Temporary Shutdown Of Resource Operations Straw Proposal-Books Pdf

Temporary Shutdown of Resource Operations Straw Proposal
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Table of Contents,1 Executive Summary 3,2 Plan for Stakeholder Engagement 4. 3 Background 4,4 Scope of Initiative 6,5 Existing Processes 6. 6 Stakeholder Comments and CAISO Responses 11,7 Straw Proposal 17. 8 Next Steps 22,CAISO Straw Proposal,1 Executive Summary. The California Independent System Operator CAISO committed to hold a stakeholder. process in 2017 to explore opportunities to potentially accommodate a resource owner taking a. resource out of service for an extended period of time when the resource owner believes that. economic conditions cannot support its continued operation 1 This paper presents the CAISO s. straw proposal for the Temporary Shutdown of Resource Operations initiative 2. This initiative will consider the conditions under which the CAISO may permit a resource owner. to take a resource temporarily out of service for non physical reasons including for economic. reasons and what form of compensation if any the CAISO would provide if it denies a. resource owner s request to take its resource out of service for non physical reasons. This straw proposal describes the plan for stakeholder engagement background and scope. existing processes and straw proposal The key elements of the CAISO s straw proposal are. listed below, The CAISO may allow a Participating Generator to temporarily shut down operation of its.
resource for economic reasons provided that there is no reliability impact to the grid as. determined by a CAISO study, The resource will need to apply for the temporary shutdown and this option will be. available only to capacity that is operating as part of the CAISO s balancing authority. area BAA and is not resource adequacy RA or Reliability Must Run RMR. The requested shutdown period can be for no less than two months and no longer than. four months and the resource owner can apply for a subsequent four month period. If the CAISO has to deny a request for a temporary shutdown the CAISO will pay the. owner a CPM payment for any months during the requested shutdown period where the. CAISO s studies show the resource is needed for reliability with a potential maximum. CPM payment of four months at a time, While on shutdown the resource owner is free to manage the resource such that it can. return to service when its shutdown is over at same MW rating and ramping capability as. it had before it went out on shutdown, The CAISO made this commitment to the Federal Energy Regulatory Commission FERC in response. to the June 17 2016 complaint filed by the La Paloma Generating Company related to the CAISO s. denial of an outage La Paloma proposed for economic reasons. 2 In the 2017 Stakeholder Initiatives Catalog this effort was titled Economic and Maintenance Outages. but the name has been changed to Temporary Shutdown of Resource Operations to better reflect the. nature of the initiative In the May 10 2017 Issue Paper this initiative was referred to as Temporary. Suspension of Resource Operations but the CAISO is now using the term shutdown rather than. suspension as suspension is already a defined term in the CAISO tariff and has a different meaning. than what is being pursued in this initiative The term suspension is currently used to denote a. situation where a generating unit is temporarily halting construction work on its unit while in the. generator interconnection queue,CAISO M ID M IP KJohnson 3 June 21 2017. CAISO Straw Proposal, During an approved shutdown since the resource will not have been paid to be.
available the resource will not have to respond to Exceptional Dispatches issued by the. CAISO and cannot be called out of shutdown status due to no touch operating. conditions on the grid, The resource can be recalled from shutdown status if there is a system emergency and. the resource will receive a CPM payment if this occurs. The Generating Unit will not be eligible to be used as a RA resource in a RA showing for. the period that it has temporarily shut down operations in the CAISO s BAA. 2 Plan for Stakeholder Engagement, The schedule for this initiative is presented in Table 1 below The CAISO plans to present its. final proposal to the CAISO Board of Governors for their approval at their meeting on November. 1 2 2017 The CAISO may take its final proposal to the September 19 20 2017 Board of. Governors meeting for their approval if stakeholder comments can be adequately addressed. after the straw proposal The CAISO will assess the situation after stakeholder comments have. been submitted on the straw proposal The accelerated approach would mean going to a draft. final proposal after the straw proposal thereby only having two rounds of stakeholder comments. before going to the Board of Governors,Table 1 Schedule for this Stakeholder Initiative. Date Milestone, Kick Off May 4 2017 Issue market notice announcing this new initiative. Issue Paper May 10 Post issue paper,May 19 Hold stakeholder call.
June 6 Stakeholder written comments due,Straw Jun 21 Post straw proposal. Proposal Jun 28 Hold stakeholder call,Jul 13 Stakeholder written comments due. Revised Aug 9 Post revised straw proposal,Straw Aug 16 Hold stakeholder call. Proposal Aug 29 Stakeholder written comments due,Draft Final Sep 11 Post draft final proposal. Proposal Sep 18 Hold stakeholder meeting,Oct 2 Stakeholder written comments due.
Nov 1 2 Present final proposal to CAISO Board for approval. 3 Background, This initiative will consider the circumstances under which the CAISO may permit a resource. owner to temporarily shut down operation of its resource for economic reasons and what form of. compensation if any the CAISO should provide if it denies a resource owner s request for a. temporary shutdown The initiative will assess how potentially allowing this type of resource. CAISO M ID M IP KJohnson 4 June 21 2017,CAISO Straw Proposal. status change would interact with other requirements of the CAISO tariff existing contracts and. with grid and market operations, The CAISO s existing Business Practice Manual BPM for Generator Management. contemplates that resource owners can permanently retire or mothball their units but does not. address the above noted topics in significant detail and in particular does not consider. compensation issues This initiative is meant to provide stakeholders an opportunity to consider. those topics in greater detail as well as what potential changes to current CAISO practice may. need to be addressed through a FERC filing to implement new tariff provisions. The CAISO committed to this stakeholder initiative during the FERC process related to a now. denied complaint that the La Paloma Generating Company filed against the CAISO 3 As. described in the relevant FERC order in May 2016 La Paloma submitted multi month outage. requests to the CAISO for several units because La Paloma did not anticipate that the continued. operation of those units would be economic The CAISO denied the requests because they. were based on economic rather than physical reasons and thus did not represent an. appropriate use of the outage management system as allowed by the CAISO tariff On June 17. 2016 La Paloma filed a complaint against the CAISO at FERC related to the CAISO s denial of. the requested outages FERC ruled that the CAISO s denial of the outages was reasonable. because based on the most reasonable construction of the tariff the only permissible reasons. for seeking an outage from CAISO include planned maintenance new construction or other. work The tariff thus does not permit CAISO to grant requests for outages for economic. reasons such as those at issue here 4, During the FERC process several intervening parties suggested that FERC order the CAISO to. revise its tariff to allow for outages based on economic considerations and or provide a capacity. procurement mechanism designation if the CAISO denies an outage request at least in the. case of a non resource adequacy capacity resource The CAISO explained that La Paloma s. complaint proceeding was not the appropriate venue to consider those issues but the CAISO. agreed that in light of the significant transformation the CAISO grid is undergoing and the. significant change in the resource mix it is appropriate for the CAISO to consider whether the. CAISO should allow for economic outages and what form of compensation if any the CAISO. should provide if it denies a generator s maintenance or economic outage 5 The CAISO. accordingly agreed to begin a stakeholder process in 2017 to address those issues It. committed to hold a process that would allow the CAISO and stakeholders to carefully consider. whether the CAISO should allow for economic outages and compensate generators when it. denies an outage for a non resource adequacy resource Through that process the CAISO and. 3 La Paloma Generating Co LLC v Cal Indep Sys Operator Corp 157 FERC 61 002 2016 Order. Denying Complaint Available at, http www caiso com Documents Oct3 2016 OrderDenyingLaPalomaComplaint EL16 88 pdf.
4 Id at P 29, 5 La Paloma Generating Co LLC v Cal Indep Sys Operator Corp Answer to Protests of the California. Independent System Operator Corp at 5 FERC Docket No EL16 88 Jul 20 2016. CAISO M ID M IP KJohnson 5 June 21 2017,CAISO Straw Proposal. stakeholders will have sufficient time to consider all pertinent issues the conditions under which. economic outages should be permitted if at all and how economic outages would interact with. other requirements of the CAISO tariff and with CAISO grid and market operations Similarly. the CAISO and stakeholders will be able to consider whether compensating non resource. adequacy resources for rejected outage requests is appropriate and if so how they should be. compensated and to whom the CAISO would allocate the costs 6. 4 Scope of Initiative, The initiative will address the circumstances that were highlighted in the La Paloma complaint. This initiative also will address the situation where a Generating Unit can switch operation for an. extended period of time from one BAA to an adjacent BAA It will establish the conditions under. which such switching would be allowed and whether a resource that has switched to an. adjacent BAA area would be eligible to be shown as RA capacity. The scope does not include a discussion of potentially allowing economic outages in general as. the CAISO s position is that outages such as those submitted to report the status of a. Generating Unit through the CAISO s outage management system should generally be taken. only for situations where there is a physical reason for the change in status of the resource. The distinction here is that this initiative will look at the conditions under which the CAISO may. allow a Generator to temporarily shut down operation of its Generating Unit for economic or. other non physical reasons The solution will likely involve a process and a new method for. requesting and then reporting a temporary shutdown of operations As part of the new method. or process the CAISO proposes to use the CAISO s existing outage management system to. report these type of new temporary shutdown outages so that the CAISO s existing systems can. be leveraged to the extent possible The CAISO tariff will be changed to make it permissible for. this new type of temporary shutdown outage to be reported through the CAISO s outage. management system At the same time the CAISO would look to reinforce its current tariff. language regarding the general need for outages reported through the outage management. system to be for physical reasons, The scope does not include refining the existing processes for the permanent retirement or. repowering of a Generating Unit as the requirements for such are already adequately covered. in the CAISO tariff BPM for Generator Management and agreements The California Energy. Commission CEC and the California Public Utilities Commission CPUC already have. processes in place to address retirements Generating Unit owners are expected to use these. existing processes when they seek to permanently retire a Generating Unit. 5 Existing Processes, This section discusses the processes that are currently in place at CEC CPUC and CAISO that.
deal with retirement or mothballing resources including reliability studies performed by the. 6 Id at 5 6,CAISO M ID M IP KJohnson 6 June 21 2017. CAISO Straw Proposal,5 1 California Energy Commission. The CEC has no policy on electric generation operation standards or the action of mothballing. or permanently retiring a generator although the CEC refers to the CPUC for maintenance. standards and CPUC General Order 167,5 2 California Public Utilities Commission. The CAISO will need to consider any conflicting policy as it plans and implements an option to. allow temporary shutdown of a resource for economic reasons The following text is taken from. CPUC General Order 167 Enforcement of Maintenance and Operation Standards for Electric. Generating Facilities, The purpose of this General Order is to implement and enforce standards for the. maintenance and operation of electric generating facilities and power plants so. as to maintain and protect the public health and safety of California residents and. businesses to ensure that electric generating facilities are effectively and. appropriately maintained and efficiently operated and to ensure electrical service. Temporary Shutdown of Resource Operations Straw Proposal June 21 2017 Market amp Infrastructure Policy

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