Texas Generator Files Complaint at PUC Regarding ERCOT Settlement, Manual Override of High Dispatch Limit

Odessa-Ector Power Partners, L.P. has filed at the Public Utility Commission of Texas a complaint and appeal of the Electric Reliability Council of Texas' denial of real time market settlement payments to Odessa following ERCOT manual overrides of Odessa's High Dispatch Limit (HDL) on November 15, 16, and 20, 2012.

Odessa alleges that on each of those days ERCOT applied manual overrides of Odessa's HDL, restricting the output of its plant in response to a combination of voltage conditions and other constraints associated with outages on area Oncor transmission facilities that had been occurring since at least November 13, 2012. Odessa's energy output was restricted down below its energy offer curve in order to protect the grid from conditions created by third parties, the company alleged.

"Odessa believes that ERCOT could have used its market based tools, rather than manual overrides, to achieve its desired result within the design of the Protocols, which would have resulted in no financial harm to Odessa. Nevertheless, Odessa agrees that preserving reliability is of the utmost importance for ERCOT. If ERCOT, however, has broad discretion to take actions that go beyond the specific procedures and design of the Protocols in the name of ensuring reliability, broad interpretation should also be applied to the Protocols regarding compensation for the market participant that was harmed by such actions by following ERCOT's dispatch instructions," the company said.

"Odessa is entitled to additional compensation under the emergency operations and voltage support provisions of ERCOT's Protocols ... Furthermore, pursuant to its Verbal Dispatch Instruction (VDI) Protocols, Odessa requested, and ERCOT should have given, a VDI, rather than a manual override, which also would have provided Odessa compensation for its losses. Finally, it should be recognized that there is no express authorization in the Protocols for the type of manual override order that ERCOT utilized here. Indeed, these orders were in the nature of Out of Merit Energy (OOME) down zonal market orders that were not expected to be used in the nodal market. Had ERCOT used its recognized nodal market tools, such as SCED, instead of manual intervention, the appropriate market pricing would have resulted and Odessa would have responded accordingly based on its submitted energy offer curve. But ERCOT determined that it had authority to act here in a way not recognized in Protocol procedures. If the Public Utility Regulatory Act (PURA) and the Protocols are to be construed to support the broad implied authority on which ERCOT relies to justify its issuance of manual overrides to Odessa, a corresponding responsibility must be recognized to compensate a market participant who suffers losses in complying with such overrides for the good of the larger grid," Odessa alleged

Odessa is seeking a total payment of $321,000 with respect to the three operating days at issue.

Docket 41790