ERCOT Testimony to Senate Business y & Commerce Committee, - - PowerPoint PPT Presentation

ERCOT Testimony to Senate Business y & Commerce Committee, Chairman John Carona

August 24, 2010 Trip Doggett President & CEO

Reliability and Generation Adequacy Adequacy

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Installed Capacity – by Fuel

Example – Nuclear: Installed Nuclear capacity = 5,091 MW Total capacity = 81,626 MW

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5,091/81,626 = 6%

2009 Energy Actually Produced - by Fuel

Example – Nuclear: Nuclear energy produced in 2009 = 41,559,723 MWH Total energy produced in 2009 = 305,432,222 MWH

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41,559,723/305,432,222 = 13.6%

Reserve Margins for Years 2000 through 2015

60% 50% 60%

E i ti l t d l t d Pl d ti d

40%

Existing plants and plants under construction Planned generation under Full Interconnection Studies

30% 12.5% Target 10% 20% 0% 10% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 5 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

The ERCOT Transmission Grid

There are 40 327 Miles of Transmission Lines in Texas There are 40,327 Miles of Transmission Lines in Texas…

8,917 Miles of 345kV Lines 19,748 Miles of 138kV Lines , 6,593 circuit miles of transmission built since 1999 5,729 circuit miles of transmission under study $4 4 b i t t i $4.4 b investment in transmission placed in service since 1999 $8 2 b d d l t $8.2 b under development (including CREZ transmission)

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Challenge of Follow ing Wind Variability

4500 5000 65,000 70,000 3000 3500 4000 55,000 60,000

W

2000 2500 3000 45,000 50,000

Load MW

Wind MW

1000 1500 35,000 40,000 500 25,000 30,000

8/9/10 8/9/10 8/10/10 8/10/10 8/11/10 8/11/10 8/12/10 8/12/10 8/13/10 8/13/10 8/14/10 8/14/10 8/15/10 8/15/10 8/16/10 8/16/10

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Integrated Load Actual Integrated Wind Output

Transition to Nodal Market

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Benefits of a Nodal market

• Precise market-based pricing of generation
• More granular price signals

More granular price signals

• Encourage resource competition

Nodal prices send proper price signals to encourage additional generation –Nodal prices send proper price signals to encourage additional generation and/or transmission investment in proper locations.

• More accurate management of congestion

More accurate management of congestion –More accurate unit information. Market model and operations model are more consistent than current structure.

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Smart Grid Plug in Electric Smart Grid, Plug-in Electric Vehicles and Energy Efficiency

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Smart Grid from the ISO perspective

• Smart Grid generally represents:

An array of modern primarily digital upgrades to the electric system – An array of modern, primarily digital upgrades to the electric system – Goals:

• Saving energy – “shaving the peak”
• Reducing cost

Reducing cost

• Improving reliability, efficiency and transparency.
• Smart Grid upgrades may be driven by policy initiatives or

Smart Grid upgrades may be driven by policy initiatives or implemented by utilities, market participants and ISOs as part of their natural course of business

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Generation Output by Fuel – Summer Peak Day

July 13, 2009

Wind Other Hydro Gas Coal Nuclear

70,000 80,000 50,000 60,000

MCPE = $30.04 MCPE = $74.16

40,000 50,000

MCPE = $16.90

20,000 30,000 10,000

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0:15 1:15 2:15 3:15 4:15 5:15 6:15 7:15 8:15 9:15 10:15 11:15 12:15 13:15 14:15 15:15 16:15 17:15 18:15 19:15 20:15 21:15 22:15 23:15

Load Participation in ERCOT

Resource Type Service Requirements

Today

Resource Type Service Requirements

Voluntary Load Response (VLR) Curtailment or reduction in response to Market Price or other factors  Metering  Curtailment technology  Retail contract with price response incentives

Today

Load Acting as a Resource (LaaR) Responsive Reserves  Interval metering  Telemetry  Curtailment technology  ERCOT Qualification Emergency Curtailment in response  Interval metering Emergency Interruptible Load Service (EILS) Curtailment in response to ERCOT Verbal Dispatch (10 minutes)  Interval metering  Curtailment technology  ERCOT Qualification All of the above PLUS additional opportunities for:

Nodal Market

Controllable Load Resources (CLRs) Regulation Service Responsive Reserves  Interval metering  Telemetry  Ability to receive AGC-type signals  Governor-type response  ERCOT Qualification

Future?

All of the above PLUS : Load Participation in Security-Constrained E i Di t h Real-Time Energy Market and all Ancillary S i  To be determined  Loads would submit DR energy offer curves to compete with generation in Economic Dispatch Services curves to compete with generation in the energy market

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Future Potential Envisioned with Advanced Meters Advanced Metering Future Potential Envisioned with Advanced Meters

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Plug-in Electric Vehicles

• ERCOT and the other ISOs are actively preparing

for a migration of a significant segment of the transportation sector from liquid fuels to electric power transportation sector from liquid fuels to electric power

• Many opportunities but also challenges
• Goals of study

Work with policymakers and market participants to encourage “smart – Work with policymakers and market participants to encourage smart charging” incentives for PEV owners

• Dynamic pricing to encourage smart charging
• Emergency demand response

g y p

• Enhanced aggregation – working with PEV aggregators to ensure efficient

scheduling of charging load during off-peak hours

– Evaluate possibility of PEV participation in ISO-RTO markets (ancillary i t ) services, etc.) – Project early adoption rates by region -- which areas of the country will be most likely impacted by early adopters?

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Energy Efficiency

• Huge investments in energy efficiency are

underway across the country underway across the country

• ERCOT Planning dept. is integrating new tools into long-term

l d f ti t t f thi i fl f EE load forecasting to account for this influx of EE

– Confidence of financial community in ERCOT forecasts is crucial for ensuring long-term resource adequacy

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