Energy Choice
                            

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Texas Staff File Reserve Margin Analysis

December 12, 2014

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Copyright 2010-14 EnergyChoiceMatters.com
Reporting by Karen Abbott • kabbott@energychoicematters.com

Staff of the Public Utility Commission of Texas have filed a reserve margin analysis as part of the review of the reliability standard in the ERCOT region.

The analysis lists Loss of Load Expectation (LOLE), Loss of Load Hours (LOLH), Expected Unserved Energy (EUE) in MWh, and Normalized EUE.

Click here for Staff's analysis, starting on page 7

Staff said that the reserve margins required to meet specific targets are as follows:

• 1-in-10 standard = 16.75%

• 2.4 LOLH (metric used in SPP) = 12.0%

• 0.001% EUE = 11.5%

The analysis also includes various risk-adjusted levels of the Economically Optimal Reserve Margin (EORM).

Staff proposes a series of questions for stakeholder comment, including:

• What actions, if any, should the Commission take if the Capacity, Demand, and Reserves Report forecast falls short of the target?

• Should the ORDC be used as a mechanism to produce a specified reserve margin? If so, please describe how this might be achieved (i.e. by altering its parameters or instituting an augmented ORDC).

• Both the target and CDR forecast are system-wide calculations that do not reflect regional supply adequacy. Could either metric be improved to address regional capacity issues?

• High reserve margins do not necessarily correlate with operational reliability. Are there any other specific market improvements that might enhance reliability outcomes?

• Should the Commission open a rulemaking or take any other action to define formally the reliability standard and its purpose?

The previously established workplan for the project contemplates a workshop presided over by Commissioners in March-April 2015, with a final Staff report in June-July 2015.

Project 42302

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