Texas Generators: RMR Contracts Should Require ERCOT Board Approval
October 31, 2016 Email This Story Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • email@example.com
Reliability Must Run should require ERCOT Board approval, several NRG Energy subsidiaries said in comments to the Texas PUC concerning an RMR rulemaking
"Market participants in ERCOT are exposed to unexpected and likely significant costs under any RMR agreement. Given the significant impact of RMR service on the market and consumers, NRG Companies believe that the ERCOT Board of Directors should directly evaluate and approve all RMR agreements. Expedited review and approval by the ERCOT Board may be required based on the urgency of the reliability situation, but this can be accommodated as provided in ERCOT procedures as necessary," NRG said
Luminant, in separately filed comments, agreed that RMR agreements should be subject to approval by the ERCOT Board. Luminant said that RMR agreements should not be subject to approval by the PUC, except in the case where a party appeals the action of the ERCOT Board. Texas Competitive Power Advocates also filed comment supporting such a position.
Texas Industrial Energy Consumers supports allowing the ERCOT Board of Directors to review and approve each RMR agreement before it is signed
In answering a question concerning whether ERCOT should have the discretion not to enter into an RMR agreement or select any RMR alternative in consideration of the cost of the RMR service or RMR alternative and the likelihood that such a reliability event will occur, Citigroup Energy, Inc. said that, "ERCOT should recognize that over the long term in its energy-only market design, RMR agreements can cause more reliability harm than good. Therefore, it should not approve RMR agreements in almost every circumstance. Instead, proper price formation should allow distributed generators or demand response to solve any short-term reliability need. Paying additional incentives to these resources should be on the table, provided that they participate in the market."