Texas Demand Response Provider Would Pay $15,000 Under Settlement Regarding Alleged Failure To Adhere To Availability Factor Protocol

Viridity Energy Inc. would pay $15,000 under a settlement with Staff of the Public Utility Commission of Texas to resolve Viridity's alleged failures to adhere to Electric Reliability Council of Texas (ERCOT) Protocols § 8.1.3.3.1, related to Emergency Response Service Performance (ERS) and Testing.

According to the settlement, Viridity was contracted to provide ERS -30 during the October 2014 to January 2015 contract period for Business Hours 1, 2 and 3 and Non-Business Hours.

Pursuant to ERCOT Protocols § 8.1.3.3.1, if a QSE submits an offer during the ERS contract period and that offer is accepted by ERCOT, the QSE must be ready to dispatch. If dispatched by ERCOT, ERS resources shall deploy consistent with their obligations and shall remain deployed until recalled by ERCOT. If a QSE submits an offer during the ERS contract period and that offer is accepted by ERCOT, the QSE must be ready to dispatch. If dispatched by ERCOT, ERS resources shall deploy consistent with their obligations and shall remain deployed until recalled by ERCOT. If the resource is not dispatched by ERCOT, ERCOT will calculate a portfolio-level ERS Availability Factor (ERSAF). If the ERSAF meets or exceeds 0.95, the QSE will be deemed to have met its ERS performance requirements for their ERS contract period. If a QSE does not achieve a 0.95 ERSAF, the QSE is subject to suspension from participating in ERS as well as administrative penalties levied by the Commission.

According to the settlement, "Viridity failed to achieve the required ERSAF of 0.95 in failing to maintain the required amount of load available for ERS deployment during any of the time periods for ERS - 30 in the October 2014 to January 2015 Contract Period."

According to the settlement Viridity asserts the following: the failure to achieve the required ERSAF was caused by circumstances beyond the control of either Viridity or its customer, a metals refiner and smelter. Viridity took multiple steps to derive an accurate estimate of customer load before submitting an offer. To prepare the offers for the Oct-Jan15 auction, a review was done of the previous year's season (Oct-Jan14) as well as the Jun-Sep14 season. Since the resource's load is dependent on production, the review focused on trending. The previous fall season provided a baseline and the summer season indicated a growth in production. Levels were chosen based on expectation that loads for Oct-Jan15 would be at or slightly above the levels in Oct-Jan14. Actual production and resulting loads were unexpectedly reduced both from the previous year and from the preceding summer months due to an unpredictable downturn in the metals smelting business.

Docket 45714