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Texas PUC Cool To Major Overhaul Of Emergency Response Service

Texas PUC Directs More "Robust" RMR Process, To Allow Consideration Of Load Alternatives, Mitigation Plans

September 9, 2016

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Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

During yesterday's open meeting, Texas PUC Chair Donna Nelson and Commissioner Brandy Marty Marquez were generally cool to a major overhaul of the Emergency Response Service (ERS) program, but said that certain tweaks should be studied, including the use of ERS for resolving local congestion, and issues related to the interplay of ERS and Reliability Must Run designations. Separately, the PUC also directed changes to make the RMR process more "robust", and to allow the consideration of non-RMR alternatives

The Commission has been reviewing potential changes to the ERS program (click here), including whether the program should be procured day-ahead

Nelson said that she was not convinced that ERS should be changed significantly at this point.

Marquez likewise said that she is not comfortable in making large-scale changes to the current ERS program, citing stakeholder concerns

Instead, the PUC directed Staff to continue evaluating several discrete issues.

Among these is an expanded use of ERS resources, including the potential use of ERS to resolve local congestion, as well as using ERS resources as alternatives to RMR agreements for local transmission issues.

Commissioner Kenneth Anderson said that Staff should study whether ERS participants can provide alternatives to RMR, and whether this can be accomplished by allowing ERS participants to also provide the RMR alternative, or whether ERS participants should be released from the ERS program so they can provide an RMR alternative

Regarding changes to the RMR process, Commissioners directed Staff to work with ERCOT to improve the RMR process, including the evaluation of broad rule language to provide ERCOT with greater flexibility.

Commissioners noted that under the current RMR process, ERCOT does not have enough time to study anything other than an RMR agreement with the retiring plant causing the local transmission issue.

Nelson said that ERCOT needed a more "robust" process for determining whether to RMR a unit.

The additional time and flexibility which may be granted to ERCOT for RMR reviews would allow for consideration of load alternatives, or the decision to not enter an RMR agreement due to cost and to instead use mitigation plans until the issue is resolved.

Additionally, Anderson noted that the cost under the most recent RMR agreement would have more than paid for implementation of co-optimization and look-ahead SCED -- market efficiency improvements which may have helped obviate the need for the RMR unit but which have been shelved due to implementation costs

Anderson said that this fact suggests that the Commission should, "bite the bullet," on implementing co-optimization and look-ahead SCED, as the one-time costs (and on-going benefits) would be superior to repeated RMR agreements of the same cost

Nelson noted that co-optimization and look-ahead SCED would be market-enhancing, rather than market-disrupting as RMR agreements are, and that money is better spent on improving the market

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