Market Performance and Planning Forum November 7, 2012
Objective: Enable dialogue on implementation planning and market performance issues • Review key market performance topics • Share updates to 2012-2014 release plans, resulting from stakeholders inputs • Provide information on specific initiatives – to support Market Participants in budget and resource planning • Focus on implementation planning; not on policy • Clarify implementation timelines • Discuss external impacts of implementation plans • Launch joint implementation planning process Slide 2
Proposed Meeting Schedule for 2013 • February 13 • April 10 • June 5 • July 31 • Sept 25 • Nov 20 Page 3
Agenda 10:00- 10:05 Introduction, Agenda Mercy Helget 10:05 – 11:20 Market Analysis Mark Rothleder, Nan Liu, Guillermo Bautista- Alderete 11:20 – 11:40 Four Corners Transition Debi Le Vine 11:40 – 12:00 Policy Update Brad Cooper 12:00 – 1:00 Lunch 1:00 – 2:00 Technical Updates Khaled Abdul-Rahman, George Angelidis, Li Zhou, NGR/REM Market Simulation Report Jeremy Malekos Outage Management System – deferred until 12/19 Jami Herguth 2:00 – 3:00 Release Updates Janet Morris Slide 4
Market Performance and Quality Update Market Quality and Renewable Integration Mark Rothleder Nan Liu Guillermo Bautista-Alderete Slide 5
1. Operation Highlights 2. Market Metrics • Price volatility and market convergence • RT energy/congestion imbalance offset • Convergence bidding • Exceptional dispatch • Bid cost recovery • MIP gap • Flex-ramp cost 3. Price Corrections 4. Events and developments Slide 6
Operation highlights: • With summer over, lower load and more transmission outages present a different set of challenges. • More outages led to more constraints modeled in the market contributing to day-ahead solution challenges. • Continue to focus on setting up forward markets conditions to meeting real-time reliability needs. • Improved price convergence between DA/HASP/RTD on average. Varies between DLAPs and time of the day. • Real-time congestion offset cost peaked in August but remained at elevated levels in September and October. Slide 7
$/MWh 10 20 30 40 50 Price convergence improved in August and September 0 Jan-11 Mar-11 May-11 Jul-11 Sep-11 PG&E Nov-11 DLAP LMP Monthly Average: $/MWh Jan-12 10 20 30 40 50 60 70 0 Mar-12 Jan-11 May-12 Mar-11 Jul-12 May-11 Sep-12 Jul-11 Sep-11 RTD HASP IFM SDG&E Nov-11 Jan-12 $/MWh 10 20 30 40 50 0 Mar-12 Jan-11 May-12 Mar-11 Jul-12 May-11 Sep-12 Jul-11 RTD HASP IFM Sep-11 SCE Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Page 8 RTD HASP IFM
$/MWh 10 20 30 40 50 60 0 Jan-11 Mar-11 May-11 Jul-11 DLAP LMP Monthly Average ( On Peak) Sep-11 PG&E Nov-11 $/MWh Jan-12 10 20 30 40 50 60 70 80 90 0 Mar-12 Jan-11 May-12 Mar-11 Jul-12 May-11 Sep-12 Jul-11 Sep-11 RTD HASP IFM SDG&E Nov-11 $/MWh Jan-12 10 20 30 40 50 60 0 Mar-12 Jan-11 May-12 Mar-11 Jul-12 May-11 Sep-12 Jul-11 Sep-11 RTD HASP IFM Nov-11 SCE Jan-12 Mar-12 May-12 Jul-12 Sep-12 Page 9 RTD HASP IFM
$/MWh 10 20 30 40 50 0 Jan-11 Mar-11 May-11 Jul-11 DLAP LMP Monthly Average ( Off Peak) Sep-11 Nov-11 PG&E $/MWh Jan-12 10 20 30 40 0 Mar-12 Jan-11 May-12 Mar-11 Jul-12 May-11 Sep-12 Jul-11 Sep-11 RTD HASP IFM Nov-11 SDG&E Jan-12 $/MWh 10 20 30 40 50 0 Mar-12 Jan-11 May-12 Mar-11 Jul-12 May-11 Sep-12 Jul-11 Sep-11 RTD HASP IFM Nov-11 SCE Jan-12 Mar-12 May-12 Jul-12 Sep-12 Page 10 RTD HASP IFM
DLAP LMP Hourly Average in October PG&E SCE 70 80 70 60 $/MWh $/MWh 60 50 IFM IFM 50 40 HASP HASP 40 30 RTD RTD 30 20 20 10 10 0 0 1 2 3 4 5 6 7 8 9 101112131415161718192021222324 1 2 3 4 5 6 7 8 9 101112131415161718192021222324 Hour SDG&E 250 200 $/MWh IFM 150 HASP 100 RTD 50 0 1 2 3 4 5 6 7 8 9 101112131415161718192021222324 Page 11
Monthly price distributions: price volatility decreased in September and October. 4.0% 2.0% 0.0% Percent of Real Time Intervals Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 -2.0% -4.0% -6.0% -8.0% -10.0% -$30 to -$5 -$100 to -$30 -$300 to -$100 <-$300 $250 to $500 $500 to $750 $750 to $1000 >$1000 Page 12
Monthly average of RTD intervals with insufficient up ramping capacity declined in October. 180 2.00% 1.80% 160 1.60% 140 1.40% Percent of Intervals 120 Count of Intervals 1.20% 100 1.00% 80 0.80% 60 0.60% 40 0.40% 20 0.20% 0 0.00% Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 5-minute intervals with insufficient upward ramping capability percent of intervals with insufficient upward ramping capability Page 13
Monthly average of RTD Intervals with insufficient down ramping capacity continued the downward trend in September and October. 5.00% 500 4.50% 4.00% 400 3.50% Number of Intervals 3.00% 300 2.50% 2.00% 200 1.50% 1.00% 100 0.50% 0 0.00% Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 5-minute intervals with insufficient downward ramping capability percent of intervals with insufficient downward ramping capability Page 14
Real-time energy offset costs decreased in September and October. Page 15
Real-Time congestion cost dropped remained at relatively high level in October due to congestion related to outage. Caused by abnormally high congestion and high shadow prices (RT vs. DA) on: 60 Table Mountain transformer, Hoodoo 50 Wash-N Gila line and SCE percent import limits. 40 30 $Millions 20 10 0 -10 Apr-09 May-09 Jul-09 Feb-10 Mar-10 Apr-10 May-10 Jul-10 Feb-11 Mar-11 Apr-11 May-11 Jul-11 Feb-12 Mar-12 Apr-12 May-12 Jul-12 Jun-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Jun-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Jun-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Jun-12 Aug-12 Sep-12 Oct-12 Congestion Imbalance Offset Energy Imbalance Offset Slide 16
Exceptional dispatch volume as percent of load declined in September and rose in October. Page 17
Daily exceptional dispatches in MWh – by reason 40 35 30 Thousands MWh Per Day 25 20 15 10 5 0 1-Sep 3-Sep 5-Sep 7-Sep 9-Sep 11-Sep 13-Sep 15-Sep 17-Sep 19-Sep 21-Sep 23-Sep 25-Sep 27-Sep 29-Sep 1-Oct 3-Oct 5-Oct 7-Oct 9-Oct 11-Oct 13-Oct 15-Oct 17-Oct 19-Oct 21-Oct 23-Oct 25-Oct 27-Oct 29-Oct 31-Oct T Procedure Transmission Outage SP26 Capacity SCE SOB 204 Unit Testing Conditions beyond control of the CAISO BA G Procedure Other Page 18
Bid cost recovery (BCR) costs decreased in September and then increased in October due to RUC uplifts. RUC procurement increased to 20 respond to potential 18 for loss COI transfer 16 capability during 14 outage work. 12 10 $Millions 8 6 4 2 0 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 IFM RT RUC Page 19
October encountered challenge to achieve quality solution within specified time thresholds. 900,000 October 1 and 2 low quality 800,000 solution due to timeout of 700,000 solution 600,000 Mip Gap ($) 500,000 400,000 300,000 200,000 100,000 0 1/1/11 2/1/11 3/1/11 4/1/11 5/1/11 6/1/11 7/1/11 8/1/11 9/1/11 10/1/11 11/1/11 12/1/11 1/1/12 2/1/12 3/1/12 4/1/12 5/1/12 6/1/12 7/1/12 8/1/12 9/1/12 10/1/12 Daily Dollar 30 Day Moving Average Page 20
Price corrections reduced in Sep but increased in Oct to address DA timing out issue. 1.2% 1.0% Incorrect distribution factors in two Percentage of Nodes Corrected weeks of July caused 70% of corrections in July 0.8% Market Software timed out while searching for the solution 0.6% 0.4% 0.2% 0.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct 2011 2012 Data Input Software Tariff Process Page 21
Price corrections reduced in Sep but increased in Oct to address DA timing out issue. Incorrect distribution factors in two weeks of July caused 70% of corrections in July Market Software timed out while searching for the solution Page 22
Enhanced Process for DAM • Leverage on the DA+2 run process to identify potential issues. • Increased support for the day-ahead market run. • Further validation of the DAM results before publishing. • Ongoing Root Cause Analysis effort for price corrections. • Development of a market validation tool. Page 23
Flexi-ramp constraint costs remained relatively low in the past four months. Monthly Flexi-Ramp Cost 4.5 4 3.5 $Millions 3 2.5 2 1.5 1 0.5 0 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Slide 24
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