'LL TALK ABOUT SOME OF THE HIGHLIGHTS FROM THERE.

AND THEN I WANT TO GIVE A PREVIEW OF AN NPRR THAT'S CURRENTLY UNDER DEVELOPMENT.

UM, IT'S TABLED AT THE MOMENT, BUT I THINK IT'D BE GOOD TO TALK ABOUT IT A LITTLE BIT TODAY SO THAT WHEN IT DOES COME, UH, BEFORE THE BOARD, UH, HOPEFULLY NEXT YEAR, UH, THERE'LL BE SOME GROUNDWORK ON THIS ALREADY.

ALRIGHT, SO THE, THE FIRST THING IS, IS OBVIOUSLY RELIABILITY UNIT COMMITMENT, UH, THE RU PROCESS, THERE ARE RESOURCES THAT ARE COMMITTED THROUGH THAT PROCESS.

UH, GENERALLY, UH, THESE, THESE RESULT IN SORT OF AN OUT OUTTA MARKET COMMITMENTS.

AND, AND THE MORE WE HAVE, UH, OBVIOUSLY THE MARKET ANTICIPATING THIS STUFF, THE BETTER.

AND I THINK THE TREND YOU SEE IN THE CHART HAS BEEN, UH, OVER THE PAST FEW YEARS, THE TREND HAS BEEN DOWN, AND THAT, THAT WE WOULD AGREE IS A POSITIVE SIGN AND A POSITIVE TREND.

I THINK I EVEN NOTED, UH, I BELIEVE AT THE LAST BOARD MEETING THAT, UH, I WAS, I WAS ANTICIPATING MUCH HIGHER NUMBERS, BUT, BUT IN THE SUMMER THEY WERE FAIRLY LOW.

AND THAT'S, THAT'S TRUE COMPARED HISTORICALLY, BUT WE HAVE SEEN AN UPTICK, AND THAT UPTICK HAS BEEN DONE, UH, AS A RESULT OF, OF A COUPLE FACTORS.

THE, THE FIRST ONE PREDOMINANTLY BEING THAT, UM, THE NET LOAD CHANGED DURING THE SOLAR RESOURCE RAMP DOWN HOURS, UH, IS, HAS RESULTED IN, IN OCTOBER AND AN UPTICK IN THE NUMBER OF RESOURCES WE SAW 25 RESOURCES, UM, UH, DURING THAT PERIOD.

THAT'S, THAT'S ONE REASON.

ANOTHER REASON HAS TO DO WITH THE, UH, CONGESTION TYPICALLY IN, UH, SOUTH TEXAS CONGESTION RELATED, UH, RUT COMMITMENTS.

SO THOSE ARE TWO OF THE REASONS WHY, PREDOMINANT REASONS WHY WE'VE SEEN THIS RECENT UPTICK IN IN OCTOBER.

WHEN YOU DO COMPARE THAT, OBVIOUSLY TO OCTOBER, 2022, IT'S, IT'S

[01:40:01]

AND, UH, AS WE, WE LOOKED IN NOVEMBER, UH, WE SAW THAT TREND KIND OF CONTINUE THROUGH, UH, THROUGH THE NOVEMBER PERIOD AS WELL.

SO WE ARE OBSERVING THAT, THAT TREND AND SOMETHING WE'RE GONNA KEEP TRACK OF, OF GOING FORWARD.

THE NEXT, THE NEXT ITEM IS OUR, UH, BIANNUAL BIENNIAL ORDC REPORT, WHICH WE PUBLISHED IN NOVEMBER.

THE LAST ONE WAS, UH, IN NOVEMBER OF 22.

AND SO ON NOVEMBER 1ST THIS YEAR, WE, WE, WE PUBLISHED OUR REPORT.

UH, THE REPORT IS TO, UH, ANALYZE THE EFFICACY UTILIZATION, UH, RELATED COSTS AND CONTRIBUTION TO GRID RELIABILITY OF THE ORDC DURING THE STUDY PERIOD.

AND THE STUDY PERIOD WAS ESSENTIALLY PICKED UP RIGHT AFTER THE LAST REPORT, UH, THROUGH SEPTEMBER OF, OF THIS YEAR.

ULTIMATELY, THERE WERE TWO KEY DESIGN CHANGES THAT OCCURRED TO THE ORDC, UH, THAT AFFECTED THE ORDC.

UH, ONE WAS THE INTRODUCTION OF THE ECRS PRODUCT IN JUNE OF 23.

AND THE SECOND CHANGE WAS, UH, THE INTRODUCTION OF TWO PRICE OF A, A MULTI-STEP PRICE ATER FLOOR BEGINNING IN NOVEMBER OF 23.

AND, AND, UH, ULTIMATELY THE REPORT AND THE FINDINGS WERE PRESENTED TO THE, UH, THE COMMISSION IN NOVEMBER.

UM, UH, AND THE FINDINGS OF THE REPORT WAS ULTIMATELY WE FOUND THAT THE ORDC WAS PERFORMING IN LINE WITH THE EXPECTATIONS BASED ON ITS CURRENT DESIGN.

THAT'S NOT TO SAY THAT THE DESIGN COULDN'T CHANGE OVER TIME, BUT AS IT'S CURRENTLY DESIGNED, UH, WE FOUND THAT THE RDC DID PERFORM IN LINE, UH, THINGS TO NOTE OF, OF PARTICULAR NOTE THAT DURING THE STUDY PERIOD, UH, THERE WERE GENERALLY HIGHER, HIGHER ANCILLARY SERVICE REQUIREMENTS, THERE WERE TIGHTER CONDITIONS.

THIS WAS PARTICULARLY TRUE IN, IN 2023 AND LOWER NATURAL GAS PRICES OVERALL.

AND SO ULTIMATELY WE SAW, UH, A, A SIGNIFICANT REDUCTION, AS I NOTED IN IN RUT COMMITMENT.

AND, UM, A RELATIVE INFREQUENCY IN THE NUMBER OF TIMES THAT THE ORDC PRICE ADDERS WERE, WERE IN EFFECT.

AND SO THESE, THESE OTHER FACTORS HELPED TO CREATE STRONG PRICE SIGNALS AND SO THAT THE ORDC WASN'T AS AS NECESSARY DURING THOSE PERIODS.

ALTHOUGH WHAT WE DO NOTE IS THAT WHEN THE ORDC, UH, PRICE FLOORS WERE IN EFFECT, THAT ULTIMATELY THEY WERE DURING PERIODS WHERE, UM, UH, COMMISERATE WITH, WITH WHEN THEY, THEY WOULD BE, UM, UH, NEEDED.

AND ULTIMATELY, UH, 85% OF THE GENERATION DURING THOSE PERIODS WERE DISPATCHABLE.

AND DEFINITELY DURING PERIODS WHERE, WHERE THOSE WERE THE TYPES OF RESOURCES, UH, THE ORDC IS, IS, UH, INTENDED TO, UH, TO INCENT, UH, ULTIMATELY THE ORDC WILL BE, WILL BE REPLACED BY THE ANCILLARY SERVICE DEMAND CURVES.

OBVIOUSLY, WE, WE'VE HAD SOME DISCUSSION ABOUT THAT EVEN TODAY.

UM, BUT WE WILL NOTE THAT, UM, THEY WILL SORT OF, UH, RETIRE WHEN THE ASCS ARE IMPLEMENTED WITH THE, UH, RTC PROJECT IN DECEMBER OF 25.

AND THEN THE FINAL POINT THAT I WANTED TO TALK ABOUT TODAY IS, UH, WORK, UH, UNDERWAY IN THE STAKEHOLDER PROCESS ON DEVELOPING A MITIGATION FRAMEWORK FOR ENERGY STORAGE RESOURCES.

AND SO THIS IS NPRR, UH, 1255.

AND SO WHAT IS, WHAT IS MITIGATION AT A HIGH LEVEL, UH, MITIGATION OCCURS TO ADDRESS MARKET POWER, LOCAL MARKET POWER IN THE PRESENCE OF TRANSMISSION CONGESTION.

ALL RESOURCES HAVE SOME FORM OF, UH, MARKET POWER ASSESSMENT, UH, MITIGATION THAT OCCURS.

ONE OF THE THINGS THAT MAKES THE ESRS, UH, A BIT UNIQUE IS THAT CURRENTLY THE, UH, THE CAP IN WHICH THEY'RE EVALUATED IS, IS EQUIVALENT TO THE SYSTEM-WIDE OFFER CAP, WHICH EFFECTIVELY DOES NOT, UH, DOESN'T REALLY RESULT IN ANY TYPE OF MITIGATION OF THEIR OFFERS.

AND SO THERE IS A, AN EFFORT ONGOING TO EVALUATE THAT.

AND I THINK WHEN WE LOOKED AT THE CHART THAT THE IMM SHOWED IN TERMS OF THE, I BELIEVE IT WAS IN GREEN, IT WAS AT THE TOP OF, OF RESOURCES THAT WE'RE OFFERING IN, AT, AT THE OFFER CAP, THAT IN THE PRESENCE OF CONGESTION MITIGATION CAN HELP, UH, ADDRESS, UH, OFFERS THAT ARE, UH, POTENTIALLY EXERCISING MARKET POWER.

AND ULTIMATELY, DESIGN IS A CHOICE BETWEEN, UM, OBVIOUSLY YOU, YOU, THERE'S A RISK OF OVER MITIGATION, WHICH, UH, UH, IS, IS, UH, OVER ADDRESSES SCARCITY.

WHEREAS UNDER MITIGATION RESULTS IN THE POTENTIAL FOR THE EXERCISE OF MARKET POWER, WHICH IS A CONCERN, THE PROPOSAL UNDER, UH, 1255 DOES CHANGE THE WAY THAT, THAT THE ESRS WOULD BE MITIGATED.

IT MAKES IT A FUNCTION OF THE, THE, THE, THE VALUE OF THE CON CONSTRAINT KNOWN AS ITS SHADOW PRICE,

[01:45:01]

IT'S RELATIONSHIP TO THE CONSTRAINT, WHICH IS SOMETIMES KNOWN AS THE SHIFT FACTOR AND THE SYSTEM PRICE.

SO WORK BEGAN ON THIS ABOUT A YEAR AGO, UM, AND AN NPRR, THE NPR WAS INTRODUCED JUST THIS FALL IN OCTOBER.

AND, UH, CURRENTLY IS TABLED, BUT WE DO ANTICIPATE THAT THIS IS GOING TO BE COMING TO THE BOARD, UH, AT SOME POINT NEXT YEAR.

AND WE ARE WORKING THROUGH THE STAKEHOLDER PROCESS, UH, AND, AND, AND TALKING PARTICULARLY WITH THOSE THAT ARE AFFECTED BY THIS CHANGE AND, AND, UH, LISTENING TO THEIR CONCERNS, BUT ALSO HAVING THEM UNDERSTAND WHERE OUR CONCERNS ARE AS WELL.

SO, UM, THAT CONCLUDES MY PRESENTATION.

UM, I'M HAPPY TO PAUSE FOR ANY QUESTIONS THAT YOU MAY HAVE.

0.1, REAL-TIME OPTIMIZATION UPDATE.

APPRECIATE THE HEADS UP ON NPRR 1255.

UH, DO YOU WANNA COMMENT ABOUT THE OUTLOOK FOR NATURAL GAS PRICES IN 2025 AT ALL? DO YOU SEE A BIG CHANGE OR NO? I, I DON'T, I DON'T.

WE WE'RE NOT SEEING ANY BIG CHANGES, UH, WITH REGARDS TO NATURAL GAS FOR, FOR NEXT YEAR AT THIS TIME.

ANY OTHER QUESTIONS FOR KEITH? OKAY, THANK YOU, KEITH.

ALRIGHT, THANK YOU.

AND THEN OUR FAVORITE TOPIC FOR 2025 MATT NESS IS NEXT WITH AGENDA ITEM 9.3

[9.3.1 Real-Time Co-optimization Update]

OKAY, THANK YOU, MADAM CHAIR FOR THE ENCOURAGEMENT.

GOOD MORNING, GOOD AFTERNOON.

MATT MARINAS WITH ERCOT AND THE CHAIR OF THE TASK FORCE.

UH, TODAY'S A BRIEF UPDATE, BUT IT GOES PRETTY DEEP INTO A COUPLE OF THINGS.

UM, SO SINCE THE LAST BOARD MEETING, WHICH DIDN'T SEEM TOO LONG AGO, WE'VE HAD SOME KEY ITEMS OCCUR.

UH, THE FIRST ONE IS, UH, THE FIRST BULLET UNDER THE INTERNAL IS THAT WE DID GATE TO EXECUTION.

UH, FOR THOSE OF YOU YOU AREN'T FAMILIAR WITH PRO PROJECT MANAGEMENT AT ERCOT IS WHEN WE GATE THE EXECUTION THAT WE, UH, REASSESS THE OVERALL BUDGET FOR THE REMAINING WORK TO GO LIVE.

AND SO WE'VE REASSESSED THE BUDGET.

UH, THERE WAS A SAVINGS OF APPROXIMATELY $7 MILLION IN HARDWARE AND SOFTWARE, UM, SAVINGS BY GOING SEVEN MONTHS EARLIER THAN EXPECTED OF $8 MILLION ON STAFF COSTS.

AND SO NOW WE'RE DOWN TO A $35 MILLION PROJECT.

UH, SO THAT'S EXCITING NEWS.

IT'S ALMOST TOO, TOO MUCH GOOD NEWS IN A WAY, BUT IT, IT'S ONE THAT WE'VE, WE'VE SCRUBBED THOSE NUMBERS BACKWARDS AND FORWARDS AND JP SHARED EARLIER TODAY.

AND THE OTHER PIECE IS WE DID HAVE OUR KEY VENDOR DELIVERED THE BETA VERSION OF SCED.

UH, WHAT WE ASKED FOR WAS, WE ARE A BEST OF BREED SYSTEM.

AND SO WE HAVE A DIFFERENT MARKET SYSTEM FROM AN ENERGY MANAGEMENT SYSTEM, FROM A NETWORK MODEL SYSTEM.

UH, SO THE IDEA OF GETTING THIS, UH, KEY PIECE OF SOFTWARE IS THE HEARTBEAT OF RTC EARLY IS SOMETHING THAT REALLY HELPS US OUT.

WE ALREADY HAVE OUR DAY AHEAD MARKET AND RELIABILITY UNIT COMMITMENT.

SO WE HAVE AN INITIAL SUITE OF SOFTWARE THAT WE'RE STARTING EXERCISE IN OUR DEVELOPMENT, AND THAT HELPS US EVEN ON OUR INTERNAL DEVELOPMENT WRAPPERS AROUND THAT CORE CODE FROM OUR VENDOR TO, UH, DEVELOP.

SO THINGS ARE CRANKING RIGHT ALONG IS PROBABLY THE BEST WAY TO SAY IT IN TERMS OF THE EXTERNAL MONTHLY MEETINGS, UH, THE MARKET TRIALS PLANNED, WE'LL TALK MORE ABOUT THIS ON THE FOLLOWING SLIDES, BUT THE MARKET TRIALS PLAN WAS APPROVED BY TAC THAT'S OUR KIND OF RULES OF THE ROAD FOR MARKET TRIALS.

THE INITIAL TRAINING READINESS VIDEOS HAVE BEEN POSTED ON THE WEBSITE.

THE, THE COOL ONE IS NOT THERE YET, BUT WE HAVE SOME NEWS ON THAT.

WE ALSO HAVE THE, WE'VE PUBLISHED SIMULATED RESULTS.

SO THOSE FIVE HISTORICAL OPERATING DAYS OF IF RTC HAD BEEN IN PLACE, WHAT WOULD THE PRICES HAVE BEEN? AND THEN AGAIN, AS JEFF SHARED EARLIER, THE IMM DID PROPOSE, UM, THEIR AS DEMAND CURVES, AND WE'LL TALK ABOUT THAT IN A MINUTE.

SO WE ARE MOVING AHEAD ON SCHEDULE, UH, AGAIN, WE'RE DEVELOPING MORE MARKET READINESS MATERIALS AND WE'LL BE WORKING VERY CLOSELY WITH THE BOARD IN 2025.

SO YOU'VE SEEN THIS ALL YEAR LONG, IT HASN'T CHANGED.

THIS IS WHAT THE SECOND HALF OF 2025 LOOKS LIKE IN TERMS OF MARKET TRIALS AND THE PROGRESSION OF ACTIVITIES TO GET THERE.

THERE'S THESE OTHER CHANGES THAT WE HAVE.

SO THE ONES WE'VE BEEN FOCUSED ON, AND I'VE REPEATEDLY BROUGHT IT HERE IN A SPREADSHEET AND IT'S PROBABLY HARD TO UNPACK QUICKLY.

UH, BUT WE DID HAVE FOUR POLICY ISSUES, AND THESE ARE THINGS THAT BACK IN 2019 AND 2020, WHEN WE DEVELOPED RTC, WE DIDN'T HAVE TO FIGURE OUT ALL THE NUMBERS TO PUT IN HERE AND THERE.

SO THIS IS THOSE IMPORTANT PARAMETERS THAT WE NEED TO DIAL IN BEFORE WE GET INTO MARKET TRIALS AND GO LIVE.

SO I'VE HAVE THEM LISTED THERE.

THEY'RE ON ANOTHER SLIDE THAT'S EASIER TO READ, UH, THAT WE CAN UNPACK THOSE.

BUT ALL OF THOSE ARE GONNA BE A AN NPRR THAT WE'RE DRAFTING THIS MONTH TO RELEASE, UM, HOPEFULLY THIS MONTH, MAYBE IN JANUARY.

BUT THAT'S LIKE AN OMNIBUS NPRR OF ALL THE PARAMETERS THAT WE NEED FOR MARKET TRIALS TO GO LIVE.

AND SO THAT'LL BE ONE NPR.

THE SECOND ONE IS THAT RED BOX BELOW IS THE REVIEW OF THE AS DEMAND CURVES.

IF THOSE ARE TO CHANGE, WHICH WE'LL DISCUSS NEXT WEEK, WHETHER IT'S THE IMM PROPOSAL OR ANOTHER PROPOSAL THAT WILL ALSO BE ANOTHER IMPORTANT POLICY NPR.

SO THOSE TWO RED BOXES ARE TWO POLICY RELATED NPRS, UH, THAT THE BOARD WILL SEE IN APRIL.

AND THEN BELOW THAT IS

[01:50:01]

ALL THE MARKET READINESS PIECES.

IT'S THE BUILDING BLOCKS OF HANDBOOKS OF SCORECARDS AND THE DETAILS AROUND THAT.

SO I WON'T GO INTO THAT UNLESS THERE'S QUESTIONS.

SO THIS IS ALMOST A LITTLE WIKI PAGE.

NOTHING LOOKS COOL HERE, BUT IF YOU CLICK IT, THERE'S SOME STUFF BEHIND IT THAT ACTUALLY IS KIND OF NEAT.

UH, THE FIRST ONE IS THAT MARKET TRIALS PLAN.

THAT'S AN EIGHT PAGE WHITE PAPER THAT TAC APPROVED THAT TOOK ALL OF THOSE GRAPHICAL BOXES FROM MAY THROUGH DECEMBER.

AND FOR EVERY ONE OF THOSE IS ONE PAGER OF WHAT'S THE ENTRY CRITERIA, THE ACTIVITIES, AND THE EXIT CRITERIA AND SCORECARD CRITERIA.

EACH OF THOSE IS NOW DEFINED AND THAT MARKET TRIALS PLAN AND IS MEMORIALIZED.

SO NOW THE GROUP GOES BACK AND STARTS TO WORK ON THE HANDBOOKS, WHICH IS THE DETAILS TO FRAME THAT OUT.

SO THAT'S WHY WE'RE BUILDING A LIBRARY OF OUR MARKET TRIALS PLAN.

THAT WAS A HUGE ACCOMPLISHMENT, A REALLY BIG THANKS TO R-T-C-B-T-F AND TAC.

THE NEXT ONE IS THE MARKET RATING.

THIS TRAINING TOPICS, UM, WE IN AND OF OURSELVES ARE NOT THE TRAINING PROGRAM FOR RTC.

WE HAVE A TRAINING DEPARTMENT, WHICH IS TRAINING IS, I DON'T KNOW WHAT ERCOT IS.

I WANT TO BE A QUEASY.

WHAT DOES THAT EVEN MEAN? THERE'S THAT KIND OF TRAINING.

THEN THERE'S THIS READINESS TRAINING OF HERE'S WHAT IT DOES TODAY, HERE'S WHAT IT'LL DO TOMORROW.

AND SO WE'RE BUILDING OUT, AND IF YOU CLICK ON THAT LINK ON OUR R-T-C-B-T-F HOMEPAGE, WE HAVE ANOTHER THAT'S A TRAINING PAGE WHERE WE'RE STARTING TO LOAD UP MATERIALS.

THE ONE I'M EXCITED ABOUT, OBVIOUSLY I'M A GEEK BECAUSE I'M CALLING THESE THINGS COOL.

NOW, UM, IS THE, UH, DAVE MAGGIO DID A 40 MINUTE RECORDING OF THE WHAT IS CHANGING WITH R-T-C-B-T-F.

SO IT'S FUNNY THAT EARLIER TODAY Y'ALL WERE ASKING FOR, CAN WE JUST GET A PRIMER ON RTC JUST SO WE KNOW WHAT IT IS? WELL, THAT PRIMER IS ALREADY RECORDED AND WE'LL GET IT OUT THERE.

UM, AND THAT'LL BE SOMETHING PEOPLE CAN SELF-SERVE ON.

THEY DON'T HAVE TO WAIT FOR THE NEXT MEETING.

THEY CAN JUST GO OUT THERE AND, UM, SHOW IT TO THEIR, UM, COMPANIES.

I'VE PROVIDED THE LINK TO THE NEXT BULLET, THE FIVE HISTORICAL DAYS FOR THE RTC SIMULATOR.

SO IF YOU WANNA SEE BEFORE AND AFTER PRICES WITH AND WITHOUT RTC, THOSE ARE LINKS TO THE POWERPOINTS THEMSELVES SUMMARIZING THAT ANALYSIS.

UH, THE NEXT ONE IS, UH, THE NEW ALTERNATIVES, UM, TO THE X PROXY OFFERS.

UH, WHEN I WAS HERE LAST TIME, WE TALKED ABOUT THERE'S THIS KIND OF, UM, WHEN SOMEBODY DOESN'T FILL IN AN OFFER FOR ANCILLARY SERVICES, WHAT SHOULD ORCO PUT IN ITS PLACE? WE DO THAT FOR ENERGY.

UH, SOME, SOME CAMPS SAY IT SHOULD BE $0.

SOME SAY IT SHOULD BE THE CAP.

UH, DAVE MAGGIO, UH, LOOKED AND IS CONSIDERING WHETHER OR NOT TO MAKE THOSE AS DEMAND CURVES PART OF A FILL IN THE BLANK, UH, PIECE THAT'LL ACTUALLY DEPEND ON WHICH AS DEMAND CURVE.

SO THERE'S MORE WORK ON THAT.

SO PLEASE JUST STAND BY ON THAT ONE.

UM, BUT I WANTED TO ACKNOWLEDGE THAT IMPORTANT PIECE.

AND THEN THE LAST ONE IS THIS UPDATE ON THE AS DEMAND CURVES.

AGAIN, WE HAD PUBLISHED A WHITE PAPER JUST TO EXPLAIN THE HISTORY OF THOSE FROM, YOU KNOW, PREVIOUS ADMINISTRATIONS, HOW WE GOT TO WHERE WE ARE AND WHAT'S IN PROTOCOLS.

AND THEN THE IMM PROPOSED JUST BEFORE THANKSGIVING WAS THE, THESE NEW RAMP IN VALUES, UH, THAT JEFF PROVIDED.

AND SO LEMME JUST GIVE YOU A SECOND TO, UM, TO ORIENT YOU TO THESE.

AND THIS IS OUT OF THEIR PRESENTATION.

SO ABOVE THE TOP LEFT IS ESSENTIALLY WHAT LOOKS LIKE THE ORDC CURVE, TABLETOP TAIL OFF TO THE RIGHT.

AND SO WHAT'S IN PROTOCOLS NOW IS VERY STRATIFIED, WHICH IS REG UP IS THE FIRST FEW MEGAWATTS RESPONSIVE IS THE NEXT, AND SO ON AND SO FORTH FOR ECRS AND NONS SPIN, IF WE WERE TO RUN SHORT OF REG UP, IT GOES INSTANTLY FROM ZERO TO $5,000.

SO WHAT THE IMM IS PROPOSING AND KIND OF SLIDE FROM THE TOP LEFT TO THE DOWN TO THE RIGHT IS RAMP IN VALUE.

SO THE IDEA IS IF YOU'RE RUNNING SHORT ON RESPONSIVE A REGULATION, IT DOESN'T JUMP UP TO THAT.

THERE'S ACTUALLY A TAIL TO HELP PROVIDE, UM, WHAT THE RIGHT WORDS ARE FOR IT.

BUT THE, THE BOX THAT THE IMM WAS WORKING IN AND THAT JEFF POINTED OUT IS NUMBER ONE, THEY WANTED TO STAY UNDER THE ORDC CURVE.

THAT'S SCARCITY VALUE OF ENERGY IN ERCOT.

UH, THE OTHER PIECE WAS DO SOMETHING THAT CHANGES IT WITHOUT ERCOT HAVING TO REDEVELOP ALL THE CODE.

SO THIS STAYS IN THAT BOX OF RE PARAMETERIZING AND MOVING MONEY AROUND AMONG THE FOUR SERVICES, NOT DOING SOMETHING DRAMATICALLY DIFFERENT.

UM, AND THEN GETTING IN, IN FRONT OF THE STAKEHOLDERS WITH TIME TO VET.

AND SO NEXT WEEK'S MEETING WILL BE FOCUSED ON THIS ONE.

AND, UH, THAT'S WHERE THE IMM PROPOSAL STANDS.

AND THEN IN TERMS OF THE PARAMETERS, SO THIS IS THOSE FOUR ITEMS IN THE BOX ON THE PREVIOUS SLIDE THAT SAYS WE NEED TO SOLVE THESE IN AN NPR.

SO THE AS PROXY OFFERS IS PART ONE THAT WE'LL HAVE AN NPR PIECE OF RAMP RATE SHARING.

UM, THAT'S IF SOMEONE'S BEING DISPATCHED FOR ENERGY AND RE UP AT THE SAME TIME, HOW DO WE SPLIT THAT OUT AND HOW DO WE RESERVE RAMPING? SO THAT'S ANOTHER PIECE OF IT.

THE AS DEMAND CURVES FOR RELIABILITY UNIT COMMITMENT, UH, THERE IS ACTUALLY, ALTHOUGH RUCK IS A RELIABILITY TOOL, IT'S ALWAYS OPTIMIZING FOR COSTS.

SO HOW

[01:55:01]

DO AS DEMAND CURVES FIT IN THOSE COSTS? AND THEN THE UM, NEXT ONE IS THE ANCILLARY SERVICE DURATION REQUIREMENTS WITH RTC.

UH, DO OUR TWO HOUR ECRS AND OR FOUR HOUR NONS SPIND PARAMETERS CHANGE.

SO THAT'LL BE ALL PART OF THAT.

UM, NPR.

AND SO THOSE PIECES THAT ARE BEING BAKED IN ARE ON THIS TIMELINE AND THERE'S A LOT OF WORDS THERE, BUT ESSENTIALLY AT THE BOTTOM YOU'LL SEE SECOND FROM THE BOTTOM BOARD APPROVAL ON APRIL 8TH, THE IDEA IS WE'RE GONNA USE THE NEXT 60 TO 90 DAYS TO VET ALL OF THESE CONCEPTS, GET IT TO PRS, TO TAC AND THE BOARD, AND THAT'S WHAT BRINGS IT BACK HERE IN APRIL.

SO WE'LL HAVE A MUCH BETTER UPDATE IN FEBRUARY OF WHAT THE RISK IS ON THAT AND HOW WE'RE LOOKING.

UH, BUT THOSE ARE THE PARAMETERS THAT WE'RE ENGAGING ON THIS MONTH.

AND THE LAST PIECE, SO WE'RE CONTINUING TO FOCUS ON THE PROGRAM, UM, WITH THE MARKET READINESS AS WELL AS THE INTERNAL NEEDS OF THE PROGRAM.

THE SIMULATOR HAS BEEN A BIG DEAL.

UH, THAT IS SOMETHING WHERE AS WE'RE PROVIDING STUDIES, UH, THE MARKET PARTICIPANTS ARE ASKING GOOD QUESTIONS AND UM, BRINGING UP SOME DIFFERENT ISSUES.

AND THEN AGAIN, WE'LL BE DEVELOPING AN NPR FOR THOSE FOUR, FOR THE FOUR POLICY ISSUES.

SO THAT I'LL SEE IF THERE ARE ANY QUESTIONS, MATT.

THANKS.

UM, MAINLY THE, THE INCORPORATION OF THE IMM UH, PARAMETERS YES.

AND HOW THAT IMPACTS THE PROCESS IN TERMS, SO WHAT WE'VE DONE, ARE YOU ASKING WHAT IT LOOKS LIKE TO IMPLEMENT THOSE CHANGES OR IN TERMS OF EFFORT CHANGES? TIMELINE? YES.

SO RESULTS OF COURSE, YES.

THE RESULTS.

SO ONE THING THAT THE IMM DID IS THEY BROUGHT THEIR PROPOSAL FORWARD.

THEY DID RUN FIVE OR SIX OPERATING DAYS THROUGH THOSE NEW CURVES TO SHOW HOW THE PRICE FORMATION WOULD CHANGE.

SO IT WAS PRE RTC, UH, WITH NESTED LOGIC AND WITH THE CURRENT LOGIC.

SO THEY WERE TRYING TO TEASE APART ALL THOSE DIFFERENT ITEMS TO SHOW THOSE TRENDS OF WHY THEY BELIEVE THAT THERE'S BENEFIT TO THIS.

UM, SO THAT IS WHAT WE'RE POLICY WISE, NAVIGATING THE NEXT 60 TO 90 DAYS IS, IS THIS THE BEST FIT OR DOES IT NEED TO BE? AND, AND JEFF SAID IT WELL TWEAKED AND LET'S LOOK AT IT FROM DIFFERENT ANGLES TO MAKE SURE IT DOES THE WORK.

ONCE THAT IS APPROVED AND PUT INTO THE NPR PROCESS, ERCOT IS STANDING BY IN APRIL TO DO A REFACTORING OF THOSE AS DEMAND CURVES.

SO AS THIS IS GOING THROUGH THE APPROVAL PROCESS, WE WILL BE ABLE TO IN APRIL AS IT'S GOING TO THE BOARD TO Y'ALL AS YOU'RE APPROVING IT, TO CODE TO THOSE DEMAND CURVES TO THEN IMPLEMENT THOSE FOR MARKET TRIALS TO BE PREPARED FOR GO LIVE.

SO DOES THAT GIVE THE ONE TWO OF THE DESIGN? MM-HMM.

UM, MATT? YES, THANK YOU FOR THAT, UH, AND FOR ALL YOUR HARD WORK ON, ON THIS, UM, IMPLEMENTATION.

I JUST AM ASKING A CLARIFICATION QUESTION.

SO THE OMNIBUS NPRR WILL BE FILED IN JANUARY? YES.

AND THEN THE A SDC WE'RE PROBABLY DOING PARALLEL.

IN PARALLEL, YES.

SO AROUND JANUARY.

AND THEN SO ACTION NEEDS TO BE TAKEN ON THOSE NPRS, IN OTHER WORDS APPROVED, FULLY APPROVED BY MAY SO THAT THE MARKET TRIAL START IN MAY.

CORRECT.

SO THERE'S THE TIMELINE RIGHT THERE.

SO THE BOARD WOULD APPROVE IT IN APRIL.

UH, THE MARKET TRIAL, STRICTLY SPEAKING MAY 5TH IS OUR FIRST DAY.

UH, THOSE MARKET TRIALS ARE ACTUALLY AT THAT POINT IT'S JUST MARKET SUBMISSIONS TESTING.

WE'RE NOT RUNNING AT THAT POINT.

MADAM CHAIR, PLEASE GO AHEAD.

THIS IS BARKSDALE WITH THE PUBLIC UTILITY COMMISSION STAFF.

UM, I JUST WOULD LIKE TO SHARE WITH THE COMMITTEE STAFF'S, UM, OPINION ABOUT THE CHANGES THAT ARE BEING DISCUSSED AROUND THE ANCILLARY SERVICES DEMAND CURVES AND THE 2019 MEMO THAT, UH, THE COMMISSIONERS SIGNED OFF ON THAT, UM, PROVIDE THE, THE SHAPE OF THE CURVES FOR THE ANCILLARY SERVICES THAT WAS, UM, PROVIDED AT A TIME WHEN THE INDUSTRY NEEDED GUIDANCE ABOUT HOW TO START MOVING FORWARD WITH SOME OF THE BIG POLICY CUTS ON REAL-TIME CO OPTIMIZATION AS IT STANDS TODAY, I THINK, UM, COMMISSION STAFF'S OPINION IS THAT IF FOLKS HAVE INTERESTING, GOOD IDEAS TO BRING FORWARD, THAT'S WONDERFUL AND WE'VE GOT A GREAT ROBUST STAKEHOLDER PROCESS TO UM, TACKLE THAT.

HOWEVER, THE GO LIVE IMPLEMENTATION DATE IS A NON-NEGOTIABLE FOR STAFF.

AND SO ANY CHANGES THAT DO TO GET DISCUSSED, IF THERE IS BROAD CONSENSUS AMONG THE STAKEHOLDERS, THEN LET'S HEAR IT AND LET'S VET IT AND GET IT FORWARD ON THE, THE TIMELINE THAT'S BEEN PRESENTED BY MATT HERE.

UM, AND IF WE CAN'T GET IT DONE BY THEN THAT'S OKAY BECAUSE WE HAVE SOMETHING THAT WE CAN MOVE FORWARD WITH, UM, AND THAT WE KNOW WILL, UH, RELIABLY ACCOMPLISH THE IMPLEMENTATION OF REALTIME CO OPTIMIZATION.

ALRIGHT, THANK YOU MARKDALE FOR THAT FEEDBACK.

AND THAT TIMEFRAME IN DECEMBER, EARLY JANUARY IS VERY, VERY, VERY SHORT.

TIME STAYING ON SCHEDULE IS NUMBER ONE

[02:00:02]

THERE'S NOT MUCH TIME THERE.

AND I WOULD LIKE TO EMPHASIZE WE WANT TO BE AS SOLID AS WE CAN ON IMPLEMENTATION GOING INTO A WINTER SEASON.

MM-HMM, , YES.

SO WE DON'T WANNA DELAY IT AND DRAG IT INTO THE MIDDLE OF WINTER TO DO A TRANSITION.

ANY OTHER COMMENTS? ALRIGHT, THANK YOU MATT.

I APPRECIATE ALL THE WORK BEHIND THE SCENES.

OKAY, NEXT IS AUSTIN ROZELLE WILL PRESENT AGENDA ITEM 9.4,

[9.4 Market Credit Update]

MARKET CREDIT UPDATE.

HELLO, AUSTIN ROSELL.

UM, HERE I HAVE A, UH, UNREMARKABLE REPORT TODAY I THINK SO SORRY IF THAT'S A LITTLE BORING, BUT THAT'S A GOOD THING IN THE CREDIT WORLD.

SO, UM, THIS CAN BE A VERY SHORT PRESENTATION.

UH, THANK YOU FOR THE, THANK YOU FOR THE TIME SLOT THOUGH TO, TO SHARE THE GOOD NEWS.

UM, SO KEY TAKEAWAYS ON THE SLIDE IS THE, RIGHT NOW THE TOTAL POTENTIAL EXPOSURE IS VERY FLAT, VERY UNCHANGED.

IT'S ACTUALLY THE SAME VALUE FOR THE LAST TWO MONTHS ON THIS REPORT.

SO WE'RE NOT SEEING, UH, ANY, ANY STRESSOR STRAIN IN THE, UH, TOTAL POTENTIAL EXPOSURE CALCULATIONS AT THIS TIME.

UM, HOWEVER, UH, SINCE THIS PRESENTATION WAS PUT TOGETHER, WE HAD DID HAVE A DEFAULT.

WE HAD A SMALL TRADER THAT DEFAULTED, UM, UH, IN LATE NOVEMBER.

UM, HOWEVER THE SYSTEM WORKED, THEY, UM, HAD ENOUGH COLLATERAL ON HAND TO COVER ANY OUTSTANDING OBLIGATIONS AND THERE WILL NOT BE ANY UPLIFTS TO THE MARKET.

SO THAT'S THE, THAT'S THE GOOD NEWS THERE.

UM, THE NEXT TWO SLIDES ARE SOME NPRS I'VE TALKED ABOUT MANY TIMES.

I THINK I PROMISED NOT TO BRING 'EM BACK, BUT I THOUGHT I, I'LL BRING 'EM BACK ONE MORE TIME TO TELL YOU THAT THEY'RE DONE.

UM, NPR 1205 WAS FULLY IMPLEMENTED ON NOVEMBER ONE.

WE'VE NOT HAD ANY ISSUES.

NOBODY'S BROUGHT UP ANY, ANY ISSUES WITH THAT IMPLEMENTATION.

SO THAT SEEMS TO HAVE BEEN GOING VERY GONE, VERY SMOOTH.

THEN WE HAD NPR 1215 THAT WE'VE TALKED ABOUT MANY TIMES.

NO IMPLEMENTATION NECESSARY FOR THAT, THAT WAS MORE OF A CLARIFICATION, BUT THAT HAS ALSO BEEN APPROVED BY THE PUC AS WELL.

UH, SO THAT'S, THAT WILL CLEAN THE SLATE FOR, UH, CREDIT RELATED NRS THAT ARE, THAT ARE FLOATING OUT THERE NOW.

ALTHOUGH WE DO PLAN TO DO SOME MORE WORK AND BRING SOME MORE NEXT YEAR.

SO, AND THEY'LL, WE WILL OBVIOUSLY UPDATE YOU ON THAT.

THERE'LL BE MORE TO COME ON THAT.

UM, AND THAT CONCLUDES MY PRESENTATION UNLESS YOU HAVE ANY QUESTIONS.

THANKS AUSTIN.

ITEM 9.5, REVISION REQUEST STATUS UPDATE.

NEXT, REBECCA ZARO AND ANN BOURNE.

WILL CO-PRESENT AGENDA

[9.5 Revision Request Status Update]

ALL RIGHT, GOOD AFTERNOON.

ANNE BOURNE WITH MARKET RULES AND STAKEHOLDER SERVICES.

I'M HERE TO GIVE THE REVISION REQUEST STATUS UPDATE.

AND THEN REBECCA IS GONNA COME UP AND GIVE AN OVERVIEW OF THE HIGH IMPACT POLICY ISSUES CURRENTLY IN THE STAKEHOLDER PROCESS.

ALL RIGHT, YOU HAVE 17 REVISION REQUESTS FOR THE DECEMBER BOARD CONSIDERATION.

THERE IS A TYPO ON THIS SLIDE.

IT DOES SAY UNOPPOSED.

UM, BUT AS YOU KNOW, NPR 1247 WAS NOT UNOPPOSED AND YOU'VE ALREADY LOOKED AT THAT ONE.

HOWEVER, THE REMAINDER WERE UNOPPOSED AND WILL BE ON THE CONSENT AGENDA TOMORROW.

THERE ARE CURRENTLY 57 REVISION REQUESTS IN PROCESS.

AS OF THE LAST BOARD MEETING.

WE'VE HAD 14 NEW REVISION REQUESTS POSTED.

AND THEN FOR THE AGING REVISION REQUEST LIST, NOTHING HAS CHANGED SINCE THE OCTOBER BOARD.

WE STILL HAVE THE SAME NINE REVISION REQUESTS THAT WERE ON THAT LIST.

UM, HOWEVER, THERE HAVE BEEN SOME ADDITIONAL COMMENTS FILED.

WE ARE WORKING ON SOME COMMENTS FOR A COUPLE OF THOSE REVISION REQUESTS AND WE DO EXPECT SOME TRACTION ON THOSE IN THE NEXT COUPLE OF MONTHS.

AND THEN FOR 20 24 70, REVISION REQUESTS HAVE BEEN APPROVED THROUGH THE STAKEHOLDER PROCESS.

, ANY QUESTIONS? OKAY, THANK YOU.

SO THIS IS A NEW SECTION WE'RE GONNA START BRINGING TO R AND M.

IT IS INTENDED TO LOOK AT KEY POLICY ISSUES THAT AREN'T IN FRONT OF THE BOARD.

NOW, YOU'VE HEARD A LOT ABOUT THESE AND SOME OF THE TECHNICAL AND OPERATIONAL UPDATES, BUT FROM A PROCESS PERSPECTIVE, WHERE THEY ARE AND WHAT THE KEY DECISION POINTS THAT'LL BE IN FRONT OF YOU ARE.

SO THE FIRST, I KNOW

[02:05:01]

YOU'LL ASK MATT ALL THE HARD QUESTIONS, BUT FOR RTC PLUS B AS WE LOOK FORWARD, UM, THE DECEMBER, 2025 GO LIVE, WE ARE EXPECTING TWO POTENTIAL REVISION REQUEST TO BE IN FRONT OF THE BOARD.

UM, ONE IS THAT POLICY PARAMETERS CONSIDERATION, WHICH IS REALLY KIND OF THE FOUR THINGS THAT WERE ORIGINALLY SET OUT AS TAC APPROVED.

WE'LL BE LOOKING TO PUT THOSE IN A SINGLE NPRR EXPECTED TO FILE IN JANUARY, UM, FOR BOARD CONSIDERATION IN APRIL, AND THEN HAVE PUC APPROVAL PRIOR TO MARKET TRIALS IN MAY.

THE NEXT ONE IS ADCS.

SO I KNOW, UM, MATT TALKED ABOUT THAT THE IMM TALKED ABOUT THAT BARKSDALE EXPRESS KIND OF WHERE THE COMMISSION IS WITH THAT, BUT IF THERE COULD BE CONSENSUS FROM STAKEHOLDERS, WE'VE ASKED EVERYONE TO KIND OF BRING FORWARD PROPOSALS BY DECEMBER, PROVIDE THE COMMISSIONER AN UPDATE IN JANUARY, AND THEN MOVE FORWARD WITH AN NPRR IF THAT IS GONNA GO FORWARD.

OTHERWISE, THAT ISSUE WILL BE TABLED FOR CONSIDERATION AFTER GO LIVE.

THE NEXT BIG POLICY ISSUE IS DRS, AND THIS IS KIND OF PHASE TWO WHERE WE'RE LOOKING AT A STANDALONE DRRS PRODUCT.

UM, THERE IS NVRR 1235, WHICH IS LIVE IN THE STAKEHOLDER PROCESS.

IT WAS FILED IN MAY AND IT'S TABLED AT PRS.

UM, ROS HAS VOTED TO ENDORSE IT WITH EXTENSIONS.

IT IS STILL BEING CONSIDERED, WOULD SAY ROBUST DISCUSSION AT WMS, UM, A STATUS UPDATE.

I KNOW THE, UM, SAWG SAW WORKING GROUP IS LOOKING AT PROPOSALS FOR THIS CONSIDERATION OF WHETHER IT'S AN OPERATIONAL TOOL OR A RESOURCE ACCURACY MECHANISM.

THAT'S ALSO AN ACTIVE, UM, CONVERSATION WITH THE COMMISSION.

AND KIND OF THE NEXT PHASE IS LOOKING AT, UM, HIGH LEVEL DESIGN CONCEPTS TO PROVIDE FLEXIBILITY ON THOSE OPTIONS.

CAN YOU JUST PULL THE MIC A LITTLE CLOSER TO YOU? I'M SORRY.

THIS IS ALSO THE TIME OF YEAR WHERE BEING OUTDOORS HATES ME AND MY ALLERGIES.

I'M NOT THE LOUDEST PERSON ANYWAY, BUT I KNOW I'M REALLY STRUGGLING.

SO SORRY ABOUT THAT.

BUT WE DO EXPECT STARTING DECEMBER TO REALLY THOSE CONVERSATIONS, UM, HAVE MORE IMPACT WITH COMMISSION CONSIDERATION AS PART OF THEIR ANCILLARY SERVICE STUDY.

AND THEN CONTINUED CONVERSATIONS THAT ARE CAUGHT IN THE SLOG PROCESS UP TO WMS. AND THE FINAL ONE FOR THIS CYCLE IS LOOKING AT LARGE LOAD ISSUES.

I KNOW THIS IS SOMETHING DAN ALSO HIGHLIGHTED.

THERE'S THE ERCOT SPONSORED PACKAGE THAT CAME OUT OF THE TASK FORCE, KIND OF NEXT PHASE.

AND THERE'S ALSO A, UM, MARKED BEEN SPONSORED NPR R THAT ARE ALSO UNDER CONSIDERATION.

SO REALLY HIGHLIGHTING THE ERCOT, UM, PACKAGE.

IT'S AN NPRR 1234 AND PICKER ONE 15.

REALLY THE KEY HERE ARE THESE ARE SEEKING TO ONE, DEFINE LARGE LOADS IN THE PROTOCOLS AND THEN PUT AROUND THOSE AND PLANNING AND MODELING REQUIREMENTS FOR INTERCONNECTION.

THE SECOND PART IS ERCOT RECENTLY FILED COMMENTS TO ESTABLISH A ONE GIGAWATT MAXIMUM SINGLE CONTINGENCY, OUR POINT OF INTERCONNECTION TO ADDRESS THE FREQUENCY STABILITY RISKS.

SO THOSE ARE, UM, WERE FILED IN MAY.

THEY ARE TABLED AT, UM, PRS AND DISCUSSION AT ROS.

AND THOSE ARE AGAIN, CONVERSATIONS OF, OF GREAT IMPACT THAT WE'RE LOOKING AT THE LARGE LOAD PACKAGE ALTOGETHER.

I ALMOST MADE IT THROUGH WITHOUT COUGHING, SO SORRY ABOUT THAT.

ARE THERE ANY QUESTIONS? NO, BUT THANK YOU FOR PUTTING THIS TOGETHER AND BEING A LITTLE MORE FORWARD LOOKING OF WHAT'S OUR IMPORTANT CHANGES IN THE QUEUE.

ITEM 10 IS WOODY RICHARDSON'S PRESENTATION OF FUTURE AGENDA ITEMS. SO WE FILLED THAT OUT WITH, UH, THE TRANSMISSION PROJECTS AND THINGS LIKE THAT WE KNOW THAT WE'RE GONNA NEED.

THANK YOU ANN AND REBECCA.

AGENDA

[10. Future Agenda Items]

I THINK AS WE GO FORWARD THOUGH, THERE'LL BE SOME OTHER THINGS THAT WILL COME INTO THAT THAT WE'RE NOT ANTICIPATING NOW, BUT THINGS THAT WE KNEW WERE GONNA COME, WE, WE'VE ALREADY PUT THE THOSE ON THERE.

ANY COMMENTS ABOUT THE FUTURE AGENDA ITEMS? LIKE SOME 65 AND THINGS LIKE THAT WILL BE TALKED ABOUT SEVERAL TIMES? YES.

AND MAYBE RRTC IF YOU GO THROUGH THAT, RIGHT? SURE.

ADJOURN IS OTHER BUSINESS AND I HAVE SOME OTHER BUSINESS.

THANK YOU WOODY.

WHERE ARE WE? THE FINAL

[02:10:01]

AGENDA ITEM BEFORE WE

[11. Other Business]

I WOULD LIKE TO THANK COMMISSIONER LORI KOBOS FOR HER SERVICE, ESPECIALLY IN THIS COMMITTEE.

SO REALLY APPRECIATE ALL YOU'VE DONE.

THANK YOU, LORI.

THANK YOU, JULIE.

I APPRECIATE IT.

THIS COMMITTEE HAS BEEN, UM, DEFINITELY LEADING THE FOREFRONT.

A LOT OF COMPLEX CHALLENGING ISSUES THAT ERCOT IS FACING, AND WE'VE HAD A LOT OF VERY ROBUST DISCUSSIONS OVER THE LAST FEW YEARS, OVER THE LAST YEAR ON VERY IMPORTANT TOPICS THAT ERCOT AND THE BOARD IS FACING.

AND I, THIS COMMITTEE IS, IS DEFINITELY, UM, YOU KNOW, VERY MUCH TACKLING THOSE ISSUES AND I WISH YOU THE BEST IN YOUR LEADERSHIP AS CHAIR OF R AND M JULIE.

BEST OF YOU IN YOUR NEXT CHAPTER.