Texas Nodal Development Process Committee Structure

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Texas Nodal Development Process Committee
Structure
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Ground Rules of this Meeting

• This is NOT a position advocacy meeting. It is a
  meeting to define committee structure for market
  redesign!!!
• Mutual respect is desired from all
• Everyone get out paper and pen and note questions
  on slides and hold them.

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Ground Rules of this Meeting Cont.

• The presentation will be given and questions
  taken in sections
• Roles/Responsibilities
• Committee Structure
• Work flow/appeals process
• Refinements for presentation at TAC

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Purpose of the Meeting

• Develop cohesive process for the Texas Wholesale
  Market redesign
• Define roles for those involved
• Produce recommendation to be presented at TAC and
  ultimately the Board

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Roles and Responsibilities

• Six major players exist in the process
• ERCOT Staff
• Stakeholders
• PUC Staff/MOD
• TAC
• ERCOT Board/Board Oversight Committee
• PUC

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ERCOT Staff

• Role
• Process facilitator and advisor
• Duties
• Meeting Chairmanship?
• Meeting Organization (agenda, when, where)
• Provide insight and advice on systems and
  processes
• Protocol language development
• Seams management (more later)
• Strawman recommendations

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Stakeholders

• Role
• Develop the policies needed to operate the Texas
  Nodal market
• Duties
• Strawman Development
• Approval of designs
• Industry segment concerns

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PUC Staff/MOD

• Role
• Ensure that policies rules established for the
  market comply with regulatory policies rules
• Ensure policies rules do not provide improper
  market incentives and are non-discriminatory
• Expedited conflict resolution
• Duties
• Strawman recommendations
• Reporting to the Commission

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Technical Advisory Committee

• Role
• Approve recommendations of the ShAG and provide
  decisions on issues of dispute
• Duties
• Voting on strawman documents
• Submitting approved stawman documents to the
  Board
• Reporting to the Board Oversight Committee of
  progress
• Deciding on appeals
• Directing PRS to convert Board approved strawmen
  into PRRs

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ERCOT Board of Directors

• Role
• Approve strawmen produced by TAC
• Decide on appeals of TAC decisions
• Duties
• Voting on strawman documents
• Direct TAC to have documents converted to
  Protocols
• Deciding on appeals
• Report to the LOC on progress?

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Board Oversight Committee

• Role
• Act as subject matter experts for the Board
• Oversee market development process
• Ensure conformity with ERCOT principles
• Ensure process is non-discriminatory
• Duties
• Assist in development of subcommittee structure
• Monitor committee process
• Review issues of conflict with the Board
• Communicate Board recommendations to TAC

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Public Utility Commission

• Role
• Provide final approval of completed Texas Nodal
  Design
• Final arbiter of any disputes in the process
• Duties
• Approval of Protocols including Texas Nodal
  Design
• Provide Orders or guidance on direction of
  decisions
• Rule on appeals

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Basic Committee Structure
ERCOT Board
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Stakeholders Advisory Group

• Governance
• Chair Independent or ERCOT
• Vice Chair ERCOT
• Voting Structure
• Similar to PRS
• Allowances for voting by non-ERCOT members and
  ERCOT?
• 7/8? Segments with one vote per company in each
  segment
• Simple majority to pass?
• ANY DECISIONS MADE CAN BE APPEALED TO TAC
• Issues
• Clearinghouse for all Texas Nodal Market
  Decisions
• Early issue Standard Market Design vs. ZEN vs.
  Other?
• ERCOT Personnel
• Minimum of one representative from
• Operations
• Settlement
• Seams representative

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Congestion Management Subc.

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• Definition of nodal market
• Selection of basic features
• Additional ERCOT Representatives
• ERCOT Operations
• Primary Protocol Section Responsibility
• Section 6 Ancillary Services

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Operations Subcommittee

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• Ancillary Services modification?
• Dispatch changes to unit specific
• Congestion management changes
• Unit specific scheduling changes? (here or DA
  group)
• Market data?

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Operations Subcommittee Cont

• Additional ERCOT Representatives
• Operations
• Operations systems
• Settlement
• Primary Protocol Section Responsibility
• Section 4 Scheduling
• Section 5 Dispatch
• Section 6 Ancillary Services
• Section 7 Congestion Management
• Section 12 Market Information System
• Section 17 Market Data Collection and Use

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Settlement Subcommittee

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• Node specific resource settlement
• Process for Load Area creation (same zones for
  load or new?)
• Changes to imbalance calculations (settle all or
  imbalance?)
• Charge type changes
• Formula changes
• Additional ERCOT Representatives
• Wholesale settlement
• Primary Protocol Section Responsibility
• Section 6 Ancillary Services
• Section 9 Settlements and Billing

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Day Ahead Market Subcommittee

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• DAM design
• Bidding structure
• Scheduling process
• Congestion management process
• Transmission rights treatment
• Credit management
• Market clearing
• Notification
• Trading Hub development

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Day Ahead Market Subcommittee Cont

• Additional ERCOT Representatives
• Market
• Operations systems
• Settlement
• Primary Protocol Section Responsibility
• Section 4 Scheduling
• Section 7 Congestion Management
• Section 12 Market Information System
• Section 16 Registration and Qualification of
  Market participants
• Section 17 Market Data Collection and Use

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Market Mitigation Subcommittee

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• Method to be used to mitigate potential market
  power abuse in a nodal market
• Additional ERCOT Representatives
• Market
• Settlement
• Primary Protocol Section Responsibility
• Section 7 Congestion Management

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Operating Guides Subcommittee

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• Changes needed to the Operating Guides to
  implement unit specific resource management
• Additional ERCOT Representatives
• Operations
• Primary Protocol Section Responsibility
• None

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Transmission Rights Subcommittee

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• Flowgate vs. point-to-point rights or combination
• Options vs. obligations
• Auction process
• Pre-Assigned rights
• Additional ERCOT Representatives
• Market
• TCR Auction
• Settlement
• Primary Protocol Section Responsibility
• Section 7 Congestion Management

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Generation Adequacy Subcommittee

• Governance
• Chair ERCOT, Stakeholder, Independent?
• Vice Chair ERCOT seams representative
• Voting Structure Non-binding straw votes
  recorded for input to ShAG
• Issues
• Method to be used to ensure capacity in ERCOT
• Additional ERCOT Representatives
• Market
• Settlement
• Primary Protocol Section Responsibility
• Section 4 Scheduling
• Section 6 Ancillary Services

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Ground Rules

• Everyone agrees to play nice
• Roberts Rules of Order will be applied in
  committees with voting structures
• In committees with no voting structures majority
  and minority opinions will be elevated with straw
  votes taken
• Others?

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Work Flow
ShAG Subcommittees --------------------- Develop
White Papers Straw Voting
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White Paper Framework

• Key concepts written clearly with sufficient
  detail for later formation of
• Protocols
• Operating Guides
• ISO Procedures
• RFP scope for necessary modification to ERCOT
  central systems
• Crafted with the design of other papers in mind

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Myths to be Dispelled

• We are taking our current system and throwing it
  away
• Fact
• Many of the current settlement and customer
  registration systems will be largely untouched.
  This is primarily a Package 1 modification
• If we dont find a way to streamline the process
  we wont make it in time
• Fact
• The original process required only 2 years and 4
  months from the first ISONP meeting through the
  market being placed on line and included many
  changes not required in this process (single
  control area, customer registration, etc.)
• Using the rule timeline gives us 2 years and 7
  months

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Also Important to Note

• Protocol changes for market redesign may not
  require large wording changes
• Small changes to Protocol language can have
  profound affects on required system changes
• Process used to implement the Protocol changes
  could be as important or more important than the
  Protocol revision process itself

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Areas of the Protocols that should require no or
minimal change

• Section 1 Overview
• Section 3 Open Access to the ERCOT Transmission
  Grid
• Section 8 Outage Coordination
• Section 10 Metering
• Section 13 Transmission and Distribution Losses
• Section 14 State of Texas Renewable Energy
  Credit Trading Program
• Section 15 Registration
• Section 18 Load Profiling
• Section 19 Texas Standard Electronic
  Transaction
• Section 20 Alternative Dispute Resolution
• Section 21 Process for Protocol Revision
• Section 22 Attachments

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Role of Seams Representative

• Attend as many meetings as possible
• Inform groups of work going on in other groups
  that may affect them
• Inform internal groups in ERCOT who may be
  affected by changes being recommended

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Timeline

• A timeline should be developed in the initial
  meetings of the ShAG to establish milestones and
  aid in determining progress
• It should include
• Protocol development
• RFP development and bid process
• Implementation
• Testing
• Production

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Other Considerations

• Training for the market should be provided on
  various nodal market designs and differences
  operating in the US and elsewhere
• The first ShAG assembly should be a two day
  meeting
• First day to ratify the ground rules and
  committee structures
• Second day to fill chair positions and establish
  marching orders

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Had Enough?