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PRR525 Compliance Management System for QSEs

Understand the PRR525 regulation's background, implementation, exemptions, scoring, disqualification, and enforcement for enhanced performance. Learn the action items, stakeholder processes, and key criteria affecting compliance under PRR525.

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PRR525 Compliance Management System for QSEs

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  1. PRR 525 Update Prepared by ERCOT Compliance December 2005

  2. ERCOT’s CPS1 12 Mo. Rolling Average

  3. QSE Regulation 10-Min Performance

  4. Regulation 10-Minute Interval Trend

  5. PRR525 Background • PRR525 Was Introduced to Apply “Regulation Like” Performance Monitoring Criteria to All QSEs for All Intervals • PRR525 is the Next Logical Step in the Effort to Improve Frequency Control • PRR525 Was Considered a Viable Alternative to Doubling Regulation

  6. PRR525 Stakeholder Process • Submitted – June 2004 • Three Measuring Methods Analyzed • PRR525 • Approved by WMS – December 2004 • 6.33 for, 1.17 opposed • Approved by PRS – January 2005 • 2 abstentions • Approved by TAC – March 2005 • 1 abstention • Approved by BOD – April 2005 • unanimous

  7. PRR525 Scoring • Simulated Scores & Data Have Been Provided to All QSEs Since September 2004 • Signals For Independent Verification Provided in Late October to: • Each QSE • A Third Party Provider • The Third Party Provider Serves 8 QSEs

  8. QSE PRR525 10-Minute Performance

  9. PRR525 10-Min Interval Trend

  10. Approved PRR525 Exemptions • 2 Hours After A Unit Trip • Portfolio Balancing Ramp Rate Violations • Verbal Dispatch Instructions (VDI) • Non-Spin Ramping Periods • RRS Ramping Periods • Other Abnormal Periods

  11. Action Items • Who Passes / Who Fails • Dynamic Schedule Impact • Disqualification Process • Disqualification Analysis (Backcast)

  12. Pass / Fail • Passing Characteristics • Close relationship between QSE & Generators • Proactive efforts to meet obligations • Diverse portfolios • Responsibility transfer agreements • Failing Characteristics • Wind Only QSEs (2) • Block Schedule Operation • Small Portfolio

  13. Dynamic Schedules • Typically Regulation Providers • Experience adhering to strict Regulation standard • Consistently meet PRR525 measure

  14. Disqualification • A/S Disqualification Conditions • Continued underperformance after all other efforts have been exhausted • Non-Compliance Actions of ERCOT • Protocols 6.10.12

  15. Disqualification Backcast Analysis • Unpredictable Market Reaction • Minimize Market Impact • Enforcement Stimulates Improved Performance • Disqualification Analysis Can Produce Drastic Cost Variations • Assumption Dependent

  16. Compliance Enforcement Plan For PRR525 • Patterned after NERC Enforcement Matrix • Increasing Levels of Severity • All QSEs Receive Their Monthly Scores • QSEs have 10 business days to respond

  17. Levels of Non-Compliance • Level 1 • First Violation • Phone Call & Letter to QSE Representative of Record • Copy to PUCT Staff • Posting on NERC & ERCOT Public Web Sites

  18. Levels of Non-Compliance(Cont) • Level 2 • Second Violation within six (6) months • Or Inadequate Response to Level 1 • Phone Call & Letter to QSE Sr. Management • Copy to PUCT Staff • Failing QSE Presentation (or report) to ROS • Posting on NERC & ERCOT Public Web Sites

  19. Levels of Non-Compliance(Cont) • Level 3 • Third Violation Within Six (6) Months • Or Inadequate Response to Level 2 • Phone Call & Letter to QSE Sr. Management • Copy to PUCT Staff • Failing QSE Presentation (or report) to TAC • Posting on NERC & ERCOT Public Web Sites • Compliance Notifies Board

  20. Proposed Future Action Plan • If Satisfactory Results Have Not Been Achieved Within The First Six Months: • Return to BOD in July 2006 With Recommendation on Next Steps • Additional Performance Criteria • (PRR 586?) • Any Others ?

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