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ERCOT Posts Draft Concept Paper on Distributed Energy Resources in the ERCOT Region

August 21, 2015

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Copyright 2010-15 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

ERCOT has posted a draft concept paper on distributed energy resources (DERs) in the ERCOT region intended to serve as a catalyst for development of new Protocols and other market rules affecting DERs in the ERCOT region and ERCOT wholesale markets, centered around two primary goals: (1)·Collection of data that ERCOT anticipates it will need, as the Independent System Operator (ISO) for the region, to ensure grid reliability as DER penetration increases in the grid of the future; and (2)·Development of a market framework that can better accommodate DERs and enable effective, efficient market participation.

Among the notable issues is the potential need for dual metering, or separate measurement of gross generation and gross native Load

The draft document contains the following recommendations:

Collection of DER-related data: This includes:

          1) More detailed collection of static DER data from Transmission & Distribution Service Providers (TDSPs), in order to support various ERCOT grid reliability functions. Mapping of all DER sites to the appropriate modeled transmission loads on the ERCOT Common Information Model (CIM) will eventually be necessary to support effective reliability studies. Because TDSPs do not currently have processes in place to map DERs to CIM Loads, ERCOT proposes a transition phase in which TDSPs provide the mapping for all DERs to the appropriate transmission substation. However, mapping DERs to CIM Loads — via a process involving the Resource Entity, the TDSP and ERCOT — will be mandatory in the near term for settlement of DERs opting to be settled at a local (Nodal) energy price.

          2) More frequent and detailed compilation and public posting by ERCOT of appropriate and non-confidential DER data, to assist operators, planners, and market participants in their decision-making processes.


New settlement options for DERs: This paper contemplates three categories of DER participation/settlement in the ERCOT markets:

          1) DER Minimal, which would be settled at Load Zone Settlement Point Prices (LZ SPPs), essentially unchanged from current practice;

          2) DER Light (either single site or aggregations), which would participate passively in the energy market while settled at Nodal prices via mapping of the DER location(s) to their appropriate CIM Load point(s); and

          3) DER Heavy (either single site or aggregations), which would participate actively in the energy and Ancillary Services markets while settled at Nodal prices via mapping of the DER location(s) to their appropriate CIM Load point(s). In many respects, DER Heavy would be treated similarly to Generation Resources in the current market construct. A key feature of a DER Heavy is the assignment of a Logical Resource Node Settlement Point, and a Settlement Point on the transmission grid.


Treatment of Storage: Storage devices in a DER Light or DER Heavy seeking to receive Wholesale Storage Load (WSL) treatment will need to have well-defined metering configurations so that the electrical energy used to charge the storage device (settled at a Nodal price) can be measured separately from native and auxiliary Load (settled at the LZ SPP). The concepts presented in this document assume that WSL treatment for both DER Light and DER Heavy would be allowed under PUC Subst. Rule §25.501(m), assuming metering requirements are met.


Treatment of Demand Response: Public Utility Commission (PUC) of Texas Substantive Rule §25.501 (h) requires Load to be settled at LZ SPPs. Absent a change or clarification to the Rule, this concept document assumes that demand response (DR) cannot be part of the performance of a DER Heavy or DER Light being settled at a Nodal price.


New metering configurations: ERCOT’s proposal would not require any metering changes, unless DER’s Resource Entity chooses to seek DER Light or DER Heavy status in order to attain Nodal pricing. In those cases, in order to maintain compliance with the aforementioned Rule, DERs Light and Heavy would require a type of metering configuration not currently in place in many ERCOT TDSP footprints, including the investor-owned TDSP service territories. Dual metering — separate measurement of gross generation and gross native Load — at DER Light and DER Heavy sites will be necessary to ensure that Load at the same Service Delivery Point continues to be settled at the LZ SPP while the on-site generation is settled at the Nodal price. This dual metering concept will likely require clarification by the PUC that Subst. Rule §25.213, which requires TDSPs to offer customers a net metering option, does not prohibit a dual metering option as described in this paper.


Information exchanged between Resource Entities representing DERs Light and Heavy, and ERCOT: Similar to how distribution-connected Load Resources are mapped to CIM Loads today, Resource Entities will need to work with TDSPs and ERCOT to provide accurate mapping of DERs Light and Heavy to their appropriate CIM Loads.


Information exchanged between Qualified Scheduling Entities (QSEs) representing DERs and ERCOT: In order to support market participation by DERs Light and Heavy, QSEs representing these resources would need to provide ERCOT with appropriate data, including status and MW output in real-time or near real-time, via ICCP telemetry or another communications medium agreed upon by stakeholders. A DER Light, which otherwise would participate passively, should be required to respond to ERCOT instructions under emergency conditions. For DER Heavy, the information provided and the required response to ERCOT instructions -- e.g., Base Points from Security Constrained Economic Dispatch (SCED) -- should mimic the expected performance of conventional Resources.


As the ISO for its region, ERCOT has jurisdiction limited to the operation of the electric system at transmission (≥60 kV) voltage. Responsibility for operation of the distribution grid resides with the Distribution Service Providers (DSPs). ERCOT does not propose to alter this structure; rather, ERCOT proposes only to enhance visibility into the distribution system for the ISO and market participants, and to create a market environment that provides appropriate market signals for DERs.

Click here for ERCOT's draft concept paper

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