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Load Response Program Manual 2003

Load Response Program Manual 2003. Henry Yoshimura – ISO-NE NEPOOL Markets Committee November 25, 2002. Objective and Outline of Presentation. Objective: MC Review and Approval of LRP Manual and MR 1, Appendix E Outline of Presentation History of demand response initiatives for SMD

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Load Response Program Manual 2003

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  1. Load Response Program Manual2003 Henry Yoshimura – ISO-NE NEPOOL Markets Committee November 25, 2002

  2. Objective and Outline of Presentation • Objective: MC Review and Approval of LRP Manual and MR 1, Appendix E • Outline of Presentation • History of demand response initiatives for SMD • Proposed schedule going forward • Summary of demand response programs • Proposed program modifications • Past MC review and discussion • New England Demand Response Initiative recommendations • ISO internal review • Implementation schedule

  3. Where Have We Been? History Of Demand Response Initiative For SMD • NEPOOL Participants Committee Approval – June 21, 2002 • Joint NEPOOL/ISO-NE Filing with FERC – July 15, 2002 • LRP Manual Reviewed by MC – Aug. 13, 2002 • NEDRI/FERC Demand Response Conference – Sept. 19-20, 2002 • FERC Order on SMD – Sept. 20, 2002 • Joint NEPOOL/ISO-NE Compliance Filing – Oct. 22, 2002 • NEDRI Consultant Recommendations – Nov. 19, 2002 • Revised LRP Manual Reviewed by MC – Nov. 25, 2002

  4. Where Are We Going? Proposed Schedule • MC Review & Approval of LRP Manual – Nov. 25, 2002 • Programs for implementation on March 1, 2003 • Additional programs implemented when software is completed • MC Review & Approval of MR 1 Appendix E – Nov. 25, 2002 • NPC Review & Approval – Dec. 6, 2002 • LRP Manual • MR 1 Appendix E • FERC Filing – Mid-December 2002 • FERC Acceptance – Mid-February 2003 • Go Live – March 1, 2003 • First Update – To be announced

  5. Summary of Programs for 2003 • Real-Time 30-Minute Notice Demand Response • Real-Time 2-Hour Notice Demand Response • Real-Time Profiled Response • Real-Time Price Response • Day-Ahead Demand Response

  6. Recent LRP Manual Modifications • Incorporate Demand Response Provider per FERC Order • Modifications in the Manual resulting from: • MC’s review of the Manual in August • NEDRI recommendations • Internal ISO review • Two Implementation Dates • Programs implemented on March 1, 2003 (SMD Effective date) • Programs implemented with 1st upgrade release of LRP software • Changes too Extensive for Redlining

  7. Changes Resulting from MC Review • Allocate LRP Interruption Payments from Load Obligation to Network Load • Energy payment is a non-market cost reflecting a public policy decision to support an infant industry facing market barriers • Separate 30-minute notice Demand Response into two groups • Demand response not involving emergency/backup generation (activated as part of Action 9 in NOP #4) • Demand response involving emergency/backup generation (activated as part of Action 12 in NOP #4) • Increase ICAP Credit for reserve component • Not available for March 1, 2003 – available with 1st update release • Relocate discussion of ICAP for Demand Response from Manual 20 to the LRP manual

  8. NEDRI • New England Demand Response Initiative – (NEDRI) • Represents a cooperative effort among New England electric industry stakeholders to promote effective demand response strategies • Sponsors include: ISO-NE, US DOE, US EPA, NYISO, NECPUC, and NESCAUM (air quality directors of six New England states and New Jersey • Goals • Develop a coordinated set of policy reforms • Identify regulatory barriers to vibrant demand response programs • Develop market and regulatory strategies for a robust demand response capability in New England • Develop a set of demand response principles and outline recommended program designs in a coordinated and integrated fashion

  9. NEDRI Recommendations • Increase program duration to 3 years • Infant industry • Customers have a 3-year time horizon to justify investments • Day-ahead program will be in place for only about 2 years • Reduce ISO charge for DRP from $5,000 to $500 per year • Increase minimum payments for interruptions • Real-Time 30-Minute Notice from $150/MWh to $500/MWh • Real-Time 2-Hour Notice from $100/MWh to $350/MWh • Provide Reserve Component Credit for ICAP • Other Long-Term proposals • No limit on bid increments (in Day-ahead program) • Location-based ICAP • Annual program evaluation • Load response working group

  10. Other Issues Discussed in NEDRI • Development of an economic, price-driven day-ahead demand response program • Adoption of state retail policies to support ISO programs • Cost allocation and recovery of DR program incentives • Environmental concerns • Potential proliferation of on-site generation, particularly in day-ahead programs

  11. ISO Internal Review Changes • Defined programs to be available March 1, 2003 • Defined programs to become available in 1st upgrade of LRP software • Incorporated all ICAP provisions from Manual 20 into the LRP Manual • Clarified metering and data submission requirements • Clarified requirements for participation in programs • Clarified responsibilities of each party • Revised LRP event messages

  12. Features Available on March 1, 2003 • Real-Time 30-Minute Notice Demand Response • Activated NOP #4 Action 9 (without emergency generation) • Activated NOP #4 Action 12 (with emergency generation) • Real-Time 2-Hour Notice Demand Response • Real-Time Profiled Response • Real-Time Price Response • ICAP credit based on declared/proven response level • DRP participation in ICAP Supply Auction

  13. Features Incorporated in 1st Update • Allocate program incentives to Network Load • ICAP credit for the Reserve Component • Recognize temporarily unavailable customers • Customer baseline adjustment for consecutive event days • Day-Ahead Demand Response Program

  14. Review of LRP Manual and Appendix E

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